2020 BOC Labor Law Reviewer PDF

U.P.
LAW BOC LABOR LAW
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U.P. LAW BOC LABOR LAW
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TABLE OF CONTENTS
LABOR LAW 1............................................................. 1 III. LABOR STANDARDS .................................. 26

I. FUNDAMENTAL PRINCIPLES.......................... 1 A. CONDITIONS OF EMPLOYMENT ......... 26
1. Hours of Work ................................... 26
A. LEGAL BASIS .........................................1
2. Rest Periods ..................................... 37
1. 1987 Constitution .................................1
3. Service Charge ................................. 39
2. Civil Code ............................................2
3. Labor Code..........................................3 B. WAGES ................................................ 40
1. Definition, Components, and Exclusions
B. STATE POLICY TOWARDS LABOR ........3
40
1. Security of tenure.................................3
2. Principles .......................................... 49
2. Social justice .......................................4
3. Minimum Wage ................................. 50
3. Equal work opportunities ......................5
4. Payment of wages ............................. 51
4. Right to self-organization and collective
5. Prohibitions regarding wages ............. 52
bargaining..................................................5
6. Wage determination .......................... 54
5. Construction in favor of labor ................6
6. Burden of proof and quantum of evidence ...7 C. LEAVES................................................ 57
1. Labor Code ....................................... 57
II. RECRUITMENT AND PLACEMENT ............. 7
2. Special laws ...................................... 58
A. DEFINITION OF RECRUITMENT AND
D. SEXUAL HARASSMENT IN THE WORK
PLACEMENT .............................................7
ENVIRONMENT................................................ 63
B. REGULATION OF RECRUITMENT AND 1. Definition........................................... 63
PLACEMENT ACTIVITIES ...............................9 2. Duties and Liabilities of Employers ..... 64
1. Regulatory Authorities ..........................9 3. Applicable Laws ................................ 65
2. Ban on Direct Hiring ........................... 11
E. WORKING CONDITIONS FOR SPECIAL
3. Entities Prohibited from Recruiting ...... 11
GROUPS OF EMPLOYEES .......................... 65
4. Suspension or Cancellation of License or
1. Apprentices and Learners .................. 66
Authority .................................................. 12
2. Disabled Workers .............................. 69
5. Prohibited Practices ........................... 13
3. Gender.............................................. 72
C. ILLEGAL RECRUITMENT ...................... 15 4. Minors............................................... 74
1. Elements ........................................... 15 5. Kasambahays ................................... 77
2. Types ................................................ 17 6. Homeworkers .................................... 80
3. Illegal Recruitment as Distinguished from 7. Solo Parents ..................................... 81
Estafa ...................................................... 18 8. Night Workers ................................... 81
9. Migrant Workers ................................ 83
D. LIABILITY OF LOCAL RECRUITMENT
10. Security Guards ................................ 84
AGENCY AND FOREIGN EMPLOYER .......... 18
1. Solidary Liability................................. 18 IV. POST-EMPLOYMENT.................................. 85
2. Theory of Imputed Knowledge ............ 20
A. EMPLOYER-EMPLOYEE RELATIONSHIP
E. TERMINATION OF CONTRACT OF MIGRANT ............................................................. 85
WORKER ...................................................... 21 1. Tests to Determine Existence ............ 86
2. Legitimate Subcontracting as
F. EMPLOYMENT OF NON-RESIDENT ALIENS 21
distinguished from Labor-Only
1. Coverage........................................... 21
Contracting ....................................... 87
2. Conditions for Grant of Permit ............ 23 3. Kinds of Employment ......................... 91
3. Validity of AEP and Renewal .............. 24
4. Denial of Application .......................... 25 B. TERMINATION BY EMPLOYER ............ 99
5. Revocation; Cancellation.................... 25 1. Requisites for Validity ...................... 100
6. Appeal ............................................... 25 2. Preventive Suspension .................... 113
7. Penalty .............................................. 26 3. Illegal Dismissal .............................. 114
4. Money Claims arising from Employer- F. BONA FIDE OCCUPATIONAL

Employee Relationship ........................... 121 QUALIFICATIONS .......................................... 195
5. When Not Deemed Dismissed; Employee on
G. POST-EMPLOYMENT RESTRICTIONS ....
Floating Status ....................................... 123
........................................................... 195
C. TERMINATION BY EMPLOYEE ........... 124
H. MARRIAGE BETWEEN EMPLOYEES OF
1. With notice to the employer .............. 124
COMPETITOR-EMPLOYERS ................ 195
2. Without notice to the employer ......... 124
3. Distinguish voluntary resignation and VII. SOCIAL LEGISLATION ............................. 195
constructive dismissal ............................ 124
A. SOCIAL SECURITY SYSTEM LAW ..... 195
D. RETIREMENT ..................................... 125 1. Coverage and Exclusions ................ 196
1. Eligibility and Coverage.................... 125 2. Dependents and Beneficiaries ......... 197
2. Amount of Retirement Pay ............... 126 3. Benefits........................................... 197
3. Retirement Benefits for Workers Paid by
B. GOVERNMENT SERVICE INSURANCE
Results .................................................. 127
SYSTEM LAW ................................................ 200
4. Retirement Benefit of Part-Time Workers
1. Coverage and Exclusions ................ 200
....................................................... 127
2. Dependents and Beneficiaries ......... 201
5. Non-Taxable .................................... 127
3. Benefits........................................... 201
LABOR LAW 2......................................................... 129
C. LIMITED PORTABILITY LAW .............. 206
V. LABOR RELATIONS ................................. 130
D. DISABILITY AND DEATH BENEFITS .. 208
A. RIGHT TO SELF-ORGANIZATION....... 130 1. Labor Code ..................................... 208
1. Who May or May Not Exercise the Right 2. Employees Compensation and State
....................................................... 130 Insurance Fund ..................................... 213
2. Commingling or Mixture of Membership . 3. Philippine Overseas Employment
....................................................... 134 Administration-Standard Employment
3. Rights and Conditions of Membership.... Contract ................................................ 214
....................................................... 134
E. SOLO PARENTS ................................ 218
B. BARGAINING UNIT ............................. 137
F. KASAMBAHAY ................................... 219
C. BARGAINING REPRESENTATIVE ...... 140
G. AGRARIAN RELATIONS ..................... 219
D. RIGHTS OF LABOR ORGANIZATIONS 1. Concept of Agrarian Reform ............ 219
158 2. Existence and Concept of Agricultural
1. Check off, Assessment, Agency Fees Tenancy ................................................ 219
158 3. Rights of Agricultural Tenants .......... 220
2. Collective Bargaining ....................... 160 4. Concept of Farmworkers.................. 221
E. UNFAIR LABOR PRACTICES.............. 169 H. UNIVERSAL HEALTH CARE ............... 222
1. Nature, Aspects ............................... 169 1. Policy .............................................. 222
2. By Employers .................................. 170 2. Coverage ........................................ 222
3. By Labor Organizations .................... 176 3. National Health Insurance Program.. 223
F. PEACEFUL CONCERTED ACTIVITIES177 VIII. JURISDICTION AND REMEDIES ......... 224
1. By Labor Organization ..................... 178
A. LABOR ARBITER................................ 224
2. By Employer .................................... 188
1. Jurisdiction of the Labor Arbiter as
3. Assumption of Jurisdiction by Secretary
distinguished from the Regional Director. 224
of Labor and Employment ............................ 189
2. Requirements to perfect appeal to National
VI. MANAGEMENT PREROGATIVE .............. 191 Labor Relations Commission.................. 225
3. Reinstatement and/or execution pending
A. DISCIPLINE ........................................ 192
appeal ................................................... 226
B. TRANSFER OF EMPLOYEES ............. 193
B. NATIONAL LABOR RELATIONS COMMISSION
C. PRODUCTIVITY STANDARDS ............ 194 226
1. Jurisdiction/Powers.......................... 226
D. BONUS ............................................... 194
2. Remedies........................................ 226
E. CHANGE OF WORKING HOURS ........ 194
C. COURT OF APPEALS......................... 229
D. SUPREME COURT ............................. 230

E. BUREAU OF LABOR RELATIONS....... 230
1. Jurisdiction ...................................... 230
2. Appeals ........................................... 232
3. Administrative Functions of the BLR . 232
F. NATIONAL CONCILIATION AND MEDIATION
BOARD ....................................................... 232
1. Jurisdiction ...................................... 232
2. Conciliation as distinguished from mediation
233
3. Preventive mediation........................ 234
G. DEPARTMENT OF LABOR AND
EMPLOYMENT REGIONAL DIRECTORS .... 234
1. Jurisdiction ...................................... 234
2. Recovery and adjudicatory power ..... 235
H. DEPARTMENT OF LABOR AND
EMPLOYMENT SECRETARY...................... 236
1. Jurisdiction ...................................... 236
2. Visitorial and enforcement powers .... 242
3. Power to suspend effects of termination
....................................................... 244
4. Remedies ........................................ 244
I. VOLUNTARY ARBITRATOR.................... 244
1. Jurisdiction ...................................... 245
2. Remedies ........................................ 247
J. PRESCRIPTION OF ACTIONS ................ 247
1. Money claims................................... 247
2. Illegal dismissal ............................... 248
3. Unfair labor practice ......................... 248
4. Offenses under the Labor Code........ 248
5. Illegal recruitment ............................ 249
LAWS AND RULES OF PROCEDURE.................. 249
U.P. LAW BOC LABOR 1 LABOR LAW
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LABOR LAW 1
LABOR LAW
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Labor as Protected Class; Presumption of

I. FUNDAMENTAL Inherent Inequality
PRINCIPLES The presumption is that the employer and the
employee are on unequal footing, so the State
has the responsibility to protect the employee.
A. LEGAL BASIS This presumption, however, must be taken on
a case-to-case basis. In situations where
special qualifications are required for
1. 1987 Constitution employment, such as a Master's degree,
prospective employees are at a better position
ART. II: Declaration of Principles and State to bargain with the employer. Employees with
Policies special qualifications would be on equal footing
The State shall: with their employers, and thus, would need a
a. Promote full employment, a rising standard lesser degree of protection from the State than
of living, and an improved quality of life for an ordinary rank-and-file worker. [Perfecto
all [Sec. 9, Art. II] Pascua v. Bank Wise Inc., G.R. No. 191460 &
b. Promote social justice [Sec. 10, Art. II] 191464 (2018)].
c. Affirm labor as a primary social economic
force [Sec. 18, Art. II] SEC. 3, par. 3-4, ART. XIII: Social Justice
d. Protect rights of workers and promote their and Human Rights
welfare [Sec. 18, Art. II] The State shall:
e. Recognize the indispensable role of the a. Promote the principle of shared
private sector [Sec. 20, Art. II.] responsibility between workers and
f. Encourage private enterprise [Sec. 20, Art. employers
II.] b. Promote the preferential use of voluntary
g. Provide incentives to needed investments modes in settling disputes
[Sec. 20, Art. II.] c. Regulate the relations between workers
and employers,
SEC. 3, par. 1-2, ART. XIII: Social Justice d. Recognize the right of labor to its just share
and Human Rights in the fruits of production and the right of
The State shall: enterprises to reasonable returns to
a. Afford full protection to labor, local and investments, and to expansion and growth.
overseas, organized and unorganized
b. Promote full employment and equality of Balancing of Interests
employment opportunities for all. While labor laws should be construed liberally
c. Guarantee the rights (also known as the in favor of labor, we must be able to balance
“Cardinal Labor Rights”) of all workers to this with the equally important right of the
1. Self-organization [employer] to due process [Gagui v. Dejero,
2. Collective bargaining and negotiations G.R. No. 196036 (2013)]
3. Peaceful concerted activities
4. Strike in accordance with law Due Process [Sec. 1, Art. III, 1987
5. Security of tenure, Constitution]
6. Humane conditions of work Under the Labor Code, as amended, the
7. A living wage. requirements for the lawful dismissal of an
8. To participate in policy and decision- employee by his employer are two-fold: the
making processes affecting their rights substantive and the procedural.
and benefits as may be provided by
law. Substantive: two requisites must concur: (1)
the dismissal must be for a just or authorized
cause; and (2) the employee must be afforded
an opportunity to be heard and to defend
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himself. [Jeffrey Nacague v. Sulpicio Lines, which impairs the obligation of a contract and
Inc., G.R. No. 172589 (2010)] is null and void. [Clemens v. Nolting, G.R. No.
L-17959 (1922)]
Procedural: an opportunity to be heard and to
defend oneself must be observed before an Vis-à-vis the freedom of contract
employee may be dismissed [Metro Eye The prohibition to impair the obligation of
Security v. Salsona, G.R. No. 167367 (2007)] contracts is not absolute and unqualified. In
spite of the constitutional prohibition and the
Labor as Property Right fact that both parties are of full age and
One’s employment is a property right, and the competent to contract, it does not necessarily
wrongful interference therewith is an actionable deprive the State of the power to interfere
wrong. The right is considered to be property where the parties do not stand upon an
within the protection of the constitutional equality, or where the public health demands
guarantee of due process of law. [Texon that one party to the contract shall be protected
Manufacturing v. Millena, G.R. No. 141380 against himself. [Leyte Land Transportation
(2004)] Co. v. Leyte Farmers & Workers Union, G.R.
No. L-1377 (1948)]
The Right to Assemble
Labor Rights and Protection
Sec. 4, Art. III. No law shall be passed All persons shall have the right to a speedy
abridging the right of the people peaceably disposition of their cases before all judicial,
to assemble and petition the government for quasi-judicial, or administrative bodies. [Sec.
redress of grievances. 16, Art. III.]
Right to peaceably assemble and petition for No involuntary servitude in any form shall exist.
redress of grievances is, together with freedom [Sec. 18 (2), Art. III.]
of speech, of expression, and of the press, a
right that enjoys primacy in the realm of Except as a punishment for a crime whereof
constitutional protection. [BAYAN, et al. v. the party shall have been duly convicted. [Sec.
Ermita, G.R. No. 169838, (2006)]. 18 (2), Art. III.]
Wearing armbands and putting up placards to 2. Civil Code

express one’s views without violating the rights
of third parties, are legal per se and even Relations between labor and capital
constitutionally protected. [Bascon v. CA, G.R. The relations between capital and labor are
No. 144899 (2004)] not merely contractual. [Art. 1700, CC]
The Right to Form Associations [Sec. 8, Art. They are impressed with public interest that
III, 1987 Constitution] labor contracts:
The right to form associations shall not be a. Must yield to the common good
impaired except through a valid exercise of b. Are subject to special laws on
police power. [Bernas, The 1987 Philippine 1. Labor unions,
Constitution: A Comprehensive Reviewer] 2. Collective bargaining,
3. Strikes and lockouts,
Non-impairment of Contracts [Sec. 10, Art. 4. Closed shop,
III, 1987 Constitution] 5. Wages,
A law which changes the terms of a legal 6. Working conditions,
contract between parties, either in the time or 7. Hours of labor; and
mode or performance, or imposes new 8. Similar subjects
conditions, or dispenses with those expressed,
or authorizes for its satisfaction something
different from that provided in its terms, is a law
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Neither capital nor labor shall of their adoption in newspapers of general

a. Act oppressively against the other, or circulation. [Art. 5]
b. Impair the interest or convenience of the
public [Art. 1701, CC]. All rights and benefits granted to workers under
this Code shall, except as may otherwise be
No contract which practically amounts to provided herein, apply alike to all workers,
involuntary servitude, under any guise whether agricultural or non-agricultural. (As
whatsoever, shall be valid. [Art. 1702, CC] amended by Presidential Decree No. 570-A,
November 1, 1974) [Art. 6]
Provisions of applicable statutes are deemed
written into the contract. Hence, the parties are
not at liberty to insulate themselves and their B. STATE POLICY TOWARDS
relationships from the impact of labor laws and LABOR
regulations by simply contracting with each
other. [Innodata Philippines, Inc. v. Quejada-
Labor Code Declaration of Basic Policy
Lopez, G.R. No. 162839 (2006)]
[Art. 3, LC]
The State shall:
Courts cannot stipulate for the parties or
a. Afford protection to labor,
amend the latter’s agreement, for to do so
b. Promote full employment,
would be to alter the real intention of the
c. Ensure equal work opportunities
contracting parties when the contrary function
regardless of sex, race or creed, and
of courts is to give force and effect to the
d. Regulate the relations between workers
intention of the parties. [Maynilad Water
and employers.
Supervisors Association v. Maynilad Water
Services, Inc., G.R. No. 198935 (2013)]
The State shall assure the rights of workers to:
a. Self-organization,
3. Labor Code b. Collective bargaining,
c. Security of tenure, and
The State shall d. Just and humane conditions of work.
b. Promote full employment,
1. Security of tenure
c. Ensure equal work opportunities
regardless of sex, race or creed, and
All workers shall be entitled to security of
d. Regulate the relations between workers
tenure. [1987 Constitution, Art. XIII, Sec. 3, par.
and employers.
2]
The State shall assure the rights of workers to
Police power allows the State to regulate the
a. Self-organization,
grant of the right to security of tenure. [St.
b. Collective bargaining,
Luke’s Medical Center Employee’s
c. Security of tenure, and
Association-AFW v. NLRC, G.R. No. 162053
d. Just and humane conditions of work. [Art.
(2007)]
3]
● Purpose: to safeguard the general welfare
of the public.
The Department of Labor and other
● Example: Persons who desire to engage
government agencies charged with the
in the learned professions may be required
administration and enforcement of this Code or
to take an examination as a prerequisite to
any of its parts shall promulgate the necessary
engaging in the same.
implementing rules and regulations.
Such rules and regulations shall become

effective fifteen (15) days after announcement
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2. Social justice
Limits of Social Justice
Sec. 9, Art. II, 1987 Constitution: The State Social justice should be used only to correct an
shall promote a just and dynamic social order injustice [Agabon v. NLRC, G.R. No. 158693
that will: (2004)]. It is not intended to countenance
a. Ensure the prosperity and independence of wrongdoing simply because it is committed by
the nation; the underprivileged. It cannot be permitted to
b. Free the people from poverty through be a refuge of scoundrels any more than can
policies that provide adequate social equity be an impediment to the punishment of
services; and the guilty. Those who invoke social justice may
c. Promote: do so only if their hands are clean and their
1. Full employment, motives blameless and not simply because
2. A rising standard of living they happen to be poor. [Tirazona v. Phil EDS
3. Improved quality of life for all Techno-Service, Inc., G.R. 169712 (2009)].
Sec. 10, Art. II, 1987 Constitution: The State Tilting the scales [Rivera vs. Genesis
shall promote social justice in all phases of Transport Service, Inc., G.R. No. 215568
national development. (2015)]
Labor laws are meant to implement and effect
Social Justice as justification [Calalang v. social justice. Thus, such considerations
Williams, G.R. No. 47800 (1940)] should be taken into account when dealing with
Social justice is neither communism, nor labor cases.
despotism, nor atomism, nor anarchy BUT:
a. The humanization of laws; and The social justice suppositions underlying labor
b. The equalization of social and economic laws require that the statutory grounds
forces by the State. justifying termination of employment should not
So that justice in its rational and objectively be read to justify the view that employees
secular conception may at least be should, in all cases, be free from any kind of
approximated. error.
Social justice means: Not every improper act should be taken to

a. The promotion of the welfare of all the justify the termination of employment. To infer
people, from a single error that an employee committed
b. The adoption by the Government of serious misconduct or besmirched his
measures calculated to insure economic employer’s trust is grave abuse of discretion. It
stability of all the competent elements of is an inference that is arbitrary and capricious.
society – It is contrary to the high regard for labor and
1. through the maintenance of a proper social justice enshrined in our Constitution and
economic and social equilibrium in the our labor laws.
interrelations of the members of the
community, constitutionally; Welfare State [Alalayan v. National Power
2. through the adoption of measures Corporation, G.R. No. L-24396 (1968)]
legally justifiable, or extra- The welfare state concept is found in the
constitutionally; and constitutional clause on the promotion of social
3. through the exercise of powers justice.
underlying the existence of all
governments on the time-honored Purpose:
principle of salus populi est suprema a. To ensure the well-being and economic
lex. security of all the people, and
b. In the pledge of protection to labor with
Note: The welfare of the people should specific authority to regulate the relations
be the supreme law.
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between landowners and tenants and Sec. 3, par. 1, Art. XIII, 1987 Constitution.
between labor and capital. The State shall:
a. Afford full protection to labor -
Separation pay as measure of social justice 1. Local and overseas,
[PLDT v. NLRC, G.R. No. 80609 (1988)] 2. Organized and unorganized, and
The rule embodied in the Labor Code is that a b. Promote full employment and equality of
person dismissed for lawful cause is not employment opportunities for all.
entitled to separation pay.
Sec. 2, R.A. No. 10911. Declaration of
Exception: Considerations of equity. Equity Policies
has been defined as justice outside law, being The State shall promote equal opportunities in
ethical rather than jural and belonging to the employment for everyone. To this end, it shall
sphere of morals than of law. be the policy of the State to:
a. Promote employment of individuals on the
Strictly speaking, however, it is not correct to basis of their –
say that there is no express justification for the 1. Abilities,
grant of separation pay to lawfully dismissed 2. Knowledge,
employees other than the abstract 3. Skills, and
consideration of equity. 4. Qualifications, rather than their age
b. Prohibit arbitrary age limitations in
Reason: Our Constitution is replete with employment.
positive commands for the promotion of social c. Promote the right of all employees and
justice, and particularly the protection of the workers, regardless of age, to be treated
rights of the workers. equally in terms of –
1. Compensation,
3. Equal work opportunities 2. Benefits,
3. Promotion,
Declaration of Basic Policy [Art. 4, LC] 4. Training, and
The State shall: 5. Other employment opportunities.
b. Promote full employment, 4. Right to self-organization and
c. Ensure equal work opportunities collective bargaining
regardless of:
1. Sex, 1987 Constitution
2. Race, or The State shall guarantee:
3. Creed, a. The right of the people, including those
d. Regulate the relations between workers employed in the public and private sectors,
and employers. to form unions, associations, or societies
for purposes not contrary to law. [Sec. 8,
The State shall assure the rights of workers to: Art. III.]
a. Self-organization, b. The rights of all workers to –
b. Collective bargaining, 1. Self-organization [Sec. 3, Art. XIII]
c. Security of tenure, and 2. Collective bargaining and negotiations
d. Just and humane conditions of work. [Sec. 3, Art. XIII]
3. Peaceful concerted activities [Sec. 3,
Note: Art. 4 of the Labor Code must be read in Art. XIII]
relation to the 1987 Constitution since this is 4. Strike in accordance with law. [Sec. 3,
still based on the 1973 Constitution. Art. XIII]
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Art. 253, Labor Code one. [Heritage Hotel Manila v. PIGLAS-

All persons employed: Heritage, G.R. No. 177024 (2009)]
a. In commercial, industrial and agricultural 4. The right to form or join a labor organization
enterprises, and necessarily includes the right to refuse or
b. In religious, charitable, medical or refrain from exercising said right. It is
educational institutions, whether operating self-evident that just as no one should be
for profit or not, denied the exercise of a right granted by
shall have the right to – law, so also, no one should be compelled
a. Self-organization, to exercise such a conferred right. [Reyes
b. Form, join, or assist labor organization of v. Trajano, G.R. No. 84433 (1992)]
their own choosing for purposes of 5. The right of the employees to self-
collective bargaining. organization is a compelling reason why
their withdrawal from the cooperative
Ambulant, intermittent and itinerant workers, must be allowed. As pointed out by the
self-employed people, rural workers and those union, the resignation of the member-
without any definite employers may form labor employees is an expression of their
organizations for their mutual aid and preference for union membership over that
protection. of membership in the cooperative. [Central
Negros Electric Cooperative v. SOLE, G.R.
Art. 254, Labor Code No. 94045 (1991)]
Employees of government corporations 6. Their freedom to form organizations would
established under the corporation code shall be rendered nugatory if they could not
have the right to: choose their own leaders to speak on
a. Organize, and their behalf and to bargain for them. [Pan-
b. Bargain collectively with their respective American World Airways, Inc v. Pan-
employers. American Employees Association, G.R.
No. L-25094 (1969)]
All other employees in the civil service shall
have the right to form associations for 5. Construction in favor of labor
purposes not contrary to law.
All doubts in the implementation and
Infringement of the right to self- interpretation of the provisions of this Code,
organization including its implementing rules and
It shall be unlawful for any person to restrain, regulations, shall be resolved in favor of
coerce, discriminate against or unduly interfere labor. [Art. 4, Labor Code]
with employees and workers in their exercise
of the right to self-organization [Art. 257, LC] In case of doubt, all legislation and all labor
contracts shall be construed in favor of the
Scope of right to self-organization safety and decent living for the laborer. [Art.
1. Right to form, join or assist labor 1702, Civil Code]
organizations of their own choosing for
the purpose of collective bargaining Liberal Construction
through representatives of their own Of the laws
choosing [Art. 257]; Art. 4 of the Labor Code mandates that all
2. Right to engage in lawful concerted doubts in the implementation and interpretation
activities for the same purpose (collective of the provisions thereof shall be resolved in
bargaining) or for their mutual aid and favor of labor. This is merely in keeping with
protection [Art. 257] the spirit of our Constitution and laws which
3. The right of any person to join an lean over backwards in favor of the working
organization also includes the right to class, and mandate that every doubt must be
leave that organization and join another resolved in their favor. [Hocheng Philippines
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Corporation v. Farrales, G.R. No. 211497 ER has burden of proving valid dismissal
(2015)] Unsubstantiated accusations or baseless
conclusions of the employer are insufficient
Of labor contracts legal justifications to dismiss an employee. The
A CBA, as a labor contract within the unflinching rule in illegal dismissal cases is that
contemplation of Art. 1700 of the Civil Code of the employer bears the burden of proof.
the Philippines which governs the relations [Garza v. Coca-Cola Bottlers Philippines, Inc.,
between labor and capital, is not merely G.R. No. 180972 (2014)]
contractual in nature but impressed with public
interest, thus, it must yield to the common Penalty must be commensurate with
good. As such, it must be construed liberally gravity of offense
rather than narrowly and technically, and the Not every case of insubordination or willful
courts must place a practical and realistic disobedience by an employee reasonably
construction upon it, giving due consideration deserves the penalty of dismissal. The penalty
to the context in which it is negotiated and to be imposed on an erring employee must be
purpose which it is intended to serve. [Cirtek commensurate with the gravity of his offense.
Employees Labor Union-FFW v. Cirtek [Joel Montallana v. La Consolacion College
Electronics, G.R. No. 190515 (2010)] Manila, G.R. No. 208890 (2014)]
Mutual obligation
The employer's obligation to give his workers II. RECRUITMENT AND
just compensation and treatment carries with it PLACEMENT
the corollary right to expect from the workers
adequate work, diligence and good conduct. A. DEFINITION OF RECRUITMENT
[Judy Philippines, Inc. v NLRC, G.R. No.
AND PLACEMENT
111934 (1998)]
6. Burden of proof and quantum of “Recruitment and placement" refers to any

evidence act of: [CETCHUP-R-CPA]
1. Canvassing,
Summary on Burden of Proof 2. Enlisting,
1. Existence of ER-EE Relationship: 3. Contracting,
Employee 4. Transporting,
2. Fact of dismissal: Employee 5. Utilizing
3. Validity of Dismissal: Employer 6. Hiring, or
7. Procuring workers
EE has burden of proving fact of
employment and of dismissal And includes –
Before a case for illegal dismissal can prosper, 1. Referrals,
an employer-employee relationship must first act of passing along or forwarding of an
be established by the employee. [Javier v. Fly applicant for employment after an initial
Ace Corp., G.R. No. 192558 (2012)] interview of a selected applicant for
employment to a selected employer,
The employee must first establish by placement officer or bureau." [Rodolfo v.
substantial evidence the fact of his dismissal People, G.R. No. 146964 (2006)]
from service. If there is no dismissal, then there 2. Contract services,
can be no question as to the legality or illegality 3. Promising, or
thereof. [MZR Industries v. Colambot, G.R. No. 4. Advertising for employment, locally or
179001 (2013)] abroad, whether for profit or not
Provided, That any person or entity which, in

any manner, offers or promises for a fee
Page 7 of 262
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employment to two or more persons shall be License and Authority [Art. 13(d) and (f); Sec.
deemed engaged in recruitment and 3 (h)(g), DO 141-14]
placement. [Art. 13 (b), Labor Code]
License Authority
The proviso provides for a presumption that a document issued by the Department of
person or entity so described engages in Labor and Employment (DOLE)
recruitment and placement. [People v. Panis,
G.R. No. 58674 (1988)] Authorize an entity Authorize an entity
to operate as a to operate as a
Number of persons: not essential private employment private recruitment
The number of persons dealt with is not an agency entity
essential ingredient of the act of recruitment
and placement of workers. Any of the acts When a license is Does not entitle a
mentioned in Art. 13(b) will constitute given, one is also private recruitment
recruitment and placement even if only one authorized to collect entity to collect fees.
prospective worker is involved. [People v. fees
Panis, supra.]
Private employment agency (PEA) v.
Worker – any member of the labor force, Private recruitment entity (PRE) [Art. 13 (c),
whether employed or unemployed. [Art.13 (a)]
(e)]
Overseas Filipino Worker/Migrant Worker – Private Private
a person who is to be engaged, is engaged, or Employmen Recruitment
has been engaged in a remunerated activity: t Agency Entity
1. in a state of which he or she is not a citizen,
or Definition Any person Any person or
2. on board a vessel navigating the foreign or entity association
seas other than a government ship used for engaged in engaged in the
military or non-commercial purposes, or recruitment recruitment
3. on an installation located offshore or on the and and placement
high seas. [Sec. 2 (a), RA 8042, as placement of of workers,
amended] workers for a locally or
fee which is overseas,
charged, without
directly or charging,
indirectly, directly or
from the indirectly,
workers or any fee
employers or
both
Require- License Authority

ment
Policy of Close Government Regulation

RA 9422 or the Act to Strengthen the
Regulatory Functions of the Philippine
Overseas Employment Administration of 2007
expressly repealed Sections 29 and 30 of RA
8042, which provided for the deregulation of
recruitment activities.
Page 8 of 262
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Recruitment of Local and Migrant Workers: with internationally-accepted standards. [Sec.

Policy of Selective Deployment 3, RA 8042, as amended]
The State shall allow the deployment of
overseas Filipino workers only in countries
where the rights of Filipino migrant workers are B. REGULATION OF RECRUITMENT
protected. The government recognizes any of AND PLACEMENT ACTIVITIES
the following as a guarantee on the part of the
receiving country for the protection of the rights
of overseas Filipino workers:
1. Regulatory Authorities
1. It has existing labor and social laws
protecting the rights of workers, including a. Philippine Overseas
migrant workers; Employment Administration
2. It is a signatory to and/or a ratifier of
multilateral conventions, declarations or POEA supersedes OEDB and NSB
resolutions relating to the protection of Executive Order 797, Reorganizing the
workers, including migrant workers; and Ministry of Labor and Employment, Creating
3. It has concluded a bilateral agreement or the Philippine Overseas Employment
arrangement with the government on the Administration (POEA), and for other
protection of the rights of overseas Filipino purposes, has superseded Art. 17 and 20, and
Workers: provides for the POEA to take over the
functions of the Overseas Employment
Provided, That the receiving country is taking Development Board (OEDB) and the National
positive, concrete measures to protect the Seamen Board (NSB).
rights of migrant workers in furtherance of any
of the guarantees under subparagraphs (a), (b) POEA Powers and Functions
and (c) hereof. [Sec. 3, RA 8042, as amended] a. Regulate private sector participation in the
recruitment and overseas placement of
[..] The Department of Foreign Affairs, through workers by setting up a licensing and
its foreign posts, shall issue a certification to registration system;
the POEA, specifying therein the pertinent b. Formulate and implement, in
provisions of the receiving country's labor/ coordination with appropriate entities
social law, or the convention/ declaration/ concerned, when necessary, a system for
resolution, or the bilateral agreement/ promoting and monitoring the overseas
arrangement which protect the rights of migrant employment of Filipino workers taking into
workers. consideration their welfare and the
domestic manpower requirements;
The State shall also allow the deployment of c. Protect the rights of Filipino workers for
overseas Filipino workers to vessels navigating overseas employment to fair and equitable
the foreign seas or to installations located recruitment and employment practices and
offshore or on high seas, whose ensure their welfare; 
owners/employers are compliant with d. Exercise original and exclusive
international laws and standards that protect jurisdiction to hear and decide all claims
the rights of migrant workers. arising out of an employer-employee
relationship or by virtue of any law or
The State shall likewise allow the deployment contract involving Filipino workers for
of overseas Filipino workers to companies and overseas employment including the
contractors with international operations: disciplinary cases; and all pre employment
Provided, That they are compliant with cases which are administrative in character
standards, conditions and requirements, as involving or arising out of violation or
embodied in the employment contracts requirement laws, rules and regulations
prescribed by the POEA and in accordance including money claims arising therefrom,
or violation of the conditions for issuance of
Page 9 of 262
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license or authority to recruit workers. All organizations, domestic or foreign, in the

prohibited recruitment activities and furtherance of its objectives. [Sec. 3, EO 247]
practices which are penal in character as
enumerated and defined under and by POEA Standard Contract Deemed
virtue of existing laws, shall be prosecuted Integrated in every Employment Contract
in the regular courts in close coordination While the seafarers and their employers are
with the appropriate Departments and governed by their mutual agreements, the
agencies concerned; POEA rules and regulations require that the
e. Maintain a registry of skills for overseas POEA SEC, which contains the standard terms
placement;   and conditions of the seafarers' employment in
f. Recruit and place workers to service the foreign ocean-going vessels, be integrated in
requirements  for trained and competent every seafarer's contract. [Wallem Maritime
Filipino workers by foreign governments Services, Inc. v. Tanawan, G.R. No. 160444,
and their instrumentalities and such other (2012)]
employers as public interest may require;
g. Promote the development of skills and POEA Jurisdiction vis-a-vis NLRC and RTC
careful selection of Filipino workers; 
Administrative Disciplinary
h. Undertake overseas market development
cases arising action cases
activities for placement of Filipino workers;
out of and other
i. Secure the best terms and conditions of
violations of special
employment of Filipino contract workers
rules and cases,
and ensure compliance therewith;
regulations involving
j. Promote and protect the well-being of relating to employers,
Filipino workers overseas; licensing and principals,
k.  Develop and implement programs for the registration of contracting
effective monitoring of returning contract POEA
recruitment partners, and
workers, promoting their re-training and re- and Filipino
employment or their smooth re-integration employment migrant
into the mainstream of national economy in agencies and workers
coordination with other government entities. [Sec. [Sec. 28(b),
agencies; 28(a), Omb. Omb. Rules
l. Institute a system for ensuring fair and Rules Implementing
speedy disposition of cases involving Implementing RA 8042]
violation or recruitment rules and RA 8042]
regulations as well as violation of terms and
conditions of overseas employment; Claims arising out of an ER-
m. Establish a system for speedy and EE relationship or by virtue of
efficient enforcement of decisions laid any law or contract involving
down through the exercise of its Filipino workers for overseas
adjudicatory function; NLRC
deployment including actual,
n. Establish and maintain close relationship moral, and exemplary and
and enter into joint projects with the other forms of damage. [Sec.
Department of Foreign Affairs, Philippine 10, RA 8042]
Tourism Authority, Manila International
Airport Authority, Department of Justice, Criminal actions arising from
Department of Budget and Management illegal recruitment [Sec. 9, RA
and other relevant government entities, in RTC
8042]
the pursuit of its objectives.
The Administration shall also establish and

maintain joint projects with private
Page 10 of 262
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b. Regulatory and Visitorial 2. Ban on Direct Hiring

Powers of the Department of
Labor and Employment General Rule: No employer may hire a Filipino
Secretary worker for overseas employment except
through the Boards and entities authorized by
Reports on Employment Status the Secretary of Labor. [Art. 18]
Whenever the public interest requires, the
Secretary of Labor may direct all persons or No employer shall directly hire an Overseas
entities within the coverage of this Title to Filipino Worker for overseas employment.
submit a report on the status of employment, [Sec. 123, 2016 Revised POEA Rules and
including job vacancies, details of job Regulations]
requisitions, separation from jobs, wages,
other terms and conditions and other Exemptions:
employment data. [Art. 33] a. Members of the diplomatic corps;
b. International organizations;
SOLE’s regulatory Power c. Heads of state and government officials
The SOLE shall have the power: with the rank of at least deputy minister;
a. To restrict and regulate the recruitment and d. Other employers as may be allowed by the
placement activities of all agencies within Secretary of Labor and Employment, such
the coverage of this Title. [Title 1, as:
Recruitment and Placement of Workers] 1. Those provided in (a), (b) and (c) who
b. To issue orders and promulgate rules and bear a lesser rank, if endorsed by the
regulations to carry out the objectives and Philippine Overseas Labor Office
implement the provisions of this Title. [Art. (POLO), or Head of Mission in the
36] absence of the POLO;
2. Professionals and skilled workers with
SOLE’s visitorial Power duly executed/authenticated contracts
The SOLE or his duly authorized containing terms and conditions over
representatives may, at any time, inspect the and above the standards set by the
premises, books of accounts and records of POEA. The number of professional and
any person or entity covered by this Title, skilled Overseas Filipino Workers hired
require it to submit reports regularly on for the first time by the employer shall
prescribed forms, and act on violation of any not exceed five (5). For the purpose of
provisions of this Title. [Art. 37] determining the number, workers hired
as a group shall be counted as one; OR
SOLE’s arrest and seizure power declared 3. Workers hired by a relative/family
unconstitutional member who is a permanent resident
After the promulgation of the 1987 Constitution, of the host country. [Sec. 124, 2016
only judges may issue search and arrest Revised POEA Rules and Regulations]
warrants. The Secretary of Labor, not being a
judge, may no longer issue search of arrest 3. Entities Prohibited from
warrants. Article 38(c) of the Labor Code is Recruiting
declared unconstitutional and of no force or
effect. [Salazar v. Achacoso, G.R. No. 81510, Entities disqualified from Engaging in the
(1990)] Business of Recruitment and Placement of
Workers for Local Employment
1. Travel agencies and sales agencies of
airline companies, whether for profit or not.
[Art. 26]
2. Those who are convicted of illegal
recruitment, trafficking in persons, anti-
Page 11 of 262
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child labor violation, or crimes involving 5. Sole proprietors, partners or officers and
moral turpitude; members of the board with derogatory
3. Those against whom probable cause or records, such as, but not limited to the ff:
prima facie finding of guilt for illegal a. Those convicted or against whom
recruitment or other related cases exist probable cause or prima facie finding of
particularly to owners or directors of guilt is determined by a competent
agencies who have committed illegal authority for illegal recruitment or for
recruitment or other related cases. other related crimes or offenses
4. Those agencies whose licenses have been committed in the course of, related to,
previously revoked or cancelled by the or resulting from, illegal recruitment, or
Department under Sec. 54 of these rules. for crimes involving moral turpitude;
5. Cooperatives whether registered or not b. Those agencies whose licenses have
under the Cooperative Act of the been revoked for violation of RA 8042,
Philippines. PD 442, RA 9208, and their IRRs;
6. Law enforcers and any official and c. Those agencies whose licenses have
employee of the Department of Labor and been cancelled, or those who, pursuant
Employment (DOLE). to the order of the Administrator, were
7. Sole proprietors of duly licensed agencies included in the list of persons with
are prohibited from securing another derogatory record for violation of
license to engage in recruitment and recruitment laws and regulations;
placement. 6. Any official employee of the DOLE, POEA,
8. Sole proprietors, partnerships or OWWA, DFA, DOJ, DOH, BI, IC, NLRC,
corporations licensed to engage in private TESDA, CFO, NBI, PNP, Civil Aviation
recruitment and placement for local Authority of the Philippines, international
employment are prohibited from engaging airport authorities, and other government
in job contracting or subcontracting agencies directly involved in the
activities. [Sec. 5, DO 141-14, Revised implementation of RA 8042, as amended,
Rules and Regulations Governing and/or any of his/her relatives within the
Recruitment and Placement for Local fourth civil degree of consanguinity or
Employment] affinity. [Part II, Rule I, Sec. 3, 2016
Revised POEA Rules and Regulations]
Entities disqualified from Engaging or
Participating in the Business of 4. Suspension or Cancellation of
Recruitment and Placement of Workers for License or Authority
Overseas Employment
1. Travel agencies and sales agencies of The Secretary of Labor shall have the power to
airline companies, whether for profit or not. suspend or cancel any license or authority to
[Art. 26] recruit employees for overseas employment
2. Officers or members of the Board of any for:
corporation or partners in a partnership a. violation of rules and regulations issued by
engaged in the business of a travel agency; the Department of Labor, the Overseas
3. Corporations and partnerships, where any Employment Development Board, and the
of its officers, members of the board or National Seamen Board;
partners is also an officer, member of the b. violation of the provisions of this and other
board or partner of a corporation or applicable laws, General Orders and
partnership engaged in the business of a Letters of Instructions. [Art. 35]
travel agency;
4. Individuals, partners, officers, or directors Acts prohibited under Art. 34 are grounds for
of an insurance company who make, suspension or cancellation of license. Note that
propose or provide an insurance contract these acts likewise constitute illegal
under the compulsory insurance coverage recruitment under RA 8042 as amended by RA
for agency-hired OFWs; 10022.
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other matters or information, as may be

Who can suspend or cancel the license? required by the Secretary of Labor;
1. DOLE Secretary i. To substitute or alter employment contracts
2. POEA Administrator approved and verified by the Department of
Labor from the time of actual signing
The power to suspend or cancel any license or thereof by the parties up to and including
authority to recruit employees for overseas the periods of expiration of the same
employment is concurrently vested with the without the approval of the Secretary of
POEA and the Secretary of Labor. [People v. Labor;
Diaz, G.R. 112175 (1996)] j. To become an officer or member of the
Board of any corporation engaged in travel
5. Prohibited Practices agency or to be engaged directly or
indirectly in the management of a travel
Recruitment of Local Workers: Prohibited agency; and
Practices under Art. 34 k. To withhold or deny travel documents from
a. To charge or accept, directly or indirectly, applicant workers before departure for
any amount greater than that specified in monetary or financial considerations other
the schedule of allowable fees prescribed than those authorized under this Code and
by the Secretary of Labor, or to make a its implementing rules and regulations.
worker pay any amount greater than that
actually received by him as a loan or Recruitment of Migrant Workers:
advance; Prohibited Acts under Sec. 6, R.A. No. 8042
b. To furnish or publish any false notice or a. To charge or accept directly or indirectly
information or document in relation to any amount greater than that specified in
recruitment or employment; the schedule of allowable fees prescribed
c. To give any false notice, testimony, by the Secretary of Labor and
information or document or commit any act Employment, or to make a worker pay or
of misrepresentation for the purpose of acknowledge any amount greater than that
securing a license or authority under this actually received by him as a loan or
Code; advance;
d. To induce or attempt to induce a worker b. To furnish or publish any false notice or
already employed to quit his employment in information or document in relation to
order to offer him to another, unless the recruitment or employment;
transfer is designed to liberate the worker c. To give any false notice, testimony,
from oppressive terms and conditions of information or document or commit any act
employment; of misrepresentation for the purpose of
e. To influence or to attempt to influence any securing a license or authority under the
person or entity not to employ any worker Labor Code, or for the purpose of
who has not applied for employment documenting hired workers with the
through his agency; POEA, which include the act of
f. To engage in the recruitment or placement reprocessing workers through a job
of workers in jobs harmful to public health order that pertains to nonexistent work,
or morality or to the dignity of the Republic work different from the actual overseas
of the Philippines; work, or work with a different employer
g. To obstruct or attempt to obstruct whether registered or not with the
inspection by the Secretary of Labor or by POEA;
his duly authorized representatives; d. To include or attempt to induce a worker
h. To fail to file reports on the status of already employed to quit his employment in
employment, placement vacancies, order to offer him another, unless the
remittance of foreign exchange earnings, transfer is designed to liberate a worker
separation from jobs, departures and such from oppressive terms and conditions of
employment;
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e. To influence or attempt to influence any recruitment when committed by a

person or entity not to employ any worker syndicate or in large scale shall be
who has not applied for employment considered an offense involving economic
through his agency or who has formed, sabotage; and
joined or supported, or has contacted n. To allow a non-Filipino citizen to head or
or is supported by any union or manage a licensed recruitment/manning
workers' organization; agency. [Sec. 6, R.A. No. 8042]
f. To engage in the recruitment or placement
of workers in jobs harmful to public health Note: Bold parts differ from those stated in the
or morality or to the dignity of the Republic prohibited practices under Art. 34.
of the Philippines;
g. To obstruct or attempt to obstruct Prohibited Acts Added by Amendment
inspection by the Secretary of Labor and a. Grant a loan to an overseas Filipino worker
Employment or by his duly authorized with interest exceeding eight percent (8%)
representative per annum, which will be used for payment
h. To fail to submit reports on the status of of legal and allowable placement fees and
employment, placement vacancies, make the migrant worker issue, either
remittance of foreign exchange earnings, personally or through a guarantor or
separation from jobs, departures and such accommodation party, postdated checks in
other matters or information as may be relation to the said loan;
required by the Secretary of Labor and b. Impose a compulsory and exclusive
Employment; arrangement whereby an overseas Filipino
i. To substitute or alter to the prejudice of worker is required to avail of a loan only
the worker, employment contracts from specifically designated institutions,
approved and verified by the Department of entities or persons;
Labor and Employment from the time of c. Refuse to condone or renegotiate a loan
actual signing thereof by the parties up to incurred by an overseas Filipino worker
and including the period of the expiration of after the latter's employment contract has
the same without the approval of the been prematurely terminated through no
Department of Labor and Employment; fault of his or her own;
j. For an officer or agent of a recruitment d. Impose a compulsory and exclusive
or placement agency to become an arrangement whereby an overseas Filipino
officer or member of the Board of any worker is required to undergo health
corporation engaged in travel agency or to examinations only from specifically
be engaged directly or indirectly in the designated medical clinics, institutions,
management of travel agency; entities or persons, except in the case of a
k. To withhold or deny travel documents from seafarer whose medical examination cost
applicant workers before departure for is shouldered by the principal/shipowner;
monetary or financial considerations, or for e. Impose a compulsory and exclusive
any other reasons, other than those arrangement whereby an overseas Filipino
authorized under the Labor Code and its worker is required to undergo training,
implementing rules and regulations; seminar, instruction or schooling of any
l. Failure to actually deploy a contracted kind only from specifically designated
worker without valid reason as determined institutions, entities or persons, except for
by the Department of Labor and recommendatory trainings mandated by
Employment; principals/shipowners where the latter
m. Failure to reimburse expenses incurred by shoulder the cost of such trainings;
the worker in connection with his f. For a suspended recruitment/manning
documentation and processing for agency to engage in any kind of
purposes of deployment, in cases where recruitment activity including the
the deployment does not actually take processing of pending workers'
place without the worker's fault. Illegal applications; and
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g. For a recruitment/manning agency or a b. Illegal Recruitment of Migrant Workers

foreign principal/employer to pass on the
overseas Filipino worker or deduct from his “Illegal Recruitment” Defined
or her salary the payment of the cost of Any act of canvassing, enlisting, contracting,
insurance fees, premium or other transporting, utilizing, hiring, or procuring
insurance related charges, as provided workers and includes referring, contract
under the compulsory worker's insurance services, promising or advertising for
coverage. [Sec. 6, R.A. No. 8042 as employment abroad, whether for profit or not,
amended by R.A. No. 10022] when undertaken by a non-licensee or non-
holder of authority contemplated under Art.
13(f), P.D. No. 442 or LC. [Sec. 5, R.A. No.
C. ILLEGAL RECRUITMENT 10022]
Note: The Migrant Workers’ Act (R.A. No.

8042) expanded the concept of illegal
1. Elements
recruitment found in the LC and provided stiffer
penalties, especially for when it constitutes
FIRST MAIN TYPE: Simple Illegal economic sabotage. [People v. Ocden, G.R.
Recruitment No. 173198 (2011)]
a. Illegal Recruitment of Local Workers Two Types Accdg. to the Offense (Elements)
1. Undertakes any recruitment activity
Two Types Accdg. to the Kind of Offender defined in Art. 13(b), LC without a valid
The following are the types of illegal license/authority
recruitment of local workers and the elements
for each type: Note: Can only be committed by one who has
1. By a licensee/holder of authority no valid license or authority to engage in
a. Offender has a valid license or recruitment and placement
authority required by law to enable one 2. Commits any of the prohibited acts in
to lawfully engage in the recruitment Sec. 6, R.A. No. 8042, as amended by R.A.
and placement of workers;
10022
b. Offender undertakes any of the a. Note: Immaterial whether an offender
prohibited acts under Art. 34 is a holder or a non-holder of a license
2. By a non-licensee/non-holder of authority or authority
a. Offender has no valid license or
authority required by law to enable one
Contract Substitution = Illegal Recruitment
to lawfully engage in the recruitment The reduced salaries and employment period
and placement of workers; in the new employment contract contradicted
b. Offender undertakes either – the POEA-approved employment contract. By
1. Any activity within the meaning of this act of contract substitution, respondents
recruitment and placement under committed a prohibited practice; consequently,
Art. 13(b) engaged in illegal recruitment. [PERT/CPM
2. Any of the prohibited practices Manpower Exponent Co. v. Vinuya, G.R. No.
under Art. 34. [Art. 34 and 38] 197528 (2012)]
Profit Immaterial Possible Liability of Employee
Recruitment may be "for profit or not." It is the Even the employee of a company engaged in
lack of the necessary license or authority, and illegal recruitment can be held liable (along with
not the fact of payment, that renders the employer) as a principal once it is shown
recruitment illegal. [Sharp v. Espanol, G.R. No. that he had actively and consciously
155903 (2007)] participated in the illegal recruitment. [People
v. Bayker, G.R. No. 170192 (2016)]
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Prohibited Not allowed [7 acts under

Accused must give the impression of Sec. 6, R.A. No. 8042 as
acts
ability to send complainant abroad for work amended by R.A. No.
It must be shown that the accused gave 10022]
complainants the distinct impression that she
had the power or ability to send them abroad
for work such that the latter were convinced to SECOND MAIN TYPE: Illegal Recruitment
part with their money in order to be employed. as Economic Sabotage
[People v. Ochoa, G.R. No. 173792 (2011)]
Two Types Accdg. to Qualifying
Lack of Receipts Not Fatal Circumstance
Mere failure of the complainant to present Illegal recruitment is considered economic
written receipts for money paid for acts sabotage when attended by the ff. qualifying
constituting recruitment activities is not fatal to circumstances:
the prosecution, provided payment can be 1. By a syndicate - carried out by a group of
proved by clear and convincing testimonies of 3 or more persons conspiring and
credible witnesses. [People v. Alvarez, G.R. confederating with one another;
142981 (2002)] 2. In large scale - committed against 3 or
more persons individually or as a group.
c. Comparison of Local and Migrant [Art. 38(b), LC; Sec. 6 of R.A. No. 8042 as
amended]
Non- Note re: In Large Scale –
Licensee/ licensee/ 3+ complainants must be in a single case
LOCAL holder of non- “Committed against 3 or more persons
authority holder of individually or as a group” must be understood
authority as referring to the number of complainants in
each case; otherwise, prosecutions for single
Recruitment Allowed Not
crimes of illegal recruitment can be cumulated
and placement allowed
to make it in large scale .[People v. Reyes,
[Art. 13(b);
G.R. No. 105204 (1995)].
Art. 38]
Prohibited Not allowed [Art. 34; 38,]

practices
Non-
Licensee/ licensee/
MIGRANT holder of non-
authority holder of
authority
Recruitment Allowed Not

and placement allowed
[Sec. 6,
R.A. No.
8042, as
amended]
Prohibited Not allowed [Sec. 6, R.A.

practices No. 8042, as amended]
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Number of victims must be alleged confederating with one another in carrying

The information for illegal recruitment done in out any unlawful or illegal transaction,
large scale must allege the number of victims. enterprise or scheme. [People v. Sison,
[People v. Fernandez, 725 SCRA 152 (2014)] G.R. No. 187160 (2017)]
a. For Local Workers (Elements) In Large Scale

1. Offender undertook any recruitment activity
By a Syndicate as defined under Sec. 6 of R.A. No. 8042
1. Offender undertakes either: 2. Offender did not have the license or the
a. Any activity within the meaning of authority to lawfully engage in the
"recruitment and placement" defined recruitment of workers
under Art. 13(b) 3. Offender committed the same against 3 or
b. Any of the prohibited practices under more persons individually or as a group.
Art. 34 [People v. De los Reyes, G.R. No. 198795
2. Offender has no valid license or authority (2017)]
required by law to enable one to lawfully
engage in recruitment and placement of 2. Types
workers
3. Illegal recruitment is committed by a group Summary of Types & Elements
of 3 or more persons conspiring or There are at least 4 kinds of illegal recruitment.
confederating with one another. [People v. [People v. Sadiosa [G.R. No. 107084 (1998)]
Gallo, G.R. No. 187730 (2010)]
In Large Scale Simple Illegal Recruitment

1. Offender undertakes either:
1. Licensed/ 1. Licensee/Holder of
a. Any activity within the meaning of
Authorized authority
"recruitment and placement" defined
2. Undertakes prohibited
under Art. 13(b)
practices under Art. 34,
b. Any of the prohibited practices under
LC (Local) or Sec. 6 of
Art. 34 R.A. No. 8042 as
2. Offender has not complied with the
amended (Migrant)
guidelines issued by the SOLE, particularly
with respect to the securing of license or an 2.Unlicensed/ 1. Non-licensee/-holder of
authority to recruit and deploy workers, Unauthorized authority
either locally or overseas 2. Undertakes either:
3. Offender commits the unlawful acts against a. Recruitment and
3 or more persons individually or as a placement under
group [Art. 38 (b)] Art. 13(b)
b. Prohibited
b. For Migrant Workers (Elements) practices/activities
under Art. 34, LC
By a Syndicate (Local) or Sec. 6,
1. Offender does not have the valid license or R.A. No. 8042
authority required by law to engage in (Migrant)
recruitment and placement of workers
2. Offender undertakes either: Economic Sabotage
a. Any of the "recruitment and placement"
activities defined in Art. 13(b) 3. In a large 1. Undertakes either:
b. Any of the prohibited practices under scale a. Recruitment and
Sec. 6 of R.A. No. 8042 placement under
3. Illegal recruitment is carried out by a group Art. 13(b)
of 3 or more persons conspiring and/or
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under the LC does not bar conviction for

b. Prohibited
offenses punishable by other laws. Conversely,
practices/activities
conviction for estafa does not bar a conviction
under Art. 34
for illegal recruitment. One's acquittal of the
(Local) or Sec. 6 of
crime of estafa will not necessarily result in his
R.A. No. 8042
acquittal of the crime of illegal recruitment in
(Migrant)
large scale, and vice versa. [People v. Ochoa,
2. No valid license or an
G.R. No. 173792 (2011); People v. Ocden,
authority to recruit and
G.R. No. 173198 (2011)]
deploy workers, either
locally or overseas
As such, the filing of criminal cases for both
3. Committed against 3 or
more persons does not constitute double jeopardy. In illegal
recruitment, profit is immaterial; on the other
individually or as a
hand, a conviction for estafa requires a clear
group
showing that the offended party parted with his
4. By a 1. Undertakes either: money or property upon the offender’s false
syndicate a. Any activity within pretenses, and suffered damage thereby. The
the meaning of two are then completely different and distinct
"recruitment and crimes. [People v. Melissa Chua, G.R. No.
placement" under 187052 (2012)]
Art. 13(b)
b. Any of the D. LIABILITY OF LOCAL RECRUITMENT
prohibited practices
AGENCY AND FOREIGN EMPLOYER
enumerated under
Art. 34 (Local) or
Sec. 6 of R.A. No. 1. Solidary Liability
8042 (Migrant)
2. No valid license or a. Local Recruitment Agency
authority to recruit and
deploy workers, either Illegal recruitment of local workers [Art. 39]
locally or overseas
3. Committed by a group Act Penalty
of 3 or more persons
conspiring and License/authority 2-5 years
confederating with one holder violating or imprisonment or
another causing another to P10K-P50K fine or
violate Title 1, Book both
1 (Art. 34)
3. Illegal Recruitment as
Distinguished from Estafa Non- 4-8 years
license/authority imprisonment or
Conviction for Illegal Recruitment NOT a holder violating or P20K-P100K fine or
Bar to Conviction for Estafa and Vice versa causing another to both
A person who commits illegal recruitment may violate Title 1, Book
be charged and convicted separately of illegal 1 (Art. 38)
recruitment under the LC and estafa under Art.
Illegal recruitment Life imprisonment
315(2a), RPC. The offense of illegal
recruitment is malum prohibitum where the constituting and P100K fine
criminal intent of the accused is not necessary economic sabotage
for conviction, while estafa is malum in se (Art. 38)
where the criminal intent of the accused is
crucial for conviction. Conviction for offenses
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If the offender is a corporation, partnership, liable as PRINCIPAL, together with his

association or entity, the penalty shall be employer if it is shown that he actively and
imposed upon the officer or officers consciously participated in illegal
responsible for the violation. recruitment. [People v. Sagayaga, GR 143726
(2004)]
In every case, conviction carries with it:
1. Automatic revocation of license/authority Two jurisdiction rule
and all permits and privileges granted A criminal action arising from illegal recruitment
under this Title of migrant workers shall be filed with the RTC
2. Forfeiture of cash and surety bonds in favor of the province or city:
of POEA or the Regional Department with 1. Where offense was committed, or
jurisdiction over the place where the 2. Where the offended party actually resides
agency or branch office is located at the time of the commission of the
3. For aliens, in addition to the penalties offense. [Sec. 9, RA 8042]
herein prescribed, deportation without
further proceedings. [Art. 39 (3)] Provided, the court where such action is first
filed acquires jurisdiction to the exclusion of
Illegal recruitment of migrant workers [Sec. other courts. [Sec. 6, Rule IV, Omnibus Rules
7, RA 8042 as amended] implementing RA 8042, as amended]
Act Penalty
Prescription
Prohibited Acts 6 years and 1 day - 12 Crime Classification Prescriptive
years imprisonment and Period
P500K-P1M fine
Local Simple/economic 3 years [Art.
Illegal 12 years and 1 day - 20 workers sabotage 305 LC]
Recruitment years imprisonment and
P1M-P2M fine Migrant Simple 5 years [Sec.
workers 12, RA 8042]
Illegal Life imprisonment and
recruitment P2M-P5M fine Economic 20 years
constituting Sabotage [Sec. 12, RA
economic Max penalty: 8042]
sabotage 1. Illegally recruited
person is below 18
b. Foreign Employer
years old, or
2. Offense is committed Foreign employers shall assume joint and
without license/
solidary liability with the recruitment/
authority
placement agency for all claims arising out of
an employer-employee relationship or by virtue
In every case, conviction carries with it: of any law or contract involving Filipino workers
1. Automatic revocation of license or for overseas deployment including claims for
registration of the recruitment/manning damages. [Sec. 10 of RA 8042, as amended]
agency, lending institutions, training school
or medical clinic. c. Solidary Liability of Agent &
2. For aliens, in addition to the penalties Principal
herein prescribed, deportation without
further proceedings. Coverage
The liability of the principal/employer and the
Employees of a company or corporation recruitment/placement agency for the claims
engaged in illegal recruitment may be held involving Filipino workers for overseas
Page 19 of 262
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deployment including claims for damages is representatives done in connection with

joint and several. recruitment and placement [Part II, Rule II,
Sec. 4 (f) (7-9), 2016 Revised POEA Rules
Incorporation into the contract and Regulations].
This shall be incorporated in the contract for
overseas employment and shall be a condition For corporations or partnerships, a duly
precedent for its approval. notarized undertaking by the corporate officers
and directors, or partners, that they shall be
Performance bond joint and severally liable with the corporation or
The performance bond filed by the partnership for claims and/or damages
recruitment/placement agency shall be awarded to workers is also required. [Part II,
answerable for all money claims or damages Rule II, Sec. 4 (g), 2016 Revised POEA Rules
awarded to workers. and Regulations]
Corporate officers and directors and 2. Theory of Imputed Knowledge

partners solidarily liable
If the recruitment/placement agency is a This is a doctrine in agency stating that the
juridical being, the corporate officers and principal is chargeable with and bound by the
directors and partners as the case may be, knowledge of or notice to his agent received
shall be joint and severally liable with the while the agent was acting as such.
corporation or partnership for the claims and
damages. [Sec. 10, RA 8042 as amended] Notice to the agent is notice to the principal.
Purpose of solidary liability A local employment agency is considered the

The termination of agreement between the agent of the foreign employer, the principal.
manning agency and its principal does not Knowledge of the former of existing labor and
relieve the former of its liability. The agency social legislation in the Philippines in binding
agreement extends until the expiration of the on the latter. Notice to the former of any
employment contracts of the employees violation thereof is notice to the latter.
recruited and employed. Otherwise, this
renders nugatory the purpose of the law which But, notice to the principal is NOT notice to the
is to assure aggrieved workers of immediate agent. Notice to the foreign employer,
and sufficient payment of what is due them. therefore, is not notice to the local employment
agency.
Requisite undertaking for application of
license
The written application for a license to operate
a private employment agency shall be
submitted with, among others, a duly
notarized undertaking that the applicant:
1. Shall assume full and complete
responsibility for all claims and liabilities
which may arise in connection with the use
of the license;
2. Assume joint and several liability with
the employer for all claims and liabilities
which may arise in connection with the
implementation of the contract, including
but not limited to unpaid wages, death,
disability compensation and repatriation.
3. Assume full and complete responsibility
for all acts of its officers, employees and
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In the case of Yap v. Thenamaris Ship’s

Management and Intermare Maritime
E. TERMINATION OF CONTRACT Agencies, Inc [G.R. No. 179532, (May 30,
OF MIGRANT WORKER 2011)], the SC affirmed the Serrano ruling, but
did not apply the Operative Fact doctrine: “As
an exception to the general rule, the doctrine
In case of –
applies only as a matter of equity and fair play.”
a. Termination of overseas employment
without just, valid, or authorized cause as
Note: In 2010, a year after Serrano, RA 10022,
defined by law or contract, or
in amending RA 8042, reincorporated the
b. Any unauthorized deductions from the
nullified 3-month salary cap clause. However,
migrant worker’s salary
the SC did not allow this and again struck the
revived clause as unconstitutional in the 2014
... the worker shall be entitled to full
case of Sameer Overseas Placement
reimbursement of:
Agency v. Cabiles [G.R. No. 170139, (August
a. His placement fee and the deductions
05, 2014)]. There, the SC said that: “when a
made with interest at twelve percent (12%)
law or a provision of law is null because it is
per annum; AND
inconsistent with the Constitution, the nullity
b. His salaries for the unexpired portion of his
cannot be cured by a reincorporation or
employment contract
reenactment of the same or a similar law or
(*or for three (3) months for every year of the
provision. A law or provision of law that was
unexpired term, whichever is less)
already declared unconstitutional remains as
[Sec. 10, RA8042, as amended by RA 10022]
such unless circumstances have so changed
as to warrant a reverse conclusion.” Hence, the
Rule before Rule after Serrano: case of Serrano holds as binding precedent,
Serrano (1995- invalidated the 3- even after the passage of RA 10022.
2009): 3-month month salary cap
salary rule applied clause
F. EMPLOYMENT OF NON-
The employment The SC there held RESIDENT ALIENS
contract involved in that “said clause is
the instant case unconstitutional for
covers a two-year being an invalid 1. Coverage
period but the classification, in
overseas contract violation of the equal Who should apply for an Alien Employment
worker actually protection clause.” Permit
worked for only 26 a. Any alien seeking admission to the
days prior to his Thus, the present Philippines for employment purposes, and
illegal dismissal. rule is that OFWs b. Any domestic or foreign employer who
Thus, the three whose contracts are desires to engage an alien for employment
months’ salary rule terminated without in the Philippines. [Art. 40, Labor Code]
applies [Flourish just cause are
Maritime Shipping v. entitled to all the Art. 40 of the Labor Code which requires
Almanzor, G.R. No. salaries for the employment permit refers to non-resident
177948 (2008)] entire unexpired aliens. Resident aliens do not fall within the
portion of their ambit of the provision [Almodiel v. NLRC, 223
employment SCRA 341 (1993)]
contract, irrespective
of the stipulated An alien cannot file a labor complaint without
term or duration having obtained an employment permit.
thereof. [Andrew James McBurnie v. Eulalio Ganzon,
707 SCRA 646 (2013)]
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6. Representative of the Foreign

Who are exempted from securing an Alien Principal/Employer assigned in the Office
Employment Permit [DOISIPRRL] of Licensed Manning Agency (OLMA) in
1. All members of the Diplomatic service and accordance with the POEA law, rules and
foreign government Officials accredited by regulations. [Section 3, D.O. No. 186-17]
and with reciprocity arrangement with the
Philippine government; Intracorporate Transferee: Requisites for
2. Officers and staff of International exclusion
organizations of which the Philippine 1. Must be an Executive, Manager, or
government is a member, and their Specialist
legitimate Spouses desiring to work in the
Philippines; Executive: primarily directs the
3. Owners and representatives of foreign management of the organization and
principals whose companies are accredited exercises wide latitude in decision making
by the POEA, who come to the Philippines and receives only general supervision or
for a limited period and solely for the direction from higher level executives, the
purpose of Interviewing Filipino applicants board of directors, or stockholders of the
for employment abroad; business; an executive would not directly
4. Foreign national who comes to the perform tasks related to the actual
Philippines to teach, present and/or provision of the service or services of the
conduct research studies in universities organization
and colleges as visiting, exchange or
adjunct Professors under formal Manager: a natural person within the
agreements between the universities or organization who primarily directs the
colleges in the Philippines and foreign organization/department/ subdivision and
universities or colleges; or between the exercises supervisory and control functions
Philippine government and foreign over other supervisory, managerial or
government: provided that the exemption is professional staff; does not include first line
on a reciprocal basis; supervisors unless employees supervised
5. Permanent Resident foreign nationals, are professionals; does not include
probationary or temporary resident visa employees who primarily perform tasks
holders; necessary for the provision of the service
6. Refugees and stateless persons
recognized by DOJ; and Specialist: a natural person within the
7. All foreign nationals granted exemption by organization who possesses knowledge at
Law. [Section 2, D.O. No. 186-17] an advanced level of expertise essential to
the establishment/provision of the service
Who are excluded from securing an Alien and/or possesses proprietary knowledge of
Employment Permit [BPTCICR] the organization’s service, research
1. Members of the governing Board with equipment, techniques or management;
voting rights only and do not intervene in may include, but is not limited to, members
the management of the corporation or in of a licensed profession.
the day to day operation of the enterprise.
2. President and Treasurer, who are part- 2. At least 1 year of continuous employment
owner of the company. prior [Section 3, D.O. No. 186-17]
3. Those providing Consultancy services who
do not have employers in the Philippines.
4. Intra corporate transferee who is a
Manager, Executive or Specialist
5. Contractual service supplier who is a
Manager, Executive, or Specialist
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Contractual Service Supplier: Requisites a. General Rule (GR): within 15 working days
for exclusion after signing of contract/appointment
1. Must be an Executive, Manager, or b. If commencement of employment is later
Specialist that the 15 working day grace period:
2. Enters the Philippines temporarily to supply before the commencement of employment
a service pursuant to a contract between [Sec. 17, D.O. No. 186-17]
his/her employer and a service consumer
in the Philippines What documents should be submitted
3. Must possess the appropriate educational 1. Application form
and professional qualifications; and 2. Photocopy of passport with visa, or Cert of
4. Employed for at least 1 year prior [Section Recognition for Refugees or Stateless
3, D.O. No. 186-17] Persons
3. Original copy of notarized appointment or
Certificate of Exclusion contract of employment enumerating the
All foreign nationals excluded from securing duties and responsibilities, annual salary,
AEP shall secure Certificate of Exclusion from and other benefits of the foreign national
the Regional Office. Further, Regional Offices 4. Photocopy of Mayor’s Permit to operate
shall issue the Certificate of Exclusion within business, in case of locators in economic
two (2) working days after receipt of complete zones, certification from the PEZA or the
documentary requirements and fees. [Section Ecozone Authority that the company is
4, D.O. No. 186-17] located and operating within the ecozone,
while in case of a construction company,
2. Conditions for Grant of Permit photocopy of license from PCAB or D.O.
No. 174-17 Registration should be
Non-availability of Competent, Able, and submitted in lieu of Mayor’s Permit; and
Willing persons [CAW] 5. Business Name Registration and
The employment permit may be issued to a Application Form with the Department of
non-resident alien or to the applicant employer Trade and Industry (DTI) or SEC
after a determination of the non-availability of Registration and GIS;
a person in the Philippines who is 6. If the position title of the foreign national is
competent, able and willing at the time of included in the list of regulated professions,
application to perform the services for a Special Temporary Permit (STP) from the
which the alien is desired. Professional Regulations Commission
(PRC); and
For an enterprise registered in preferred areas 7. If the employer is covered by the Anti-
of investments, said employment permit may Dummy Law, an Authority to Employ
be issued upon recommendation of the Foreign National (ATEFN) from the DOJ or
government agency charged with the from the DENR in case of mining. [Section
supervision of said registered enterprise. 5a, D.O. No. 186-17]
[Art 40, Labor Code]
In case of additional position of change in
Where to file Applications position
All applications for AEP shall be filed and Additional position of the foreign national in
processed at the DOLE Regional Office or the same company or subsequent assignment
Field Office having jurisdiction over the in related companies during the validity or
intended place of work. [Sec. 5(a), D.O. No. renewal of the AEP will be subject for
186-17] publication requirement. A change of
position or employer shall require an
When to file Applications application for new AEP [Section 5(c), D.O.
Newly hired/appointed officers may file the No. 186-17]
application for new AEP without penalty:
Only one AEP at a time
Page 23 of 262
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At any given time only one AEP shall be issued b. Information or criminal offense and grave
to a foreign national. A foreign national may be misconduct in dealing with or ill treatment
issued one AEP only at any given time. [Sec. of workers filed with the Regional Offices
5d, D.O. No. 186-17] any time.
Fees Processing and Issuance

1. Upon filing: AEP shall be issued:
a. One year validity: P9000 a. Within three working days after publication
b. More than 1 year: plus P4000 per year and payment of fees: new AEP
c. Renewal: P4000 per year b. One day after receipt: renewal of AEP [Sec.
2. Courier fee: P200 8, D.O. No. 186-17]
3. Loss/change of info, AEP replacement:
P1500 Verification Inspection
4. Certificate of exclusion: P500 The authorized representatives of the Regional
[Sec. 6, D.O. No. 186-17] Director may conduct inspection to verify
legitimacy of employment of the foreign
Labor Market Test [Sec. 7, D.O. No. 186-17] national as deemed necessary, based on the
AEP application (new/change in or additional documents submitted within two working days
position/subsequent assignment) should be upon payment of fees. [Sec. 9, D.O. No. 186-
published by the DOLE Regional Office in: 17]
1. Newspaper of general circulation within 2
working days from receipt of application 3. Validity of AEP and Renewal
2. DOLE Website (30 days)
3. PESO (30 days) Duration of Validity
The AEP shall be valid for the position and the
Contents of the Publication: company for which it was issued for
1. Name,
2. Position, GR: 1 year
3. Employer and address, Exception: period not exceeding 3 years; if the
4. A brief description of the functions to be employment contract/mode of engagement
performed by the foreign national, provides otherwise. [Sec. 10, D.O. No. 186-17]
5. Qualifications,
6. Monthly salary range and other benefits, if When to apply for renewal
there are any. GR: not earlier than 60 days before expiration
7. Indicate that any person in the Philippines Exceptions:
who is competent, able and willing at the a. Alien needs to leave the country;
time of the application to perform the b. Other similar circumstances that will hinder
services for which the foreign national is the filling of renewal within this prescribed
desired may file an objection at the DOLE period.
Regional Office.
In case of officers to be appointed/elected
Where to file objection a. Before AEP expiration: not later than 15
Regional Office within 30 days after working days after appointment, or before
publication. its expiration, whichever comes later
b. After AEP expiration: before the expiration
Other information that DOLE may refer to of the AEP, renewed for 1 year
a. Philjobnet and PESO Information System c. Within 15 working days after the date of
(PEIS), the PRC Registry of professionals, appointment or election, the foreign
and the TESDA registry of certified workers national shall submit to the issuing
to establish availability or non availability of Regional Office the Board Secretary’s
able and qualified Filipino workers. Certification
Page 24 of 262
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1. The Regional Director shall revoke the 5. Revocation; Cancellation

AEP after 1 month from its issuance, if
no Certification is filed. [Sec. 11, D.O. Grounds for Cancellation [Non-Mi-Fa-Me-
No. 186-17] Con-Te-Mi]
a. Non-compliance with any of the
Expired AEP requirements or conditions for which the
Expired AEP shall be processed as a new AEP was issued;
application subject to the payment of required b. Misrepresentation of facts in the
fees and penalties in relation to Section 17 application including fraudulent
(Penalty for Working without AEP). [Sec. 11, misrepresentation;
D.O. No. 186-17] c. Submission of Falsified or tampered
documents;
4. Denial of Application d. Meritorious objection or information
against the employment of the foreign
Grounds for Denial [Mi-Fa-Co-Mi-CAW-Wo- national;
Ex]: e. Foreign national has been Convicted of a
a. Misrepresentation of facts in the criminal offense or a fugitive from justice;
application including fraudulent f. Employer Terminated the employment of
misrepresentation foreign national;
1. i.e. false statement that has a negative g. Grave Misconduct in dealing with or ill
effect in the evaluation of the treatment of workers. [Sec. 13, D.O. No.
application made knowingly, or without 186-17]
belief in its truth, or recklessly whether
it is true or false; Effect of denial/revocation or cancellation
b. Submission of Falsified documents; Disqualified to re-apply for 10 years in case the
c. Conviction to a criminal offense or a ground for denial or cancellation is:
fugitive from justice in the country or a. Conviction of criminal offense or fugitive
abroad; from justice in the country or abroad; or
d. Grave Misconduct in dealing with or ill b. Grave misconduct in dealing with or ill
treatment of workers; treatment of workers [Sec. 14, D.O. No.
e. Availability of a Filipino who is Competent, 186-17]
Able and Willing to do the job;
f. Worked without valid AEP for more than a Effect of fraudulent application
year; Employers, employer’s or foreign national’s
g. Application for renewal with Expired visa or representatives, and/or agents acting in behalf
with temporary visitor’s visa [Sec. 112, of the applicant found to have filed fraudulent
D.O. No. 186-17] application for AEP for three (3) counts shall be
barred from filing application for a period of five
Effect of Denial (5) years after due process. [Sec. 15, D.O. No.
Denial of application for AEP shall cause the 186-17]
forfeiture of the fees paid by the applicant.
[Sec. 12, D.O. No. 186-17] 6. Appeal
When and where to file

With the Secretary of the DOLE within 10 days
after receipt of denial/cancellation/revocation
order.
The decision of the DOLE Secretary shall be

final and executory unless a motion for
reconsideration is filled within 10 days after
receipt of the decision. No second motion for
Page 25 of 262
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reconsideration shall be allowed. [Sec. 16, General principles in determining if time is

D.O. No. 186-17] considered as hours worked
All hours are hours worked which the employee
7. Penalty is required to give their employer, regardless
of whether or not such hours are spent in
Fines productive labor or involve physical or mental
Working without valid AEP: P10,000 for every exertion.
year or fraction thereof
An employee need not leave the premises of
Employing aliens without valid AEP: P10,000 the work place in order that their rest period
for every year or fraction thereof shall not be counted, it being enough that
they stop working, may rest completely and
Failure to pay penalty: not allowed to employ may leave their work place to go elsewhere,
foreign national for any position [Sec. 17, D.O. whether within or outside the premises of their
No. 186-17] work place. [Sec. 4(b), Rule I, Book III, IRR]
If the work performed was necessary, or it

benefited the employer, or the employee
III. LABOR STANDARDS could not abandon his work at the end of his
normal working hours because he had no
replacement, all time spent for such work shall
Labor Standards refers to the minimum
be considered as hours worked, if the work
requirements prescribed by existing laws, rules
was with the knowledge of his employer or
and regulations relating to wages, hours of
immediate supervisor. [Sec. 4(c), Rule I,
work, cost-of-living allowance and other
Book III, IRR]
monetary and welfare benefits, including
occupational, safety and health standards.
The time during which an employee is inactive
[Maternity Children’s Hospital v. Secretary of
by reason of interruptions in his work
Labor, G.R. 78909 (1989)]
beyond his control shall be considered
working time either:
Note: All Articles from hereon refer to the Labor
a. If the imminence of the resumption of work
Code, unless otherwise indicated.
requires the employee’s presence at the
place of work, or
A. CONDITIONS OF b. If the interval is too brief to be utilized
effectively and gainfully in the employee’s
EMPLOYMENT own interest. [Sec. 4, Rule I, Book III, IRR]
1. Hours of Work Employees exempted or not covered

General rule: Title I: Working Conditions and
a. Principles in determining hours Rest Periods shall apply to employees in all
worked and employees establishments and undertakings whether for
exempted or not covered profit or not. [Art. 82]
Principles in determining hours worked Note: Article 82 applies to the whole of Title I.
Hours worked shall include: This includes Service Incentive Leaves, which
1. All time during which an employee is will be discussed in a separate section.
required to be on duty or to be at a
prescribed workplace; AND Exceptions (i.e. those NOT covered by Title I):
2. All time during which an employee is 1. Government employees [Art. 82; Art. 76]
suffered or permitted to work. [Art. 84] (exception to the exception: Employees
of GOCCs created under the Corporation
Code)
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2. Managerial Employees [Art. 82]

3. Members of the managerial staff [Art. 82] Characteristics of managerial employees
4. Field Personnel [Art. 82] [Sec. 2(b), Rule I, Book III, IRR]
5. Members of the family of the employer who Managerial employees are exempted from the
are dependent on him for support [Art. 82]; coverage of Book III Articles 83 through 96 if
6. Domestic workers or kasambahay [Art. they meet all of the following conditions:
141, RA 10361] (exception to the 1. Their primary duty consists of the
exception: Assignment in a Commercial, management of the establishment in
Industrial or Agricultural Enterprise) which they are employed or of a
7. Persons in the personal service of another department or subdivision thereof.
8. Workers who are paid by result as 2. They customarily and regularly direct the
determined by DOLE regulation [Art. 82] work of two or more employees therein.
3. They have the authority to hire or fire
(1) Government Employees employees of lower rank; or their
suggestions and recommendations as
The terms and conditions of employment of all to hiring and firing and as to the promotion
government employees, including employees or any other change of status of other
of GOCCs, are governed by the Civil Service employees, are given particular weight.
rules and regulations, not by the Labor Code
[Art. 291]. Managerial employees and managerial staff
are determined by their job description and not
However, not all GOCCs are governed by the their job title. [Peñarada v. Baganga Plywood
Civil Service Rules; only those created by Corp., G.R. No. 159577 (2006)]
original charter are governed by the Civil
Service rules: (3) Members of the managerial staff
(supervisory employees)
“Following Sec. 2(i) Art. IX-B of 1987 Phil.
Constitution, the test in determining whether a Definition
government owned corporation is subject to Supervisory employees are those who, in the
the Labor Code or the Civil Service law is interest of the employer, effectively
finding out what created it – if it is created by recommend such managerial actions if the
a special charter, then, Civil Service Law exercise of such authority is not merely
applies, if it is created by the General routinary or clerical in nature but requires the
Corporation Law, then the Labor Code use of independent judgment. [Art. 219(m)]
applies.” [PNOC Energy Development Corp.
v. NLRC, G.R. No. 79182 (1991)] Art. 82 also includes managerial staff
(supervisory employees) in the definition of
(2) Managerial Employees managerial employees. The definition in Art. 82
covers more people than that in Art. 219(m). In
Two definitions of “managerial employee” effect, managerial employees in Art. 82
in the Labor Code: includes supervisors, but Art. 219(m) does not,
1. One whose primary duty consists of the for purposes of the right to self-organization.
management of the establishment in which
they are employed or of a department or
subdivision thereof and to other officers or
members of the managerial staff. [Art. 82]
2. One who is vested with the powers or
prerogatives to lay down and execute
management policies and/or to hire,
transfer, suspend, lay off, recall, discharge,
assign or discipline employees. [Art.
219(m)]
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Managerial Staff is included as they are be determined with reasonable certainty by the
considered managerial employees as well employer. In so doing, an inquiry must be
[Sec. 2(c), Rule I, Book III, IRR] made as to whether or not the employee’s
Officers or members of a managerial staff are time and performance are constantly
also exempted if they perform the following supervised by the employer. [Far East
duties and responsibilities: Agricultural Supply v. Lebatique, G.R. No.
1. Their primary duty consists of the 162813 (2007)]
performance of work directly related to
management policies of their employer; Although the fishermen perform non-
2. Customarily and regularly exercise agricultural work away from petitioner’s
discretion and independent judgment; business offices, the fact remains that
3. (a) Regularly and directly assist a throughout the duration of their work they are
proprietor or a managerial employee under the effective control and supervision
whose primary duty consists of the of petitioner through the vessel’s patron or
management of the establishment in which master. Hence, the fishermen are not “field
he is employed or subdivision thereof; OR personnel”. [Mercidar Fishing Corporation v.
(b) Execute under general supervision NLRC, G.R. No. 112574 (1998)]
work along specialized or technical lines
requiring special training, experience, or (5) Dependent Family Members
knowledge; OR
(c) Execute, under general supervision, Workers who are family members of the
special assignments and tasks; employer, and who are dependent on him for
4. Do not devote more than 20% of their hours their support, are outside the coverage of this
worked in a work week to activities which Title on working conditions and rest periods
are not directly and closely related to the [Art. 82].
performance of the work described in
paragraphs (1), (2) and (3) above. (6) Domestic Helpers (Workers)
Effective recommendatory power Definition

Supervisory employees are those who, in the Domestic worker or “Kasambahay” refers to
interest of the employer, effectively any person engaged in domestic work within
recommend such managerial actions and the an employment relationship such as but not
exercise of such authority is not merely limited to the following:
routinary or clerical in nature but requires the 1. general househelp,
use of independent judgment [Art. 219(m)]. 2. nursemaid or “yaya”,
3. cook,
(4) Field Personnel 4. gardener or
5. laundry person
Field personnel are non-agricultural
employees: "Domestic work" refers to work performed in
1. Who regularly perform their duties away or for a household. [Sec. 3(d), IRR of RA10361]
from the principal or place of business or
branch office of the employer; and "Household" refers to the immediate
2. Whose actual hours of work in the field members of the family or the occupants of the
cannot be determined with reasonable house who are directly and regularly provided
certainty. [Art. 82] services by the kasambahay. [Sec. 3(g), IRR of
RA 10361]
Legal Test: Control & Supervision of
employer
In order to determine whether an employee is
a field employee, it is also necessary to
ascertain if actual hours of work in the field can
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The definition of “Kasambahay” excludes:

1. Any person who performs domestic work Definition
only occasionally or sporadically and not Workers who are paid by results are those
on an occupational basis. whose output rates are in accordance with the
2. Children who are under foster family standards prescribed under Sec. 8, Rule VII,
arrangement, and are provided access to Book Three of these regulations, or where such
education and given an allowance rates have been fixed by the Secretary of Labor
incidental to education [Sec. 4(d), Art. 1, and Employment in accordance with the
RA 10361] aforesaid Section.
3. Service providers,
4. Family drivers. [Sec. 2 of the IRR, These include those who are paid on piece
RA10361] work, “takay,” “pakiao” or task basis, and other
nontime work. [Sec. 2(e), Rule I, Book III, IRR]
Exclusivity of function required
Note that the definition contemplates a Workers under piece-rate employment have no
domestic helper who is employed in the fixed salaries and their compensation is
employer’s home to minister exclusively to the computed on the basis of accomplished tasks.
personal comfort and enjoyment of the That their work output might have been
employer’s family. [Azucena] affected by the change in their specific work
assignments does not necessarily imply that
Thus, it has been held that the following any resulting reduction in pay is tantamount to
personnel are NOT domestic employees: constructive dismissal. It is the prerogative of
1. House-help or laundry-women working in the management to change their assignments
staffhouses of a company, as well as or to transfer them. [Best Wear Garments v. De
drivers, houseboys, or gardeners Lemos and Ocubillo, G.R. No. 191281 (2012)]
exclusively working in the company, the
staffhouses and its premises [Apex Mining Workers paid by results may be grouped into
Company v. NLRC, G.R. No. 94951 two: 1) those whose time and performance is
(1991)] supervised by the employer and 2) those
2. House-help doing chores for the whose time and performance is unsupervised
employer's family, while also fulfilling tasks by the employer [Azucena, p. 289].
connected with the employer's business
(bakery) such as cooking, filling orders, Must be unsupervised to be excluded
baking orders, and other clerical work Those who are engaged on task basis,
[Fernando Co v. Vargas, G.R. No. 195167 purely commission basis, or those who are
(2011)] paid a fixed amount for performing work
irrespective of the time consumed in the
(7) Persons in Personal Service of Another performance thereof are excluded from
receiving benefits such as nightime pay,
Persons in the personal service of another are holiday pay, service incentive leave, inter alia,
not covered by Title I: Working Conditions and provided their time and performance is
Rest Periods if they: unsupervised by the employer. [Labor
a. Perform such services in the employer’s Congress of the Philippines v. NLRC, G.R. No.
home which are usually necessary or 123938 (1998)]
desirable for the maintenance and
enjoyment thereof; or Rule on overtime pay
b. Minister to the personal comfort Workers who are paid by results, if their
convenience or safety of the employer as output rates are in accordance with the
well as the members of his employer’s standards prescribed under Sec. 8, Rule VII,
household. [Sec. 2 (d), Rule I, Book III, Book III, of those regulations, or where such
IRR] rates have been fixed by the Secretary of Labor
(8) Workers Paid by Result (piece-workers) in accordance with the aforesaid section, are
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not entitled to receive overtime pay. [Sec.

2(e), Rule I; Labor Congress of the Philippines b. Compensable Time
v. NLRC, G.R. No. 123938 (1998)]
i. Normal hours of work
Summary of benefits payable
Benefit Unsuper- Supervised General Rule: 8-Hour Labor Law
vised The normal hours of work of any employee
shall not exceed eight (8) hours a day. [Art. 83]
Applicable Yes
statutory Note: Art. 83 of the Labor Code only sets a
minimum wage maximum of number of hours as "normal hours
[Art. 101] of work" but did not prohibit work of less than
eight hours. [Legend Hotel v. Realuyo, G.R.
Night No Yes 153511 (2012)]
differential
[Sec. 1(e), Exception to 8-Hour Law: Work Hours of
Rule II] Health Personnel
Health personnel in:
Service No Yes
incentive leave a. Cities and municipalities with a population
of at least one million (1,000,000) OR
[Sec. 1(d),
Rule V] b. Hospitals and clinics with a bed capacity of
at least one hundred (100)
Holiday pay Yes shall hold regular office hours for eight (8)
[Sec. 8(b), hours a day, for five (5) days a week,
Rule IV] exclusive of time for meals.
13th month Yes, provided the worker HOWEVER, where the exigencies of the
pay [Revised has rendered at least 1 service require that they work for six (6) days
Guidelines on month of service during the or forty-eight (48) hours, they shall be entitled
the calendar year to an additional compensation of at least thirty
Implementation percent (30%) of their regular wage for work on
of the 13th the sixth day.
Month Pay
Law (1987)] “Health personnel" shall include:
Other statutory No Yes 1. Resident physicians, nurses, nutritionists,
benefits [Labor dietitians, pharmacists, social workers,
Congress of laboratory technicians, paramedical
the Philippines technicians, psychologists, midwives,
v. NLRC, G.R. attendants and all other hospital or clinic
No. 123938 personnel. [Art. 83]
(1998)] 2. Medical secretaries [Azucena]
ii. Night shift differential

Not determinative of EER
Payment by result is not determinative of Definition
employer-employee relationship. It is a method Night Shift Differential is the additional
of compensation and does not define the compensation of 10% of an employee’s
essence of the relation. It is a method of regular wage for each hour of work performed
computing compensation, not a basis for between 10pm and 6am. [Art. 86]
determining the existence or absence of
employer-employee relationship. [Tan v. Illustration: If an employee has a regular wage
Lagrama, G.R. No. 111042 (1999)] of P100 for each hour of work performed
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between 10PM and 6AM, he/she shall be paid Work may be performed beyond eight hours a
P110 per hour worked during such time day, provided that the employee is paid an
interval. additional compensation equivalent to his
regular wage plus at least 25% thereof. [Art. 87]
Coverage
Aside from those enumerated under Art. 82 as Overtime work on holiday or rest day
excluded from Title I: Working Conditions and Work performed beyond eight hours on a
Rest Periods, those employed in retail and holiday or rest day shall be paid an additional
service establishments regularly employing not compensation equivalent to the rate of the first
more than five (5) workers are also NOT eight hours on a holiday or rest day plus at least
entitled to Night Shift differential [Sec. 1, Rule 30% thereof. [Art. 87]
II, Book III, IRR]
Computation of additional compensation
Rest days (night-off) Base of Computation: Regular wage – means
Night shift employees are entitled to a weekly regular base pay.
night-off (usually Saturday evening) or a
weekly rest period of 24 hours beginning at the It includes the cash wage only without
start of the night shift [See also Art. 91]. deduction on account of facilities provided by
the employer. [Art. 90]
Work on special days
Night shift employees are also entitled to the It excludes money received in different
premium pay on special days and holidays. concepts, such as Christmas bonus and other
These days are reckoned as calendar days fringe benefits. [Bisig ng Manggagawa ng
which start at midnight and end at the following Philippine Refining Co. v. Philippine Refining
midnight. The premium pay for the night shift Co., G.R. L-27761 (1981)]
also starts or ends at midnight. However, the BUT when the overtime work was performed
employment contract, company policy or CBA on the employee’s rest day or on special
may provide that in the case of night shift days or regular holidays (Art. 93 and 94), the
workers, days—including special days and premium pay, must be included in the
regular holidays—shall begin on the night computation of the overtime pay. [See: p. 19 of
before a calendar day. [Chan, Pre-Week Handbook on Workers’ Statutory Monetary
Guidelines] Benefits, issued by the Bureau of Working
Conditions, 2006]
iii. Overtime work
ILLUSTRATIONS
Overtime compensation is additional pay for Overtime on a Regular Day (OTRD)
service or work rendered or performed in Work may be performed beyond eight (8) hours
excess of eight hours a day by employees or a day provided that the employee is paid for the
laborers covered by the Eight-hour Labor Law. overtime work, an additional compensation
[National Shipyard and Steel Corp. v. CIR, equivalent to his regular wage plus at least
G.R. No. L-17068 (1961)] twenty-five percent (25%) thereof [Art. 87]
Rationale OTRD = Hourly wage x 125% x number of

There can be no other reason than that he is hours of OT work
made to work longer than what is
commensurate with his agreed compensation
for the statutorily fixed or voluntary agreed
hours of labor he is supposed to do. [PNB v.
PEMA, G.R. No. L-30279 (1982)]
Overtime on ordinary working day
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Work on Scheduled Rest Day (WRD) conditions where performance or quality of

Work performed on a rest day shall be paid an work is dependent thereon. [added by Rule
additional compensation equivalent to 30% of 1, Sec. 10]
the regular wage. [Art. 93]
Overtime pay does not preclude night
WRD = Regular Wage x 130% differential pay
When the tour of duty of a laborer falls at
Overtime on Scheduled Rest Day (OTSRD) nighttime [between 10:00pm and 6:00am], the
Where an employee is made or permitted to receipt of overtime pay will not preclude the
work on his scheduled rest day, he shall be right to night differential pay. The latter is
paid an additional compensation of at least payment for work done during the night, while
thirty percent (30%) of his regular wage. An the other is payment for the excess of the
employee shall be entitled to such additional regular eight-hour work. [Naric v. Naric
compensation for work performed on Sunday Workers Union, G.R. No. L-12075 (1959)]
only when it is his established rest day. [Art.
93(a)] SYNTHESIS OF RULES
1. An employer cannot compel an employee
OTSRD = Hourly Wage x 169% x number of to work overtime
hours of OT work Exception: Emergency overtime work as
provided for in Art. 89
Note: 169% was derived by adding 39% (which
is 30% of 130 or 1.3x.3 to 130% 2. Additional compensation is demandable
only if the employer had knowledge and
Emergency overtime consented to the overtime work rendered
Any employee may be required by the by the employee.
employer to perform overtime work in any of Exception: Express approval by a superior
the following cases: NOT a requisite to make overtime
1. When the country is at war or when any compensable:
other national or local emergency has been a. If the work performed is necessary, or
declared by the National Assembly or the that it benefited the company; or
Chief Executive; b. That the employee could not abandon
2. When it is necessary to prevent loss of life his work at the end of his eight-hour
or property or in case of imminent danger work because there was no substitute
to public safety due to an actual or ready to take his place. [Sec. 4(c), Rule
impending emergency in the locality I; Manila Railroad Co. v. CIR, G.R. L-
caused by serious accidents, fire, flood, 4614 (1952)]
typhoon, earthquake, epidemic, or other
disaster or calamity; Note: However, the Court has also ruled
3. When there is urgent work to be performed that a claim for overtime pay is NOT
on machines, installations, or equipment, in justified in the absence of a written
order to avoid serious loss or damage to authority to render overtime after office
the employer or some other cause of hours during Sundays and holidays.
similar nature; [Global Incorporated v. Atienza, G.R. L-
4. When the work is necessary to prevent loss 51612-13 (1986)]
or damage to perishable goods; and
5. Where the completion or continuation of Daily time records cannot prove the
the work started before the eighth hour is performance of overtime work if the same
necessary to prevent serious obstruction or had no prior authorization by the
prejudice to the business or operations of management. [Robina Farms Cebu/
the employer. [Art. 89] Universal Robina Corp. v. Villa, G.R. No.
6. Where overtime work is necessary to avail 175869 (2016)]
of favorable weather or environmental
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3. Compensation for work rendered in excess councils, employee assemblies or

of the 8 normal working hours in a day: referenda.
a. For ordinary days, additional 25% of 2. In firms using substances, chemicals and
the basic hourly rate. processes or operating under conditions
b. For rest day/special day/holiday, where there are airborne contaminants,
additional 30% of the basic hourly rate. human carcinogens or noise prolonged
exposure to which may pose hazards to
4. A given day is considered an ordinary day, employees’ health and safety, there must
unless it is a rest day. be a certification from an accredited
health and safety organization or
5. Undertime does NOT offset overtime. practitioner from the firm’s safety
Undertime work on any particular day shall committee that work beyond eight hours is
not be offset by overtime work on any other within threshold limits or tolerable levels of
day. Permission given to the employee to exposure, as set in the OSHS.
go on leave on some other day of the week 3. The employer shall notify DOLE, through
shall NOT exempt the employer from the Regional Office having jurisdiction over
paying the additional compensation the workplace, of the adoption of the CWW
required in this Chapter. [Art. 88] scheme. The notice shall be in DOLE
CWW Report Form attached to this
Offsetting work on a regular day with work Advisory. [DOLE Advisory No. 02-04]
rendered on a holiday or rest day is prohibited
because such deprives the employee of Effects of CWW
additional pay or premium. [Lagatic v. NLRC, 1. Unless there is a more favorable practice
G.R. No. 121004 (1998)] existing in the firm, work beyond eight
hours will not be compensable by
(a) Compressed work week overtime premium provided the total
(CWW) number of hours worked per day shall not
exceed twelve (12) hours. In any case, any
[DOLE Advisory No. 02, Series of 2004] work performed beyond 12 hours a day or
48 hours a week shall be subject to
A CWW refers to one where the normal overtime premium.
workweek is reduced to less than 6 days but 2. Consistent with Art. 85, employees under a
the total number of work hours of 48 hours per CWW scheme are entitled to meal periods
week shall remain. Under the CWW scheme, of not less than 60 minutes. There shall be
the normal workday goes beyond eight no impairment of the right of the employees
hours but not exceed 12 hours, without the to rest days as well as to holiday pay, rest
corresponding overtime premium. [DOLE day pay or leaves in accordance with law
Advisory No. 04, Series of 2010]. or applicable collective bargaining
agreement or company practice.
In excess of such, the employer is obliged to 3. Adoption of the CWW scheme shall in no
pay the worker the overtime premium. case result in diminution of existing
benefits. Reversion to the normal eight-
Conditions for CWW hour workday shall not constitute a
1. The CWW scheme is undertaken as a diminution of benefits.
result of an express and voluntary
agreement of majority of the covered Rationale: Although the right to overtime pay
employees or their duly authorized cannot be waived as per Cruz v. Yee Sing
representatives. This agreement may be [G.R. No. L-12046 (1959)], D.O. No. 21
expressed through collective bargaining or sanctions the waiver of overtime pay in
other legitimate workplace mechanisms of consideration of the benefits that the
participation such as labor management employees will derive from the adoption of a
compressed workweek scheme, thus:
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1. Where the work is non-manual work in

The compressed workweek scheme was nature or does not involve strenuous
originally conceived for establishments wishing physical exertion;
to save on energy costs, promote greater work 2. Where the establishment regularly
efficiency and lower the rate of employee operates not less than sixteen (16) hours a
absenteeism, among others. Thus, under this day;
scheme, the generally observed workweek of 3. In case of actual or impending
six (6) days is shortened to five (5) days, but emergencies or there is urgent work to be
prolonging the working hours from Monday to performed on machineries, equipment or
Friday without the employer being obliged for installations to avoid serious loss which the
pay overtime premium compensation for work employer would otherwise suffer; OR
performed in excess of eight (8) hours on 4. Where the work is necessary to prevent
weekdays, in exchange for the benefits that will serious loss of perishable goods [par. 1,
accrue to the employees (e.g. savings on meal Sec. 1, Rule I, Book III, IRR]
and snack expenses; longer weekends etc).
[Bisig Manggagawa sa Tryco v. NLRC, et al., The eight-hour work period does not include
G.R. No. 151309 (2008)] the meal break. Employees are not prohibited
from going out of the premises as long as they
(b) Built-in overtime return to their posts on time. Nowhere in the
law may it be inferred that employees must
Composite or Package Pay NOT per se take their meals within the company premises.
illegal; Conditions for Validity [Philippine Airlines v. NLRC, G.R. No. 132805
Composite or “package pay” or “all-inclusive (1999)]
salary” is an arrangement where the
employee’s salary includes the overtime pay. SYNTHESIS OF THE RULES
In other words, the overtime pay is “built-in”. General Rule: Meal periods are NOT
Such arrangement is valid provided that: compensable.
1. There is a clear written agreement
knowingly and freely entered by the Exception:
employee; and It becomes compensable:
2. The mathematical result shows that the 1. Where the lunch period or meal time is
agreed legal wage rate and the overtime predominantly spent for the employer’s
pay, computed separately, are equal to or benefit. [Azucena citing 31 Am. Jur. 881;
higher than the separate amounts legally Duka, Labor Laws and Social Legislation]
due. [Damasco v. NLRC, G.R. 115755 2. Meal periods of 1 hour are deemed
(2000)] compensable when the employee is on
continuous shift. [National Development
c. Non-compensable hours; When Co. v. CIR, G.R. No. L-15422, (1962)]
compensable 3. Shortened meal period of less than 1 hour
(say, 30 minutes) must be compensable.
i. Meal break [Sec. 7, Rule I, Book III, IRR]
General Rule: Subject to such regulations as Note: To shorten meal time to less than 20
the Secretary of Labor may prescribe, it shall minutes is not allowed. If the so-called meal
be the duty of every employer to give his time is less than 20 minutes, it becomes only a
employees not less than sixty (60) minutes REST PERIOD and is considered working
time-off for their regular meals. [Art. 85] time.
Exceptions: Employees may be given a meal
period of not less than twenty (20) minutes Exception to the Exception: Shortened meal
provided that such shorter meal period is breaks upon the employees’ request – NOT
credited as compensable hours worked of the compensable.
employee:
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The employees themselves may request that 2. the employees can use the time effectively
the meal period be shortened so that they can for their own interest.
leave work earlier than the previously
established schedule. [Drilon: Letter to Kodak In this case, the employer may extend the
Philippines, Nov. 27, 1989; Cilindro: BWC- working hours beyond the regular schedule on
WHSD, Opinion No. 197, s. 1998] that day to compensate for the loss of
productive man-hours without being liable for
Conditions for shortened meal breaks upon overtime pay. [Policy Instruction No. 36, May
employee’s request 22, 1978]
1. The employees voluntarily agree in writing
to a shortened meal period of 30 minutes Note: The time during which an employee is
and are willing to waive the overtime pay inactive by reason of work interruptions beyond
for such shortened meal period; his control is considered working time, either if
2. There will be no diminution whatsoever in the imminence of the resumption of work
the salary and other fringe benefits of the requires the employee’s presence at the place
employees existing before the effectivity of of work or if the interval is too brief to be utilized
the shortened meal period; effectively and gainfully in the employee’s own
3. The work of the employees does not interest. [Sec. 4(d), Rule I, Book III, IRR]
involve strenuous physical exertion and
they are provided with adequate “coffee iii. Idle time
breaks” in the morning and afternoon;
4. The value of the benefits derived by the The idle time that an employee may spend for
employees from the proposed work resting and dining which he may leave the spot
arrangement is equal to or or place of work though not the premises of his
commensurate with the compensation employer, is not counted as working time
due them for the shortened meal period as only where the work is broken or is not
well as the overtime pay for 30 minutes as continuous. [National Development Co. v. CIR,
determined by the employees concerned; G.R. No. L-15422 (1962)]
5. The overtime pay of the employees will
become due and demandable if ever they A laborer need not leave the premises of the
are permitted or made beyond 4:30pm; factory, shop or boat in order that his period of
and rest shall not be counted, it being enough that
6. The effectivity of the proposed working he "cease to work", may rest completely and
time arrangement shall be of temporary leave or may leave at his will the spot where he
duration as determined by the Secretary actually stays while working, to go somewhere
of Labor. [BWC-WHSD Opinion No. 197, s. else, whether within or outside the premises of
1998] said factory, shop or boat. If these requisites
are complied with, the period of such rest
ii. Power interruptions or shall not be counted. [Luzon Stevedoring Co.
brownouts v. Luzon Marine Department Union, G.R. No.
L-9265 (1957)]
Brownouts of short duration, but not
exceeding 20 minutes, shall be treated as
hours worked, whether used productively by
the employees or not.
If they last more than 20 minutes, the time

may not be treated as hours worked if:
1. the employees can leave their workplace or
go elsewhere whether within or without the
work premises; OR
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iv. Travel time 2. Attendance in CBA negotiations or

grievance meeting is compensable hours
Travel time [Department of Labor Manual] worked provided that such is stipulated in
Travel from home to work – An employee the CBA. [Department of Labor Manual,
who travels from home before his regular Sec. 4323.03]
workday and returns to his home at the end of 3. Attendance in hearings in cases filed by the
the workday is engaged in ordinary home-to- employee is NOT compensable hours
work travel which is NOT considered hours worked.
worked, EXCEPT: 4. Participation in strikes is NOT
a. When called to travel during emergency; compensable working time.
b. When travel is done through a conveyance
furnished by the employer; Attendance in lectures, meetings, and training
c. Travel is done under vexing and dangerous periods must necessarily beneficial to the
circumstances; employer. [Sec. 6(c), Rule I, IRR]
d. Travel is done under the supervision and
control of the employer. v. Commuting time
Travel that is all in the day’s work – Time Employees performing tasks during their
spent by an employee in travel from jobsite to commute which are not merely incidental to the
jobsite during the workday, must be counted employee’s job, and are primarily for the
as hours worked. Where an employee is benefit of the employer (such as a company
required to report at a meeting place to receive driver performing a carpool service for co-
instructions or to perform other work there, the workers according to an agreement with the
travel from the designated place to the company), are entitled to overtime pay. [Hilario
workplace is part of the day’s work. Rada v. NLRC, G.R. No. 96078 (1992)]
Travel away from home – Travel that keeps vi. Waiting time
an employee away from home overnight is
travel away from home. Travel away from Rest period – short duration or “coffee
home is worktime when it cuts across the break”
employee’s workday. The time is hours worked 1. Rest periods of short duration during
not only on regular working hours but also working hours shall be counted as hours
during the corresponding hours on non- worked. [par. 2, Art. 84, par. 2]
working days. 2. Rest periods or coffee breaks running from
five (5) to twenty (20) minutes shall be
Lectures, meetings, trainings considered as compensable working time.
Attendance at lectures, meetings, training [par. 2, Sec. 7, Rule I, Book III, IRR]
programs, and other similar activities shall
NOT be counted as working time if ALL of the On call
following conditions are met: Compensable work time, if employee is:
1. Attendance is outside of the employee’s 1. Required to remain on call in the
regular working hours; employer’s premises or so close thereto
2. Attendance is in fact voluntary; and 2. That he cannot use the time effectively and
3. The employee does not perform any gainfully for his own purpose shall be
productive work during such attendance. considered as working while on call.
[Sec. 6, Rule I, Book III, IRR]
Note: An employee who is not required to leave
Notes: word at his home or with company officials
1. Attendance in lectures, meetings, and where he may be reached is NOT working
training periods sanctioned or required by while on call. [Sec. 5 (b), Rule I, Book III, IRR]
the employer are considered hours
worked. Inactive due to work interruptions
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The time during which an employee is inactive COMPULSORY WORK ON REST DAY
by reason of interruptions in his work beyond The employer may require his employees to
his control shall be considered working time work on any day:
either: 1. In case of actual or impending
1. If the imminence of the resumption of work emergencies caused by serious accident,
requires the employee's presence at the fire, flood, typhoon, earthquake, epidemic
place of work OR or other disaster or calamity to prevent loss
2. If the interval is too brief to be utilized of life and property, or imminent danger to
effectively and gainfully in the employee's public safety;
own interest. [Sec. 4 (d), Rule I, Book III, 2. In cases of urgent work to be performed on
IRR] the machinery, equipment, or installation,
to avoid serious loss which the employer
2. Rest Periods would otherwise suffer;
3. In the event of abnormal pressure of work
It shall be the duty of every employer, whether due to special circumstances, where the
operating for profit or not, to provide each of his employer cannot ordinarily be expected to
employees a rest period of not less than resort to other measures;
twenty-four (24) consecutive hours after 4. To prevent loss or damage to perishable
every six (6) consecutive normal work days. goods;
[Art. 91 (a)] 5. Where the nature of the work requires
continuous operations and the stoppage of
Preference of the employee work may result in irreparable injury or loss
The employer shall determine and schedule to the employer; and
the weekly rest day of his employees subject to 6. Under other circumstances analogous or
collective bargaining agreement and to such similar to the foregoing as determined by
rules and regulations as the Secretary of Labor the Secretary of Labor and Employment.
and Employment may provide. However, the [Art. 92]
employer shall respect the preference of
employees as to their weekly rest day when Synthesis of the Rules
such preference is based on religious grounds. 1. Rest day of not less than 24 consecutive
[Art. 94 (b)] hours after 6 consecutive days of work.
2. No work, no pay principle applies.
The employee shall make known his 3. If an employee works on his designated
preference to the employer in writing at least rest day, he is entitled to a premium pay.
seven days before the desired effectivity of the 4. Premium pay is additional 30% of the basic
initial rest day so preferred. pay.
5. Employer selects the rest day of his
When the choice of the employee as to his rest employees
day based on religious grounds will inevitably 6. However, employer must consider the
result in serious prejudice or obstruction to the religious reasons for the choice of a rest
operations and the employer cannot normally day.
be expected to resort to other measures, the
employer may so schedule the weekly rest day PREMIUM PAY
of his choice for at least two days in a month. Premium pay refers to the additional
[Rule III, Sec. 4] compensation for work performed within 8
hours on non-work days, such as rest days and
special days.
Coverage [Sec. 7, Rule III, Book III, IRR]

General Rule: All employees
Exceptions:
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1. Those of the government and any of the Work on a Sunday or holiday which is also
political subdivision, including government- a scheduled rest day
owned and controlled corporations; All establishments and enterprises may
2. Managerial employees as defined in Book operate or open for business on Sundays and
III; holidays provided that the employees are given
3. Househelpers and persons in the personal the weekly rest day and the benefits as
service of another; provided in this Rule. [Sec. 2, Rule III, Book III,
4. Workers who are paid by results, including IRR]
those who are paid on piece rate, takay,
pakyaw, or task basis, and other noontime Compensation on rest day/Sunday/holiday
work, if their output rates are in accordance Except those employees referred to under Sec.
with the standards prescribed in the 2, Rule I, Book III:
regulations, or where such rates have been 1. An employee who is made or permitted to
fixed by the Secretary of Labor and work on his scheduled rest day shall be
Employment; paid with an additional compensation of at
5. Field personnel, if they regularly perform least 30% of his regular wage.
their duties away from the principal or 2. An employee shall be entitled to such
branch office or place of business of the ER additional compensation for work
and whose actual hours of work in the field performed on a Sunday only when it is his
cannot be determined with reasonable established rest day.
certainty. 3. An employee shall be paid an additional
compensation of at least 30% of his regular
Premium pay rates [Handbook on Workers wage for work performed on Sundays and
Statutory Monetary Benefits, 2018] holidays, where the nature of the work of
When Work Performed Premium Pay the employee is such that he has no regular
work days and no regular rest days can be
On scheduled rest day 130% of regular scheduled. [Sec. 7, Rule III, Book III, IRR]
wage
CBA on higher premium pay/Rate
On Sunday ONLY IF this 130% of regular Adjustments
is the ESTABLISHED wage Where the collective bargaining agreement or
rest day other applicable employment contract
stipulates the payment of a higher premium
On Sunday and holidays, 130% of regular pay than that prescribed under this Article, the
when no regular work wage employer shall pay such higher rate. [Art. 93
and rest days (d)] The employer and his employees or their
representatives are not prevented from
On any special 130% of regular entering into any agreement with terms more
holiday/special day wage favorable to the employees. [Sec. 9, Rule II,
Book III, IRR]
On any special holiday/ 150% of regular
special day falling on wage Nothing in this rule shall justify an employer in
scheduled rest day reducing the compensation of his employees
for the unworked Sundays, holidays, or other
On a regular holiday 260% of regular rest days, which are considered paid off days
falling on a rest day wage or holidays by agreement or practice subsisting
upon the effectivity of the Code. [Sec. 8, Rule
III, Book III, IRR]
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3. Service Charge Hotel-Nikko v. NUWHRAIN-APL-IUF-Dusit

Hotel Nikko Chapter, G.R. No. 181972
Coverage (2009)]
Employers
This rule shall apply only to establishments Service charge not included in determining
which collect service charges such as: compliance with minimum wage
a. Hotels, restaurants, lodging houses, night In the event that the minimum wage is
clubs, cocktail lounge, massage clinics, increased by law or wage order, service
bars, casinos and gambling houses; charges paid to the covered employees shall
b. Similar enterprises including those entities not be considered in determining the covered
operating primarily as private subsidiaries establishment’s compliance with the increased
of the Government [Sec. 1, DO 206-19, minimum wage. [Sec. 5, DO 206-19, IRR of
IRR of RA11360] RA11360]
Employees In Relation to Collective Bargaining

Shall apply to ALL employees of covered Agreements and Employer-Employee
employers: Agreements
1. Regardless of their positions, designations, Nothing in the Rules shall prevent the employer
or employment status, and and employee from entering into any
2. Irrespective of the method by which their agreement with terms more favorable to the
wages are paid. [Sec. 2 (a), DO 206-19, employees than those granted therein, or be
IRR of RA11360] used to diminish any benefit granted to the
employees under existing laws, agreement
Exceptions AND voluntary employer practice. [Sec. 6, Rule
Managerial employees [Sec. 2 (c), DO 2016- VI, Book III, IRR]
19, IRR of RA11360]
The rule is without prejudice to existing, future
Distribution, amended by RA11360 collective bargaining agreements. [Sec. 7, Rule
Pursuant to the 2019 amendments to Art. 96, VI, Book III, IRR]
all service charges collected by hotels, shall
be distributed completely and equally Synthesis of the Rules
among the covered workers except managerial 1. Service charges must be pooled;
employees, based on actual hours or days of 2. Where a restaurant or similar
work or service rendered, among the covered establishment does not collect service
employees, including those already receiving charges but has a practice or policy of
the benefit of sharing in the service charges. monitoring and pooling tips given
[Sec. 3, DO 206-19, IRR of RA11360] voluntarily by its customers to its
employees, the pooled tips should be
The shares shall be distributed to employees monitored, accounted for and distributed in
not less than once every 2 weeks or twice a the same manner as the services charges
month at intervals not exceeding 16 days. [Sec. [Handbook on Workers’ Statutory
4, DO 206-19, IRR of RA11360] Monetary Benefits, 2018];
3. The amount collected shall be distributed
Notes: completely and equally among the covered
1. The P2,000.00 salary ceiling for workers;
entitlement thereto is no longer applicable. 4. It shall be given twice a month with
2. [The employees’] right to their shares in the intervals of not more than 16 days;
service charges collected by [the employer] 5. Payment of service charges will not be
is distinct and separate from their right to considered in compliance with any
ECOLA; gratification by the [employer] of increase in the minimum wage by law or
one does not result in the satisfaction of the wage order.
other. [Philippine Hoteliers, Inc., Dusit
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Note: Workers in registered barangay micro

B. WAGES business enterprise are only exempted from
the Minimum Wage Law, not from the Title on
Wages [RA 9178].
1. Definition, Components, and a. Wage vs. Salary
Exclusions
Wages and salary are in essence synonymous.
Definition [Songco v. NLRC, G.R. No. L-50999 (1990)]
It is the remuneration or earnings, however
designated: There are slight differences:
1. Capable of being expressed in terms of
money; Wage Salary
2. Whether fixed or ascertained on a time,
Paid for skilled or Paid to white collar
task, piece, or commission basis, or other
unskilled manual workers and denote
method of calculating the same;
labor a higher grade of
3. Payable by an employer to an employee
employment
under a written or unwritten contract of
employment – Not subject to Subject to
a. for work done or to be done; or execution, execution,
b. for services rendered or to be rendered garnishment or garnishment or
[Art. 97(f)] attachment except for attachment [Gaa v.
debts related to CA, G.R. No. L-
Coverage/Exclusions necessities [Art. 44169 (1985)]
Wage includes the fair and reasonable value of 1708]
facilities furnished by the employer to the
employee. [Art. 97(f)] while allowances are
excluded from the basic salary or wage b. Distinguish: Facilities and
computation. [Cebu Institute of Technology v. Supplements
Ople, G.R. No. L-58870 (1987)]
Criterion: In determining whether a privilege is
Note: Fair and reasonable value shall not a facility, the criterion is not so much its kind
include any profit to the employer, or to any but the PURPOSE for which it is given.
person affiliated with the employer. [Art. 97(f)] [Millares v. NLRC & PICOP, G.R. No. 122827
(1999)]
Applicability
The Labor Code Title on wages shall not apply Comparison between Facilities and
to the following [Art. 98 and Sec. 3, Rule VII, Supplements
Book III, IRR]: Facilities Supplements
a. Farm tenancy or leasehold;
b. Household or domestic helpers, including What it is
family drivers and other persons in the
personal service of another; Articles or Extra remuneration or
c. Homeworkers engaged in needlework; services/items of special benefits/
d. Workers in registered cottage industries expense; articles or services/
who actually work at home; EXCLUDES tools of tools of the trade
e. Workers in registered cooperatives when the trade or articles given to or received
so recommended by the Bureau of or service primarily by laborers over and
Cooperative Development upon approval for the benefit of the above their ordinary
of the Secretary of Labor. ER [Sec. 5, Rule 7- earning or wages
A, Book III, IRR] [Sec. 5, Rule 7-A,
Book III, IRR;]
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General Rule: A bonus is an act of gratuity on

Who benefits
the part of the employer, and is a management
For the benefit of For the benefit or prerogative which cannot be forced upon the
the employee and convenience of the employer. [Kamaya Point Hotel v. NLRC, G.R.
his family; for their employer No. 75289, August 31, 1989]
existence and
subsistence Exception: For a bonus to be enforceable:
1. It must have been promised by the
Part of the wage? employer and expressly agreed upon by
the parties; or
Yes [Art. 97] No [Art. 97] 2. It must have had a fixed amount and had
been a long and regular practice on the part
Deductible from wage? of the employer. [American Wire and Cable
Union v. American Wire, G.R. No. 155059,
Yes – part of the No – independent of April 29, 2005]
wage so it is the wage so not
deductible [Art. 97] deductible [Art. 97] See also VI. D. Bonus for a more
comprehensive discussion on company
Requirements for deducting value of practices*
facilities
Mere availment is not sufficient to allow 13th MONTH PAY
deductions from employees’ wages. Before the [PD 851 (The 13th-Month Pay Law) and the
value of facilities can be deducted from the Revised Guidelines on the Implementation of
employees’ wages, the following requisites the 13th Month Pay Law]
must all be attendant:
a. Proof must be shown that such facilities are Coverage
customarily furnished by the trade; General Rule: ALL EMPLOYERS are hereby
b. The provision of deductible facilities must required to pay all their rank and file
be voluntarily accepted in writing by the employees a 13th month pay not later than
employee; and Dec 24 of every year, Provided that they have
c. Facilities must be charged at reasonable worked for at least one (1) month during a
value. [SLL International Cable Specialists calendar year. [Memorandum Order No. 28]
v. NLRC, G.R. No. 172161 (2011)]
N.B.: The law distinguishes managerial
“Customary” means long-established and employees from rank-and-file employees;
constant practice connoting regularity. [Millares hence, managerial employees are not legally
v. NLRC & PICOP, G.R. No. 122827 (1999)] entitled to 13th month pay.
Computation Exempted Employers:

Value of Facilities = Cost of Operation and a. Government, its political subdivisions,
maintenance + Adequate depreciation + including GOCCs except those operating
reasonable allowance (not more than 5.5% essentially as private subsidiaries of the
interest on the depreciated amount of capital Government;
invested by the employer) b. Employers already paying their employees
a 13th month pay or more in a calendar
If the fair rental value is lower than the year or its equivalent at the time of this
computed value, fair rental value will be used. issuance; and
[Rule VII-A, Sec. 6] c. Employers of those who are paid on purely
commission, boundary or task basis and
c. Bonus, 13th Month Pay those who are paid a fixed amount for
performing specific work, irrespective of
BONUS the time consumed in the performance
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thereof (except those workers who are paid work done on rest days and special holidays,
on piece~rate basis, in which case their and pay for regular holidays. Thus, the
employer shall grant them 13th month pay). payments made pursuant thereto, ripened into
benefits enjoyed by the employees, and any
Notes: benefit and supplement being enjoyed by them
“Equivalent” of a 13th month pay includes: cannot be reduced, diminished, discontinued
a. Christmas bonus, mid-year bonus, cash or eliminated by the employer. [Davao Fruits
bonuses; and Corp. v. ALU, G.R. No. 85073 (1993)]
b. Other payments amounting to not less than
1/12 of the basic salary Time of payment
But shall NOT INCLUDE cash and stock General Rule: paid not later than Dec 24 of
dividends, cost of living allowances and all each year.
other allowances regularly enjoyed by the
employee, as well a non-monetary benefits. Exception: ER may give to his employees half
(½) of the required 13th Month Pay before the
Workers paid on a piece-rate basis – paid a opening of the regular school year and the
standard amount for every piece or unit of work other half on or before the 24th of December
produced that is more or less regularly every year.
replicated, without regard to the time spent in
producing the same. Their employer shall grant The frequency of payment of this monetary
them 13th month pay. benefit may be the subject of agreement
between the employer and the recognized CBA
Minimum Amount of the employees.
1/12 of the total basic salary earned by an
employee within a calendar year. Rationale behind 13th Month Pay
a. To further protect the level of real wages
Base Amount from the ravage of world-wide inflation;
General Rule: basic salary shall include: b. There had been no increase in the legal
a. Cost of living allowances (COLA) minimum wage rates since 1970;
integrated into the basic salary of a c. The Christmas season is an opportune
covered employee pursuant to EO 178. time for society to show its concern for the
b. All remunerations or earnings paid by this plight of the working masses so they may
employer for services rendered. properly celebrate Christmas and New
Year. [Whereas clauses of PD 851]
Excluding the allowances and monetary
benefits which are not considered or integrated 13th Month Pay in Special Cases
as part of the regular or basic salary, such as a. Paid by Results: Employees who are paid
the cash equivalent of: on piece work basis are, by law, entitled to
1. Unused vacation and sick leave credits, the 13th Month Pay. [Revised Guidelines
2. Overtime, on the Implementation of the 13th Month
3. Premium, Pay Law]
4. Night differential, b. Fixed or Guaranteed Wage: Employees
5. Holiday pay and, and who are paid a fixed or guaranteed wage
6. Cost-of-living allowances. plus commission are entitled to 13th month
pay (not purely commission); the basis for
Exception: A company practice favorable to computation shall be both their fixed or
the employees had indeed been established if guaranteed wage and commission.
for a considerable length of time, the employer [Revised Guidelines]
had freely, voluntarily and continuously
included in the computation of its employees' c. Those with Multiple Employers:
thirteenth month pay, the payments for sick, Government Employees working part time
vacation and maternity leaves, premiums for in a private enterprise, including private
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educational institutions, as well as electricity, assuming they were given, were

Employees working in two or more private not a proper substitute for the 13th month
firms, whether on full or part time bases, pay required by law. Neither may year-end
are entitled to the required 13th Month rewards for loyalty and service be
Pay from all their private Employers considered in lieu of 13th month pay.
regardless of their total earnings from each [Framanlis Farms, Inc. v. MOLE, G.R. No.
or all their employers. [Revised Guidelines] 72616-17 (1989)]
c. Wage Difference: The difference between
d. Private School Teachers: Private school the minimum wage and the actual salary
teachers, including faculty members of received by the Employee cannot be
universities and colleges, are entitled to the deemed as his 13th month pay as such
required 13th month pay, regardless of the difference is not equivalent to or of the
number of months they teach or are paid same import as the said benefit
within a year, if they have rendered service contemplated by law. [JPL Marketing
for at least one (1) month within a year. Promotions v. CA, G.R. No. 151966
[Revised Guidelines] (2005)]
d. 14th Month Pay is not mandated:
Overload pay is NOT included in the Employers already paying their employees
computation for 13th month pay; overload is a 13th month pay or its equivalent are not
not overtime as it is additional work done covered by this Decree. [Kamaya Point
within the normal shift. [Letran Calamba Hotel v. NLRC, G.R. No. 75289 (1989)]
Faculty v. NLRC, G.R. No. 156225 (2008)] e. Non-inclusion in regular wage: The
mandated 13th month pay need not be
e. Resigned or Separated Employee: An credited as part of regular wage of
Employee who has resigned or whose employees for purposes of determining
services were terminated at any time overtime and premium pays, fringe benefits
before the time for payment of the 13th insurance fund, Social Security, Medicare
month pay is entitled to this monetary and private retirement plans. [Revised
benefit in proportion to the length of time he Rules]
worked during the year, reckoned from the
time he started working during the calendar Commissions vis-à-vis 13th month pay
year up to the time of his resignation or The Rule on Productivity Bonuses.
termination from service. [Revised “Productivity bonuses” have no clear direct or
Guidelines] necessary relation to the amount of work
actually done by each individual employee. If
f. Terminated Employees: The payment of an employer cannot be compelled to pay a
the 13th month pay may be demanded by productivity bonus to its employees, it should
the employee upon the cessation of follow that such productivity bonus, when
employer-employee relationship. [Archilles given, should not be deemed to fall within the
Manufacturing Corp. v. NLRC, G.R. No. “basic salary” of employees when the time
107225 (1995)] comes to compute their 13th month pay. [Boie-
Takeda v. de la Serna, G.R. No. 92174 and
Additional Rules G.R. No. L-102552 (1993)]
a. Commissions: If the commissions may be
properly considered part of the basic The sales commission earned by the salesmen
salary, then they should be INCLUDED. If who make or close a sale constitute part of the
they are not an integral part of the basic compensation or remuneration paid to
salary, then they should be EXCLUDED. salesmen for serving as salesmen, and hence
[Phil. Duplicators Inc. v. NLRC, G.R. No. as part of the “wage” or salary of petitioner’s
110068 (1995)] salesmen. The sale commissions were an
b. Substitute Payment not allowed: integral part of the basic salary structure used
Benefits in the form of food or free as the base amount for the computation of 13th
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month pay. [Phil. Duplicators v. NLRC, G.R. Exceptions:

No. 110068 (1995)] a. Those of the government and any of the
political subdivision, including government-
CBA vis-à-vis 13th month pay owned and controlled corporation;
P.D. No. 851 is specific and mandatory. b. Those of retail and service establishments
However, if the employers actually grant such regularly employing less than 10 workers;
13th month pay in the monetary benefits c. Domestic helpers and persons in the
provided for in the CBA, they could be personal service of another;
exempted from the operation of the decree. To d. Managerial employees and officers or
be exempted, there must be actual payment. members of the managerial staff as defined
[Marcopper Mining Corp. v. Ople, G.R. No. L- in Book III;
51254 (1981)] e. Field personnel and other employees
whose time and performance is
Effect of Deficiency in 13th month pay unsupervised by the employer including
An employer who pays less than 1/12th of the those who are engaged on task or contract
employees’ basic salary as their 13th month basis, purely commission basis, or those
pay is only required to pay the difference. who are paid a fixed amount for performing
[Revised Rules] work irrespective of the time consumed in
the performance thereof. [Sec. 1, Rule IV]
d. Holiday Pay
Retail Establishment is one principally
Holiday pay is a one-day pay given by law to engaged in the sale of goods to end-users for
an employee, even if he does not work on a personal or household use.
regular holiday. This gift of a day’s pay is
limited to each of the 12 regular holidays. Service Establishment is one principally
Note: Art. 94 (c), was superseded by E.O. 203, engaged in the sale of service to individuals for
which was subsequently amended by RA their own or household use and is generally
9177, 9256, 9492, and 9849. The current state recognized as such. [RA 6727 (The Wage
of the law is discussed below. Rationalization Act) IRR]
Coverage Regular holidays

General Rule: All employees [Art. 94(a); Rule RA 9492 and 9849 (which added the two
IV, Sec. 1] Muslim holidays) provide for the observance of
the following regular holidays:
1. New Year’s Day – Jan. 1
2. Maundy Thursday – Movable date
3. Good Friday – Movable date
4. Araw ng Kagitingan – Monday nearest Apr.
9
5. Labor Day – Monday nearest May 1
6. Independence Day – Monday nearest June
12
7. Eid’l Fitr – Movable date
8. Eid’l Adha – Movable date
9. National Heroes Day – Last Monday of
August
10. Bonifacio Day – Monday nearest Nov. 30
11. Christmas Day – Dec. 25
12. Rizal Day – Monday nearest Dec. 30
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Special (Non-Working Days) granted by law to the workingman are

RA 9492 and RA 10966 provide for the determined on the basis of the criteria laid
observance of the following special holidays: down by laws, and not on worker’s faith.
1. Ninoy Aquino Day – Monday nearest Aug. Art. 3(3), PD 1083 states that nothing
21 herein shall be construed to operate to the
2. All Saints Day – Nov. 1 prejudice of a non-Muslim. [San Miguel
3. Immaculate Conception of Mary [RA Corp v. CA, G.R. No. 146775 (2002)]
10966] – Dec. 8
4. Last day of the year – Dec. 31 Holiday pay computation [Art. 94; Rule IV,
Book III, IRR; RA 9424; DOLE Memorandum
Note: Proclamation 269 fixed the data for the Circular 1 Series of 2004]
observance of the regular and special holidays
including additional special holidays for 2018 General Rule: An employer may require an
and 2019 employee to work on a regular holiday but such
employee shall be paid a compensation
The dates for Eid’l Fitr and Eid’l Adha (special equivalent to twice his regular rate. If an
holidays) shall follow after approximate dates employee is required to work on a special
of the Islamic holidays have been determined. holiday, the additional compensation should be
30% of his regular rate.
Arts. 169-173, P.D. 1083 (Code of Muslim
Personal Laws)
Work on
Specifically for the Muslim Areas, P.D. 1083, in Computation
holiday
its Book V, IRR Title, recognizes five (5) Muslim
Holidays, namely: Work on a WRH = Regular wage x
1. Amun Jadid (New Year) which falls on the Regular 200%
first (1st) day of the lunar month of Holiday
Muharram; (WRH) Note: The employer may
2. Mauli-un-Nabi (Birthday of the Prophet require an employee to work
Muhammad) which falls on the twelfth on any holiday but such
(12th) day of the third (3rd) lunar month of employee shall be paid a
Rabi-ul-Awwal; compensation equivalent to
3. Lailatul Isra Wal Mi Rai (Nocturnal Journey twice his regular rate [Art.
and Ascencion of the Prophet 94(b)]
Muhammand) which falls on the twenty-
seventh (27th) day of the seventh (7th) Overtime on OTRH = Hourly wage x
lunar month of Rajab; a Regular 260% x number of hours
4. Id-ul-Fitr (Hari Raja Pausa) which falls on Holiday of OT work
the first (1st) day of the tenth (10th) lunar (OTRH)
month of Shawwal commemorating the Note: Work performed
end of the fasting season; and beyond eight hours on a
5. Id-ul-Adha (Hari Raha Haji) which falls on holiday or rest day shall be
the tenth (10th) day of the twelfth (12th) paid an additional
lunar month of Dhu’l-Hijja. compensation equivalent to
the rate of the first eight
Notes: hours on a holiday or rest
1. Id-ul-Fitr (Eid’l Fitr) and Id-ul-Adha (Eid’l day plus at least thirty
Adha) have been added to the list of percent (30%) thereof. [Art.
national legal holidays [RA 9849]. 87]
2. There should be no distinction between 200% of regular daily wage
Muslims & non-Muslims as regards to (for the 1st 8 hours)+ 60% of
the payment of benefits for Muslim
holidays. Wages & other emoluments
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hourly rate on said day which falls Note: Where such holiday
[260%] on a Rest work falls on the employee’s
Day scheduled rest day, he shall
Work on WRHRD = Regular wage x (WSHRD)  be entitled to an additional
Regular 260%  compensation of at least
Holiday 50% of his regular wage.
which falls Note: Where an employee is Regular daily wage + 50%
on a Rest made or permitted to work thereof [150%]
Day on his scheduled rest day,
(WRHRD)  he shall be paid an Overtime OTWSHRD = Hourly wage
additional compensation of during Work x 195% x number of hours
at least 30% of his regular on Special of OT work
wage. [Art. 93(a)] Holiday
200% of regular daily wage which falls Note: 45% (which is 30% of
+ 60% (which is 30% of on a Rest 150%) + 150% [195%]
200%) [260%] Day
(OTWSHRD)
Overtime on OTWRHRD = Hourly Rate
Regular x 338% x number of hours
Holiday of OT According to DOLE Memo Circular 1-04, a
which falls “special holiday”/”special day” includes the
on a Rest Note: Regular holiday-on- National Special Days, and declared special
Day rest day rate (200% of days such as Special Non-working Holiday,
(OTWRHRD)  regular daily wage plus 30% Special Public Holiday and Special National
of such amount) + 30% of Holiday. Such days are entitled to the rates
hourly rate on said day. prescribed above. These days are not the
[338%] same as a special working holiday.
Work on WSH = Regular wage x A special working holiday is considered an

Special 130% ordinary working day, so there is no premium
Holiday pay.
(WSH) Note: Work performed on
any special holiday shall be Double holiday pay
paid an additional According to “DOLE Explanatory Bulletin on
compensation of at least Worker’s Entitlement to Holiday Pay on 9 April
30% of the regular wage of 1993,” if two holidays fall on the same day:
the employee. [Art. 93(c)] a. If unworked, 200% of basic wage.
b. If worked, 300% of basic wage. [Azucena]
Regular daily wage + 30%
thereof [130%] Double Holiday Rule for Monthly-paid
employees
Overtime OTWSH = Hourly wage x For covered employees whose monthly
during Work 169% x number of hours salaries are computed based on 365 days and
on Special of OT work for those other employees who are paid using
Holiday factor 314, or 262, or any other factor which
(OTWSH) Note: 130% of regular daily already considers the payment for the 11 [now
wage + 39 (which is 30% of 12] regular holidays, NO additional payment is
130%) [169%] due them. [BWC-WHSD Opinion No. 053, s.
1998]
Work on WSHRD = Regular wage x
Special 150% Successive holiday pay
Holiday
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According to IRR, Rule IV, Sec. 10, an overtime pay, holiday pay and leave
employee is entitled to holiday pay for both conversions). [Trans Asia Phils. v. NLRC,
days, IF: supra]
a. He is present on day immediately
preceding first holiday; or Sundays
b. He works on first holiday, which entitles him (See “Work on a Sunday or holiday which is
to pay on second holiday. also a scheduled rest day”)
a. When a holiday falls on a Sunday, the
Where the day immediately preceding the following Monday will not be considered a
holiday is a non-working day in the holiday unless a proclamation says so.
establishment or the scheduled rest day of the b. A legal holiday falling on a Sunday does not
employee, he shall not be deemed to be on create a legal obligation to pay extra, aside
leave of absence on that day, in which case he from the usual holiday pay, to monthly-paid
shall be entitled to the holiday pay if he worked employees. [Azucena, citing Letter of
on the day immediately preceding the non- Instruction No. 1087]
working day or rest day. [Sec. 6, Rule IV, Book
III, IRR] No provision of law requires any employer to
make adjustments in the monthly salary rate
Divisors set by him to take account of legal holidays
The divisor assumes an important role in falling on Sundays in a given year, otherwise to
determining whether or not holiday pay is reckon a year at more than 365 days.
already computed. [Wellington Investment and Manufacturing
a. Monthly paid employees are not entitled to Corporation v. Trajano, G.R. No. 114698
the holiday pay if their total annual income (1995)]
is divided by 365 days resulting in a wage
which is beyond the minimum wage per Non-working/scheduled rest day
day because they are considered paid Where the day immediately preceding the
everyday of the year including holidays, holiday is a non-working day in the
rest days, and other non-working days. establishment or the scheduled rest day of the
b. As a general rule, for a company with a 6- employee, he shall not be deemed to be on
day working schedule, the divisor 313 leave of absence on that day, in which case he
already means that the legal holidays are shall be entitled to the holiday pay if he
included in the monthly pay of the worked on the day immediately preceding
employee. The divisor is arrived at by the non-working day or rest day. [Sec. 6(c),
subtracting all Sundays from the total Rule IV, Book III, IRR]
number of calendar days in a year.
c. As a general rule for a company with a 5- Example:
day working schedule, the divisor 277 If a holiday falls on Monday, and Sunday is a
means that the holiday pay is already non-working day in the establishment or is the
included in the monthly salary of the scheduled rest day of the employee, the
employee. [Trans Asia Phils. v. NLRC, employee shall be entitled to holiday pay if he
G.R. No. 118289 (1999)] worked on Saturday (which is the day
immediately preceding Sunday, the non-
An increase in the divisor that results in the working day or rest day).
prejudice of the employees is a violation of the
proscription against non-diminution of benefits
under Sec. 100 of the Labor Code. Such
increases should only be used for
computations which would be advantageous to
the employer (i.e. deduction for absences) and
not for computations which would diminish the
existing benefits of the employees (i.e.,
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Right to holiday pay in case of absences piece work, his holiday pay shall not be less
If an employee is on leave of absence with pay than his average daily earnings for the last
on the day immediately preceding a regular seven (7) actual working days preceding
holiday, he is entitled to holiday pay. [Sec. 6(a), the regular holiday; Provided, However,
Rule IV, Book III, IRR] that in no case shall the holiday pay be less
than the applicable statutory minimum
If an employee is on leave of absence without wage rate.
pay on the day immediately preceding a c. Seasonal workers may not be paid the
regular holiday, he is not entitled to holiday pay required holiday pay during off-season
unless he works on such regular holiday. [Sec. when they are not at work
6(a), Rule IV, Book III, IRR] d. Workers who have no regular working days
shall be entitled to the benefits provided in
In case of temporary cessation of work this Rule. [Sec. 8, Rule IV, Book III, IRR]
a. In cases of temporary or periodic shutdown
and temporary cessation of work of an Holiday Pay of Hourly-Paid Faculty
establishment, as when a yearly inventory Members
or when the repair or cleaning of Not Entitled: Regular Holiday Pay
machineries and equipment is undertaken, Entitled: Regular hourly rate on days declared
the regular holidays falling within the as special holidays or for some reason classes
periods shall be compensated in are called off or shortened for the hours they
accordance with this Rule. are supposed to have taught, whether
b. The regular holiday during the extensions of class days be ordered or not; in
cessation of operation of an enterprise case of extensions said faculty members shall
due to business reverses as authorized likewise be paid their hourly rates should they
by the Secretary of Labor may not be paid teach during said extensions.
by the employer. [Sec. 7, Rule IV, Book III, a. They are not entitled to payment of
IRR] holiday pay because they are paid only for
work actually done. Since regular
An employee is entitled to holiday pay for the holidays are known to both the school and
regular holidays falling within the period in faculty members as “no class day”;
cases of temporary shutdowns or cessation of certainly the latter do not expect payment
work, when: for said unworked holidays.
a. An annual inventory; or b. They are entitled to their hourly rate on
b. Repair or cleaning of machineries and days declared as special holidays. When
equipment is undertaken. a special public holiday is declared, the
faculty member paid by the hour is
The employer may not pay his employees for deprived of expected income, and it does
the regular holidays during the suspension of not matter that the school calendar is
work if: the cessation of operation is due to extended in view of the days or hours lost,
business reverses, and is authorized by the for their income that could be earned from
Secretary of Labor. other sources is lost during the extended
days.
Teachers, Piece Workers, Seafarers, c. Similarly, when classes are called off or
Seasonal Workers, Etc. shortened on account of typhoons, floods,
a. Private school teachers, including faculty rallies, and the like, these faculty members
members of colleges and universities, may must likewise be paid, whether or not
not be paid for the regular holidays during extensions are ordered. [Jose Rizal
semestral vacations. They shall, however, College v. NLRC, G.R. No. L-65482
be paid for the regular holidays during (1987)]
Christmas vacation; Piece workers
b. Where a covered employee, is paid by The philosophy underlying the exclusion of
results or output, such as payment on piece workers from the 8-hour law is that said
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workers are paid depending upon the work management and employee is that a "fair day's
they do irrespective of the amount of time wage for a fair day's labor." It is hardly fair or
employed in doing said work. [Red V Coconut just for an employee or laborer to fight or litigate
Products Ltd. v. CIR, G.R. No. L-21348 (1966)] against his employer on the employer's time.
[Sugue v. Triumph International, G.R. No.
Seafarers 164804 (2009)]
Any hours of work or duty including hours of
watch-keeping performed by the seafarer on Exception: When the laborer was able,
designated rest days and holidays shall be paid willing and ready to work but was illegally
rest day or holiday pay. [Sec. 11.C, Standard locked out, suspended or dismissed, or
Terms and Conditions Governing the otherwise illegally prevented from working.
Employment of Filipino Seafarers on Board [Sugue v Triumph International, supra]
Ocean-Going Vessels]
d. Non-diminution of benefits
Seasonal workers
Seasonal workers who do not work during off- General Rule: There is a prohibition against
season are not entitled to pay for the regular elimination or diminution of benefits. [Art. 100]
holidays occurring during their off-season.
Workers assigned to “skeleton crews” that No wage order issued by any regional board
work during the off-season have the right to be shall provide for wage rates lower than the
paid on regular holidays falling in that duration. statutory minimum wage rates prescribed by
Congress. [Art. 127, as amended by RA 6727]
2. Principles
Requisites
a. No work, no pay If the following are met, then the employer
cannot remove or reduce benefits [Vergara Jr.
General Rule: If there is no work performed by v. Coca-Cola Bottlers Phils, G.R. No. 176985
the employee, there can be no wage or pay. (2013)]:
1. Ripened company policy – Benefit is
Exception: Unless the laborer was able, founded on a policy which has ripened into
willing and ready to work but was prevented by a practice over a long period;
management or was illegally locked out, 2. Practice is consistent and deliberate; and
suspended or dismissed. [Azucena, citing 3. Not due to error in the construction or
Philippine Airlines v. NLRC, G.R. No. 55159, application of a doubtful or difficult question
June 22, 1989] of law. [Globe Mackay Cable v. NLRC,
G.R. No. L-74156 (1988)]
b. Equal pay for equal work 4. The diminution or discontinuance is done
unilaterally by the employer.
Employees working in the Philippines, if they
are performing similar functions and See also VI. D. Bonus.
responsibilities under similar working
conditions, should be paid equally. If an When not applicable: At least one of the
employer accords employees the same requisites is absent.
position and rank, the presumption is that these a. Mistake in the application of the law [Globe
employees perform equal work. [International Mackay Cable v. NLRC, supra.]
School Alliance of Educators v. Hon. b. Negotiated benefits [Azucena]
Quisumbing, G.R. No. 128845 (2000)] c. Reclassification of Positions – e.g. loss of
some benefits by promotion.
c. Fair wage for fair work d. Contingent or Conditional Benefits – the
rule does not apply to a benefit whose grant
General Rule: The age-old rule governing the depends on the existence of certain
relation between labor and capital or conditions, so that the benefit is not
Page 49 of 262
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demandable if those preconditions are whether the employees in any industry or

absent. enterprise are being compensated in
accordance with the minimum wage
Benefits initiated through negotiation between requirements of this Rule.
Employee and Employer, e.g. CBA, can only b. The basis for the establishment of rates for
be eliminated or diminished bilaterally. piece, output, or contract work shall be the
performance of an ordinary worker of
3. Minimum Wage minimum skill or ability.
c. An ordinary worker of minimum skill or
Definition - “Statutory minimum wage” is the ability is the average worker of the lowest
lowest wage fixed by law that an employer can producing group representing 50% of the
pay his workers. [Rules Implementing RA total number of employees engaged in
6727] similar employment in a particular
establishment, excluding learners,
Payment of statutory minimum wage is apprentices and handicapped workers
mandatory employed therein.
Lack of funds is not a valid defense from paying d. Where the output rates established by the
the statutory minimum wage, which is a employer do not conform with the
mandatory statutory obligation. To uphold such standards prescribed herein, or with the
defense of lack of available funds would render rates prescribed by the DOLE in an
the Minimum Wage Law futile and defeat its appropriate order, the employees shall be
purpose. [De Racho v. Municipality of Ilagan, entitled to the difference between the
G.R. No. L-23542, January 2, 1968] amount to which they are entitled to receive
under such prescribed standards or rates
a. Payment by hours worked and that actually paid them by the
employer. [Sec. 8, Rule VII-A, Book III,
The minimum wage rates for agricultural and IRR]
non-agricultural employees and workers in
each and every region of the country shall be From the above rules, piece rate workers may
those prescribed by the Regional Tripartite be categorized into two:
Wages and Productivity Boards. [Art. 99] 1. Those who are paid piece rates which are
prescribed in Piece Rate Orders issued by
See III. A. 1. Hours of work. DOLE.
b. Payment by results Wages or earnings in this category are

determined by simply multiplying the
The Secretary of Labor and Employment shall number of pieces produced by the rate per
regulate the payment of wages by results, piece. [Azucena]
including pakyao, piecework, and other non-
time work, in order to ensure the payment of These workers are not covered by the Rule
fair and reasonable wage rates, preferably on Hours of Work which provides for
through time and motion studies or in premium and overtime payments.
consultation with representatives of worker’s
and employer’s organizations. [Art. 101] See III. A. 1. a. Principles in determining
hours worked and employees exempted or
Basis of output pay rate not covered for more details.
a. On petition of any interested party, or upon
its initiative, the Department of Labor shall 2. Those who are paid output rates which are
use all available devices, including the use prescribed by the employer and are not yet
of time and motion studies and consultation approved by the DOLE.
with representatives of employers’ and
workers’ organizations, to determine
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The number of pieces produced is multiplied by When payment through check, postal
the rate per piece as determined by the orders or money orders is allowed:
employer. a. When payment is customary (on the date
1. If the resulting amount is equivalent to or of Code effectivity);
more than the applicable statutory b. Where it is so stipulated in a collective
minimum daily rate in relation to the agreement;
number of hours worked, the worker will c. Where all of the following conditions are
receive that amount. met:
2. If the amount is less than the applicable 1. Bank/Facility for encashment is within
legal rate, it is possible that the rates per 1-km radius from the workplace
piece are not in accordance with the 2. ER did not receive any pecuniary
standards prescribed by the rules benefit because of said arrangement
implementing the Labor Code. The 3. EEs are given reasonable time during
employer is thus required by law to pay the banking hours to withdraw their wages
difference between the resulting amount (compensable hours, if during working
and the applicable legal minimum wage hours)
rate. [Azucena] 4. The payment by check is with the
written consent of the EEs concerned,
4. Payment of wages in the absence of a CBA. [Sec. 2, Rule
VIII]
a. Form of Payment [Art. 102;
Secs. 1-2, Rule VIII, Book III, b. Time of Payment [Art. 103; Sec.
IRR] 3, Rule VIII, Book III, IRR]
General Rule: Legal Tender Only Time of Payment
Exception: Check/Money Order if customary Frequency At least once every 2

OR necessary because of special weeks or 2x per month
circumstances, as specified by the Secretary of
Labor or the CBA. Intervals Must not be more than
16 days
Not allowed:
1. Promissory Notes Force Majeure or Valid excuse for
2. Vouchers circumstances delayed payment
3. Tokens beyond ER’s
4. Tickets control BUT ER must pay
5. Chits; or immediately after
6. Any other form alleged to represent a legal cessation and not less
tender, even when expressly requested by than once a month
the employee. [Art. 102]
Tasks which Payments should be
cannot be made with intervals
completed in 2 not more than 16
weeks days, in proportion to
work completed
Final settlement is
made upon completion
of the work.
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c. Place of Payment [Art. 104; Sec. d. Person to Pay [Sec. 5, Rule VIII,
4, Rule VIII, Book III, IRR] Book III, IRR]
General Rule: Shall be made at or near the General Rule: Directly to EE

place of undertaking (workplace).
Exceptions:
Exceptions: 1. Member of EE’s family → if ER is
1. Deterioration of peace and order authorized in writing by the EE.
conditions, or by reason of actual or 2. A 3rd person → if authorized by law (e.g.
impending emergencies (fire, flood, insurance companies for premiums, union
epidemic); dues where the right to check-off has been
2. Free transportation to the employees back recognized by ER in accordance with a
and forth; CBA or authorized in writing by EE
3. Under any other analogous circumstances concerned).
provided, that the time spent by the 3. Heirs → in case of death of EE, without
employees in collecting their wages shall necessity of intestate proceedings.
be considered as compensable hours a. If heirs are of age → they shall execute
worked. an affidavit attesting to their
relationship to the deceased and the
NO PAYMENT in any bar, night or day club, fact that they are his heirs to the
drinking establishment, massage clinic, dance exclusion of others
hall, or other similar places or in places where b. If any of the heirs is a minor → such
games are played with stakes of money or affidavit shall be executed in his behalf
things representing money, except in the case by his natural guardian or next of kin.
of persons employees in such places
When the employer engages the services of an
Condition for ATM payment [Labor organized group of workers, payment to their
Advisory on Payment of Salaries thru ATM leader cannot be considered a violation of the
(1996)] rule on direct payment. [Bermiso v. Escano,
1. ATM system of payment is with the written G.R. No. L-11606 (1959)]
consent of the EEs.
2. EEs are given reasonable time to withdraw 5. Prohibitions regarding wages
their wages from the banking facility
(compensable hours, if during work hours). a. Interference in disposal of wages [Art. 112]
3. System shall allow workers to receive their b. Wage deduction [Art. 113]
wages within the period/frequency c. Requirement to make deposits for loss or
provided by law. damage [Arts. 114-115]
4. There is a bank/ATM facility within 1km d. Withholding of wages [Art. 116]
radius from the place of work. e. Deduction to ensure employment [Art. 117]
5. Upon request of the concerned EEs, the f. Retaliatory measures [Art. 118]
ER shall issue a record of payment of g. False reporting [Art. 119]
wages, benefits and deductions for a
particular period. a. Prohibition against Interference
6. There shall be no additional expenses and in Disposal of Wages
no diminution of benefits and privileges.
7. The ER shall assume responsibility in case No employer shall:
the wage protection provisions of law and 1. Limit or otherwise interfere with the
regulations are not complied with under the freedom of any employee to dispose of his
arrangement. wages
2. Force, compel, or oblige his employees to:
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a. Purchase merchandise, commodities

or other property from any other Note: RA 10142 (FRIA) subsequently
person; or amended Art. 2244, CC and Art. 110 by
b. Make use of any store or services of elevating trade-related claims to 1st priority.
such employer or any other person.
[Art. 112] c. Prohibition Against
Requirement to Make Deposits
b. Prohibition against Wage for Loss or Damage [Art. 114,
Deduction [Art. 113] 115]
General Rule: ER cannot make any deduction General Rule: No employer shall require his
from the wages of his EE. worker to make deposits from which
deductions shall be made for the
Exceptions: reimbursement of loss of or damage to tools,
1. Insurance premiums materials, or equipment supplied by the
2. Union dues employer
3. Other deductions authorized by
law/Secretary of Labor [e.g. SSS, Exception: It is allowed when the employer is
withholding tax] engaged in such trades, occupations or
4. When the deductions are with written business where the practice of making
authorization of the employees for payment deductions or requiring deposits is:
to a third person and the employer agrees 1. A recognized one, or is necessary; or
to do so, provided that the latter does not 2. Desirable as determined by the Secretary
receive any pecuniary benefit, directly or of Labor and Employment in appropriate
indirectly, from the transaction. [Labor rules and regulations. [Art. 114]
Advisory No. 11 (2014)]
No deduction from the deposits of an EE for the
If the law prohibits a deduction, the actual amount of the loss/damage shall be
authorization given by the employee does not made unless:
validate the deduction. 1. There is reasonable opportunity for EE to
show cause why deduction should not be
In case of Bankruptcy or Liquidation of an made;
ER’s business 2. EE’s responsibility has been clearly shown
Workers shall enjoy first preference as regards 3. Amount is fair and reasonable and shall not
their wages and other monetary claims, any exceed the actual loss of damage; and
provision of law to the contrary 4. Must not exceed 20% of weekly pay. [Art.
notwithstanding. Such unpaid wages and 115; Rule VIII, Sec. 11]
monetary claims shall be paid in full before the
claims of the Government and other creditors Attorney’s fees in any judicial or administrative
may be paid. [Art. 110] proceedings for the recovery of wages shall not
exceed 10% of the amount awarded.
Article 110 of the Labor Code has modified
Article 2244 of the Civil Code in two respects: d. Prohibition Against Withholding
1. Firstly, by removing the one year of Wage
limitation found in Article 2244, number 2;
and General Rule: It shall be unlawful for any
2. Secondly, by moving up claims for unpaid person, directly or indirectly, to:
wages of laborers or workers of the 1. Withhold any amount from the wages of a
Insolvent from second priority to first worker or;
priority in the order of preference 2. Induce him to give up any part of his wages
established I by Article 2244. [Republic v. by force, stealth, intimidation, threat or by
Peralta, G.R. 150537 (1987)]
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any other means whatsoever without the 6. Wage determination

worker’s consent. [Art. 116]
a. Wage order
Exceptions:
1. Deduction is for insurance premium Wage Order (WO) – an order issued by the
2. For union dues Regional Tripartite Wages and Productivity
3. Authorized by law/ DOLE Sec Boards (“Regional Boards”) that establishes
4. Due & demandable debt to ER the minimum wage rates to be paid by ERs in
the region, which shall in no case be lower than
e. Prohibition Against Deduction the applicable statutory minimum wage rates.
to Ensure Employment [NWPC Rules of Procedure on Minimum Wage
Fixing].
It shall be unlawful to make any deduction from
the wages of any employee for the benefit of State Policy
the employer or his representative or It is hereby declared the policy of the State to:
intermediary as consideration of a promise 1. Rationalize the fixing of minimum wages
of employment or retention in employment. 2. Promote productivity-improvement and
[Art. 117] gain-sharing measures to ensure a decent
standard of living for the workers and their
f. Prohibition Against Retaliatory families;
Measures 3. To guarantee the rights of labor to its just
share in the fruits of production;
It shall be unlawful for an employer to: 4. To enhance employment generation in the
a. Refuse to pay or reduce the wages and countryside through industry dispersal;
benefits 5. To allow business and industry reasonable
b. Discharge, or returns on investment, expansion and
c. Discriminate in any manner against growth. [Sec. 2, Wage Rationalization Act
any employee who has filed any complaint or (RA 6727)]
instituted any proceeding under this Title or
has testified or is about to testify in such Powers & Functions of the Regional Board
proceedings. [Art. 118] 1. To determine and fix minimum wage rates
applicable in their region, provinces or
This covers offenses only under the title of industries therein
Wages in the Labor Code. 2. To issue the corresponding wage orders,
subject to guidelines issued by the
g. Prohibition Against False Commission [Art. 122]
Reporting
Wage fixing takes place whenever the
It shall be unlawful for any person to make any conditions in the region so warrant, after
statement, report, or record filed or kept investigating and studying all pertinent facts
pursuant to the provisions of this Code knowing and based on the standards and criteria
such statement, report or record to be false in prescribed by the Labor Code. [Art. 123, as
any material respect. [Art. 119] amended by RA 6727]
Covers all offenses under the Labor Code. Standards/Criteria in Wage Fixing
a. The demand for living wages;
b. Wage adjustment vis-a-vis the consumer
price index;
c. The cost of living and changes or increases
therein;
d. The needs of workers and their families;
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e. The need to induce industries to invest in affected by the order of the corresponding
the countryside; increase in the event such order is affirmed
f. Improvements in standards of living; [Art. 123].
g. The prevailing wage levels;
h. Fair return of the capital invested and Grounds for Appeals for Review of WO
capacity to pay of employers; a. Non-conformity with prescribed guidelines
i. Effects on employment generation and and/or procedure
family income; and b. Questions of law
j. The equitable distribution of income and c. Grave abuse of discretion [Sec. 2, Rule V,
wealth along the imperatives of economic Revised Rules of Procedure on Minimum
and social development. [Art. 124, as Wage Fixing]
amended by RA 6727]
Double Indemnity Doctrine
WO Effectivity: After 15 days from its Double Indemnity is the payment to a
complete publication in at least one newspaper concerned EE of the prescribed increase or
of general circulation. [Art. 123] adjustments in the wage rate which was not
paid by an ER in an amount equivalent to 2x
Note: Public hearing and publication are the benefits owing to such employee.
mandatory [Cagayan Sugar Milling Co. v. Sec. [Philippine Hoteliers, Inc. v. National Union of
of Labor, G.R. No. 128399 (1998)]. Workers, GR No. 181972 (2009); RA 6727, as
amended]
Frequency: A WO issued by the Board may
not be disturbed for a period of 12 months from Unpaid Benefits
its effectivity and no petition for wage increase The prescribed wage rates which the ER failed
shall be entertained during said period. [Rule to pay upon the effectivity of a WO, exclusive
IV, Sec. 4, Revised rules of Procedure on of other wage-related benefits.
Minimum Wage Fixing]
Unpaid benefits serve as the principal basis for
Exceptions: computing the double indemnity. [Sec. 2, D.O.
a. When Congress itself issues a law No. 10-98]
increasing wages.
b. Supervening conditions (i.e. extraordinary Wages of apprentices, learners and
increases in prices of petroleum products handicapped workers shall in no case be less
and basic goods/services. than 75% of the statutory minimum wage rates.
[Sec. 10, IRR of RA 6727]
Appeal: Any party aggrieved by the Wage
Order issued by the Regional Board may METHODS OF FIXING
appeal such order to the Commission within a. Floor Wage Method- fixing a determinate
ten (10) calendar days from the publication of amount to be added to the prevailing
such order. It shall be mandatory for the statutory minimum wage rates (e.g. setting
Commission to decide such appeal within sixty P25 increase for min. wage rates).
(60) calendar days from the filing thereof [Art. b. Salary-Ceiling Method- Wage adjustment
123]. to be applied to EEs receiving a certain
denominated salary or workers being paid
Effect of Appeal more than existing min. wage (e.g. WO
General Rule: Does not operate to stay the granting P25 increase to those earning up
order. to P250).
Exception: Party appealing such order shall

file with the Commission an undertaking with a
surety/sureties (surety bond) satisfactory to the
Commission for payment to employees
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not by management prerogative. [Bankards

Employees’ Union v. NLRC, G.R. No. 140689
Floor Wage Salary Ceiling
(2004)]
What it does
HOW TO RESOLVE WAGE DISTORTION
Adds to previous All wages under a certain [Art. 124]
minimum wage wage increases to that Organized Establishment
wage a. Employer and the union shall negotiate to
correct the distortions.
Example b. Disputes shall be resolved through the
grievance procedure.
P456 + P100 = All wages under P456 c. If still unresolved, voluntary arbitration.
P556 must be increased to
P556 Grievance Procedure (under the CBA) → if
unresolved, VOLUNTARY arbitration
b. Wage distortion
Unorganized Establishment
Wage Distortion/Rectification a. ERs and Ees shall endeavor to correct
A situation where an increase in prescribed such distortions.
wage rates results in the elimination or severe b. Disputes shall be settled through the
contraction of intentional quantitative National Conciliation and Mediation Board.
differences in wage or salary rates between c. If still unresolved after 10 calendar days of
and among employee groups in an conciliation, it shall be referred to the
establishment as to effectively obliterate the appropriate branch of the NLRC –
distinctions embodied in such wage structure compulsory arbitration
based on skills, length of service, or other Both the employer and employee cannot
logical bases of differentiation. [Art. 124] use economic weapons.
d. Employer cannot declare a lock-out;
Elements of wage distortion Employee cannot declare a strike because
1. Existing hierarchy of positions with the law has provided for a procedure for
corresponding salary rates; settling
2. A significant change in the salary rate of a e. The salary or wage differential does not
lower pay class without a concomitant need to be maintained. [National
increase in the salary rate of a higher one Federation of Labor v. NLRC, G.R. No.
(must be caused by a wage order) 103586 (1994)]
[Philippine Geothermal Inc. v. Chevron,
G.R. No. 190187 (2018)]; National Conciliation and Mediation Board → if
3. The elimination of the distinction between unresolved, COMPULSORY arbitration by the
the two levels; and NLRC
4. The existence of the distortion in the same
region of the country. [Prubankers Assn. v. CBA vis-à-vis Wage Orders – CBA
Prudential Bank and Co., G.R. No. 131247 creditability
(1999)] In determining an employee’s regular wage,
the pertinent stipulations in the CBA are
The implementation of wage orders in one controlling, provided the result is not less than
region but not in others does not in itself the statutory requirement [Philippine National
necessarily result in wage distortion. Bank v. PEMA, G.R. No. L-30279 (1982)]
[Prubankers Assn. v. Prudential Bank and Co.,
G.R. No. 131247 (1999)] Note: The manner of resolving wage distortion
is largely based on the applicable wage order.
Wage distortion can only exist where the wage The current one for NCR, WO 20, refers to the
adjustment is brought about by a wage order, procedure in Art. 124 of the Labor Code
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The law grants annual SIL of five days to

domestic workers, but their SIL shall not be
C. LEAVES converted to cash or carried over to
succeeding years. [Sec. 5, RA 10361]
Meaning of “1 year of service”

1. Labor Code General Rule: "At least one year service" shall
mean service for NOT LESS than 12 months,
a. Service Incentive Leave (SIL) whether continuous or broken, reckoned from
the date the employee started working,
Coverage including authorized absences and paid
Every employee who has rendered at least one regular holidays.
year of service shall be entitled to a yearly
service incentive leave of five days with pay. Exception: Service for LESS than 12 months
[Art. 95(a)] is counted as “at least one year service” when:
1. The working days of the establishment, as
Service Incentive Leave DOES NOT apply to a matter of practice or policy, is less than
the following employees: 12 months; or
a. Those of the government and any of its 2. The employment contract provides working
political subdivisions, including GOCCs; days that is less than 12 months. [Sec. 3,
b. Domestic helpers and persons in the Rule V, Book III, IRR]
personal service of another;
c. Managerial employees as defined in Book Arbitration or Administrative Action
III of this Code; The grant of benefit IN EXCESS of that
d. Field personnel and other employees provided herein shall not be made a subject of
whose performance is unsupervised by the arbitration or any court or administrative action.
employer including those who are engaged [Art. 95 (c)]
on task or contract basis, purely
commission basis, or those who are paid a
Commutable nature of benefit
fixed amount for performing work
The service incentive leave shall be
irrespective of the time consumed in the
commutable to its money equivalent if not used
performance thereof;
or exhausted at the end of the year. [Sec. 5,
e. Those who are already enjoying the benefit Rule V, Book III, IRR]
herein provided;
f. Those enjoying vacation leave with pay of
When Entitled EE’s Cause of Action
at least 5 days;
Accrues
g. Those employed in establishments
1. If the employee did not make use of said
regularly employing less than 10
leave credits but instead chose to avail
employees. [Sec. 1, Rule V, Book III, IRR]
of its commutation into money:
The cause of action to claim his SIL pay
Piece-rate employees are entitled to service
accrues from the moment the employer
incentive leave pay provided that they are
refuses to remunerate its monetary
supervised. If they are unsupervised, they are
equivalent.
not entitled to SIL. [Labor Congress of the
2. If the employee wishes to accumulate
Phils. v. NLRC, G.R. No. 123938 (1998)]
his leave credits and opts for its
commutation upon his resignation or
Teachers of private school on contract basis
separation from employment:
are entitled to service incentive leave. [Cebu
The cause of action to claim the whole
Institute of Technology v. Ople, G.R. No. L-
amount of his accumulated SIL shall arise
58870 (1987)]
when the employer fails to pay such
amount at the time of his resignation or
separation from employment. [Auto Bus
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Transport v. NLRC, G.R. No. 156367 j. Any family member who assumes the
(2005)] responsibility of head of family as a result
of the death, abandonment,
2. Special laws~ disappearance, or prolonged absence of
the parents or solo parent for at least one
a. Parental leave for solo parents (1) year. [Sec. 3 (a), RA 8972]
[RA 8972 (Solo Parents’ Welfare Act of 2000)] Conditions for Entitlement
A solo parent employee shall be entitled to the
Parental leave for solo parents – Leave parental leave under the following conditions:
benefits granted to a solo parent to enable a. He/she has rendered at least one (1) year
him/her to perform parental duties and of service, whether continuous or broken;
responsibilities where physical presence is b. He/she has notified his/her employer that
required. [Sec. 3 (d), RA 8972] he/she will avail himself/herself of it, within
a reasonable period of time; and
Coverage c. He/she has presented to his/her employer
Any solo parent or individual who is left alone a Solo Parent Identification Card, which
with the responsibility of parenthood due to: may be obtained from the DSWD office of
a. Giving birth as a result of rape or and other the city or municipality where he/she
crimes against chastity even without a final resides. [Sec. 19, Art. V, IRR, RA 8972]
conviction of the offender: Provided, That
the mother keeps and raises the child; Availment
b. Death of spouse; The parental leave is in addition to leave
c. Spouse is detained or is serving sentence privileges under existing laws with full pay,
for a criminal conviction for at least one (1) consisting of basic salary and mandatory
year; allowances. It shall not be more than seven (7)
d. Physical and/or mental incapacity of working days every year. [Sec. 8, RA 8972]
spouse as certified by a public medical
practitioner; Grant of Flexible Work Schedule
e. Legal separation or de facto separation The employer shall provide for a flexible
from spouse for at least one (1) year: working schedule for solo parents: Provided,
Provided, that he/she is entrusted with the That the same shall not affect individual and
custody of the children; company productivity: Provided, further, That
f. Declaration of nullity or annulment of any employer may request exemption from the
marriage as decreed by a court or by a above requirements from the DOLE on certain
church: Provided, that he/she is entrusted meritorious grounds. [Sec. 6, RA 8972]
with the custody of the children;
g. Abandonment of spouse for at least one (1) Protection against Work Discrimination
year; No employer shall discriminate against any
h. Unmarried father/mother who has solo parent employee with respect to terms and
preferred to keep and rear his/her conditions of employment on account of his/her
child/children, instead of having others status. [Sec. 7, RA 8972]
care for them or give them up to a welfare
institution;
i. Any other person who solely provides
parental care and support to a child or
children: Provided, that he/she is duly
licensed as a foster parent by the
Department of Social Welfare and
Development (DSWD) or duly appointed
legal guardian by the court; and
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Termination of the Benefit the probable date of her childbirth, which

A change in the status or circumstance of the notice shall be transmitted to the SSS in
parent claiming the benefit under the law, such accordance with the rules and regulations
that he/she is no longer left alone with the it may provide. [Sec. 1, Rule VI, IRR of
responsibility of parenthood, shall terminate RA11210]
his/her eligibility for these benefits. [Sec. 3 (a),
RA 8972] Maternity leave benefit after termination of
employment possible
See III. E. 7. for discussion on other working General Rule: Maternity leave with full pay
conditions for solo parents* shall be granted even if the childbirth,
miscarriage, or emergency termination of
See also VII. E. for discussion on support for pregnancy occurs not more than 15
solo parents* calendar days after the termination of an
employee’s service.
b. Expanded maternity leave
Exception: When the employment of the
[RA 11210 (105-Day Expanded Maternity pregnant woman worker has been terminated
Leave Law)] without just cause, the employer must pay her
the full amount equivalent to her salary for 105
Expanded Maternity Leave -- Maternity leave days for childbirth and 60 days for miscarriage
of 105 days with full pay, with an option to and emergency termination of pregnancy
extend for an additional 30 days without pay. based on her full pay, in addition to the other
[Sec. 3, RA 11210] applicable daily cash maternity benefits that
she should have received had her employment
Coverage not been illegally terminated. [Sec. 5, Rule IV,
Every female worker in government and the IRR of RA 11210]
private sector, including those in the informal
economy, regardless of civil status or the Benefit received
legitimacy of her child, is entitled to the A daily maternity benefit equivalent to 100% of
maternity leave benefits. her average daily salary credit for:
a. 105 days in cases of live childbirth
This is applicable to pregnancy and b. 60 days in cases of miscarriage or
miscarriage, or emergency termination of emergency termination of pregnancy.
pregnancy, regardless of frequency. [Sec. 3,
RA 11210] The maternity leave can be credited as
combinations of prenatal and postnatal leave
Maternity leave for female workers in as long as it does not exceed 105 days or 60
private sector, requisites days as the case may be. In no case shall
a. Contribution: The female worker must postnatal care be less than 60 days. [Sec. 2,
have paid at least 3 monthly contributions Rule IV, IRR of RA 11210]
in the 12-month period immediately
preceding the semester of her childbirth, In case the employee qualifies as a solo parent
miscarriage, or emergency termination of (see III. C. 2. a., above), the employee shall be
pregnancy. paid an additional maternity benefit of 15 days.
[Sec. 5 (a), RA 11210]
In determining the female member’s
entitlement to the benefit, the SSS shall
consider only those contributions paid prior
to the semester of contingency; and
b. Notice: The female worker shall have

notified her employer of her pregnancy and
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Extended maternity leave option, requisite a. That the maternity leave benefits have not
notice yet been commuted to cash, if applicable;
In cases of live childbirth, an additional and
maternity leave of 30 days, without pay, can be b. That a certified true copy of the death
availed of, at the option of the female worker, certificate or medical certificate or abstract
provided that the employer shall be given is provided to the employers of both the
notice. female worker and the child’s father or
alternate caregiver.
Due notice must be in writing must be given at
least 45 days before the end of the female In case the maternity leave benefits have
worker’s maternity leave. already been paid to the female worker in full,
the child’s father or alternate caregiver shall be
Exception: No prior notice shall be necessary entitled to enjoy the remaining unexpired leave
in the event of a medical emergency, but credits of the female worker, if any.
subsequent notice shall be given to the
employer. Provided, That such leave without pay shall not
be considered a gap in the service of the child’s
The period of extended maternity leave without father or alternate caregiver. [Sec. 4, Rule VIII,
pay shall not be considered a gap in the IRR of RA 11210]
service. [Sec. 3, Rule IV, IRR of RA 11210]
Other conditions
Allocation of maternity leave credits a. Employer shall advance the full payment
A female worker entitled to maternity leave subject to reimbursement by the SSS
benefits may, at her option, allocate up to 7 within 30 days from filing of leave
days of said benefits to the child’s father, application. [Sec. 3, Rule VI, IRR of RA
whether or not the father is married to the 11210]
mother. b. SSS shall immediately reimburse the
employer the maternity benefits advanced
The allocated benefit granted to the child’s to the employed female member, only to
father is over and above the paternity benefits the extent of 100% of her average daily
provided under RA 8187 (Paternity Leave Act). salary credit for 105 days, 120 days or 60
In case of death, absence, or incapacity of the days, as the case may be, upon receipt of
child’s father, the female worker may allocate satisfactory and legal proof of such
to an alternate caregiver who may be: payment. [Sec. 4, Rule VI, IRR of RA
a. A relative within the 4th degree of 11210]
consanguinity; or c. Availment shall be a bar to the recovery of
b. The current partner, regardless of sexual sickness benefits provided under RA 1161
orientation or gender identity, of the female (Social Security Law) for the same period
worker sharing the same household. for which daily maternity benefits have
been received. [Sec. 6, Rule VI, RA 11210]
The option to allocate maternity leave credits d. Sanction: That if an employee should give
shall not be applicable in cases of miscarriage birth or suffer miscarriage or emergency
or emergency termination of pregnancy. [Sec. termination of pregnancy:
1, Rule VIII, IRR of RA 11210] 1. Without the required contributions
having been remitted for her by her
Death or permanent incapacity employer to the SSS, or
If the female worker dies or becomes 2. Without the latter having been
permanently incapacitated, the balance of her previously notified by the ER of time of
maternity leave benefits shall accrue to the the pregnancy,
child’s father or to a qualified alternate the employer shall pay to the SSS
caregiver subject to the following conditions: damages equivalent to the benefits which
Page 60 of 262
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said employee would otherwise have been Conditions for entitlement [Sec. 3, IRR, RA
entitled to. [Sec. 5, RA 11210] 8187]
a. He is married;
c. Paternity leave b. He is an employee at the time of the
delivery of his child
[RA 8187 (Paternity Leave Act of 1996)] c. He is cohabiting with his spouse at the time
that she gives birth or suffers a miscarriage
Paternity Leave – leave of 7 calendar days d. He has applied for paternity leave with his
with full pay for every married male employee ER within a reasonable period of time from
in the private and public sectors the expected date of delivery by his
pregnant spouse, or within such period as
Coverage and Purpose may be provided by company rules and
Paternity leave is granted to all married male regulations, or by CBA; and,
employees in the private and public sectors, e. His wife has given birth or suffered a
regardless of their employment status (e.g. miscarriage.
probationary, regular, contractual, project
basis). Application for paternity leave
See d. under conditions for entitlement.
The purpose of this benefit is to allow the
husband to lend support to his wife during her In case of miscarriage, prior application for
period of recovery and/or in nursing her paternity leave shall not be required. [Sec. 4,
newborn child. [Sec. 3, RA 8187] IRR, RA 8187]
Benefit Non-conversion to cash

It shall be for 7 calendar days, with full pay, In the event that the paternity leave is not
consisting of basic salary and mandatory availed of, it shall not be convertible to cash
allowances fixed by the Regional Wage Board, and shall not be cumulative. [Sec. 7, IRR, RA
if any, provided that his pay shall not be less 8187]
than the mandated minimum wage. [Sec. 2, RA
8187] Crediting of existing benefits
a. If the existing paternity leave benefit under
It shall apply to the first 4 deliveries of the the CBA, contract, or company policy is
employee’s lawful wife with whom he is greater than 7 calendar days as provided
cohabiting. for in RA 8187, the greater benefit shall
prevail.
Cohabiting means the obligation of the b. If the existing paternity leave benefit is less
husband and wife to live together. [Sec. 1, IRR, than that provided in RA 8187, the ER shall
RA 8187] If the spouses are not physically adjust the existing benefit to cover the
living together because of the workstation or difference. [Sec. 9, IRR, RA 8187]
occupation, the male employee is still entitled
to the paternity leave benefit. Where a company policy, contract, or CBA
provides for an emergency or contingency
Usage of the benefit leave without specific provisions on paternity
Usage of the leave shall be after the delivery, leave, the ER shall grant to the employee 7
without prejudice to an employer’s policy of calendar days of paternity leave. [Sec. 9, IRR,
allowing the employee to avail of the benefit RA 8187]
before or during the delivery, provided that the
total number of days shall not be more than 7
days for each covered delivery. [Sec. 5, IRR,
RA 8187]
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d. Gynecological leave Conditions for Entitlement

Any female employee, regardless of age and
[RA 9710 (Magna Carta for Women)] civil status, shall be entitled to a special leave
benefit, provided she has complied with the
Gynecological Leave - A female employee’s following conditions:
leave entitlement of two (2) months with full a. She has rendered at least 6 months
pay from her employer based on her gross continuous aggregate employment service
monthly compensation following surgery for the last 12 months prior to surgery;
caused by gynecological disorders, provided b. She has filed an application for special
that she has rendered continuous aggregate leave
employment service of at least six (6) months c. She has undergone surgery due to
for the last 12 months. gynecological disorders as certified by a
competent physician. [Sec. 2, D.O. No.
Gynecological Disorders 112]
Disorders that would require surgical
procedures such as, but not limited to: Application for Special Leave Before
1. Dilatation and curettage; Surgery
2. Those involving female reproductive The employee shall file her application for
organs such as the vagina, cervix, uterus, leave with her employer within a reasonable
fallopian tubes, ovaries, breast, adnexa period of time from the expected date of
and pelvic floor, as certified by a competent surgery, or within such period as may be
physician; provided by company rules and regulations or
3. Hysterectomy, ovariectomy, and by CBA.
mastectomy.
Application for Special Leave After Surgery
Gross Monthly Compensation Prior application for leave shall not be
The monthly basic pay plus mandatory necessary in cases requiring emergency
allowances fixed by the regional wage boards. surgical procedure, provided that the employer
[Sec. 7, Rule II, IRR, RA 9710] shall be notified verbally or in written form
within a reasonable period of time and provided
Basic Requirement further that after the surgery or appropriate
The woman employee should have been with recuperating period, the female employee shall
the company for 12 months prior to surgery. An immediately file her application using the
aggregate service of at least six (6) months prescribed form. [Sec. 3, D.O. No. 112]
within the said 12-month period is sufficient to
entitle her to avail of the special leave benefit. Period of Entitlement
The 2 months special leave is the maximum
Employment service includes absences with period of leave with pay that a woman
pay such as use of other mandated leaves, employee may avail of under RA 9710.
company-granted leaves and maternity leaves.
For purposes of determining the period of leave
Competent Physician with pay that will be allowed to a female
A medical doctor preferably specializing in employee, the certification of a competent
gynecological disorders or is in the position to physician as to the required period of
determine the period of recuperation of the recuperation shall be controlling. [Sec. 4, D.O.
woman employee. [Sec. 1, D.O. No. 112, as No. 112, as amended]
amended (Guidelines Governing the
Implementation of the Special Leave Benefits Availment
for Women Employees in the Private Sector)] The special leave shall be granted to the
qualified employee after she has undergone
surgery. [Sec. 5, D.O. No. 112, as amended]
Frequency of Availment
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A woman employee can avail of the SLB for A victim leave may be availed of at any time
every instance of surgery due to gynecological during the application of any protection order,
disorder for a maximum total period of 2 investigation, prosecution and/or trial of the
months per year. [Sec. 6, D.O. No. 112, as criminal case [Sec. 42, Rule VI, IRR]
amended]
Requirement
Special Leave Benefit vis-à-vis SSS In order to be entitled to the leave benefit, the
Sickness Benefit only requirement is for the victim-employee to
The SLB is different from the SSS sickness present to her employer a certification from the
benefit. The former is granted by the employer barangay chairman (Punong Barangay) or
in accordance with RA 9710. barangay councilor (barangay kagawad) or
prosecutor or the Clerk of Court, as the case
It is granted to a woman employee who has may be, that an action relative to the matter is
undergone surgery due to gynecological pending [Sec. 42, Rule VI, IRR].
disorder. The SSS sickness benefit, on the
other hand, is administered and given by the The usage of the ten-day leave shall be at the
SSS in accordance with RA 1161 as amended option of the woman employee. In the event
by RA 8282. [Sec. 7, D.O. No. 112, as that the leave benefit is not availed of, it shall
amended] not be convertible into cash and shall not be
cumulative [Sec. 42, Rule VI, IRR].
e. Battered woman leave
When denied; employer’s liability
[RA 9262 (Anti-Violence Against Women and The employer/agency head who denies the
Their Children Act of 2004 or VAWC)] application for leave, and who shall prejudice
the victim-survivor or any person for assisting
Victims of any of the acts covered by VAWC a co-employee who is a victim-survivor under
shall be entitled to take a paid leave of the Act shall be held liable for discrimination
absence up to ten (10) days in addition to and violation of R.A 9262. [Sec. 42, Rule VI,
other paid leaves under the Labor Code and IRR].
Civil Service Rules and Regulations,
extendible when the necessity arises as
specified in the protection order [Sec. 43, RA D. SEXUAL HARASSMENT IN
9262] THE WORK ENVIRONMENT
Acts covered by VAWC
1. “Physical violence” - refers to acts that
1. Definition
include bodily or physical harm
2. “Sexual violence” - refers to an act which is [RA 7877 - Anti-Sexual Harassment Act of
1995; RA 11313 - Safe Spaces Act]
sexual in nature, committed against a
woman or her child.
3. “Psychological violence” - acts or ANTI-SEXUAL HARASSMENT ACT
omissions causing or likely to cause mental Work, education or training-related sexual
or emotional suffering of the victim. harassment is defined in Sec. 3, RA 7877.
4. “Economic abuse” - acts that make or Acts Demanding, requesting or
attempt to make a woman financially covered otherwise requiring any
dependent. sexual favor from the other,
regardless of whether these
Note: To fall under VAWC, the offender must are accepted by the object of
have had a sexual or dating relationship with said Act
the offended woman. Committed An employer, employee,
When availed of by manager, supervisor, agent
of the employer, teacher,
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instructor, professor, coach, a. affecting the dignity of a person, which

trainor, or any other person is unwelcome, unreasonable, and
who, having authority, offensive to the recipient;
influence or moral b. whether done verbally, physically or
ascendancy over another through the use of technology such as
Where In a work or training or text messaging or electronic mail or
education environment through any other forms of information
and communication systems.
Employment or Work-Related Sexual 3. A conduct that is unwelcome and pervasive
Harassment and creates an intimidating, hostile or
1. The sexual favor is made as a condition: humiliating environment for the recipient.
a. in the hiring or in the employment, re-
employment or continued employment Workplaces include all sites, locations, spaces,
of said individual; or where work is being undertaken by an
b. in granting said individual favorable employee within or outside the premises of the
compensation, terms, conditions, usual place of business of the employer. [Sec.
promotions, or privileges; or 18, Rule VI, IRR of RA11313]
c. in the refusal to grant the sexual favor
results in limiting, segregating or 2. Duties and Liabilities of
classifying the EE which in any way Employers
would discriminate, deprive or diminish
employment opportunities or otherwise ANTI-SEXUAL HARASSMENT ACT
adversely affect said employee; Persons who may be liable
2. The above acts would either: 1. Any employer, employee, manager,
a. impair the employee’s rights or supervisor, agent of the employer, teacher,
privileges under existing labor laws; or instructor, professor, coach, trainer or any
b. result in an intimidating, hostile, or other person, regardless of whether the
offensive environment for the demand, request for requirement for
employee. [Sec. 3, RA 7877] submission is accepted by the object of
said act having authority, influence or
SAFE SPACES ACT moral ascendancy over another in a
Gender-based Sexual Harassment (GBSH) work or training or education environment,
in the Workplace who demands, requests or otherwise
The crime of GSBH in the workplace includes requires any sexual favor from another;
the following: 2. Any person who directs or induces another
1. An act or series of acts: to commit any act of sexual harassment as
a. involving any unwelcome sexual herein defined; OR
advances, requests or demand for 3. Any person who cooperates in the
sexual favors or any act of sexual commission by another without which it
nature; would NOT have been committed, shall
b. whether done verbally, physically or also be held liable under this Act. [Sec. 3,
through the use of technology such as RA 7877]
text messaging or electronic mail or
through any other forms of information It is not necessary that the demand, request or
and communication systems; requirement of a sexual favor be articulated in
c. that has or could have a detrimental a categorical oral or written statement. It may
effect on the conditions of an be discerned, with equal certitude, from the
individual's employment or education, acts of the offender. [Domingo v. Rayala, G.R.
job performance or opportunities. No. 155831 (2008)]
2. A conduct of sexual nature and other
conduct based on sex: Role of the employer or Head of Office
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The Employer or Head of Office shall have the Employers, or other persons of authority,
duty: influence or moral ascendancy have the
1. to prevent the commission of such acts and following duties:
2. to lay down the procedure for the a. Disseminate or post a copy of the Safe
resolution, settlement or prosecution of Spaces Act to all persons in the workplace;
committed acts. [Sec. 4, RA 7877] b. Provide measures to prevent GBSH in the
workplace;
He shall be solidarily liable for damages: c. Create an independent internal mechanism
1. if he is informed of such acts by the or a committee on decorum and
offended party, and investigation to investigate and address
2. no immediate action is taken thereon. [Sec. complaints of GBSH;
5, RA 7877] d. Provide and disseminate, in consultation
with all persons in the workplace, a code of
Independent action for damages conduct or workplace policy. [Sec. 17, RA
The victim of work, education or training- 11313]
related sexual harassment can institute a
separate and independent action for damages In addition to liabilities for committing acts of
and other affirmative relief. [Sec. 6, RA 7877] GSBH, employers may also be held
responsible for:
Sanctions a. Non-implementation of their duties under
Criminal: imprisonment of 1 month to mos. or Sec. 17 of this Act (see above), as provided
fine of P10k to P20k or both in the penal provisions; or
b. Not taking action on reported acts of GBSH
Prescription of such action is in 3 years. committed in the workplace.
Termination Any person who violates (a) shall, upon

As a managerial employee, petitioner is conviction, be penalized with a fine of not less
bound by more exacting work ethics. When than P5,000, nor more than P10,000.
such moral perversity is perpetuated against
his subordinate, he provides a justifiable Any person who violates (b) shall, upon
ground for his dismissal for lack of trust and conviction, be penalized with a fine of not less
confidence. [Sec. 7, RA 7877; Libres v. NLRC, than P10,000 nor more than P15,000. [Sec. 19,
G.R. No. 123737 (1999)] RA 11310]
The gravamen of the offense in sexual Independent action for damages

harassment is not the violation of the Nothing shall preclude the victim of work-
employee's sexuality but the abuse of power by related GBSH from instituting a separate and
the employer. Any employee, male or female, independent action for damages and other
may rightfully cry "foul" provided the claim is affirmative relief.
well substantiated. Strictly speaking, there is
no time period within which he or she is 3. Applicable Laws
expected to complain through the proper
channels. [Phil. Aelous Automotive United a. Sexual Harassment Act
Corp. v. NLRC, G.R. No. 124617 (2000)] b. Safe Spaces Act
SAFE SPACES ACT See also D. 1 & 2 above

Anyone who commits any of the acts of GBSH
may be held liable. GBSH may even be
committed between peers, and by a E. WORKING CONDITIONS FOR
subordinate to a superior officer. [Sec. 18, IRR SPECIAL GROUPS OF EMPLOYEES
of RA 11313]
Duties of employers
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1. Apprentices and Learners apprenticeship only in nonhazardous

occupations;
[RA 7796 (Technical Education and Skills 2. Be physically fit for the occupation in which
Development Act of 1994 or TESDA Act of he desires to be trained;
1994)] 3. Possess vocational aptitude and capacity
for the particular occupation as established
a. Apprentices through appropriate tests; and
4. Possess the ability to comprehend and
Definitions follow oral and written instructions.
a. Apprenticeship - training within
employment with compulsory related Trade and industry associations may
theoretical instruction involving a contract recommend to the SOLE appropriate
between an apprentice and an employer on educational qualifications for apprentices
an approved apprenticeable occupation. in certain occupations.
[Sec 4(j), RA 7796] General Rule: Such qualifications, if
b. Apprentice is a person undergoing approved, shall be the educational
training for an approved apprenticeable requirements for apprenticeship in such
occupation during an apprenticeship occupations.
agreement. [Sec 4(k), RA 7796]
c. Apprenticeship Agreement is a contract Exception: The educational qualifications may
wherein a prospective employer binds be waived by an employer in favor of an
himself to train the apprentice, who in turn applicant who has demonstrated exceptional
accepts the terms of training for a ability. A certification explaining briefly the
recognized apprenticeable occupation ground for such waiver, and signed by the
emphasizing the rights, duties and person in charge of the program, shall be
responsibilities of each party. [Sec 4(l), RA attached to the apprenticeship agreement of
7796] the applicant concerned. [Sec. 11, Rule VI,
d. Apprenticeable Occupation is an Book II, IRR]
occupation officially endorsed by a tripartite
body and approved for apprenticeship by Period of Apprenticeship
the Authority. [Sec 4(m), RA 7796] The period of apprenticeship shall not exceed
six months.
Who may employ apprentices
Only employers in highly technical industries Terms and conditions
may employ apprentices and only in Apprenticeship agreements, including the
apprenticeable occupations approved by the wage rates of apprentices, shall conform to the
SOLE. [Art. 60, LC]. rules issued by the Secretary of Labor and
Employment.
The act of filing the proposed apprenticeship
program with the DOLE is a preliminary step Wage rate
towards its final approval, and does not Apprenticeship agreements providing for wage
instantaneously give rise to an employer- rates below the legal minimum wage, which in
apprentice relationship. It must be duly no case shall start below 75 percent of the
approved by the Minister of Labor and applicable minimum wage, may be entered
Employment. [Nitto Enterprises v. NLRC, G.R. into only in accordance with apprenticeship
No. 114337 (1995)] programs duly approved by the Secretary of
Qualifications of apprentice Labor and Employment. [Art. 61, as amended
An apprentice must: by E.O. 111-1986]
1. Be at least fifteen years of age; provided
those who are at least fifteen years of age Apprenticeship without compensation
but less than eighteen may be eligible for The Secretary of Labor and Employment may
authorize the hiring of apprentices without
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compensation whose training on the job is

required by the school or training program Summary of Rules:
curriculum or as requisite for graduation or 1. The apprentice must be paid not less than
board examination. [Art. 72] 75% of the prescribed minimum salary [Art.
61]; HOWEVER, the employer MAY NOT
The wages of apprentices and learners shall in pay any wage if the apprenticeship training
no case be less than seventy-five percent is:
(75%) of the applicable minimum wage rates. a. part of the school curriculum,
[Sec. 7, Wage Order No. NCR-19] b. a requirement for graduation, or
c. a requirement for board examination
Enforcement [Art. 72]
Investigation of violation of apprenticeship 2. The apprenticeship agreement must be
agreement approved by the DOLE Secretary (without
Upon complaint of any interested person or such one shall be deemed a regular
upon its own initiative, the appropriate agency employee) [Nitto Enterprises v. NLRC,
of the DOLE or its authorized representative G.R. No. 114337 (1995)];
shall investigate any violation of an 3. The employer is not compelled to continue
apprenticeship agreement pursuant to such one’s employment upon termination of
rules and regulations as may be prescribed by apprenticeship;
the Secretary of Labor and Employment. [Art. 4. One-half (1/2) of the value of labor training
65] expenses incurred for developing the
productivity and efficiency of apprentices of
Appeal to the Secretary of Labor and the training cost is deducted from the
Employment employer’s income tax, but it shall not
The decision of the authorized agency of the exceed 10% of direct labor wage. [Art. 71]
DOLE may be appealed by any aggrieved
person to the SOLE within five (5) days from Working scholars
receipt of the decision. The decision of the There is no employer-employee relationship
Secretary of Labor and Employment shall be between students on one hand, and schools,
final and executory. [Art. 66] colleges or universities on the other, where
there is written agreement between them under
Exhaustion of administrative remedies which the former agree to work for the latter in
No person shall institute any action for the exchange for the privilege to study free of
enforcement of any apprenticeship agreement charge, provided, the students are given real
or damages for breach of any such agreement, opportunities, including such facilities as may
unless he has exhausted all available be reasonable and necessary to finish their
administrative remedies. [Art. 67] chosen courses under such agreement. [Sec.
14, Rule X, Book III, IRR]
Incentives for employers
An additional deduction from taxable income of
one-half (1/2) of the value of labor training
expenses incurred for developing the
productivity and efficiency of apprentices shall
be granted to the person or enterprise
organizing an apprenticeship program. [Art. 71]
Requisites of the deduction:
1. Apprenticeship program must be duly
approved by the DOLE;
2. Deduction shall NOT exceed 10% of direct
labor wage;
3. Employer must pay his apprentices the
minimum wage. [Art. 71]
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b. Learners Summary of Rules

1. The duration of learnership shall not
Definition exceed 3 months [Art. 73];
Learners are persons hired as trainees in semi- 2. If the learnership of 3 months is completed,
skilled and other industrial occupations: the employer may be compelled to
1. Which are non-apprenticeable; continue with the services of the learner as
2. Which may be learned through practical a regular employee; There is a
training on the job in a relatively short commitment from the employer to employ
period of time, which shall not exceed the learners if they so desire, as regular
three (3) months. [Art. 73; Sec 4(n), RA employees upon completion of the
7796] learnership;
3. If the learner is dismissed from service
When may learners be hired without just and valid cause and without
1. No experienced workers are available; due process after 2 months of service, he
2. The employment of learners being will be deemed as regular employee; [Art.
necessary to prevent the curtailment of 75(d)] and
employment opportunities; and 4. The wages or salary rates of the learners
3. The employment will neither create unfair which shall begin at not less than 75% of
competition in terms of labor costs nor the applicable minimum wage. [Art. 75(c)]
impair working standards. [Art. 74]
Distinctions between Learnership and
Terms and conditions of employment Apprenticeship
Any employer desiring to employ learners shall Apprenticeship Learnership
enter into a learnership agreement with them,
which agreement shall include: Highly technical Semi-skilled
1. The duration of the learnership period, industries industrial
which shall not exceed three (3) months; occupations
2. The wages or salary rates of the learners
which shall begin at not less than seventy- Practical training Practical training
five percent (75%) of the applicable supplemented by whether or not such
minimum wage; and related theoretical practical training is
3. A commitment to employ the learners if instruction supplemented by
they so desire, as regular employees upon theoretical
completion of the learnership. All learners instructions
who have been allowed or suffered to work
during the first two (2) months shall be Apprenticeable Non-apprenticeable
deemed regular employees if training is occupations occupations
terminated by the employer before the end approved by the
of the stipulated period through no fault of SOLE
the learners.
Written apprentice Learnership
The learnership agreement shall be subject to agreement ratified agreement
inspection by the Secretary of Labor and by the appropriate
Employment or his duly authorized committees
representative. [Art. 75]
More than 3 months, Shall not exceed 3
Learners employed in piece or incentive-rate shall not exceed 6 months
jobs during the training period shall be paid in months
full for the work done. [Art. 76]
When apprentice When learner may
may be hired: be hired:
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1. The person is at 1. When no upon completion of

least 15 years of experienced the learnership
age, provided workers are
those who are at available; Deductibility of ½ of No additional
least 15 years of 2. The employment training costs deduction from
age but less of learners is incurred, provided: taxable income for
than 18 may be necessary to Program is duly undertaking a
eligible for prevent recognized by learnership
apprenticeship curtailment of DOLE agreement
only in non- employment Deduction shall
hazardous opportunities; not exceed 10%
occupation; and of direct labor
2. The person is 3. The employment wage
physically fit for does not create Payment of
the occupation in unfair minimum wage
which he desires competition in to apprentice
to be trained; terms of labor
3. The person costs or impair
possesses or lower working
2. Disabled Workers
vocational standards.
aptitude and [RA 7277 - Magna Carta for Disabled Persons,
capacity for the as amended by RA 9442]
particular
occupation as Definitions
established a. Disabled persons are those suffering
through from restriction or different abilities, as a
appropriate result of a mental, physical or sensory
tests; and impairment, to perform an activity in the
4. The person is manner or within the range considered
able to normal for a human being. [Sec. 4(a), RA
comprehend and 7277]
follow oral and b. Impairment is any loss, diminution or
written aberration of psychological, physiological,
instructions. or anatomical structure or function. [Sec.
4(b), RA 7277]
Wage rate shall Wage rate shall c. Disability shall mean (1) a physical or
begin at not less begin at not less mental impairment that substantially limits
than 75% of the than 75% of the one or more psychological, physiological or
minimum wage minimum wage anatomical function of an individual or
activities of such individual; (2) a record of
No compensation if Learners in such an impairment; (3) being regarded as
SOLE authorizes, as piecework shall be having such an impairment. [Sec. 4(c), RA
OJT is required by paid in full for the 7277]
the school [Art. 72]. work done d. Handicap refers to a disadvantage for a
given individual, resulting from an
The employer is not Learnership impairment or a disability, that limits or
compelled to agreement must prevents the function or activity, that is
continue one’s contain a considered normal given the age and sex
employment upon commitment to of the individual. [Sec. 4(d), RA 7277]
termination of employ the learners Coverage
apprenticeship if they so desire, as RA 7277 covers all disabled persons and, to
regular employees the extent herein provided, departments,
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offices and agencies of the National In the placement of disabled persons in

Government or nongovernment organizations sheltered employment, it shall accord due
involved in the attainment of the objectives of regard to the individual qualities, vocational
this Act. [Sec. 3, RA 7227] goals and inclinations to ensure a good
working atmosphere and efficient production.
a. Equal opportunity [Sec 6, RA 7277]
Rights of disabled workers 4. Full minimum wage

1. Equal opportunity for employment
All qualified handicapped workers shall
No disabled person shall be denied access to receive the full amount of the minimum wage
opportunities for suitable employment. A rate prescribed herein. [Sec 7, Wage Order No.
qualified disabled EE shall be subject to the NCR-19]
same terms and conditions of employment and
the same compensation, privileges, benefits, A Qualified Individual with a Disability shall
fringe benefits, incentives or allowances as a mean an individual with a disability who, with or
qualified able-bodied person. [Sec. 5 (par. 1), without reasonable accommodations, can
RA 7277] perform the essential functions of the
employment position that such individual holds
Once they are regular employees, they are or desires.
entitled to the benefits granted by law which the
parties cannot stipulate away. [Bernardo v. However, consideration shall be given to:
NLRC, 310 SCRA 186 (1999)] 1. The employer’s judgement as to what
functions of a job are essential
2. Reserved contractual positions 2. The written description prepared by the
employer before advertising or interviewing
5% of all casual, emergency and contractual applicants for the job, which shall be
positions in the DSWD; DOH, DepEd; and considered evidence of the essential
other government agencies, offices or functions of the job. [Sec. 2(l), RA 7277
corporations engaged in social development (Magna Cart for Persons with Disability, as
shall be reserved for disabled persons. [par. 2, amended by RA 9442)]
Sec. 5, RA 7277]
A qualified disabled EE should be given the
3. Sheltered employment same terms and conditions of employment as
a qualified able-bodied person. Since the
Definition Magna Carta accords them the rights of
The provision of productive work for disabled qualified able-bodied persons, they are thus
persons through workshop providing special covered by Art. 280 of the Labor Code. In the
facilities, income producing projects or present case, the handicap of petitioners (deaf-
homework schemes. [Sec 4(i), RA 7277] mutes) is NOT a hindrance to their work. The
eloquent proof of this statement is the repeated
Purpose renewal of their employment contracts.
To give them the opportunity to earn a living [Bernardo v. NLRC, G.R. No. 122917 (1999)]
thus enabling them to acquire a working
capacity required in open industry. [Sec 4(i),
RA 7277]
If suitable employment for disabled persons

cannot be found through open employment,
the State shall endeavor to provide it by means
of sheltered employment.
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Apprenticeship Opportunities 5. Favoring a non-disabled employee over a

Disabled persons shall be eligible as qualified disabled employee with respect to
apprentices or learners: Provided, that: promotion, training opportunities, study
1. Their handicap is NOT as much as to and scholarship grants, solely on account
effectively impede the performance of job of the latter's disability;
operations in the particular occupation for 6. Re-assigning or transferring a disabled
which they are hired; employee to a job or position he cannot
2. After the lapse of the period of perform by reason of his disability;
apprenticeship, if found satisfactory in the 7. Dismissing or terminating the services of a
job performance, they shall be eligible for disabled employee by reason of his
employment. [Art. 81; Sec. 7, RA 7277; disability unless the employer can prove
Bernardo v. NLRC, supra.] that he impairs the satisfactory
performance of the work involved to the
b. Discrimination on employment prejudice of the business entity: Provided,
however, That the employer first sought to
No entity, whether public or private, shall provide reasonable accommodations for
discriminate against a qualified disabled disabled persons;
person by reason of disability in regard to: 8. Failing to select or administer in the most
1. Job application procedures effective manner employment tests which
2. The hiring, promotion, or discharge of accurately reflect the skills, aptitude or
employees other factor of the disabled applicant or
3. Employee compensation employee that such tests purports to
4. Job training measure, rather than the impaired sensory,
5. Other terms, conditions, and privileges of manual or speaking skills of such applicant
employment. or employee, if any; and
9. Excluding disabled persons from
Acts of Discrimination: membership in labor unions or similar
1. Limiting, segregating or classifying a organizations. [Sec. 32, RA 7277]
disabled job applicant in such a manner
that adversely affects his work Occasions when a Disabled Applicant may
opportunities; be Subjected to Medical Examination
2. Using qualification standards, employment Upon an offer of employment, a disabled
tests or other selection criteria that screen applicant may be subjected to medical
out or tend to screen out a disabled person examinations, on the following occasions:
unless such standards, tests or other 1. All entering employees are subjected to
selection criteria are shown to be job- such an examination regardless of
related for the position in question and are disability;
consistent with business necessity; 2. Information obtained during the medical
3. Utilizing standards, criteria, or methods of condition or history of the applicant is
administration that: collected and maintained on separate
a. have the effect of discrimination on the forms and in separate medical files and is
basis of disability; or treated as a confidential medical record;
b. perpetuate the discrimination of others Provided, however, That:
who are subject to common a. Supervisors and managers may be
administrative control. informed regarding necessary
4. Providing less compensation, such as restrictions on the work or duties of the
salary, wage or other forms of employees and necessary
remuneration and fringe benefits, to a accommodations;
qualified disabled employee, by reason of b. First aid and safety personnel may be
his disability, than the amount to which a informed, when appropriate, if the
non-disabled person performing the same disability may require emergency
work is entitled; treatment;
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c. Government officials investigating Constitutional basis

compliance with this Act shall be The State recognizes the role of women in
provided relevant information on nation-building, and shall:
request; and a. Ensure the fundamental equality before the
d. The results of such examination are law of women and men;
used only in accordance with this Act b. Protect working women by providing:
[Sec. 33, RA 7277]. 1. Safe and healthful working conditions,
taking into account their maternal
c. Incentives for employers functions, and
2. Such facilities and opportunities that
For employment of disabled persons - will enhance their welfare and enable
additional deduction, from their gross income, them to realize their full potential in the
equivalent to 25% of the total amount paid as service of the nation. [Sec. 14, Art. II &
salaries and wages to disabled persons: Sec. 14, Art. XIII, 1987 Constitution]
a. Private entities that employ disabled
persons either as regular EEs, apprentice a. Discrimination
or learner;
b. Provided such entities present proof as It shall be unlawful for any employer to
certified by the DOLE and the DOH [Sec. discriminate against any woman employee with
8[b], RA 7277] respect to terms and conditions of employment
solely on account of her sex.
For construction of disabled-friendly
facilities - additional deduction from their net The following are acts of discrimination:
taxable income, equivalent to 50% of the direct a. Payment of a lesser compensation,
costs of the improvements or modifications: including wage, salary or other form of
a. Private entities that improve or modify their remuneration and fringe benefits, to a
physical facilities in order to provide female employee as against a male
reasonable accommodation for disabled employee, for work of equal value; and
persons; b. Favoring a male employee over a female
b. Does NOT apply to improvements or employee with respect to promotion,
modifications or facilities required under training opportunities, study and
BP 344. [Sec. 8 (c), RA 7277] scholarship grants solely on account of
their sexes. [Art. 133]
For establishments giving discounts – may
claim such discounts as tax deductions based The Magna Carta of Women provides that the
on the net cost of the goods sold or services State:
rendered: 1. Condemns discrimination against women
a. The cost of the discount shall be allowed in all its forms
as deduction from gross income for the 2. Pursues by all appropriate means and
same taxable year that the discount is without delay the policy of eliminating
granted discrimination against women in keeping
b. The total amount of the claimed tax with the Convention on the Elimination of
deduction net of VAT if applicable, shall be All Forms of Discrimination Against
included in their gross sales receipts for tax Women (CEDAW) and other international
purposes and shall be subject to proper instruments consistent with Philippine law.
documentation and to the provisions of the 3. Shall accord women the rights, protection,
National Internal Revenue Code, as and opportunities available to every
amended. [Sec. 32, RA 7277, as amended member of society
by RA 9442] 4. Shall take steps to review and, when
necessary, amend and/or repeal existing
3. Gender laws that are discriminatory to women
within three (3) years from the effectivity of
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this Act. [Sec. 2 & Sec. 12, Magna Carta of A personal or marital relationship with an
Women] employee of a competitor might compromise
the interests of the company. Thus an
b. Stipulation against marriage [Art. 134; employer policy prohibiting the same may be
Sec. 13(e), Rule XII] held as valid [Duncan Association of Detailmen
v. Glaxo Wellcome, supra.]
It shall be unlawful for an employer to:
1. require as a condition of employment or c. Prohibited acts [Art. 135]
continuation of employment that a woman
employee shall not get married, or 1. Discharge to prevent enjoyment of
2. stipulate expressly or tacitly that upon benefits.
getting married a woman employee shall To deny any woman employee the benefits
be deemed resigned or separated or provided for in this Chapter or to discharge
3. actually dismiss, discharge, discriminate or any woman employed by him for the
otherwise prejudice a woman employee purpose of preventing her from enjoying
merely by reason of her marriage. [Art. 134; any of the benefits provided under this
Duncan Assoc of Detailman – PTGWO v. Code. [Art. 135 (1), as amended by R.A.
Glaxo Wellcome, G.R. No. 162994 (2004)] 6725]
The Magna Carta of Women protects women 2. Discharge on account of pregnancy.

against discrimination in all matters relating to To discharge such woman on account of
marriage and family relations, including the her pregnancy, while on leave or in
right to choose freely a spouse and to enter confinement due to her pregnancy. [Art.
into marriage only with their free and full 135 (2)]
consent.
3. Discharge or refusal of the admission to
Bona fide occupational qualification work
exception To discharge or refuse the admission of
While a marriage or no-marriage qualification such woman upon returning to her work for
may be justified as a "bona fide occupational fear that she may again be pregnant. [Art.
qualification," the employer must prove two 135 (3)]
factors necessitating its imposition, viz:
1. that the employment qualification is 4. Discharge on account of testimony
reasonably related to the essential To discharge any woman or child or any
operation of the job involved; and other employee for having filed a complaint
2. that there is a factual basis for believing or having testified or being about to testify
that all or substantially all persons meeting under the Code [Sec. 13 (d), Rule XII, Book
the qualification would be unable to III, IRR]
properly perform the duties of the job.
[Capin-Cadiz v. Brent Hospital and 5. Expulsion of Women faculty/female
Colleges, Inc., G.R. No. 187417 (2016)]. student due to pregnancy outside of
marriage
When the employer can prove that the Expulsion and non-readmission of women
reasonable demands of the business require a faculty due to pregnancy outside of
distinction based on marital status, and there is marriage shall be outlawed. No school
no better available or acceptable policy which shall turn out or refuse admission to a
would better accomplish the business purpose, female student solely on the account of her
an ER may discriminate against an EE based having contracted pregnancy outside of
on the identity of the EE’s spouse. [Star Paper marriage during her term in school. [Sec.
Corp. v. Simbol, G.R. No. 164774 2006] 13(c), RA 9710]
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d. Facilities for women [Art. 130]

4. Minors
The Secretary of Labor shall establish
standards that will insure the safety and health Relevant Laws: RA 7610 (Special Protection
of women employees. In appropriate cases, he of Children Against Abuse, Exploitation and
shall by regulations, require employers to: Discrimination Act), RA 9231 (Special
a. Provide seats proper for women and permit Protection of Children Against Child Abuse,
them to use such seats when they are free Exploitation and Discrimination Act), Art.
from work and during working hours, 137(a)
provided they can perform their duties in
this position without detriment to efficiency; Constitutional basis
b. To establish separate toilet rooms and The State recognizes the vital role of the youth
lavatories for men and women and provide in nation-building and shall promote and
at least a dressing room for women; protect their physical, moral, spiritual,
c. To establish a nursery in a workplace for intellectual, and social well-being. It shall
the benefit of the woman employees inculcate in the youth patriotism and
therein; and nationalism, and encourage their involvement
d. To determine appropriate minimum age in public and civic affairs. [Sec. 13, Art. II, 1987
and other standards for retirement or Constitution]
termination in special occupations such as
those of flight attendants and the like. [Sec. General Rule: Children below 15 shall NOT be
130] employed.
Subject to the approval of the SOLE, the Exception (Employment of Children)

Bureau of Women and Young Workers (The Children below fifteen (15) years of age shall
BWYW merged into the Bureau of Workers not be employed except:
with Special Concerns in 2010), shall, within 30 a. When a child works directly under the sole
days from the effective date of these Rules, responsibility of his/her parents or legal
determine in an appropriate issuance: guardian and where only members of
1. The work situations for which the facilities his/her family are employed: Provided,
enumerated in Art. 130 of the Code shall be however, That his/her employment neither
provided; endangers his/her life, safety, health, and
2. The appropriate minimum age and morals, nor impairs his/her normal
standards for retirement or termination of development: Provided, further, That the
employment in special occupation in which parent or legal guardian shall provide the
women are employed. [Sec. 14, Rule XII, said child with the prescribed primary
Book III, IRR] and/or secondary education; or
a. Where a child's employment or
e. Women working in night clubs, participation in public entertainment or
etc. [Art. 136] information through cinema, theater, radio,
television or other forms of media is
Any woman who: essential: Provided, That the employment
1. Is permitted or suffered to work, with or contract is concluded by the child's parents
without compensation; or legal guardian, with the express
2. In any night club, cocktail lounge, massage agreement of the child concerned, if
clinic, bar or similar establishments; possible, and the approval of the
3. Under the effective control or supervision Department of Labor and Employment:
of the employer for a substantial period of Provided, further, That the following
time as determined by the SOLE; requirements in all instances are strictly
shall be considered as an employee of such complied with:
establishment for purposes of labor and social
legislation. [Art. 136]
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1. The employer shall ensure the Exceptions

protection, health, safety, morals and a. Child works directly under the sole
normal development of the child; responsibility of his parents or legal
2. The employer shall institute measures guardian and where only members of the
to prevent the child's exploitation or employer’s family are employed, provided:
discrimination taking into account the 1. his employment does NOT endanger
system and level of remuneration, and his life, safety, health and morals,
the duration and arrangement of 2. nor impairs his normal development,
working time; and and
3. The employer shall formulate and 3. the parent or legal guardian shall
implement, subject to the approval and provide the said minor child with the
supervision of competent authorities, a prescribed primary and/or secondary
continuing program for training and education; [Sec. 12 of RA 7610, as
skills acquisition of the child. amended by RA 7658]
b. Child’s employment or participation in
In the above-exceptional cases where any public entertainment or information through
such child may be employed, the employer cinema, theater, radio or television is
shall first secure, before engaging such child, a essential, provided that [Sec. 12 of RA
work permit from the DOLE which shall ensure 7610, as amended by RA 7658]:
observance of the above requirements. 1. employment does NOT involve ads or
commercials promoting alcohol,
For purposes of this Article, the term "child" tobacco and its by-products or violence
shall apply to all persons under eighteen (18) [Sec. 14, RA 7610]
years of age. [Sec. 2, RA 9231] 2. the employment contract is concluded
by the child’s parents or guardian, and
Children - refers to any person under 18 years approved by DOLE
of age or those over but are unable to fully take 3. The ER shall ensure the protection,
care of themselves or protect themselves from health, safety and morals of the child
abuse, neglect, cruelty, exploitation or 4. The ER shall institute measures to
discrimination because of a physical or mental prevent the child’s exploitation or
disability or condition. [Sec. 2, RA 7610] discrimination taking into account the
system and level of remuneration, and
Child labor - refers to any work or economic the duration and arrangement of
activity performed by a child that subjects working time
him/her to any form of exploitation or is harmful 5. The ER shall formulate and implement,
to his/her health and safety or physical, mental subject to the approval and supervision
or psychosocial development. of competent authorities, a continuing
program for training and skills
Working child - refers to any child engaged as acquisition of the child. [Sec. 12 of RA
follows: 7610, as amended by RA 7658]
1. when the child is below eighteen (18) years
of age, in work or economic activity that is
not child labor as defined in the
immediately preceding subparagraph; and
2. when the child is below fifteen (15) years of
age, in work where he/she is directly under
the responsibility of his/her parents or legal
guardian and where only members of the
child‘s family are employed; or in public
entertainment or information. [Sec. 3, D.O.
No. 65-04]
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Employment of Children from 15 to 18 4. Involves the use of dangerous

Employment is allowed even without permit but machinery, equipment and tools such
restricted to non-hazardous work. as power-driven or explosive power-
actuated tools; or
Non-hazardous work shall mean any work or 5. Exposes the child to physical danger
activity in which the EE is not exposed to any such as, but not limited to the
risk which constitutes an imminent danger to dangerous feats of balancing, physical
his safety and health. [Sec. 3, Rule XII, Book strength or contortion, or which
III, IRR] requires the manual transport of heavy
loads; or
The Secretary of Labor shall from time to time 6. Is performed in an unhealthy
publish a list of hazardous work and activities environment exposing the child to
in which persons 18 years of age and below hazardous working conditions,
cannot be employed [Sec. 3, Rule XII, Book III, elements, substances, co-agents or
IRR] processes involving ionizing, radiation,
fire, flammable substances, noxious
The following are HAZARDOUS components and the like, or to extreme
workplaces: temperatures, noise levels, or
See DO 149-16 as amended by DO 149-A-17, vibrations; or
Sec. 6 7. Is performed under particularly difficult
conditions; or
Worst Forms of Child Labor 8. Exposes the child to biological agents
a. All forms of slavery, as defined under the such as bacteria, fungi, viruses,
"Anti-trafficking in Persons Act of 2003", or protozoans, nematodes and other
practices similar to slavery such as sale parasites; or
and trafficking of children, debt bondage 9. Involves the manufacture or handling
and serfdom and forced or compulsory of explosives and other pyrotechnic
labor, including recruitment of children for products [Sec. 12-D, RA 9231 as
use in armed conflict; or amended].
b. The use, procuring, offering or exposing of
a child for prostitution, for the production of Working Hours of a Child
pornography or for pornographic Quantity
performances; or Age Bracket Daily Max Weekly Max
c. The use, procuring or offering of a child for
illegal or illicit activities, including the Below 15 y/o 4 hrs 20 hrs
production and trafficking of dangerous
drugs and volatile substances prohibited 15 to below 8hrs. 40 hrs
under existing laws; or 18
d. Work which, by its nature or the
circumstances in which it is carried out, is
hazardous or likely to be harmful to the Night work prohibition
health, safety or morals of children, such Age Bracket Prohibited Hours
that it:
1. Debases, degrades or demeans the Below 15 y/o 8 pm to 6 am (10
intrinsic worth and dignity of a child as hrs.)
a human being; or
2. Exposes the child to physical, 15 to below 18 10 pm to 6 am (8
emotional or sexual abuse, or is found hrs.)
to be highly stressful psychologically or
may prejudice morals; or Discrimination
3. Is performed underground, underwater
or at dangerous heights; or
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No employer shall discriminate against any determine and adjust the minimum wage rates
person in respect to terms and conditions of of domestic workers. [Sec. 24, RA 10361]
employment on account of his age. [Art. 138]
Standard of Treatment
5. Kasambahays The employer or any member of the household
shall not subject a domestic worker or
Relevant Law: RA 10361 (Batas Kasambahay “kasambahay” to any kind of abuse nor inflict
or Domestic Worker’s Act any form of physical violence or harassment or
Note: RA 10361 has expressly repealed any act tending to degrade the dignity of a
Chapter III, “Employment of Househelpers”, domestic worker. [Sec. 5, RA 10361]
Title III, Book III of the Labor Code
Board, Lodging and Medical Attendance
Domestic work - This refers to work The employer shall provide for the basic
performed in or for a household or households. necessities of the domestic worker to include:
[Sec 4(c)., RA 10361] 1. At least three adequate meals a day
2. Humane sleeping arrangements that
Household - refers to the immediate members ensure safety
of the family or the occupants of the house that 3. Appropriate rest and assistance in case of
are directly provided services by the domestic illnesses and injuries sustained during
worker. [Sec 4(f), RA 10361] service without loss of benefits. [Sec. 6, RA
10361]
Domestic worker or “Kasambahay” - Refers
to any person engaged in domestic work within Privacy
an employment relationship such as, but not Respect for the privacy of the domestic worker
limited to, the following: general househelp, shall be guaranteed at all times and shall
nursemaid or “yaya”, cook, gardener, or extend to all forms of communication and
laundry person. [Sec 4(d), RA 10361] personal effects [Sec. 7, RA 10361]
The term domestic worker or “kasambahay” Access to Outside Communication

excludes any person who performs domestic The employer shall grant the domestic worker
work only occasionally or sporadically and not access to outside communication during free
on an occupational basis. [Sec.4(d), RA 10361] time: Provided, That in case of emergency,
access to communication shall be granted
Note: IRR, Sec. 2 does not include family even during work time. [Sec. 8, RA 10361]
drivers. See previous discussion on domestic
workers. See also discussion under III. A. 1. A. Education and Training
e. Domestic workers. The employer shall afford the domestic worker
the opportunity to finish basic education and
Minimum wage may allow access to alternative learning
The minimum wage of domestic workers shall systems and, as far as practicable, higher
not be less than the following: education or technical and vocational training.
a. P2,500 a month for those employed in [Sec. 9, RA 10361]
NCR
b. P2,000 a month for those employed in Social and Other Benefits
chartered cities and first class A domestic worker who has rendered at least
municipalities one (1) month of service shall be covered by
c. P1,500 a month for those employed in the Social Security System (SSS), the
other municipalities Philippine Health Insurance Corporation
(PhilHealth), and the Home Development
Within one year from the effectivity of RA Mutual Fund or Pag-IBIG, and shall be entitled
10361, and periodically thereafter, the to all the benefits in accordance with the
Regional Board shall review, and if proper, pertinent provisions provided by law.
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Pre-Employment Prohibition
Leave Benefits The ff. shall be unlawful:
A domestic worker who has rendered at least 1. Charging any share in the recruitment or
one (1) year of service shall be entitled to an finder’s fees against the domestic worker
annual service incentive leave of five (5) days by a private employment agency or third
with pay. [Sec. 29, RA 10361] party. [Sec. 13, RA 10361]
2. Requiring a domestic worker to make
Rest Periods deposits from which deductions shall be
Daily Rest Period: 8 hours made for the reimbursement of loss or
damage to tools, materials, furniture and
Weekly Rest Period: at least 24 consecutive equipment in the household. [Sec. 14, RA
hours. The employer and employee may agree 10361]
to: 3. Placing the domestic worker under debt by
a. Offsetting a day of absence with a the employer or any person acting on
particular rest day; behalf of the employer to [Sec. 15, RA
b. Waiving a particular rest day in return for 10361]
an equivalent daily rate of pay;
c. Accumulating rest days not exceeding five Time and Manner of Payment
(5) days; or Payment of wages shall be made:
d. Other similar arrangements. [Sec. 20, 21, 1. Directly to the domestic worker in cash
RA 10361] 2. At least once a month
3. With no deductions from the wages other
Pre-Employment Requirement than that which is mandated by law, unless
Prior to the execution of the employment allowed by the domestic worker through a
contract, the employer may require the written consent
following from the domestic worker:
a. Medical certificate or a health certificate No employer shall pay the wages of a domestic
issued by a local government health officer; worker by means of promissory notes,
b. Barangay and police clearance; vouchers, coupons, tokens, tickets, chits, or
c. National Bureau of Investigation (NBI) any object other than the cash wage as
clearance; and provided for under this Act. [Sec. 25, RA
d. Duly authenticated birth certificate or if not 10361]
available, any other document showing the
age of the domestic worker such as voter’s Payslip
identification card, baptismal record or The employer shall at all times provide the
passport. domestic worker with a copy of the pay slip
containing the amount paid in cash every pay
However, Sec. 12(a), (b), (c) and (d) shall be day, and indicating all deductions made, if any.
standard requirements when the employment The copies of the pay slip shall be kept by the
of the domestic worker is facilitated through the employer for a period of three (3) years. [Sec.
PEA. 26, RA 10361]
The cost of the foregoing shall be borne by the Wage Prohibitions

prospective employer or agency, as the case It shall be unlawful for the original employer to
may be. [Sec. 12, RA 10361] charge any amount from the said household
where the service of the domestic worker was
temporarily performed. [Sec. 23, RA 10361]
Other Prohibited Acts

a. Interference in employee’s wage disposal
[Sec. 27, RA 10361]
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b. Direct or indirect withholding of wages by

the employer [Sec. 28, RA 10361] Initiated by the employer
c. Payment in forms other than cash [Sec. 25, An employer may terminate the services of the
RA 10361] domestic worker at any time before the
expiration of the contract, for any of the
Right against assignment to non- following causes:
household work at a wage rate lower than 1. Misconduct or willful disobedience by the
that mandated for agricultural or non- domestic worker of the lawful order of the
agricultural enterprises depending on the case. employer in connection with the former’s
[Sec. 22, RA 10361] work;
2. Gross or habitual neglect or inefficiency by
Employment Age of Domestic Workers: the domestic worker in the performance of
Unlawful to employ any person below fifteen duties;
(15) years of age as a domestic worker [Sec. 3. Fraud or willful breach of the trust reposed
16, RA 10361] by the employer on the domestic worker;
4. Commission of a crime or offense by the
Persons between 15-18 years old should only domestic worker against the person of the
be employed in non-hazardous work. [D.O. No. employer or any immediate member of the
4-99 Sec. 4] employer’s family;
5. Violation by the domestic worker of the
Daily Rest Period: Aggregate of eight (8) terms and conditions of the employment
hours per day. [Sec. 20, RA 10361] contract and other standards set forth
under this law;
Employment Certification: ER shall give the 6. Any disease prejudicial to the health of the
househelper a written statement of the nature domestic worker, the employer, or
and duration of the service and his or her work member/s of the household; and
performance as househelper upon severance. 7. Other causes analogous to the foregoing.
[Sec. 35, RA 10361] [Sec. 34, RA 10361]
Termination Employment Certification

Initiated by the domestic worker Upon the severance of the employment
The domestic worker may terminate the relationship, the employer shall issue the
employment relationship at any time before the domestic worker within five (5) days from
expiration of the employment contract for any request a certificate of employment indicating
of the following causes: the nature, duration of the service and work
1. Verbal or emotional abuse of the domestic performance [Sec. 35, RA 10361].
worker by the employer or any member of
the household; Unjust dismissal
2. Inhuman treatment including physical Neither the domestic worker nor the employer
abuse of the domestic worker by the may terminate the contract before the
employer or any member of the household; expiration of the term except for grounds
3. Commission of a crime or offense against provided in Secs. 33 and 34 of RA 10361.
the domestic worker by the employer or
any member of the household; If the domestic worker is unjustly dismissed,
4. Violation by the employer of the terms and the domestic worker shall be paid the
conditions of the employment contract and compensation already earned plus the
other standards set forth under this law; equivalent of 15 days work by way of indemnity
5. Any disease prejudicial to the health of the [Sec. 32, RA 10361].
domestic worker, the employer, or
member/s of the household; and
6. Other causes analogous to the foregoing.
[Sec. 33, RA 10361]
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Leaving without justifiable reason by the and thereafter to be returned or to be

domestic worker disposed of or distributed in accordance
a. Any unpaid salary due not exceeding the with employer’s direction; OR
equivalent 15 days work shall be forfeited b. Sells any goods, articles, or materials to be
AND processed or fabricated in or about a home
b. The employer may recover from the and then rebuys them after. [Art. 153]
domestic worker the costs incurred related
to the deployment expenses, if any: Note: Sec. 2(d), Rule XIV, Book III is
Provided, that the service has been substantially similar to the above.
terminated within 6 months from the
domestic worker’s employment [Sec. 32, Rights and benefits accorded
RA 10361]. homeworkers
a. Right to form, join or assist organizations
Notice to end the working relationship [Sec. 3, Rule XIV, Book III, IRR]
If the duration of the domestic service is not b. Right to acquire legal personality and the
determined either in stipulation or by the nature rights and privileges granted by law to
of the service, the employer or the domestic legitimate labor organizations upon
worker may give notice to end the working issuance of the certification of registration
relationship five (5) days before the intended [Sec. 4, Rule XIV, Book III, IRR]
termination of the service. c. Immediate payment upon employer’s
receipt of finished goods or articles [Sec. 6,
The domestic worker and the employer may Rule XIV, Book III, IRR]
mutually agree upon written notice to pre- d. SSS, MEDICARE and ECC premium
terminate the contract of employment to end contributions shall be deducted from their
the employment relationship. [Sec. 32, RA pay and shall be remitted by
10361] ER/contractor/subcontractor to the SSS
[Sec. 6, Rule XIV, Book III, IRR]
6. Homeworkers
Liability of Employer
Note: D.O. No. 5, DOLE (February 4, 1992), is a. Employer may require homeworker to redo
now Rule XIV, Book III of the IRR. work improperly executed without
additional pay [Sec. 9(a), Rule XIV, Book
Industrial homework III, IRR]
a. Is a system of production under which work b. Employer need not pay homeworker for
for an employer or contractor is carried out any work done on goods or articles not
by a homeworker at his/her home. returned due to homeworker’s fault [Sec.
Materials may or may not be furnished by 9(b), Rule XIV, Book III, IRR]
the employer or contractor. c. If subcontractor/contractor fails to pay
b. Decentralized form of production, where homeworker, employer is jointly and
there is ordinarily very little supervision or severally liable with the former to the
regulation of methods of work. [Sec. 2(a), homeworker for his/her wage [Sec. 11,
Rule XIV, Book III, IRR] Rule XIV, Book III, IRR]
d. Employer shall assist the homeworkers in
Industrial Homeworker - a worker who is the maintenance of basic safe and
engaged in industrial homework. healthful working conditions at the
homeworkers’ place of work. [Sec. 11, Rule
Employer means any natural or artificial XIV, Book III, IRR]
person who:
a. Acts as a contractor or subcontractor – Regional Office shall provide technical
delivers or causes to be delivered any assistance to registered homeworkers’
goods, articles, or materials to be organizations [Sec. 14, Rule XIV, Book III, IRR]
processed or fabricated in or about a home Prohibited Homework
Page 80 of 262
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a. explosives, fireworks and articles of like Night worker

character; Any employed person whose work requires
b. drugs and poisons; and performance of a substantial number of
c. other articles, the processing of which hours of night work which exceed a
requires exposure to toxic substances. specified limit. This limit shall be fixed by the
[Sec. 13, Rule XIV, Book III, IRR] Sec of Labor after consulting the workers’
representatives/labor organizations and
Deductions employers. [Art. 154, as amended by RA
No deduction from the homeworker’s earnings 10151]
for the value of materials lost, destroyed or
damaged unless: Any employed person whose work covers the
a. Homeworker is clearly shown to be period from 10:00 pm to 6:00 am the following
responsible for loss or damage morning, provided that the worker performs no
b. Reasonable opportunity to be heard less than 7 consecutive hours of work. [Sec. 2,
c. Amount of deduction is fair and Rule XV, Book III, Rule XV, Sec. 2, IRR,
reasonable, and does not exceed actual through D.O. No. 119-12]
loss or damage
d. Deduction does not exceed 20% of Health Assessment
homeworker’s weekly earnings [Sec. 8, At the worker’s request, they shall have the
Rule XIV, Book III, IRR] right to undergo a health assessment without
charge and to receive advice on how to reduce
7. Solo Parents or avoid health problems associated with their
work:
See III. C. 2. A. for discussion on definition of a. Before taking up an assignment as a night
solo parents and solo parent leave* worker
b. At regular intervals during such an
See VII. E. for discussion on non-work related assignment
support for solo parents* c. If they experience health problems during
such an assignment
Flexible work schedule for solo parents
“Flexible work schedule” is the right granted to With the exception of a finding of unfitness for
a solo parent to vary his/her arrival and night work, the findings of such assessments
departure time without affecting core work shall be confidential and shall NOT be used to
hours as defined by the employer. [Sec. 3(e), their detriment, subject, however, to applicable
RA 8972] company policies. [Art. 155, as amended by
RA 10151; Sec. 3, Rule XV, Book III, IRR,
The employer shall provide a flexible work through D.O. No. 119-12]
schedule for solo parents: Provided,
1. That the same shall not affect individual Mandatory Facilities
and company productivity: Mandatory facilities shall be made available for
2. That any employer may request exemption workers performing night work, which include
from the above requirements from the the following:
DOLE on certain meritorious grounds. a. Suitable first-aid and emergency facilities;
[Sec. 6, RA 8972] b. Lactation station in required companies
pursuant to RA 10028;
Work discrimination illegal c. Separate toilet facilities for men & women
No employer shall discriminate against any d. Facility for eating w/ potable drinking water;
solo parent employee with respect to terms and AND
conditions of employment on account of his/her e. Facilities for transportation and/or properly
status. [Sec. 7, RA 8972] ventilated temporary sleeping or resting
8. Night Workers quarters, separate for male and female
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workers, shall be provided except where employees shall be assigned to day work,
any of the ff. circumstances is present: before and after childbirth, for a period of at
1. There is an existing company least sixteen (16) weeks, which shall be
guideline, practice or policy, CBA, or divided between the time before and after
any similar agreement providing for an childbirth;
equivalent or superior benefit; or
2. Start or end of the night work does NOT Medical certificate issued by competent
fall within 12 mn - 5 am; or physician (OB/Gyne/Pedia) is necessary
3. Workplace is located in an area that is for the grant of:
accessible 24 hours to public 1. additional periods of assignment to day
transportation; or work during pregnancy or after
4. Number of employees does NOT childbirth, provided that such shall not
exceed a specified number as may be be more than 4 weeks or for a longer
provided for by the SOLE in period as may be agreed upon by
subsequent issuances [Art. 156, as employer and worker;
amended by RA 10151; Sec. 4, Rule 2. extension of maternity leave; and
XV, Book III, IRR, through D.O. No. 3. clearance to render night work.
119-12]
b. Provision of social security benefits - in
Transfer accordance with provisions of Act No 8282
If night worker is unfit for night work due to (Social Security Act of 1997) and other
health reasons as certified by competent existing company policy or collective
physician, s/he shall be: bargaining agreement.
a. Transferred in good faith to a job for which
they are fit to work whenever practicable, c. Extension of maternity leave – where
which must be similar and equivalent transfer to day work is not possible, but
position; requires recommendation by competent
b. If transfer is not practicable, or workers are physician; without pay or using earned
unable to render night work for a leave credits, if any. [Art. 158, , as
continuous period of not less than 6 amended by RA 10151; Sec. 6, Rule XV,
months upon certification of a competent Book III, IRR, through D.O. No. 119-12]
public health authority, they shall be
granted the same benefits as other workers Protection against dismissal and loss of
who are unable to work due to illness. benefits attached to employment status,
c. If workers are certified as temporarily unfit seniority, and access to promotion
to render night work for a period of less Where no alternative work can be provided to
than 6 months, they shall be given the a woman employee who is not in a position to
same protection against dismissal or notice render night work, she shall be allowed to go
of dismissal as other workers who are on leave or on extended maternity leave, using
prevented from working for health reasons. her earned leave credits.
[Art. 157, as amended by RA 10151; Sec.
5, Rule XV, Book III, IRR, through D.O. No. A woman employee shall NOT be dismissed
119-12] for reasons of pregnancy, childbirth and
childcare responsibilities as defined under this
Women Night Workers Rule. She shall NOT lose the benefits
Employers shall ensure that measures shall be regarding her employment status, seniority,
taken to ensure that an alternative to night work and access to promotion which may attach to
for pregnant and nursing employees who her regular night work position. [Sec. 8, Rule
would otherwise be called upon to perform XV, Book III, IRR, through D.O. No. 119-12]
such work. Such measures may include:
a. Transfer to day work – As far as See also Night Shift Differential above.
practicable, pregnant or nursing
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9. Migrant Workers Emergency repatriation

The OWWA, in coordination with DFA, and in
See II. A. Policy of Selective Deployment appropriate situations, with international
above. agencies, shall undertake the repatriation of
workers in cases of war, epidemic, disasters or
Overseas Filipino Worker/Migrant Worker – calamities, natural or man-made, and other
A person who is to be engaged, is engaged or similar events, without prejudice to
has been engaged in a remunerated activity: reimbursement by the responsible principal or
1. In a state of which he or she is not a citizen agency within sixty (60) days from notice. [Sec.
or 5, Rule XIII, IRR of RA 8042, as amended by
2. On board a vessel navigating the foreign RA 10022].
seas other than a government ship used for
military or non-commercial purposes or Underage migrant workers; repatriation is
3. On an installation located offshore or on mandatory
the high seas. [Sec. 2 (a), RA 8042, as Upon discovery or upon being informed of the
amended] presence of migrant workers whose actual
ages fall below the minimum age requirement
Principals and agencies have primary for overseas deployment, the responsible
responsibility for repatriation officers in the Foreign Service shall without
The repatriation of the worker or his/her delay repatriate said workers and advise the
remains, and the transport of his/her personal DFA through the fastest means of
effects shall be the primary responsibility of the communication available of such discovery and
principal, employer or agency that recruited or other relevant information. [Sec. 6, Rule XIII,
deployed him/her abroad. All costs attendant IRR of RA 8042, as amended by RA 10022]
thereto shall be borne by the principal,
employer or the agency concerned. [Sec. 1, Prohibition on bonds and deposits
Rule XIII, IRR of RA 8042, as amended by RA In no case shall a private recruitment/manning
10022] agency require any bond or cash deposit from
the worker to guarantee performance under the
Principals and agencies to advance contract for his/her repatriation [Sec. 9, Rule
repatriation costs XIII, IRR of RA 8042, as amended by RA
Principals and agencies have the obligation to 10022]
advance the costs of repatriation, and to
immediately repatriate the migrant worker Compulsory insurance coverage for all
without a prior determination of the worker’s migrant workers
employment. Each migrant worker shall be covered by a
compulsory insurance policy which shall be
However, after the worker has returned to the secured at no cost to said worker. Such
country, the principal or agency may recover insurance policy shall be effective for the
the cost of repatriation from the worker if the duration of the migrant worker’s employment.
termination of employment was solely due to [Sec. 37-A, RA 8042, as amended by RA
the worker’s fault. [Sec. 2, Rule XIII, IRR of RA 10022]
8042, as amended by RA 10022]
The insurance policy shall cover:
a. Accidental death;
b. Natural death;
c. Permanent total disablement;
d. Repatriation cost of the worker when
his/her employment is terminated by the
employer without any valid cause, or by the
employee with just cause, including the
transport of his/her personal belongings;
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e. Subsistence allowance benefit for a c. Retirement benefits under RA 7641, RA

migrant worker who is involved in a case 1161, as amended by RA 8282, and
for litigation for the protection of his/her retirement plans of the security service
rights in the receiving country; contractor, if any;
f. Money claims arising from employer’s d. Social security and welfare benefits;
liability which may be awarded or given to e. Right to self-organization and collective
the worker in a judgment or settlement of bargaining, subject to the provisions of
his/her case in the NLRC; existing laws; and
g. Compassionate visit. When a migrant f. Security of tenure. [Sec. 6, DO 150-16]
worker is hospitalized and has been
confined for at least seven (7) consecutive PNP Examination required for employment
days, he shall be entitled to a The security guards and other private security
compassionate visit by one (1) family personnel in the employ of any security service
member or a requested individual; contractor (SSC)/private security agency
h. Medical evacuation. When an adequate (PSA) should be duly licensed and must have
medical facility is not available proximate to passed the physical and neuro-psychiatric
the migrant worker, as determined by the examination and drug test required by the PNP
insurance company's physician and/or a for pre-employment and for continued
consulting physician, the insurance employment. Expenses for these examinations
provider shall provide for the worker’s and test shall be shouldered by the security
evacuation; and guards.
i. Medical repatriation. When medically
necessary as determined by the attending Any additional test may be required at the
physician, repatriation under medical expense of the requesting party. [Sec. 7.1, DO
supervision to the migrant worker's 150-16]
residence shall be undertaken by the
insurance provider at such time that the Minimum wage
migrant worker is medically cleared for Unless a higher minimum wage is agreed upon
travel by commercial carrier. [Sec. 2, Rule by the parties, the security guards and other
XVI, IRR of RA 8042, as amended by RA private security personnel shall be entitled to
10022] receive a salary of not less than the minimum
wage rate prescribed for non-agricultural
10. Security Guards sector or industry in the region where he/she is
assigned, regardless of the nature of business
[Relevant issuance: DO 150-16, Revised of the principal. [Sec. 7.3, DO 150-16]
Guidelines Governing the Employment and
Working Conditions of Security Guards and In case of transfer, the wage rate most
Private Security Personnel in the Private favorable to the security guards and other
Sector Industry] private security personnel shall apply. [Sec.
7.4, DO 150-16]
Rights of security guards and other private
security personnel Deductions from salary
All security guards and other private security No deduction shall be made from the salary of
personnel, whether deployed or assigned as the security guards and other private security
reliever, seasonal, week-ender, or temporary, personnel, except for:
shall be entitled to all the rights and privileges 1. SSS contribution;
as provided for in the Labor Code, which shall 2. Pag-IBIG contribution;
include: 3. PhilHealth contribution;
a. Safe and healthful working conditions; 4. Withholding tax from income, provided a
b. Labor standards as may be provided in the proper withholding tax receipt is issued to
Service Agreement or under the Labor the employee before the filing of income
Code; tax return every year;
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5. Union dues, if authorized in writing;

6. Agency fees which may be collected from IV. POST-EMPLOYMENT
employees who are not members of the
bargaining agent but accept benefits under
the collective bargaining agreement (CBA); A. EMPLOYER-EMPLOYEE
and RELATIONSHIP
7. Other deduction as may be authorized in
writing by the security guard and other
private security personnel for payment to a Definitions
third person and the employer agrees to do 1. Employer
so, provided that the latter does not receive Any person acting directly or indirectly in
any pecuniary benefit, directly or indirectly, the interest of an employer in relation to an
from the transaction. employee. [Art. 97(b); Art. 219(f)]
Any person, natural or juridical, employing
In case an SSC/PSA requires its security guard the services of the employee. [Art. 173(f)]
and other private security personnel to post a Includes:
bond for use of firearms and other o The government
paraphernalia, such may only be imposed o All its branches, subdivisions and
once. instrumentalities
o All government-owned or controlled
The amount of the bond should not be more corporations and institutions
than 5% of the amount of the firearm issued to o All nonprofit private institutions, or
the security guard and other private security organizations. [Art. 97(b)]
personnel. The said cash bond, less the cost of Does not include any labor organization or
damage or loss of firearms or paraphernalia any of its officers or agents except when
due to the fault of the security guard, shall be acting as employer. [Art. 219(f)]
refunded to the security guards and other
private security personnel within 15 calendar 2. Employee
days from severance of employment. Any individual employed by an employer.
[Art. 97(c); Art. 219(g)]
See III. B. 4. b. Prohibition against wage Any person compulsorily covered by the
deductions for deduction from deposits. GSIS under C.A. No. 168, as amended.
[Art. 173(g)]
In the event that a SSC/PSA requires a cash Includes:
deposit from its employees, the maximum o The members of the AFP,
amount shall not exceed the employee’s 1 o Any person employed as casual,
month basic salary. The said cash deposit may emergency, temporary, substitute or
be deducted from the employee’s wages in an contractual,
amount which shall not exceed 20% of the o Any person compulsorily covered by
employee’s wages in a week. The full amount the SSS under R.A. No. 1161, as
of cash deposit deducted shall be returned to amended. [Art. 173(g)]
the employee within 10 days from his/her o Any individual whose work has ceased
separation from the service. [Sec. 8, DO 150- as a result of or in connection with any
16] current labor dispute or because of any
unfair labor practice if he has not
obtained any other substantially
equivalent and regular employment.
[Art. 219(g)]
The term shall not be limited to the
employees of a particular employer, unless
the Code so explicitly states. [Art. 219(g)]
3. Person
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An individual, partnership, association, Power to control

corporation, business trust, legal This is the most important element when
representatives, or any organized group of determining the existence of an EER. It
persons. [Art. 97(a); Art. 173(h)] pertains not only to results, but also to the
means and methods to attain those results.
Both a question of law and of fact [Lirio v. Genovia, G.R. No. 169757 (2011)].
The existence or absence of EER is a question
of law and of fact, each in its defined sense. The “existence” of the right to control is
Ultimately, it is a question of fact because sufficient for the element to be present. There
whether one exists or not is dependent upon need not be “actual exercise” of the right.
the facts of each case. [SSS v. CA and Ayalde, [Zanotte Shoes v. NLRC, G.R. No. 100665,
G.R. No. 100388, (2000)]. However, it is a (1995)]
question of law because it cannot be made the
subject of agreement [Tabas et.al. v. California Not every form of control will create an EER.
Manufacturing Co., et. al., G.R. No. 80680, No EER exists when control is in the form of
(1989)]. Hence, the characterization of the law rules that merely serve as guidelines towards
prevails over that in the contract. the achievement of results without dictating the
means or methods to attain them. EER exists
1. Tests to Determine Existence when control is in the form of rules that fix the
methodology to attain a specified result and
a. Four-Fold Test bind the worker to use such. [Insular Life
Assurance Co, LTD v. NLRC, G.R. No. 84484
Elements of an EER (1989)].
1. Selection and engagement of the
employee; b. Economic Dependence Test
2. Payment of wages;
3. Power of dismissal; and Two-tiered approach
4. Employer’s power to control the 1. Control Test (refer to the Four-Fold Test)
employee’s conduct with respect to the 2. Underlying economic realities within the
means and methods by which the work is activity or relationship [Sevilla v. CA, G.R.
to be accomplished [Brotherhood Labor Nos. L-41182-3 (1988)]
Unity Movement of the PH v. Zamora, G.R.
No. 48645, (1987)] Underlying economic realities
In determining the existence of an EER, these
Payment of wages realities must be examined, taking into
The following are not conclusive of the consideration the totality of circumstances
absence of an EER: surrounding the true nature of the parties’
That a worker was not reported as an relationship. The benchmark “reality” for the
employee to SSS; existence of an EER is economic dependence
That a worker’s name does not appear in of the worker on his employer. “Economic
the payrolls and pay envelope records dependence” is whether the worker is
submitted by the employer. dependent on the employer for his continued
employment. [Orozco v. CA, G.R. No. 155207
Note: For a payroll to be utilized to disprove the (2008)]
EER, it must contain a true and complete list of
employees. [Southeast East International
Rattan v Coming, G.R. No. 186621 (2014)]
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Competent and relevant evidence needed justice. [Pamplona Plantation Co v Tinghil

to prove EER [G.R. No. 159121 (2005)]
No particular form of evidence is required to
prove the EER. Any competent and relevant Doctrine illustrated in jurisprudence
evidence to prove the relationship may be In Sarona v. NLRC [G.R. No. 185280 (2012)],
admitted. For, if only documentary evidence the doctrine was applied. It involved the illegal
would be required to show that relationship, no dismissal of Sarona, a security guard who first
scheming employer would ever be brought worked at Sceptre but was subsequently
before the bar of justice, as no employer would assigned to Royale, where he was illegally
wish to come out with any trace of the illegality dismissed. In the computation of his separation
he has authored considering that it should take pay, Sarona prayed that the corporate veil of
much weightier proof to invalidate a written Royale be pierced as it was a mere
instrument. [Tenazas, et al., v. R. Villegas Taxi continuation of Sceptre; hence, his separation
Transport, G.R. No. 192998 (2014)] pay should be computed from the time he was
hired by Sceptre. This was granted.
Burden of proof on alleged employee Circumstances indicated that Spectre and
The onus probandi rests on the employer to Royale were one and the same (same office,
prove that its dismissal was for a valid cause. same officers, same person exercising control
However, before a case for illegal dismissal and supervision over employees of both
can prosper, an EER must first be established. companies), and that Sarona’s transfer to
It is incumbent upon the employee to prove the Royale was done in bad faith. As such, Sarona
EER by substantial evidence. [Javier v. Fly Ace could be said to have an EER with Sceptre.
Corporation, G.R. No. 192558 (2012)] Thus, his separation pay was to be computed
from the time he was hired by Sceptre.
Doctrine of piercing the corporate veil
When this doctrine is applied, an employee can 2. Legitimate Subcontracting as
be said to have an EER with the corporation distinguished from Labor-Only
that another corporation (who the employee Contracting
“works” for) is merely an alter ego of. It applies
in these 3 basic scenarios:
Contracting or Subcontracting
1. Defeat of public convenience as when
Definition of Contracting/Subcontracting
corporate fiction is used as a vehicle to
Contracting or subcontracting refers to an
evade existing obligations;
arrangement whereby a principal agrees to
2. Fraud cases as when the corporate entity
farm out to a contractor the performance or
is used to justify a wrong, protect fraud, or
completion of a specific job or work –
defend a crime;
a. Within a definite or predetermined period,
3. Alter ego cases, where a corporation is a
b. Regardless of whether such job or work is
farce, as it is a mere alter ego or business
to be performed or completed within or
conduit of a person, or where the
outside the premises of the principal. [Sec.
corporation is so organized and controlled
3(c), D.O. No. 174-17]
and its affairs are so conducted as to make
it merely an instrumentality, agency,
Contracting/Subcontracting as
conduit or adjunct of another corporation.
distinguished from Labor-Only Contracting
[Maricalum Mining Corp. v. Florentino,
There is "labor-only" contracting where:
G.R. No. 221813 (2018)]
1. The person supplying workers to an
employer does not have substantial capital
Note: The corporate character is not fully
or investment in the form of tools,
abrogated. It continues for other legitimate
equipment, machineries, work premises,
objectives. However, in certain circumstances,
among others, and
it may be pierced in order to promote
2. The workers recruited and placed by such
substantial justice. Such fiction of law cannot
person are performing activities which are
be invoked to further ends subversive of
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directly related to the principal business of defined in Art. 13(b), whether for local or
such employer. overseas employment. [Sec. 2. D.O. No.
174-17: Rules Implementing Articles 106 to
In such cases, the person or intermediary shall 109 of the Labor Code, as amended]
be considered merely as an agent of the
employer who shall be responsible to the Applicability of Rules to Indirect Employers
workers in the same manner and extent as if The provisions of Art. 106 shall likewise apply
the latter were directly employed by him. [Art. to any person, partnership, association or
106, par. 4] corporation which, not being an employer,
contracts with an independent contractor for
Rules for Contracting/Subcontracting the performance of any work, task, job or
1. Whenever an employer enters into a project. [Art. 107]
contract with another person for the
performance of the former’s work, the Service Agreement
employees of the contractor and of the Service agreement refers to the contract
latter’s subcontractor, if any, shall be paid between the principal and contractor
in accordance with the provisions of this containing the terms and conditions governing
Code. [Art. 106, par. 1] the performance or completion of a specific job
2. In the event that the contractor or or work being farmed out for a definite or
subcontractor fails to pay the wages of his predetermined period. [Sec. 3(j), D.O. No. 174-
employees in accordance with this Code, 17]
the employer shall be jointly and severally
liable with his contractor or subcontractor a. Elements
to such employees:
a. To the extent of the work performed To be considered legitimate contracting or
under the contract subcontracting, the following elements must
b. In the same manner and extent that he concur:
is liable to employees directly 1. Distinct and independent business:
employed by him. [Art. 106, par. 2] Contractor or subcontractor is engaged in
3. The SOLE may, by appropriate a distinct and independent business and
regulations, restrict or prohibit the undertakes to perform the job on its own
contracting-out of labor to protect the rights responsibility, according to its own manner
of workers established under this Code. and method;
[Art. 106, par. 3] 2. Substantial capital or investment:
a. He may make appropriate distinctions Contractor or subcontractor has substantial
between labor-only contracting and job capital to carry out the job farmed out by
contracting as well as differentiations the principal on his account, manner and
within these types of contracting. method, investment in the form of tools,
b. He may determine who among the equipment, machinery and supervision;
parties involved shall be considered 3. Free from control/direction of the
the employer for purposes of this Code. principal: In performing the work,
4. An employer or indirect employer may contractor or subcontractor is free from the
require the contractor or subcontractor to control/direction of the principal in all
furnish a bond equal to the cost of labor matters regarding performance of the work
under contract, on condition that the bond except the result;
will answer for the wages due the 4. Compliance with labor laws: Service
employees should the contractor or Agreement ensures that employees of the
subcontractor, as the case may be, fail to contractor/subcontractor are given all the
pay the same. [Art. 108] benefits and rights they are entitled to
5. Contractors and subcontractors referred to under labor laws. [Sec. 8, D.O. No. 174-17]
in these rules are prohibited from engaging
in recruitment and placement activities as Substantial capital (#2)
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Refers to paid-up capital stocks/shares of at 2. Service Agreement between the principal

least P5,000,000 in the case of corporations, and the contractor - It shall include the
partnerships and cooperatives; in case of following:
single proprietorship, a net worth of at least a. Specific description of the job or work
P5,000,000. [Sec. 3(l), D.O. No. 174-17] being subcontracted, including its term
or duration;
b. Trilateral relationship b. Place of work and terms and conditions
governing the contracting
When the above-elements are present, a arrangement, including the agreed
trilateral relationship arises. It consists of the amount of the contracted job or work,
following parties: the standard administrative fee of not
1. Principal - Any natural or juridical entity, less than 10% of the total contract cost;
whether an employer or not, who puts out c. Provision on the issuance of the bond/s
or farms out a job or work to a contractor. renewable every year. [Sec. 11, D.O.
2. Contractor - Any person or entity engaged No. 174-17]
in a legitimate contracting or
subcontracting arrangement providing Rights of contractor’s employees
services for a specific job or undertaking 1. Security of tenure
farmed out by a principal under a Service 2. Safe and healthful working conditions;
Agreement. 3. Labor standards such as but not limited to
3. Contractor’s employee - Employee of the service incentive leave, rest days, overtime
contractor hired to perform or complete a pay, holiday pay, 13th month pay, and
job or work farmed out by the principal. separation pay
[Sec. 3, D.O. No. 174-17] 4. Retirement benefits under the SSS or
retirement plans of the
Note: Contractor may also be a subcontractor. contractor/subcontractor;
5. Social security and welfare benefits; and
Relationships within the trilateral 6. Self-organization, collective bargaining
relationship and peaceful concerted activities including
1. EER between the contractor and the the right to strike. [Sec. 10, D.O. No. 174-
employees it engaged to perform the 17]
specific job, work or service being
contracted; and Termination of employment [Sec. 13, D.O.
2. Contractual relationship between the No. 174-17]
principal and the contractor as governed Cause Effect
by the provisions of the NCC. [Sec. 5, par.
1, D.O. No. 18-A-11] Prior to Governed by Art. 297 –
expiration of 299
Required contracts Service
1. Employment contract between the Agreement
contractor and its employees -
Notwithstanding any oral or written Pre- The right of the
stipulations to the contrary, such contract termination of contractor’s employee to
shall be governed by LC 294 and 295, and Service unpaid wages and other
provisions on general labor standards. It Agreement unpaid benefits including
shall include the following: and not due to unremitted legal mandatory
a. Specific description of the job or work authorized contributions, (e.g., SSS,
to be performed by the employee; and causes PhilHealth, Pag-ibig, ECC),
b. Place of work and terms and conditions shall be borne by the party
of employment, including a statement at fault, without prejudice
of the wage rate applicable to the to the solidary liability of
individual employee.
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Labor-only contracting
the parties to the Service
Agreement. This is one of the violations that may be
committed by the principal and contractor,
Due to Employee may opt to wait which may make them solidarily liable. There
expiration of for re-employment within 3 are two kinds:
Service months to resign and 1. Provided for by Article 206, Labor Code:
Agreement, or transfer to another a. (i) The contractor does not have
from contractor-employer. substantial capital; or
completion of (ii) the contractor does not have
the phase of Failure of the contractor to investments in the form of tools,
the job, work provide new employment equipment, machineries, supervision,
or service for shall entitle the employee work premises, among others;
which to payment of separation b. The contractor’s employees are
employee is benefits as may be performing activities that are directly
engaged provided by law or the related to the main business operation
Service Agreement, of the principal.
whichever is higher, 2. The contractor does not exercise the right
without prejudice to his/her to control the performance of the work of
entitlement to completion the employee. [Sec. 5., D.O. No. 174-17]
bonuses or other
emoluments, including Substantial capital under 1st kind
retirement benefits Having substantial capitalization is not enough
whenever applicable. to declare one a legitimate contractor. If any of
The mere expiration of the the other elements of labor-only contracting is
Service Agreement shall present, they are labor-only contractors.
not be deemed as a [Quintanar v. Coca-Cola Bottlers, 794 SCRA
termination of employment 654 (2016)]
of the contractor’s
employees who are Presumption of labor-only contracting
deemed regular employees A contractor is presumed to be a labor-only
of the contractor. contractor and has the burden of proving the
contrary. [Polyfoam-RGC Int’l Corp. v.
Concepcion, 672 SCRA 148 (2012)]
c. Liabilities
Effect of labor-only contracting: employees
Solidary liability of principal and contractor become regular employees
Every employer or indirect employer shall be Where an entity is declared to be a labor-only
held responsible with his contractor for any contractor, the employees supplied by said
violations of labor laws. For purposes of contractor to the principal become regular
determining the extent of their civil liability, they employees of the latter. Having gained regular
shall be considered as direct employers. [Art. status, the employees are entitled to security of
109] tenure and can only be dismissed for just or
authorized causes and after they had been
afforded due process. [Norkis Trading v.
Buenavista, G.R. No. 182018 (2012)]
Other prohibitions
1. When the principal farms out work to a
“Cabo” [See definition under Sec. 3(a).,
D.O. No. 174-17];
2. Contracting out of job or work through an
in-house agency;
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3. Contracting out of job or work through an contracting or subcontracting arrangements. It

in-house cooperative which merely does not apply to:
supplies workers to the principal; 1. Information technology-enabled services,
4. Contracting out of a job or work by reason such as:
of a strike or lockout whether actual or a. Business process outsourcing
imminent; b. Knowledge process outsourcing
5. Contracting out of a job or work being c. Legal process outsourcing
performed by union members and such will d. IT infrastructure outsourcing
interfere with, restrain or coerce employees e. Application development
in the exercise of their rights to self- f. Hardware and/or software support
organization as provided in Art. 259; g. Medical transcription
6. Requiring the contractor’s employees to h. Animation services
perform functions which are currently being i. Back office operations/support
performed by the regular employees of the 2. Construction industry under the licensing
principal; coverage of the Philippine Contractors
7. Requiring the contractor’s employees to Accreditation Board, which shall be
sign, as a precondition to employment or governed by D.O. No. 19-93; D.O. No. 13-
continued employment, an antedated 98; and DOLEDPWH-DILG-DTI and PCAB
resignation letter; a blank payroll; a waiver Memo of Agreement-Joint Admin Order 1-
of labor standards including minimum 2011.
wages and social or welfare benefits; or a 3. Contracting or subcontracting
quitclaim releasing the principal or arrangements in the private security
contractor from liability as to payment of industry, which are governed by D.O. No.
future claims; or require the employee to 150-16.
become member of a cooperative; 4. Contracts of sale, purchase, lease,
8. Repeated hiring by the contractor of carriage, growing agreement, toll
employees under an employment contract manufacturing, contract of management,
of short duration; operation and maintenance and other such
9. Requiring employees under a contracting contracts governed by the NCC and other
arrangement to sign a contract fixing the special laws. [DOLE Dept. Circular No. 01-
period of employment to a term shorter 17]
than the term of the Service Agreement,
unless the contract is divisible into phases 3. Kinds of Employment
for which substantially different skills are
required and this is made known to the a. Regular
employee at the time of engagement;
10. Such other practices, schemes or An employment shall be deemed to be regular
employment arrangements designed to where the employee has been engaged to
circumvent the right of workers to security perform activities which are usually necessary
of tenure. [Sec. 6, D.O. No. 174-17] or desirable in the usual business or trade of
the employer, except where:
Mandatory registration a. The employment has been fixed for a
It shall be mandatory for all persons or entities, specific project or undertaking, the
including cooperative, acting as contractors, to completion or termination of which has
register with the Regional Office of the DOLE been determined at the time of the
where it principally operates. Failure to register engagement of the employee; or
shall give rise to the presumption that the b. The work or service to be performed is
contractor is engaged in labor-only contracting. seasonal in nature and the employment is
[Sec. 14, D.O. No. 174-17] for the duration of the season. [Art. 295]
Applicability
D.O. No. 174-17 applies only to trilateral
relationships that can be characterized as
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An employee who is allowed to work after a determining the existence of an EER, as it

probationary period shall be considered a merely distinguishes between two kinds of
regular employee. [Art. 296] employees, i.e., regular and casual, for
purposes of determining the right of an
Regular employee defined employee to certain benefits, to join or form a
One who is engaged to perform activities that union, or to security of tenure. [Atok Big Wedge
are necessary and desirable in the usual Co., Inc. v. Gison, G.R. No. 169510 (2011)]
business or trade of the employer as against
those which are undertaken for a specific Hiring for an extended period
project or are seasonal. Where the employment of project employees is
extended long after the supposed project has
It is not synonymous with permanent been finished, the employees are removed
employee, because there is no such thing as a from the scope of project employees and
permanent employment. Any employee may considered regular employees. [Audion
be terminated for just cause. Electric Co., Inc. v. NLRC, G.R. No. 106648
(1999)]
Two kinds of regular employee
1. Those engaged to perform activities which While length of time is not a controlling test for
are necessary or desirable in the usual project employment, it can be a strong factor in
business or trade of the employer; and determining whether the employee was hired
2. Casual employees who have rendered at for a specific undertaking or in fact tasked to
least 1 year of service, whether continuous perform functions which are vital, necessary
or broken, with respect to the activity in and indispensable to the usual business or
which they are employed. [Romares v. trade of the employer. [Tomas Lao Const. v.
NLRC, G.R. No. 122327 (1998)] NLRC, G.R. No. 116781 (1997)]
Reasonable connection rule Repeated renewal of contract

The primary standard to determine regular While contractual stipulations as to the duration
employment is the reasonable connection of employment are valid, they cannot apply
between the activity performed by the where the contract-to-contract arrangement
employee to the business or trade of the was but an artifice to prevent the acquisition of
employer. security of tenure and to frustrate constitutional
decrees. [Beta Electric Corp. v. NLRC, G.R.
Test: W/N the employee is usually necessary No. 86408 (1990)]
or desirable in the usual business or trade of
the employer. Length of time not controlling
Length of time is merely a badge of regular
If the employee has been performing the job for employment. [Maraguinot v. NLRC, G.R. No.
at least one year, even if not continuous or 120969 (1998)]
merely intermittent, the repeated and
continuing need for performance is sufficient
evidence of necessity, if not indispensability of
that activity to the business of the employer.
Hence, the employment is also considered
regular, but only with respect to such activity
and while such activity exists. [Forever Richons
Trading Corp. v. Molina, G.R. No. 206061
(2013)]
When Art. 295 not applicable

It does not apply where the existence of an
EER is in dispute. It is not the yardstick for
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b. Casual desirable to the main business of the employer,

then employment is regular. [A. M. Oreta and
An employment shall be deemed to be casual Co., Inc. v. NLRC, G.R. No. 74004 (1989)]
where:
a. An employee is engaged to perform a job, c. Contractual
work or service which is merely incidental
to the business of the employer, and such See Discussion on Fixed-Term Employees
job, work or service is for a definite period
made known to the employee at the time of Contractual employees defined
engagement. [Sec. 5(b), Rule I, Book VI, Those who employment is governed by the
IRR] contracts they sign every time they are hired.
b. The employment has been fixed for a Their employment is terminated when the
specific project or undertaking, the contract expires, which is usually fixed for a
completion or termination of which has certain period of time (e.g., seafarers). [Unica
been determined at the time of the v. Anscor Swire Ship Management Corp., G.R.
engagement of the employee; or No. 184318 (2014)]
c. The work or service to be performed is
seasonal in nature and the employment is No implied renewal upon expiration
for the duration of the season. [Art. 295] Absent a mutually-agreed upon agreement,
there is no renewal or extension of an expired
Provided, That any employee who has contract.
rendered at least one year of service, whether
such service is continuous or broken, shall be Termination of contract
considered a regular employee with respect to The existence of a contract does not mean
the activity in which he is employed and his there can be no illegal dismissal. Due process
employment shall continue while such activity (substantial and procedural) must still be
exists. [Art. 295] observed in termination and pre-termination of
the contract. [Fuji Television Network Inc v.
Casual employee defined Espiritu, G.R. No. 204944-45 (2014)]
One engaged to perform a job, work or service
that is merely incidental to the business of the d. Project
employer, and such job, work or service is for
a definite period made known to the employee Employment is not deemed regular where the
at the time of engagement. employment has been fixed for a specific
project or undertaking the completion or
It is also someone who is not a regular, project termination of which has been determined at
or seasonal employee. the time of the engagement of the employee.
[Art. 295]
Requirements to become regular employee
1. One (1) year service, continuous or broken Project employee defined
with respect to activity employed, unless he One who is hired for carrying out a separate
has been contracted for a specific project. job, distinct from the other undertakings of the
[Tabas v. California Marketing Co., Inc., company, the scope and duration of which has
G.R. No. L-80680 (1989)] been determined and made known to the
2. Employment shall continue while such employees at the time of employment. [Hanjin
activity exists. Heavy Industries & Const. Co. v. Ibañez, G.R.
No. 170181 (2008)]
Nature of work determines kind of
employment
What determines regularity or casualness is
not the employment contract but the nature of
the job. If the job is usually necessary or
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Rationale for project employment 3. Agreement and is made clear to the

If a project has already been completed, it employee at the time of the hiring;
would be unjust to require the employer to 4. The work/service to be performed by the
maintain them in the payroll while they are employee is in connection with the
doing absolutely nothing~ except waiting until particular project/undertaking for which he
another project is begun. In effect, these stand- is engaged;
by workers would be enjoying the status of 5. The employee, while not employed and
privileged retainers, collecting payment for awaiting engagement, is free to offer his
work not done, to be disbursed by the employer services to any other employer;
from profits not earned. [De Ocampo, Jr. v. 6. The termination of his employment in the
NLRC, G.R. No. 81077 (1990)] particular project/undertaking is reported to
the DOLE Regional Office having
Two kinds of project employee jurisdiction over the workplace following
1. For a particular job or undertaking that is the date of his separation from work, using
WITHIN the regular or usual business of the prescribed form on employees’
the employer company, but which is terminations /dismissals/suspensions;
distinct and separate, and identifiable as 7. An undertaking in the employment contract
such, from the other undertakings of the by the employer to pay completion bonus
company (e.g., construction) to the project employee as practiced by
2. For a particular job or undertaking that is most construction companies. [D.O. No.
NOT within the regular business of the 19, Sec. 2.2; Samson v. NLRC, G.R. No.
corporation. Such a job or undertaking 11366 (1996)].
must also be identifiably separate and
distinct from the ordinary or regular Repeated hiring, length of service not
business operations of the employer. [Villa determinative
v. NLRC, G.R. No. 117043 (1988)] The repeated and successive rehiring of
project employees do not qualify them as
Test of project employment regular employees. What is determinative is
W/N employment has been fixed for a specific whether the employment has been fixed for a
project or undertaking the completion or specific project or undertaking, its
termination of which has been determined at completion has been determined at the time of
the time of the engagement of the employee. the engagement of the employee. [Leyte
[D.M. Consunji v. NLRC, G.R. No. 116572 Geothermal Power Progressive Employees
(2000)] Union v. Philippine National Oil Company, G.R.
No. 170351 (2011)]
Note: When the employment contract does not
state a particular date, but it does specify that The fact that employment as project
termination of employment is to be on a “day employees has gone beyond 1 year does not
certain” -- the day when the specified phase of legally dissolve their status as project
work would be completed --, the employee employees. LC 280(2) providing that an
cannot be considered regular. He is a project employee who has served at least 1 year
employee. [Filipinas Pre-Fabricated Building shall be considered a regular employee,
Systems, Inc. v. Puente, G.R. No. 153832 relates to casual employees, not to project
(2005)] employees. [Raycor Aircontrol Systems v.
NLRC, G.R. No. 114290 (1996)]
Indicators of project employment
1. The duration of the specific/identified Generally, length of service provides a fair
undertaking for which the worker is yardstick for determining when an employee
engaged is reasonably determinable; initially hired on a temporary basis becomes a
2. Such duration, as well as the specific permanent one, entitled to the security and
work/service to be performed, is defined in benefits of regularization. But this standard
an employment contract; will not be fair, if applied to the construction
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industry, simply because construction firms employment was terminated due to completion
cannot guarantee work and funding for its of each construction project. Failure of the
payrolls beyond the life of each project. employer to file termination reports after every
[William Uy Construction Corp. v. Trinidad, project completion proves that the employees
G.R. No. 183250 (2010)] are not project employees. [Pasos v. Philippine
National Construction Corp., G.R. No. 192394
Work pool employee (2013)]
Project employees may or may not be
members of a work pool. Those who are e. Seasonal
members of a work pool may either be project
or regular employees. [Raycor Aircontrol Employment is not deemed regular where the
Systems, Inc. vs. NLRC, G.R. 114290, (1996)] work or service to be performed is seasonal in
nature and the employment is for the duration
A work pool may exist although the workers in of the season. [Art. 295]
the pool do not receive salaries and are free to
seek other employment during temporary Seasonal employees defined
breaks in the business, provided, that the Those whose work or services to be performed
worker shall be available when called to report are seasonal in nature, as there is no
for a project. Although primarily applicable to continuing need for the worker. Their
regular seasonal workers, this set-up can employment is for the duration of the season.
likewise be applied to project workers insofar
as the effect of temporary cessation of work is “Regular seasonal” employees after one
concerned. [Maraguinot v. NLRC, G.R. No. season
120969. (1998)] Seasonal workers who are constantly rehired
and are only temporarily laid off during off-
Work pools in construction companies season are not separated from service in said
Members of a work pool from which a period, but are merely considered on leave
construction company draws its project until work resumes. They are considered
employees, if considered employees of the regular and permanent employees. The nature
construction company while in the work pool, of their relationship is such that during off-
are non-project employees or employees for an season they are temporarily laid off but during
indefinite period. If they are employed in a summer season they are re-employed, or when
particular project, the completion of the project their services may be needed. They are not
or any phase thereof will not mean severance strictly speaking separated from the service but
of the EER. [Policy Instruction No. 20; J. & DO are merely considered as on leave of absence
Aguilar Corp. v. NLRC, G.R. No. 116352 without pay until they are re-employed.
(1997)] [Philippine Tobacco Flue-Curing & Redrying
Corp. v. NLRC, G.R. No. 127395, (1998)]
When a project employee or a member of a
work pool acquires the status of regular Must only be hired for the duration of one
employment season
1. Continuous rehiring of project employees To be considered seasonal employees, it is not
even after cessation of a project; enough that work or services performed are
2. Task performed by the alleged “project seasonal in nature. The employees must have
employees” are vital, necessary and been employed only for the duration of one
indispensable to the usual business or season. [Hacienda Fatima v. National
trade of the employer. [Maraguinot v. Federatiom of Sugarcane Workers, G.R. No.
NLRC, G.R. No. 120969. (1998)] 149440 (2003)]
Termination requirements Exception to one season rule (illustrative

A report of termination to the nearest public case)
employment office every time their
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Although respondent constantly availed herself certain agreed upon (i.e., the commencement
of the petitioners’ services from year to year, it and termination of the EER). [GMA Network v.
was clear from the facts therein that they were Pabriga, G.R. No. 176419 (2013)]
not in her regular employ. Petitioners therein
performed different phases of agricultural work Distinguished from independent
in a given year. However, during that period, contractors
they were free to work for other farm owners, No EER exists between independent
and in fact they did. In other words, they contractors and their principals; their contracts
worked for respondent, but were nevertheless are governed by the law on contracts and other
free to contract their services with other farm applicable law. Employees under fixed-term
owners. The Court was thus emphatic when it contracts cannot be independent contractors
ruled that petitioners were mere project because in fixed-term contracts, an EER
employees, who could be hired by other farm exists. [Fuji Television Network, Inc. v.
owners. [Mercado, Sr. v. NLRC, G.R. No. Espiritu, G.R. No. 204944-45 (2014)]
79869 (1991)]
Regular fixed-term employee
f. Fixed-term Where an employee’s contract had been
continuously extended or renewed to the same
Brent doctrine position, with the same duties and remained in
When the following indicators are present, the employ without any interruption, then such
fixed-term employment is valid: employee is a regular employee. The
1. Fixed period of employment was knowingly employee’s contract indicating a fixed-term did
and voluntarily agreed upon by the parties not automatically mean that he/she could never
absent any circumstance vitiating consent be a regular employee.
2. It satisfactorily appears that the employer
and employee dealt each other on more or An employee can be a regular employee with a
less equal footing with no moral dominance fixed-term contract. The law does not preclude
exercised by one over the other. the possibility that a regular employee may opt
to have a fixed-term contract for valid reasons.
Reason for equal footing indicator For as long as it was the employee who
When a prospective employee, on account of requested, or bargained, that the contract have
special skills or market forces, is in a position a “definite date of termination,” or that the fixed-
to make demands upon the prospective term contract be freely entered into by the
employer, such prospective employee needs employer and the employee, then the validity of
less protection than the ordinary worker. The the fixed-term contract will be upheld. [Fuji
level of protection to labor must be determined Television Network Inc v. Espiritu, G.R. No.
on the basis of the nature of the work, 204944-45 (2014)].
qualifications of the employee, and other
relevant circumstances. [Fuji Television No implied renewal upon termination
Network Inc v. Espiritu, G.R. No. 204944-45 When the day certain for the termination of
(2014)]. employment comes, there is no implied
renewal or extension of employment This must
Distinguished from project employees be expressly and mutually-agreed upon. [Unica
Fixed-term employees are different from v. Anscor Swire Ship Management Corp., G.R.
project employees, as the former negotiates No. 184318 (2014)]
their employment contract on more equal
footing with the employer than the latter. In case of pre-termination
Furthermore, both kinds of employment Due process must be observed in the pre-
happen within a period. For project employees, termination of fixed-term contracts in order for
the determining factor is the activity (w/n the employer to not be liable for illegal
project) to be performed. For fixed-term dismissal. [Fuji Television Network Inc v.
employees, the determining factor is the day Espiritu, G.R. No. 204944-45 (2014)]
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3. When it involves the 3-year probationary

g. Probationary; Private School period of teachers. [Mercado v. AMA
Teachers Computer College, G.R. No. 183572,
(2010)]
Probationary employee defined 4. When it involves an act of liberality on the
One who is made to go on a trial period by an part of his employer affording him a second
employer during which the employer chance to make good after having initially
determines whether he is qualified for failed to prove his worth as an employee.
permanent employment, based on reasonable [Mariwasa v. Leogardo, G.R. No. 74246
standards made known to him at the time of (1989)]
engagement. [Robinson’s Galleria et al. v.
Ranchez, G.R. No. 177937 (2011)] Purpose of probationary employment
1. Observation Period – for the employee to
Rules for probationary employment demonstrate his skills to the employer who
1. Shall not exceed 6 months from the date determines whether the former is qualified.
the employee started working, unless it is 2. Restrictive - As long as termination was
covered by an apprenticeship agreement made before the expiration of the 6-month
stipulating a longer period. [Art. 296] probationary period, the employer has a
2. The services of an employee who has been right to sever the EER.
engaged on a probationary basis may be
terminated for a just cause or when he The employer has the right to choose who will
fails to qualify as a regular employee in be hired. It is within the exercise of this right
accordance with reasonable standards that the employer may fix a probationary period
made known by the employer to the within which he may test and observe the
employee at the time of his engagement. conduct of the employee before permanent
[Art. 296] hiring. [Grand Motor Parts Corp. v. MOLE, G.R.
a. The employer shall make known to the No. L-58958 (1984)]
employee the standards under which
he will qualify as regular employee at Requirements for validity of qualification
the time of his engagement. standards
b. Where no standards are made known In order for the standards set by the employer
to the employee at the time of to be validly used in determining whether the
engagement, he shall be deemed a employee qualifies for permanent employee:
regular employee. [Sec. 6(d), Rule I, 1. The employer must communicate such
Book VI, IRR] standards to the probationary employee;
3. An employee who is allowed to work after and
a probationary period shall be considered 2. Such communication must be made at the
a regular employee. [Art. 296] time of the probationary employee’s
engagement.
Duration
General Rule: Shall not exceed 6 months from An employer is deemed to have made known
the date of the commencement of employment the standards when it has exerted reasonable
Exceptions: efforts to apprise the employee of what he is
1. When it is covered by an apprenticeship expected to do or accomplish during the trial
agreement stipulating a longer period. [Art. period of probation. This employee must be
296] sufficiently made aware of his probationary
2. When the parties to the employment status as well as the length of time of the
contract agree otherwise, such as when probation. The exception to the foregoing is
established by company policy or required when the job is self-descriptive in nature.
by the nature of the work performed by the [Abbott Laboratories Phil. et al. v. Alcaraz, G.R.
employee. [Buiser v. Leogardo, G.R. No. L- No. 192571 (2013)]
63316, (1984)]
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Effect of failure to comply [Robinson’s Galleria et al. v Ranchez, G.R.

If the employer fails to comply with the above- No. 177937, Jan. 19, (2011)]
requirements, the employee is deemed as a
regular and not probationary employee. [Alcira Nonetheless, procedural and substantial due
v. NLRC, G.R. No. 149859, (2004)] process must be observed during termination
of the probationary employee.
Burden of proof of compliance with
employer Note: In order to invoke “failure to meet the
The employer has the burden of proving that probationary standards” as a justification for
they have informed the probationary employee dismissal, the employer must show how these
of the standards, that those standards have standards have been applied to the subject
been applied to the employee, and that the employee. [Univac Development, Inc. v.
employee fell short of such standards. Soriano, G.R. No. 182072 (2013)]
Prohibition on extended/double probation Limits to termination

When the employer renews the employment 1. It must be exercised in accordance with the
contract after the lapse of the 6-month specific requirements of the contract
probationary period, the employees thereby 2. If a particular time is prescribed, the
became regular employees. No employer is termination must be within such time and if
allowed to indefinitely determine the fitness of formal notice is required, then that form
its employees. [Bernardo v. NLRC, supra.] must be used
3. Employer’s dissatisfaction must be real
Furthermore, an employee who is merely and in good faith, not feigned so as to
transferred to his employer’s sister company circumvent the contract or the law
cannot be subjected to new probationary 4. There must be no unlawful discrimination in
employment when he had already attained the dismissal [Manila Hotel Corporation v.
regular employment under his original NLRC, G.R. No. 53453 (1986)]
employer. [A Prime Security Services, Inc. v.
NLRC, G.R. No. 107023, (2000)] Private school teachers
A private school teacher’s entitlement to
Termination of probationary employee security of tenure is governed by the Manual of
A probationary employee enjoys only a Regulations for Private Schools and not the
temporary employment status. He is Labor Code. Thus, for a private school teacher
terminable at any time, permanent employment to acquire permanent employment (security of
not having been attained in the meantime. The tenure), these must be present:
employer could decide he no longer needed 1. Must be a full-time teacher
the probationary employee’s services or his 2. Must have rendered 3 consecutive years of
performance fell short of expectations. As long service
as termination was made before the 3. Service must have been satisfactory. [La
termination of the 6-month probationary period, Salette of Santiago v. NLRC, G.R. No.
the employer was within his rights to sever the 82918 (1991)]
EER. A contrary interpretation would defect the
clear meaning of the term “probationary.” [De Mere completion of the 3-year probation, even
la Cruz, Jr. v. NLRC, G.R. No. 145417 (2003)] with an above-average performance, does not
guarantee that the employee will automatically
Termination can only be for: acquire a permanent employment status. The
1. Just causes; probationer can only qualify upon fulfillment of
2. Authorized causes; or the reasonable standards set for permanent
3. Failure to qualify as a regular employee in employment as a member of the teaching
accordance with reasonable standards personnel. [Herrera-Manaois v. St.
made known by the employer to the Scholastica’s College, G.R. No. 18891 (2013)]
employee at the time of engagement.
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These standards should be made known to the employees is adequately protected by the
teachers on probationary status at the start of laws. [Albambra Industries v. NLRC, GR No.
their probationary period, or at the very least 106771 (1994)]
under the circumstances of the present case,
at the start of the semester or the trimester Management Prerogative
during which the probationary standards are to An employer cannot be compelled to continue
be applied. Of critical importance in invoking a in its employ a person whose continuance in
failure to meet the probationary standards, is the service would patently be inimical to its
that the school should show – as a matter of interests. [Baguio Central University v.
due process – how these standards have been Gallente, GR No, 188267 (2013)]
applied. [Colegio del Santisimo Rosario v.
Rojo, G.R. No. 170388 (2013)] Requisites for the valid invocation of
management prerogative affecting security of
tenure:
B. TERMINATION BY 1. Exercised in good faith for the
EMPLOYER advancement of employer’s interest, and
2. Not for the purpose of defeating or
circumventing the rights of the employees
Coverage
under special laws or valid agreements.
All establishments or undertakings, whether for
[San Miguel Brewery Sales Force Union v.
profit or not. [Art. 293]
Ople, GR No. 52515 (1989)]
Exception
Disposition of labor disputes
Government and its political subdivisions
Bare and vague allegations as to the manner
including GOCCs without original charter. [Sec.
of service and the circumstances surrounding
1, Rule 1, Book VI, IRR]
the same would not suffice.
Security of Tenure [Art. 294]
Example: a mere copy of the notice of
In case of regular employment, the employer
termination allegedly sent by the employer to
shall not terminate the services of an employee
the employee, without proof of receipt or at the
except for a just cause or when authorized
very least, actual service is not substantial
by this Title.
evidence. [Mansion Printing Center v. Bitara
Jr., GR No. 168120 (2012)]
An employee who is unjustly dismissed from
work shall be entitled to:
Substantive issues must be addressed more
1. Reinstatement without loss of seniority
than anything else, and so, the Court may
rights, and other privileges,
forego the matter of procedural infirmities in
2. Full backwages inclusive of allowance, and
labor cases. [Ang v. San Joaquin, Jr., GR No.
3. Other benefits or their monetary equivalent
182249 (2013)]
Reckoning period of computation: from the
Burden of Proof
time his compensation was withheld up to his
In order:
actual reinstatement.
1. Existence of ER-EE Relationship - borne
by employee
Rationale
2. Fact of dismissal - borne by employee
It is a constitutionally protected right under Sec.
3. Legality of dismissal - borne by employer
3, Art. XIII, 1987 Constitution.
Employee must first establish fact of
Termination of employment is not anymore a
dismissal
mere cessation or severance of a contractual
Before the employer must bear the burden of
relationship, but an economic phenomenon
proving that the dismissal was legal, the
affecting members of the family. Under the
employee must prove by substantial evidence
principle of social justice, dismissal of
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the fact of his dismissal from service for the

question of the legality or illegality of the The dismissal must be for any of the causes
dismissal to arise. [MZR Industries v. provided for in Art. 297-299.
Colambot, GR No. 179001 (2013)]
i. Just causes
Employer’s burden of proving legality of
dismissal a. Serious Misconduct or Willful
The burden of proving the termination was for Disobedience (Insubordination)
a valid or authorized cause shall rest on the b. Gross & Habitual Neglect of Duties
employer. (Art. 292 (b)) c. Fraud/Willful Breach of Trust
d. Commission of A Crime
Unsubstantiated accusations or baseless e. Analogous cases
conclusions of the employer are insufficient
legal justifications to dismiss and employee. An employer may terminate an employment for
[Garza v. Coca-Cola Bottlers Inc, GR No. any of the following causes:
180972 (2014)] a. Serious misconduct or willful disobedience
by the employee of the lawful orders of his
The employer’s case succeeds or fails on the employer or representatives in connection
strength of its evidence, and not the weakness with his work;
of that adduced by the employee in keeping b. Gross and habitual neglect by the
with the principle that the scales of justice employee of his duties;
should be titled in favor of the latter in case of c. Fraud or willful breach by the employee of
doubt in the evidence presented. [Functional the trust reposed in him by his employer or
Inc. v Garafil, GR No, 176377 (2011)] duly authorized representative;
d. Commission of a crime or offense by the
Measure of Penalty employee against the person of his
Not every case of insubordination or willful employer or any immediate member of his
disobedience by an employee reasonably family or his duly authorized
deserves the penalty of dismissal. The penalty representatives; and
must be commensurate with the gravity of e. Other causes analogous to the foregoing.
the offense. [Joel Montallana v. La [Art. 297]
Consolacion College Manila, GR No. 208890
(2014)]
While an employer enjoys a wild latitude of

discretion in the promulgation of policies, rules
and regulations on work-related activities, such
must be fair and reasonable, and the
corresponding penalties, when prescribed
must be commensurate to the offense
involved and to the degree of infraction.
[Moreno v. San Sebastian College-Recoletos,
GR No. 175283 (2008)]
1. Requisites for Validity
a. Substantive due process
Substantive Due Process - whether the

termination was based on the provisions of the
Labor Code or in accordance with
jurisprudence.
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Basis well-intentioned reasons to protect the

As a measure of self-protection against acts company from liability under the Bouncing
inimical to the employer’s interest. An employer Checks Law. It was not wrongful nor willful.
cannot be compelled to continue employing an Neither can it be considered an obstinate
employee guilty of acts inimical to the defiance of company authority. [Lores Realty
employer’s interest, justifying loss of Enterprises v. Paria, GR No. 171189 (2011)]
confidence in him. [Yabut v. Meralco, GR No.
190436 (2012)] (b) Gross and Habitual Neglect of Duties
(a) Serious Misconduct or Willful Requisites

Disobedience 1. There must be a neglect of duty
2. The neglect must be both gross and
Requisites of Serious Misconduct habitual in character.
1. There must be misconduct
2. The misconduct is of such grave and Gross negligence has been defined as the
aggravated character want or absence of or failure to exercise slight
3. It must relate to the performance of the care or diligence, or the entire absence of care.
employee’s duties It evinces a thoughtless disregard of
4. A showing that the employee becomes consequences without exerting any effort to
unfit to continue working for the avoid them. In order to constitute just cause for
employer. [Sec. 5.2(a), D.O. No. 147-15] an employee’s dismissal due to negligence, it
must be both gross and habitual. A single or an
Misconduct refers to the improper or wrong isolated act cannot be categorized as habitual.
conduct that transgresses some established [National Bookstore v. CA, GR No. 146741
and definite rule of action, a forbidden act, a (2002)]
dereliction of duty, willful in character, and
implies wrongful intent and not mere error in Gross negligence - want of care in the
judgment. [Northwest Airlines Inc v. Del performance of one’s duties
Rosario, GR No. 157633 (2014)]
Habitual neglect - repeated failure to perform
Example: Accusatory and inflammatory one’s duties for a period of time.
language used by an employee to the
employer or superior. [Nissan Motors Phils v. Estoppel by toleration of management
Angelo, GR No. 164181 (2011)] Breach of rules and regulations which are
tolerated by management cannot serve as a
Requisites of Willful Disobedience basis for termination. The rule only applies
1. There must be disobedience or when the violation is not tantamount to fraud or
insubordination; commission of illegal activities. One cannot
2. The disobedience or insubordination must evade liability based on obedience to the
be willful or intentional characterized by corporate chain of command. [PNB V. Padao,
a wrongful and perverse attitude; GR No. 180849, 187143 (2011)]
3. The order violated must be reasonable,
lawful and made known to the employee Gross negligence includes gross
[Mirant Philippines Corp v. Sario, GR No. inefficiency
197598 (2012)]; and Gross and habitual neglect of duty includes
4. The order must pertain to the duties which gross inefficiency, negligence and
he has been engaged to discharge. [Sec. carelessness. [Century Iron Works, Inv. c.
5.2(b), D.O. No. 147-15] Banas, GR No. 184116 (2013)]
The employee’s initial reluctance to prepare

the checks which was seemingly an act of
disrespect and defiance, was for honest and
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(c) Fraud/Willful Breach of Trust The employee is one holding a position of trust
and confidence (e.g. managerial or fiduciary
Requisites of fraud or willful breach of employees). There must be an act that justifies
trust: the loss of trust and confidence based on a
1. There must be an act, omission or willful breach of trust and founded on clearly
concealment; established facts. [Wesleyan University -
2. The act, omission or concealment involves Philippines v. Reyes, GR No. 208321 (2014)]
a breach of legal duty, trust, or
confidence justly reposed; Moreover, the act complained must be related
3. It must be committed against the to the performance of the duties of the
employer or his/her representative; and employee such as would show him to be
4. It must be in connection with employee’s thereby unfit to continue working for the
work. [Sec. 5.2 (d), DO No. 147-15] employer. [Equitable Banking Corp. v. NLRC,
GR No. 102467 (1997)]
When dismissal is proper for fraud/willful
breach of trust Note: DO 174-15 distinguishes fraud or willful
Such breach is willful if it is done intentionally, breach of trust from loss of confidence, but, as
knowingly, and purposely, without justifiable seen in cases, jurisprudence seems to make
excuse as distinguished from an act done no such distinction.
carelessly, thoughtlessly, heedlessly or
inadvertently. The act complained of must be Positions of trust and confidence
work-related and shows that the employee is 1. Managerial employees - vested with
unfit to continue working. In addition, it must be powers or prerogatives to lay down
premised on the fact that the employee management policies and to hire, transfer,
concerned holds a position of responsibility, suspend, lay-off, recall, discharge, assign
trust and confidence or is entrusted with or discipline employees or effectively
confidence with respect to delicate matters recommend such managerial actions.
such as handling or case and protection of the 2. Fiduciary Rank and File - those who in the
property and assets of the employer. normal and routine exercise of their
[Villanueva, Jr. v. NLRC, GR No. 176893 functions, regularly handle significant
(2012)] amounts of money or property. Ex.
cashiers, auditors, property custodians.
Requisites of loss of confidence [Prudential Guarantee and Assurance
1. There must be an act, omission or Employee Labor Union v. NLRC, GR No.
concealment; 185335 (2012)].
2. The act, omission or concealment justifies
the loss of trust and confidence of the Managerial Fiduciary Rank-
employer to the employee; and-File
3. The employee concerned must be holding
a position of trust and confidence; Mere existence of a Proof of involvement
4. The loss of trust and confidence should basis for the belief in the alleged events
not be simulated; of employee’s guilt. in question required;
5. It should not be used as a subterfuge for [Grand Asian mere uncorroborated
causes which are improper, illegal or Shipping Lines assertions and
unqualified; and Inc.v. Galvez, GR accusations are not
6. It must be genuine and not a mere No. 178184 (2014) enough. [Etcuban,
afterthought to justify an earlier action Jr. v. Sulpico Lines
taken in bad faith. [Sec. 5.2(e), DO No. Employment for a Inc, GR No. 148410
147-15] long time is counted (2005)]
AGAINST the
When dismissal is proper for loss of employee. [Salvador
trust/confidence
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representative. [Sec. 5.2(f), D.O. No. 147-

v. Philippine Mining
Service, GR No. 15]
148766]
The employer may validly dismiss for loss of
trust and confidence an employee who
Reason for Rule on Managerial Employees commits an act of fraud prejudicial to the
While plain accusations are not sufficient to interest of the employer. Neither a criminal
justify the dismissal of rank and file employees, prosecution nor a conviction beyond
the mere existence of a basis for believing that reasonable doubt for the crime is a requisite for
managerial employees have breached the trust the validity of the dismissal. [Concepcion v.
reposed on them by their employer would Mimex Import Corporation, GR No. 153569
suffice to justify their dismissal. [Grand Asian (2012)]
Shipping Lines Inc.v. Galvez, GR No. 178184
(2014)] (e) Analogous causes
Acquittal in Criminal Case arising from Requisites

Misconduct 1. There must be an act or omission similar
Notwithstanding acquittal in the criminal case to those specified just causes; and
for qualified theft, the company had adequately 2. The act or omission must be voluntary
established the basis for the company’s loss of and/or willful on the part of the
confidence as a just cause to terminate. As employees.
opposed to the “proof beyond reasonable
doubt” standard of evidence in criminal cases, No act or omission shall be considered as
labor suits require only substantial evidence to analogous cause unless expressly specified in
prove the validity of the dismissal. [Paulino v. the company rules and regulations or policies.
NLRC, GR No. 176184 (2012)] [Sec 5.2. (g), D.O. No. 147-15]
Betrayal by a long-time employee Analogous means susceptible of comparison

Length of service is not a bargaining chip that with another either in general or in some
can simply be stacked against the employer. specific detail; or has a close relationship with
After all, an employer-employee relationship is the latter.
symbiotic where both parties benefit from
mutual loyalty and dedicated service, If an Other causes
employer had treated his employees well, has 1. Abandonment
accorded him fairness and adequate 2. Courtesy resignation
compensation as determined by law, it is only 3. Change of ownership
fair to expect a long-time employee to return 4. Habitual absenteeism/tardiness
such fairness with at least some respect and 5. Poor performance
honesty. Thus, it may be said that betrayal by 6. Past offenses
a long-time employee is more insulting and 7. Habitual infractions
odious for a fair employer. [Moya v. First Solid 8. Immorality
Rubber Industries, GR No. 184011 (2013)]. 9. Totality of infractions
10. Pregnancy out of wedlock
(d) Commission of a Crime 11. Conviction/commission of a crime
12. Temporary “off-detail” or “floating status”
Requisites:
1. There must be an act or omission
punishable or prohibited by law; and
2. The act or omission was committed by the
employee against the person of the
employer, his immediate family
member, or his duly authorized
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Abandonment time. [RB Michael Press v. Galit, GR NO.

It is the deliberate and unjustified refusal of an 153510 (2008)]
employee to resume his employment. It is a
form of neglect of duty. However, there are instances when
absenteeism is not sufficient to justify
Requisites termination. In the case of Cavite Apparel v.
1. Failure to report for work or absence Michelle Marquez, GR No. 172044 (2013), the
without valid or justifiable reason, and SC ruled that though Michelle was guilty of
2. Clear intention to sever the employer- violating company rules on leaves of absences
employee relationship (more determinative and discipline, the dismissal imposed on her
factor and manifested in overt acts). was unjustified under the circumstances.
Michelle had been employed with the employer
The burden to prove whether the employee for 6 years, with no derogatory record other
abandoned his work rests on the employer. than the four absences without official leave,
[Protective Maximum Security Inc. v. Celso E. not to mention she had already been penalized
Fuentes, GR No. 169303 (2015)] for the first three absences, the most serious
being a six-day suspension.
Absence must be accompanied by overt acts
unerringly pointing to the fact that the Poor performance
employee simply does not want to work It is tantamount to inefficiency and
anymore. The employer has the burden of incompetence in the performance of official
proof to show a deliberate and unjustified duties. An unsatisfactory rating can be a just
refusal of the employee to resume employment cause for dismissal only if it amounts to gross
without any intention of returning. [Tan and habitual neglect of duties. Poor or
Brothers Corp v. Escudero, GR No. 188711 unsatisfactory performance of an employee
(2013)] does not necessarily mean he is guilty of gross
and habitual neglect of duty. [Shipmanagement
Courtesy resignation Inc. v. Campo-Redondo, GR No. 199931
Resignation per se means voluntary (2015)]
relinquishment of a position or office. Adding
the word ‘courtesy’ did not change the essence Past offenses
of the resignation. [Batongbacal v. Associated Previous offenses may be used as a valid
Bank, GR No. 184517 (2013)] justification for dismissal only if the infractions
are related to the subsequent offense upon
Change of ownership which the basis of termination is decreed.
A mere change in the equity composition of a [Century Canning Corporation v. Ramil, GR
corporation is neither just nor an authorized No. 171630 (2010)
cause that would legally permit the dismissal of
the corporation’s employees en masse. [SME Habitual infractions
Bank Inc. v. De Guzman, GR No. 184517, A series of irregularities when put together may
186641 (2013)] constitute serious misconduct, under which Art.
297 of the Labor Code is a just cause for
Habitual absenteeism/tardiness dismissal. [Gustilo v. Wyeth Phil Inc., GR No.
It is a form of neglect of duty. Lack of initiative, 149629 (2004)]
diligence and discipline to come to work on
time everyday exhibit the employee’s Immorality
deportment towards work. It is inimical to the DECS Order No. 92 provides that disgraceful
general productivity and business of the or immoral conduct can be used as a basis for
employer. This is especially true when the termination of employment. [Santos, Jr. v.
tardiness and/or absenteeism occur frequently NLRC, GR No. 116795 (1998)]
and repeatedly within an extensive period of
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The act of engaging in extramarital affairs was taken together in determining the proper
specifically provided for by the cooperative’s imposable penalty. [Merin v. NLRC, GR No.
Personnel Policy as one of the grounds for 171790 (2008)]
termination of employment. The Board
received complaints and petitions from the Pregnancy out of wedlock
cooperative members for the removal of When the law speaks of immoral or
Bandiola because of his immoral conduct, necessarily, disgraceful conduct, it pertains to
hence immorality (extramarital affair) justified public and secular morality.
the termination of his employment. [Alilem
Credit Cooperative v. Bandila, Jr. GR No. Pre-marital sexual relations between two
173489 (2013) consenting adults, who have no impediment to
marry each other, and consequently,
Standard of morality conceiving a child out of wedlock, gauged from
It is public and secular, not religious. Whether a purely public and secular view of morality
a conduct is considered disgraceful or immoral does NOT amount to an immoral conduct.
should be made in accordance with the [Cheryl Leus v. St. Scholastica College
prevailing norms of conduct, which as stated in Westgrove, GR No. 187226 (2015)]
Leus, refer to those conducts which are
proscribed because they are detrimental to Conviction/commission of a crime
conditions upon which depend the existence of The charge of drug abuse within the company’s
and progress of human society. premises and during work hours constitutes
serious misconduct which is a just cause for
The fact that a particular act does not conform termination. [Bughaw Jr. v. Treasure Island
to the traditional moral views of a certain Industrial, GR No. 173151 (2008)]
sectarian institution is insufficient to qualify the
act as immoral unless it likewise does not Temporary “off-detail” or “floating status”
conform to the public and secular standards. This is the period of time when security guards
More importantly, there must be substantial are in between assignments or when they are
evidence to establish premarital sexual made to wait after being relieved from a
relations and pregnancy out of wedlock is previous post until they are transferred to a new
considered disgraceful or immoral. [Capin- one.
Cadiz v. Brent Hospital, GR No. 187417
(2016)] When this occurs
1. Security agency’s clients decide not to
Totality of infractions renew their contracts with the agency,
The totality of infractions or the number of resulting in a situation where the available
violations committed during the period of posts under its existing contracts are less
employment shall be considered in determining than the number of guards in its roster,
the penalty to be imposed upon an erring 2. Contracts stipulate that the client may
employee. Fitness for continued employment request the agency for replacement of
cannot be compartmentalized into tight little guards assigned to it even for want of
cubicles of aspects of character, conduct and cause.
ability separate and independent of each other.
During such time, the security guard does not
While it may be true that the petitioner was receive any salary or financial assistance
penalized for his previous infractions, this does provided by law. It does not constitute a
not and should not mean that his employment dismissal, as the assignments primarily
record would be wiped clean. After all, the depend on contracts entered into between
record of an employee is a relevant security agencies and third parties, so as long
consideration in determining the penalty that as such status does not continue beyond a
should be meted out since an employee’s past reasonable time. When such status lasts for
misconduct and present behavior must be more than 6 months, the employee may be
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considered constructively dismissed. Payment of Separation Pay

[Salvaloza v. NLRC, GR No. 182086 (2010)]
Authorized Cause Separation Pay
Transfer/Reassignment of work Labor-saving 1 month pay or at
Jurisprudential guidelines devices least 1 month pay
1. A transfer is a movement from one position for every year of
to another of equivalent rank, level or Redundancy service, whichever is
salary without break in the service or a higher [Art. 298]
lateral movement from one position to
another of equivalent rank or salary; Retrenchment, 1 month pay or at
2. The employer has the inherent right to closure, or least ½ month pay
transfer or reassign an employee for suspension of for every year of
legitimate business purposes; operations service, whichever is
3. A transfer becomes unlawful where it is higher. [Art. 298]
motivated by discrimination or bad faith or
is effected as a form of punishment or is a
demotion without sufficient cause; Note: A fraction of at least 6 months shall be
4. The employer must be able to show that considered 1 whole year. [Art. 298]
the transfer is not unreasonable,
inconvenient or prejudicial to the Basis
employee. [Rural Bank of Cantilan Inc v. Employment is the lifeblood upon which the
Julve, GR No. 169750 (2007)] worker and his family owe their survival. [Flight
Attendants and Stewards Ass’n of the
ii. Authorized causes Philippines v. PAL, GR. No. 178083 (2009)]
Also known as “Business-related Causes” Written notice

For all authorized causes, a written notice
The employer may also terminate the served on both the employees and the DOLE
employment of any employee due to: at least one month prior to the intended date of
a. The installation of labor-saving devices, termination is required.
b. Redundancy,
c. Retrenchment to prevent losses or (a) Installation of labor-saving devices
d. The closing or cessation of operation of the
establishment or undertaking not due to This refers to the installation of machinery to
serious loss [Art. 298] effect efficiency and economy in the
employer’s method of production. [Edge
Other causes Apparel Inc v. NLRC, GR No. 121314 (1998)]
a. Disease incurable in 6 months [Art. 299]
b. Enforcement of union security clause in the Requisites
CBA 1. There must be introduction of
c. Dismissal of union officers for the conduct machinery, equipment, or other
of an illegal strike; Dismissal of union devices;
members for participating in the 2. The introduction must be done in good
commission of illegal acts in a strike [Art. faith;
279 (a)] 3. The purpose for such introduction must
d. Termination in conformity with existing be valid such as to save on cost, enhance
statute/qualification requirements. efficiency and other justifiable economic
reasons;
4. There is no other option available to
employer than the introduction of
machinery, equipment or device and the
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consequent termination of employment of In implementing a redundancy program, the

those affected thereby; and employer is required to adopt fair and
5. There must be fair and reasonable reasonable criteria taking into consideration
criteria in selecting employees to be factors such as (a) preferred status, (b)
terminated. efficiency, and (c) seniority among others.
[Morales v. Metrobank, GR No. 182475 (2012)]
General Rule: In cases of installation of labor-
saving devices, redundancy and retrenchment, (c) Retrenchment to prevent serious loss
the Last-In, First-Out Rule shall apply.
Requisites
Exception: Employee volunteers to be 1. The retrenchment is reasonably
separated from employment. [Sec. 5.2(a), D.O. necessary and likely to prevent business
No. 147-15] losses;
2. The losses, if already incurred, are not
(b) Redundancy merely de minimis, but substantial,
serious, actual and real, or if only
Redundancy exists when the service capability expected are reasonably imminent as
of the workforce is in excess of what is perceived objectively and in good faith by
reasonably needed to meet the demands of the the employer;
business enterprise. 3. The expected or actual losses must be
proved by sufficient and convincing
A position is redundant when it is superfluous evidence;
and superfluity of a position or positions could 4. The retrenchment must be in good faith for
be the result of a number of factors such the the advancement of its interest and not to
overhiring of workers, a decrease in the volume defeat or circumvent the employees’ right
of business or dropping of a particular line or to security of tenure; and
service previously manufactured or undertaken 5. There must be fair and reasonable
by the enterprise. [Morales v. Metrobank, GR criteria in ascertaining who would be
No. 182475 (2012)] dismissed and would be retained among
the employees such as status, efficiency,
Requisites seniority, physical fitness, age and financial
1. There must be superfluous positions or hardship for certain workers. [Sec. 5.4(c),
services of employees; D.O. No. 147-15]
2. The positions or services are in excess of
what is reasonably demanded by the The employer bears the burden of proving the
actual requirements of the enterprise to existence of the imminence of substantial
operate in an efficient and economical losses with clear and satisfactory evidence that
manner; there are legitimate business reasons justifying
3. There must be good faith in abolishing a retrenchment. [Mount Carmel College
redundant positions; Employees Union v. Mount Carmel College,
4. There must be fair and reasonable GR No. 187621 (2014)]
criteria in selecting the employees to be
terminated; and Two kinds of losses justifying
5. There must be adequate proof of retrenchment
redundancy such as but not limited to the 1. Incurred losses - substantial, serious actual
new staffing pattern, feasibility and real
studies/proposal, on the viability of newly 2. Expected losses - reasonably imminent
created positions, job description and the [Sanoh Fulton Phils v. Bernardo Tagohoy, GR
approval by the management of the No. 187214 (2013)]
restructuring. [Sec. 5.4(b), D.O. No. 147-
15] (d) Closing or cessation of business not
due to serious loss
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5. The burden of proving compliance with all

Requisites the above-stated falls upon the employer.
1. There must be a decision to close or cease [Manila Polo Club Employees’ Union v.
operation of the enterprise by the Manila Polo Club, GR No. 172846 (2013)]
management;
2. The decision was made in good faith; and Closure of Department
3. There is no other option available to the The closure of a department or division of a
employer except to close or cease company constitutes retrenchment by, and not
operations. [Sec 5.4(d), DO No. 147-15] closure of, the company itself. [Waterfront
Cebu City Hotel v. Jimenez, GR No. 174214
Unless the closing is for the purpose of (2012)]
circumventing the provisions of this Title [Art.
298] Corporate Acquisitions
Asset Sales Stock Sales
By serving a written notice on the workers and
the Ministry of Labor and Employment at least
1 month before the intended date thereof. [Art. Sale
298]
Corporate entity The individual or
Guidelines sells all or corporate
1. Closure or cessation of operations of substantially all of its shareholders sell a
establishment or undertaking may either be assets to another controlling lock of
partial or total. entity. stock to new or
2. Closure or cessation of operations of existing
establishment or undertaking may or may shareholders.
not be due to serious business losses or
financial reverses. In both instances, proof Obligations of Seller
must be shown that:
a. It was done in good faith to advance the Seller in good faith is A shift in the
employer's interest and not for the authorized to composition of its
purpose of defeating or circumventing dismiss the affected shareholders will not
the rights of employees under the law employees, but is affect its existence
or a valid agreement; and liable for the and continuity.
b. A written notice on the affected payment of
employees and the DOLE is served at separation pay. Notwithstanding the
least 1 month before the intended date stock sale, the
of termination of employment. corporation
3. The employer can lawfully close shop even continues to be the
if not due to serious business losses or employer of its
financial reverses but separation pay, people and
which is equivalent to at least one month continues to be
pay as provided for by Article 283 of the liable for the
Labor Code, as amended, must be given to payment of their
all the affected employees. wages.
4. If the closure or cessation of operations of
establishment or undertaking is due to Obligation of Buyer
serious business losses or financial
reverses, the employer must prove such
The buyer in good The corporation or
allegation in order to avoid the payment of
faith is not obliged to its new majority
separation pay. Otherwise, the affected absorb the shareholders are not
employees are entitled to separation pay. employees affected entitled to lawfully
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Asset Sales Stock Sales
by the sale, nor is it dismiss corporate

liable for the employees absent a
payment of their just or authorized
claims. The most cause. [SME Bank v.
that it may do, for De Guzman, GR
reasons of public No.184517 (2013)]
policy and social
justice, is to give
preference to the
qualified separated
personnel of the
selling firm.
Criteria in selecting employees for

dismissal
1. Preferred status (e.g. temporary, casual or
regular employees)
2. Efficiency
3. Physical fitness
4. Age
5. Financial hardship
6. Seniority [Asian Alcohol Corp v. NLRC, GR
No. 131108 (1999)]
Summary
Retrenchment Redundancy Closure
Reduction of personnel usually Service of employee is in The reversal of the fortune of

due to poor financial returns so excess of what is required by the employer whereby there is
as to cut down on costs of an enterprise a complete cessation of
operations in terms of wages business operations and/or
and salaries actual locking-up of the doors
of the establishment, usually
due to financial losses.
To avoid or minimize business To save production costs. To prevent further financial

losses. drain upon the employer.
1 month or ½ month pay per 1 month or 1 month pay per Closure not due to serious
year of service separation pay year of service separation pay business losses, 1 month or ½
(whichever is higher) (whichever is higher) month pay per year of service
separation pay (whichever is
higher).
Closure due to serious

business losses, no separation
pay. [Manila Polo Club
Employees union v. Manila
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Retrenchment Redundancy Closure
Polo Club, GR No. 172846

(2013)]
(e) Disease
Prior certification required
An employer may terminate the services of an It is only where there is a prior certification from
employee: a competent public authority that the disease
1. Who has been found to be suffering from afflicting the employee sought to be dismissed
any disease; and is of such nature or at such stage that it cannot
2. Whose continued employment is prohibited be cured within 6 months even with proper
by law or is prejudicial to his health as well medical treatment that the latter could be
as the health of his co-employees. [Art. validly terminated from his job. [Crayons
299] Processing v. Pula, GR No. 167727 (2007)]
Separation Pay Note: If the disease or ailment can be cured

An employee terminated on the ground of within the period of 6 months, the employer
disease shall be paid separation pay shall not terminate the employee but shall ask
equivalent to at least 1 month salary or to ½ the employee to take a leave of absence. The
month salary for every year of service, employer shall reinstate such employee to his
whichever is greater. [Art. 299] former position immediately upon the
restoration of his health. [Sec. 8, Rule I, Book
Note: A fraction of at least six (6) months being VI]
considered as one (1) whole year.
(f) Enforcement of Union Security Clause
Requisites in CBA
1. The employee must be suffering from a
disease which cannot be cured within 6 The law authorizes the enforcement of union
month, even with proper medical security clauses, provided it is not
treatment; characterized by arbitrariness and always with
2. Continued employment is either: due process.
a. Prohibited by law or
b. Prejudicial to his health or In terminating the employment of an employee
c. Prejudicial to the health of his co- by enforcing the Union Security Clause, the
employees; and employer needs only to determine and prove
3. A certification to that effect issued by a that:
competent public health authority, which 1. The union security clause is applicable
must state that the disease is of such 2. The union is requesting for the
nature or at such a stage that it cannot be enforcement of the union security provision
cured within a period of six (6) months even in the CBA
with proper medical treatment [Sec. 8, Rule 3. There is sufficient evidence to support the
I, Book VI; Crayons Processing v. Pula, GR union’s decision to expel the employee
No. 167727 (2007), Sec. 5.2(f), D.O. 147- from the union or company.
15]
(g) Dismissal of Union Officers for the
Burden of proof with employer conduct of an illegal strike; Dismissal of
The burden of proof falls upon the employer to union members for participating in the
establish the requisites. In the absence of such commission of illegal acts in a strike
certification, the dismissal must be necessarily
declared illegal.
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Any union officer who knowingly participates in written explanation within a reasonable
an illegal strike, and any worker or union officer period.
who knowingly participates in the commission 2. The requirement of a hearing is complied
of illegal acts during a strike may be declared with as long as there was an opportunity to
to have lost employment status. [Art. 279 (a)] be heard, and not necessarily an actual
hearing was conducted.
(h) Termination in Conformity with Existing 3. After determining that termination of
Statute/ Qualification Requirements employment is justified, the employers
shall serve the employees a written notice
While the right of workers to security of tenure of termination indicating that:
is guaranteed by the Constitution, its exercise a. All circumstances involving the charge
may be reasonably regulated pursuant to the against the employee have been
police powers of the State to safeguard health, considered, and
morals, peace, education, order, safety, and b. The grounds have been established to
the general welfare of the people. justify the severance of the
employment. [Inguillo v. First Phil
Consequently, persons who desire to engage Scales, GR No. 165407 (2019)]
in the learned professions requiring scientific or
technical knowledge may be required to take The employee must be afforded an opportunity
an examination as a prerequisite to engaging to be heard and defend himself. [Fujitsu
in their chosen careers. [St. Luke's Medical Computer Products Corporation of the Phil v.
Center Employees Assn v. NLRC, GR No. CA, GR No. 158232 (2005)]
162053 (2007)]
The employer may not substitute the required
b. Procedural due process prior notice and opportunity to be heard with
the mere payment of 30 day’s salary. [PNB V.
The employer shall: Cabansag, GR No. 157010 (2005)]
1. Furnish the worker, whose employment is
sought to be terminated, a written notice Right to Counsel
containing a statement of the causes for The right to counsel, a very basic requirement
termination; and of substantive due process, has to be
2. Afford the latter ample opportunity to be observed. Indeed the rights to counsel and to
heard and to defend himself, with the due process of law are two of the fundamental
assistance of his representative if he so rights guaranteed by the 1987 Constitution to
desires, in accordance with company rules any person under investigation, be the
and regulations promulgated pursuant to proceeding administrative, civil or criminal.
guidelines set by the DOLE. [Art. 292 (b)] [Salaw v. NLRC, GR No. 90786 (1991)]
Any decision taken by the employer shall be The procedure can be summarized as follows:
without prejudice to the right of the worker to 1. Employer must furnish the employee with a
contest the validity or legality of his dismissal written notice containing the cause for
by filing a complaint with the regional branch of termination.
the National Labor Relations Commission. 2. The employer must give the employee an
[Art. 292 (b)] opportunity to be heard. This can be done
either through:
Procedural Due Process - manner in which a. Position paper or
the dismissal was effected. b. Clarificatory hearing.
1. The first written notice to be served on the 3. The employee MAY also be assisted by a
employees should contain the specific representative or counsel.
causes or grounds for termination against 4. The employer must give another written
them, and a directive that the employees notice apprising the employee of its
are given the opportunity to submit their
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findings and the penalty to be imposed 4. The company rules, if any, violated and/or
against the employee, if any. the grounds under Art. 288 being charged
against the employee. [United Tourist
In labor cases, these requisites meet the Promotions v. Kemplin, GR No. 205453
constitutional requirement of procedural due (2014)]
process, which contemplates, “notice and
opportunity to be heard before judgment is CONTENTS OF SECOND NOTICE
rendered affecting one’s person or property”. 1. All circumstances involving the charge
[Montinola v. PAL, GR No. 198656 (2014)] against the employee considered
2. Grounds established to justify the
i. Twin Notice Requirement severance of employment. [United Tourist
Promotions v. Kemplin, GR No. 205453
The employer has the burden of proving that a (2014)]
dismissed worker has been served two notices:
1. First written notice: specifying the PRE-DISMISSAL NOTICE GROUNDS
ground(s) for termination and giving the An employee may be dismissed only if the
employee the reasonable opportunity grounds mentioned in the pre-dismissal notice
within which to explain his side. were the ones cited for termination of
2. Second written notice: indicating that upon employment. [Erector Advertising Sign Groups
due consideration of all circumstances, v. Cloma, GR No. 167218 (2010)]
grounds have been established to justify
his termination ii. Hearing
Reasonable opportunity for the first written In employee dismissal cases, the essence of
notice should be construed at least 5 calendar due process is simply the opportunity to be
days from receipt of the notice. heard, it is the denial of this that constitutes a
violation of due process of law. [Technol Eight
Ratio: to give the employee an opportunity to Philippines Corporation v. NLRC, GR No.
study the accusation against him, consult a 187605 (2010)]
union official or lawyer, gather data and
evidence, and decide on his defenses. [King of While a formal hearing or conference is ideal, it
Kings Transport v. Mamac, GR No. 166208 is not an absolute, mandatory or exclusive
(2007); Puncia v. Toyota Shaw/Pasig, GR No. avenue of due process. [Perez v. PT&T, GR
214399 (2016)] No. 152048 (2009)]
CONTENTS OF FIRST NOTICE

1. Specific causes or grounds for termination
against the employee
2. Directive that the employee is given the
opportunity to submit his written
explanation within a “reasonable period” or
every kind of assistance that management
must accord to enable him to prepare
adequately for his defense. This should be
construed as a period of at least 5 calendar
days from receipt of notice.
3. Detailed narration of the facts and
circumstances that will serve as basis for
the charge against the employees. A
general description of the charge will not
suffice. [Unilever v. Rivera, GR No. 201701
(2013)]
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Guidelines in hearing requirements

Just/ PDP Dismissa Employer’s
1. “Ample opportunity to be heard” means any
Autho- l liability
meaningful opportunity (verbal or written)
rized
given to the employee to:
cause
a. Answer the charges against him and
b. Submit evidence in support of his YES YES VALID No liability.
defense, whether in a hearing, Separation
conference or some other fair, just and pay only in
reasonable way. authorized
2. A formal hearing or conference becomes causes.
mandatory when:
a. Requested by the employee in writing, NO YES INVALID Reinstatement
b. Substantial evidentiary disputes exist or separation
c. A company rule or practice requires it, pay (if
or reinstatement
d. When similar circumstances warrant. is not
3. The “ample opportunity to be heard” possible) + full
standard in the Labor Code prevails over backwages
the “hearing or conference” requirement in
the implementing rules and regulations. NO NO INVALID Reinstatement
[Perez v. PT&T, supra] or separation
pay (if
PROCEDURE FOR TERMINATION CASES reinstatement
is not
Just Cause Authorized Cause
possible) + full
1. First notice Notice to: backwages
specifying 1. Employee and
YES NO VALID Liable for
grounds of 2. DOLE
damages due
dismissal
to procedural
2. Hearing or At least 1 month prior
opportunity to to the date of infirmity
be heard termination of (nominal
damages).
3. Second notice employment.
Separation
of decision to
pay if for
dismiss
authorized
cause.
Guidelines
1. Notice is NOT NEEDED when employee
consented to the retrenchment or 2. Preventive Suspension
voluntarily applied for one. [International
Hardware Inc v. NLRC, GR No. 80770 Definition
(1989)] Preventive suspension is a disciplinary
2. Notice must be individual, not collective. measure for the protection of the company’s
[Shoppers Gain Supermart v. NLRC, GR property pending investigation of any alleged
No. 110731 (1996)] malfeasance or misfeasance committed by the
3. Voluntary arbitration satisfies notice employee. [Gatbonton v. NLRC, G.R. No.
requirement for authorized causes. 146779 (2006)]
[Revidad v. NLRC, GR No. 11105 (1995)]
It is important to note that preventive
Consequences for non-compliance of suspension is not a penalty, but a part of a
Procedural Due Process (PDP) process to investigate a questioned action of
an employee. Preventive suspension does not
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in itself prove that the employer already finds XXIII with “Rule XXIII Contempt” and does not
the employee guilty of the charges he is asked contain provisions on preventive suspension.
to answer and explain [Soriano v. NLRC et. al.,
G.R. No. 75510, (1987)]. It is curious to note, however, that in a 2018
case [Consolidated Building Maintenance, Inc.
When imposed v. Asprec, Jr., G.R. No. 217301, (June 6,
Preventive suspension may be legally imposed 2018)], the Court stated that “preventive
on employee whose alleged violation is the suspension shall not last for more than 30
subject of an investigation. days” HOWEVER, in stating so, the Court cited
an OLD provision of the IRR of the Labor Code.
The employer may place the worker concerned In fact, it is a recurring theme in a number of
under preventive suspension if his continued more recent cases that the Court would cite old
employment poses a serious and imminent provisions of the IRR of the labor code which
threat to the life or property of the employer or have long been amended or repealed.
of his co-workers. When, however, it is
determined that there is no sufficient basis to When preventive suspension is deemed
justify an employee’s preventive suspension, dismissal
the latter is entitled to the payment of salaries When preventive suspension exceeds the
during the time of preventive suspension.” maximum period allowed without reinstating
[Gatbonton v. NLRC, G.R. No. 146779 (2006)] the employee either by actual or payroll
reinstatement or when preventive suspension
Purpose is for an indefinite period, only then will
The purpose of his suspension is to prevent constructive dismissal set in.
him from causing harm or injury to the company
as well as to his fellow employees. [Sec. 8, Not entitled to pay
Rule XXIII, IRR]. Employee placed under preventive suspension
is not entitled to the payment of wages.
Period of suspension However, if the basis for suspension is later
No preventive suspension shall last longer than proven to be unfounded or invalid, the said
thirty (30) days. employee is entitled to his salary during the
whole period of his suspension. [Gatbonton v.
Upon the expiry of such period, the employer NLRC, G.R. No. 146779 (2006)]
shall thereafter:
1. Reinstate the worker in his former or in a 3. Illegal Dismissal
substantially equivalent position; or
2. The employer may extend the period of a. Kinds
suspension provided that:
a. During the period of extension, he pays i. No just or authorized cause
the wages and other benefits due to the
worker For the dismissal of an employee to be valid,
b. The worker shall not be bound to the dismissal must be for any of the causes
reimburse the amount paid to him provided for in Art. 297-299.
during the extension if the employer
decides, after completion of the An employer who dismisses an employee
hearing, to dismiss the worker. [Sec. 9, without just or authorized cause is liable for:
Rule XXIII, Book V, IRR] 1. Reinstatement or separation pay if
reinstatement is not possible; and
Note: The portion on preventive suspension 2. Full backwages.
under the cited Book V, Rule XXIII, Secs. 8-9
are no longer in existence. The current IRR of ii. Constructive dismissal
the Labor Code (as of 2020) has replaced Rule
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Constructive dismissal is cessation of work Otherwise, the transfer could be considered as

because continued employment is either: constructive dismissal. [The Philippine
1. rendered impossible, unreasonable or American Life and General Insurance Co. v.
unlikely; Angelita S. Gramaje, G.R. No. 156963 (2004)]
2. when there is a demotion in rank or
diminution in pay or both; or Forced resignation is constructive
3. when a clear discrimination, insensibility, or dismissal
disdain by an employer becomes Mere allegations of threat or force do not
unbearable to the employee. [Dusit Hotel constitute evidence to support a finding of
Nikko v. NUHWRAIN-Dusit Hotel Chapter, forced resignation.
G.R. No. 160391 (2005)]
In order for intimidation to vitiate consent, the
The Test of Constructive Dismissal following requisites must concur:
Whether a reasonable person in the 1. that the intimidation caused the consent to
employee’s position would have felt compelled be given;
to give up his position under the 2. that the threatened act be unjust or
circumstances. [Tuazon v. Bank of Commerce, unlawful;
G.R. No. 192076 (2012)] 3. that the threat be real or serious, there
being evident disproportion between the
It is an act amounting to dismissal but made to evil and the resistance which all men can
appear as if it were not. Constructive dismissal offer, leading to the choice of doing the act
is, therefore, a dismissal in disguise. As such, which is forced on the person to do as the
the law recognizes and resolves this situation lesser evil; AND
in favor of employees in order to protect their 4. that it produces a well-grounded fear from
rights and interests from the coercive acts of the fact that the person from whom it
the employer. In fact, the employee who is comes has the necessary means or ability
constructively dismissed may be allowed to to inflict the threatened injury to his person
keep on coming to work. [McMer Corp., Inc. v. or property. [Mandapat v. Add Force
NLRC, G.R. No. 193421 (2014)] Personnel, G.R. No. 180285 (2010)]
(a) Burden of proof
Unlawful withholding of wages for a long time
could be tantamount to an illegal constructive The burden of proving that the termination was
dismissal. [Gilles v. CA, G.R. No. 149273 for a valid or authorized cause shall rest on the
(2009)] employer. [Art. 292 (b)]
A bona fide suspension of work is allowed for In illegal dismissal cases, the onus of proving
as long as it does not exceed 6 months. that the employee was not dismissed or, if
Failure of the employer to recall the suspended dismissed, that the dismissal was not illegal,
employees in the 6-month period amounts to rests on the employer, failure to discharge
constructive dismissal. [SKM Art. Craft Corp. v. which would mean that the dismissal is not
Bauca, G.R. No. 171282 (2013)] justified and, therefore, illegal. [Macasero v.
Southern Industrial Gases Philippines, GR No.
For a transfer to be a valid exercise of 198656 (2014)]
management prerogative:
(1) There is no demotion in rank;
(2) There is no diminution of salary, benefits,
and other privileges;
(3) The action is not motivated by
discrimination, made in bad faith, or
effected as a form of punishment or
demotion without sufficient cause.
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Degree of Proof 3. Backwages

In labor cases, as in other administrative 4. Damages and Attorney’s Fees
proceedings, substantial evidence is required 5. Separation Pay
and it is such relevant evidence as a
reasonable mind might accept as adequate to (1) Reinstatement
support a conclusion. [Andrada v. Agemar
Manning Agency, GR No. 194758 (2012)] Reinstatement means restoration to a state or
condition from which one had been removed or
Substantial evidence is necessary for an separated. The person reinstated assumes the
employer to effectuate any dismissal. position he had occupied prior to his dismissal.
Uncorroborated assertions and accusations by [Asian Terminals, Inc. v. Villanueva, G.R. No.
the employer do not suffice; otherwise the 143219 (2006)]
constitutional guarantee of security of tenure of
the employee would be jeopardized. [Kulas General Rule: Reinstatement and backwages
Ideas & Creations et. al. v. Alcoseba & Arao Exceptions:
Arao, GR No. 180123 (2010)] a. Separation pay
b. Closure of business [Retuya v. Hon.
(b) Liability~of officers Dumarpa, G.R. No. 148848 (2003)]
c. Economic business conditions [Union of
Art. 219(e) defines “employer” as including any Supervisors v. Secretary of Labor, G.R.
person acting in the interest of an employer, No. L-39889 (1981)]
directly or indirectly. d. Employee’s unsuitability [Divine Word High
School v. NLRC, G.R. No. 72207 (1986)]
Note that the provision does not expressly e. Employee’s retirement/ overage [New
make a corporate officer personally liable for Philippine Skylanders, Inc. v. Dakila, G.R.
the liabilities of a corporation. However, in No. 199547 (2012)]
Lozada vs Mendoza [GR No. 196134, 12 f. Antipathy and antagonism [Wensha Spa
October 2016], the Court ruled that, as a Center v. Yung, G.R. No. 185122 (2010)]
general rule, officers are not personally liable g. Job with a totally different nature [DUP
for corporate obligation, with the exception that Sound Phils. v. CA, G.R. No. 168317
in order to hold a director or officer personally (2011)]
liable occurs when the following requisites are h. Long passage of time
present: i. Inimical to the employer's interest
1. the complaint must allege that the director j. When supervening facts have transpired
or officer assented to the patently unlawful which make execution on that score unjust
acts of the corporation, or that the director or inequitable or, to an increasing extent
or officer was guilty of gross negligence or [Emeritus Security & Maintenance
bad faith; and Systems, Inc. v. Dailig, G.R. No. 204761
2. there must be proof that the director or (2014)]
officer acted in bad faith.
Prescription Period
(c) Reliefs from illegal An action for reinstatement by reason of illegal
dismissal dismissal is one based on an injury, which may
be brought within 4 years from the time of
The following reliefs are cumulative and not dismissal. [Art. 1146, CC]
alternative:
1. Reinstatement In any event, the decision of the Labor Arbiter
2. Options Given to Employers reinstating a dismissed or separated
a. Actually reinstate the dismissed employee, insofar as the reinstatement aspect
employees or, is concerned, shall immediately be executory,
b. Constructively reinstate them in the pending appeal. The employee shall either be
payroll. admitted back to work under the same terms
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and conditions prevailing prior to his dismissal SEPARATION PAY IN LIEU OF

or separation or, at the option of the employer, REINSTATEMENT
merely reinstated in the payroll. The posting of
a bond by the employer shall not stay the Kinds of separation pay (SP)
execution for reinstatement provided herein. 1. SP as a statutory requirement for
[Art. 229] authorized causes
2. SP as financial assistance found in the next
(2) Options Given to Employers section
a. Actually reinstate the dismissed 3. SP in lieu of reinstatement where
employees or, reinstatement is not feasible; and
b. Constructively reinstate them in the 4. SP as a benefit in the CBA or company
payroll. policy
Either way, this must be done immediately Instances when the award of separation pay, in
upon the filing of their appeal, without need of lieu of reinstatement to an illegally dismissed
any executory writ. employee, is proper:
a. When reinstatement is no longer possible,
If the order of reinstatement of the Labor Arbiter in cases where the dismissed employee's
is reversed on appeal, it is obligatory on the position is no longer available;
part of the employer to reinstate and pay the b. The continued relationship between the
wages of the dismissed employee during the employer and the employee is no longer
period of appeal until reversal by the higher viable due to the strained relations
court. between them; and
c. When the dismissed employee opted not to
The Labor Arbiter's order of reinstatement is be reinstated, or the payment of separation
immediately executory and the employer has to benefits would be for the best interest of the
either re-admit them to work under the same parties involved. [Sec. 4(b), Rule I, Book VI,
terms and conditions prevailing prior to their IRR]
dismissal, or to reinstate them in the payroll,
and that failing to exercise the options in the Separation Pay and Reinstatement,
alternative, employer must pay the employee's Exclusive Remedies
salaries [Magana v. Medicard Philippines, Inc., The payment of separation pay and
G.R. No. 174833 (2010)] reinstatement are exclusive remedies. The
payment of separation pay replaces the legal
No refund doctrine consequences of reinstatement to an
An employee cannot be compelled to employee who was illegally dismissed. [Bani
reimburse the salaries and wages he received Rural Bank, Inc. v. De Guzman, G.R. No.
during the pendency of his appeal, 170904 (2013)]
notwithstanding the reversal by the NLRC of
the LA's order of reinstatement. [College of the Doctrine of Strained Relations
Immaculate Conception v. NLRC, G.R. No. Where reinstatement is not feasible, expedient
167563 (2010)] or practical, as where reinstatement would only
exacerbate the tension and strained relations
Note: However, Rule XI, Sec. 14 of the 2011 between the parties or where the relationship
NLRC Rules of Procedure provide for between the employer and employee has been
restitution of amounts paid pursuant to unduly strained by reason of their irreconcilable
execution of awards during pendency of the differences, particularly where the illegally
appeal. However, it expressly disallows dismissed employee held a managerial or key
restitution of wages paid due to reinstatement position in the company, it would be more
pending appeal. prudent to order payment of separation pay
instead of reinstatement. [Quijano v. Mercury
Drug Corp., G.R. No. 126561 (1998)]
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b. Nor is it a redress of a private right. [St.

Computation Theresa's School of Novaliches
SP as a statutory requirement is computed by Foundation v. NLRC, G.R. No. 122955
integrating the basic salary with regular (1998)]
allowances employee has been receiving
[Planters Products, Inc. v. NLRC, G.R. No. Backwages and reinstatement are two reliefs
78524, 78739 (1989)]; allowances include that should be given to an illegally dismissed
transportation and emergency living employee. They are separate and distinct from
allowances [Santos v. NLRC, G.R. No. 76721 each other.
(1987)]
An illegally dismissed employee is entitled to
In an illegal dismissal case involving (1) either reinstatement, if viable, or separation
salespersons, the Court took judicial notice of pay if reinstatement is no longer viable, and (2)
the fact that the nature of the work of a backwages. [Aurora Land Projects Corp. v.
salesperson and the reason for such type of NLRC, G.R. No. 114733 (1997)]
remuneration for services rendered,
demonstrate clearly that commissions are part Effect of failure to order backwages
of salespersons' wage or salary. If the Court A “plain error” which may be rectified, even if
adopted the opposite view that commissions employee did not bring an appeal regarding the
do not form part of wage or salary, then, in matter. [Aurora Land Projects Corp. v. NLRC,
effect, the Court will be saying that supra.]
salespersons do not receive any salary and
therefore, not entitled to separation pay in the Extent of Entitlement
event of discharge from employment. This General rule: An illegally dismissed employee
narrow interpretation is not in accord with the is entitled to full backwages.
liberal spirit of our labor laws and considering
the purpose of separation pay which is, to Exceptions
alleviate the difficulties which confront a a. The Court awarded limited backwages
dismissed employee thrown to the streets to where the employee was illegally
face the harsh necessities of life. [Songco v. dismissed but the employer was found to
NLRC, G.R. Nos. 50999-51000 (1990)] be in good faith. [San Miguel Corporation v.
Javate, Jr., G.R. No. L-54244 (1992)]
A dismissed employee who has accepted b. Delay of the EE in filing the case for illegal
separation pay is not necessarily estopped dismissal [Mercury Drug Co., Inc. v. CIR,
from challenging the validity of his or her supra]
dismissal. Neither does it relieve the employer
of legal obligations. [Anino v. NLRC, G.R. No. COMPUTATION OF BACKWAGES
123226 (1998)] Full backwages means exactly
that, i.e., without deducting from backwages
(3) Backwages the earnings derived elsewhere by the
concerned employee during the period of his
Definition illegal dismissal. [Bustamante v. NLRC, G.R.
Backwages are: No. 111651 (1996)]
1. Earnings lost by a worker due to his illegal
dismissal; The formula of awarding reasonable net
2. A form of relief that restores the income lost backwages without deduction or
by reason of such unlawful dismissal; qualification relieves the employees from
3. In the nature of a command to the employer proving or disproving their earnings during their
to make a public reparation for illegally lay-off and the employers from submitting
dismissing an employee. counterproofs, and obviates the twin evils of:
a. It is not private compensation or 1. Idleness on the part of the employee who
damages; would "with folded arms, remain inactive in
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the expectation that a windfall would come Indemnity of Employer

to him" [Itogon Suyoc Mines, Inc. v. Validity
Sangilo-Itogon Workers Union, G.R. No. L- Doc-
of Liability
24189 (1968), as cited in Diwa ng Period trine in
dismis- of ER
Pagkakaisa v. Filtex International Corp., effect
sal
G.R. No. 23960-61 (1972)]; and Reinstate-
2. Attrition and protracted delay in satisfying Prior Pre- ment +
such award on the part of unscrupulous Illegal
1989 Wenphil Back-
employers who have seized upon the wages
further proceedings to determine the actual Dismiss
earnings of the wrongfully dismissed or Feb.
now,
laid-off employees [See La Campana Food 1989- Wenphil Valid
indemnity
Products, Inc. v. CIR, G.R. No. L-27907 1999
pay later
(1969); and Kaisahan ng Mga Full back-
Manggagawa v. La Campana Food wages up
Products, Inc., G.R. No. L-30798 (1970)]. Jan.
to
2000 – Ineffec-
Serrano reinstate-
The salary base properly used should be the Oct. tual
ment
basic salary rate at the time of dismissal plus 2004
finality of
the regular allowances; allowances include: decision
a. Emergency cost of living allowances Nov.
(ECOLA), transportation allowances, 13th Nominal
2004 – Agabon Valid
month pay. [Paramount Vinyl Product damages
present
Corp. v. NLRC, G.R. No. 81200 (1990)]
b. Also included are vacation leaves, service (4) Damages and Attorney’s Fees
incentive leaves, and sick leaves.
In cases of unlawful withholding of wages: the
The effects of extraordinary inflation are not to culpable party may be assessed attorney’s
be applied without an official declaration fees
thereof by competent authorities. [Lantion v.
NLRC, G.R. No. 82028 (1990)] Amount: equivalent to 10% of the amount of
wages recovered.
Note that according to Nacar v. Gallery
Frames, when the judgment of the court It shall be unlawful for any person to demand
awarding a sum of money becomes final and or accept, in any judicial or administrative
executory, the rate of legal interest …. shall be proceedings for the recovery of wages,
6% per annum from such finality until its attorney’s fees which exceed 10% percent of
satisfaction, this interim period being deemed the amount of wages recovered. [Art. 111, CC]
to be by then an equivalent to a forbearance of
credit. [Nacar v. Gallery Frames, G.R. No. General Rule: attorney's fees and expenses of
189871, (2013)] litigation, other than judicial costs, cannot be
recovered
Exception: stipulation to the contrary xxx in

actions for the recovery of wages of household
helpers, laborers and skilled workers [Art.
2208(7), CC]
The employee is entitled to moral damages

when the employer acted
a. in bad faith or fraud;
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b. in a manner oppressive to labor; or in a year of service,

manner contrary to morals, good customs, whichever is higher
or public policy [Montinola v. PAL, G.R. No. Art. 289:
198656 (2014). Retrenchment to
prevent losses or
In labor cases, the court may award exemplary Equivalent to at least
closure or cessations
damages "if the dismissal was effected in a 1 month pay or ½
of operations of
month pay for every
wanton, oppressive or malevolent manner." establishments or
[Garcia v. NLRC, GR. No. 110518 (1994)] year of service*,
undertaking not due
whichever is higher
to serious business
(5) Separation Pay losses or financial
reverses
[Arts. 289 & 290; DOLE Handbook on Worker’s Art. 290: Disease
Statutory Monetary Benefits (2018)] when continued Equivalent to at least
employment is 1 month pay or ½
Separation pay is defined as the amount that prohibited by law or month pay for every
an employee receives at the time of his is prejudicial to his year of service*,
severance from the service and is designed to health or health of whichever is higher
provide the employee with the wherewithal co-employees
during the period that he is looking for another Art. 291: Termination
employment. [A’ Prime Security Services v. by employee whether
NLRC, G.R. No. 107320 (1993)] None
with or without just
cause
COVERAGE *A fraction of at least 6 months shall be
General Rule: considered 1 whole year
Cause for
Entitlement
Termination Exceptions: Considerations of equity as in
Art. 288: Termination the cases of Filipro, Inc. v. NLRC [G.R. No.
by Employer 70546 (1986)]; Metro Drug Corp. v. NLRC
a. Serious [G.R. No. 72248 (1986)]; Engineering
misconduct or Equipment, Inc. v. NLRC [G.R. No. L-59221
willful (1984)]; and San Miguel Corp v. NLRC [G.R.
disobedience of No. 80774 (1988)] [PLDT v. NLRC, G.R. No.
lawful orders 80609 (1988)].
b. Gross and An employee who voluntarily resigns is not
habitual neglect entitled to separation pay unless stipulated in
of duties the employment contract, or the collective
c. Fraud or willful None bargaining agreement, or is sanctioned by
breach of trust established practice or policy of the employer.
d. Commission of a [Phimco Industries v. NLRC, G.R. No. 118041
crime against (1997); Hinatuan Mining Corp v. NLRC, G.R.
employer or No. 117394 (1997) cited in JPL Marketing
immediate Promotions v. CA, G.R. No. 151966 (2005)]
member of his
family or AMOUNT
representative One-Half (½) Month Pay per Year of Service
e. Analogous An employee is entitled to receive separation
causes pay equivalent to ½ month pay for every year
Art. 289: Installation of service, a fraction of at least six (6) months
Equivalent to at least
of labor-saving being considered as one whole year, if his/her
1 month pay or 1
devices or separation from the service is due to any of the
month pay for every
redundancy following authorized causes:
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a. Retrenchment to prevent losses (i.e. intended date thereof. [DOLE Handbook on

reduction of personnel effected by Workers’ Statutory Monetary Benefits, 2018
management to prevent losses) [Art. 298]; ed.]
b. Closure or cessation of operation of an
establishment not due to serious losses or Basis of Separation Pay
financial reverses [Art. 298]; The computation of separation pay of an
c. When the EE is suffering from a disease employee shall be based on his/her latest
not curable within a period of six (6) months salary rate. [DOLE Handbook on Workers’
and his/her continued employment is Statutory Monetary Benefits, 2018 ed.]
prejudicial to his/her health or to the health
of his/her co-employees [Art. 299]; and, Inclusion of Regular Allowance in the
d. Lack of service assignment of security Computation
guard for a continuous period of six (6) In the computation of separation pay, it would
months [D.O. 150, s. 2016] be error not to integrate the allowance with the
basic salary. The salary base properly used in
In no case will an employee get less than one computing the separation pay should include
(1) month separation pay if the separation is not just the basic salary but also the regular
due to the above stated causes. [DOLE allowances that an employee has been
Handbook on Workers’ Statutory Monetary receiving. [Planters’ Products, Inc. v. NLRC,
Benefits, 2018 ed.] G.R. No. 78524 (1989); DOLE Handbook on
Workers’ Statutory Monetary Benefits, 2018
One-Month Pay per Year of Service ed.]
An employee is entitled to separation pay
equivalent to his/her one-month pay for every Non-taxable
year of service, a fraction of at least 6 months In case of separation of an official or employee
being considered as one whole year, if his/her from the service of the employer due to death,
separation from service is due to any of the sickness or other physical disability or for any
following: cause beyond the control of the said official or
a. Installation by employer of labor-saving employee, any amount received by him or by
devices; his heirs from the employer as a consequence
b. Redundancy, as when the position of the of such separation shall likewise be exempt
employee has been found to be excessive from tax. [Last proviso of par. 1, Sec. 1, RA
or unnecessary in the operation of the 4917]
enterprise;
c. Impossible reinstatement of the employee 4. Money Claims arising from
to his/her former position or to a Employer-Employee Relationship
substantially equivalent position for
reasons not attributable to the fault of the Money claims must have arisen from
employer [Gaco v. NLRC, G.R. No. 104690 employment
(1994)] Money claims of workers which do not arise out
d. Lack of service assignment of security of or in connection with their employer-
guard by reason of age. [D.O. 150, s. 2016; employee relationship fall within the general
DOLE Handbook on Workers’ Statutory jurisdiction of regular courts of justice. [San
Monetary Benefits, 2018 ed.] Jose vs. NLRC and Ocean Terminal Services,
Inc., G.R. No. 121227 (1998)]
Notice of Termination
The employer may terminate the employment
of any employee due to the above-mentioned
authorized causes by serving a written notice
on the employee and the DOLE through its
regional office having jurisdiction over the
place of business at least 1 month before the
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Illustrative cases A money claim arising from employer-

In Pepsi-Cola Bottling Co. v. Martinez [G.R. employee relations, excepting SSS/
No. L-5887 (1982)], where an employee won ECC/Medicare claims, is within the jurisdiction
an award for his performance as top salesman of a Labor Arbiter —
of the year, the Court held that the claim for a. if the claim, regardless of amount, is
said prize unquestionably arose from an accompanied with a claim for
employer-employee relationship and, reinstatement; or
therefore, falls within the coverage of Art. 217 b. if the claim, whether or not accompanied
(now 224), which speaks of "all claims arising with a claim for reinstatement, exceeds five
from employer-employee relations." Indeed, thousand pesos (P5,000) per claimant.
the employee would not have qualified for the
contest, much less won the prize, if he was not Money claims cognizable by the Secretary
an employee of the company at the time of the of Labor or its duly authorized
holding of the contest. representative
The Secretary of Labor and Employment or his
But, in San Miguel Corp. vs. NLRC [G.R. No. duly authorized representatives shall have the
80774 (1988)], where SMC sponsored an power to:
innovation program granting cash awards to 1. issue compliance orders to give effect to
employees who would submit ideas and the labor standards provisions of this Code
suggestions beneficial to the corporation, the and other labor legislation
Court ruled that such undertaking, though 2. Issue writs of execution to the appropriate
unilateral in origin, could nonetheless ripen into authority for the enforcement of their
an enforceable contractual obligation on the orders, except in cases where the
part of SMC under certain circumstances. employer contests the findings of the labor
Thus, whether or not an enforceable contract employment and enforcement officer and
had arisen, and if so, whether or not it had been raises issues supported by documentary
reached, are preeminently legal questions on proofs which were not considered in the
contracts, questions not to be resolved by course of inspection. [Art. 128]
referring to labor legislation.
The visitorial and enforcement powers of the
Money claims cognizable by the Labor DOLE Regional Director to order and enforce
Arbiter compliance with labor standard laws can be
The Labor Arbiter shall have original and exercised even where the individual claim
exclusive jurisdiction to hear and decide, the exceeds P5,000.00. [Cireneo Bowling Plaza
following cases involving all workers: Inc. v. Sensing, G.R. 146572 (2005)]
1. Those cases that workers may file See discussion on Part VIII. G. 1. Visitorial
involving wages, rates of pay, hours of powers of the SOLE.
work and other terms and conditions of
employment, if accompanied with a claim Money claims cognizable by the Regional
for reinstatement Director
2. All other claims arising from employer- The Regional Director or any of the duly
employee relations, including those of authorized hearing officers is empowered to
persons in domestic or household service, hear and decide any matter involving the
involving an amount exceeding P5,000.00 recovery of:
regardless of whether accompanied with a 1. Wages and other monetary claims and
claim for reinstatement. benefits arising from employer-employee
a. Except claims for Employees relations
Compensation, Social Security, 2. Including legal interest
Medicare and maternity benefits [Art. Owing to an employee or person employed in
224(a)(3)(6)] domestic or household service or househelper
under this Code
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Provided, That:
1. Such complaint does not include a claim During this time, employees are considered on
for reinstatement; "floating status". [Art. 301; International
2. The aggregate money claims of each Hardware, Inc. vs. NLRC, G.R. No. 80770
employee or househelper does not (1989)]
exceed [Art. 129]
Floating Status in Security Agencies
SUMMARY OF RULES ON MONEY CLAIMS Temporary “off-detail” or “floating status” is the
Art. 224 - Art. 128 - period of time when security guards are in
Art. 129 - RD between assignments or when they are made
LA SOLE
Past or Past or to wait after being relieved from a previous post
Existing ER- until they are transferred to a new one.
present ER- present ER-
EE relation-
EE relation- EE relation-
ship Dire exigency of the employer’s bona fide
ship ship
Monetary The power Monetary suspension of operation, business or
claims of the SOLE claims below undertaking takes place when:
below 5k to order and 5k without a a. The security agency’s clients decide not to
arising from enforce claim for renew their contracts with the agency; and
terms and compliance reinstate- b. Contracts for security services stipulate
conditions of with labor ment that the client may request the agency for
employment, standard the replacement of the guards assigned to
if it is with a laws can be it
claim for exercised
reinstate- even where The employer should prove that there are no
ment the posts available to which the employee
individual temporarily out of work can be assigned. [Peak
Monetary claim Ventures Corp v. Nestor Villareal, G.R. No.
claims exceeds 184618 (2014)]
exceeding P5,000.00
5k, whether [Cireneo Requirement to be Reinstated
or not it is Bowling The employee on floating status must indicate
with a claim Plaza, Inc. his desire to resume his work not later than one
for reinstate- v. Sensing] (1) month from the resumption of operations of
ment, his employer or from his relief from the military
except or civic duty.
those
involving Thereafter, the employer shall reinstate the
SSS, employee to his former position without loss of
Medicare seniority rights. [Art. 301]
and
maternity When deemed constructive dismissal
benefits When that "floating status" of an employee
lasts for more than six months, he may be
5. When Not Deemed Dismissed; considered to have been illegally dismissed
from the service. Thus, he is entitled to the
Employee on Floating Status corresponding benefits for his separation, and
this will apply to the two types of work
The bona fide suspension of the operation of a suspension, that is, either of the entire
business or undertaking for a period not business or of a specific component thereof.
exceeding six (6) months, or the fulfillment by [Valdez v. NLRC, G.R. No. 125028 (1998)]
the employee of a military or civic duty shall
not terminate employment. [Art. 301]
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C. TERMINATION BY To constitute a resignation:

EMPLOYEE 1. It must be unconditional and with the intent
to operate as such;
2. There must be an intention to relinquish a
1. With notice to the employer portion of the term of office accompanied
by an act of relinquishment.
An employee may terminate without just cause
the employer-employee relationship The fact that the employee signified his desire
a. By serving a written notice on the employer to resume his work when he went back to
at least one (1) month in advance AZCOR after recuperating from his illness, and
b. The employer upon whom no such notice actively pursued his case for illegal dismissal
was served may hold the employee liable before the labor courts when he was refused
for damages [Art. 300] admission by his employer, negated any
intention on his part to relinquish his job at
Notice is required when termination is without AZCOR. [Azcor Manufacturing Inc. v. NLRC,
just cause. Written notice to resign must be G.R. No. 117963 (1999)]
submitted one (1) month in advance. [Art. 300]
Well-entrenched is the rule that resignation is
2. Without notice to the employer inconsistent with the filing of a complaint for
illegal dismissal. [Blue Angel Manpower and
An employee may put an end to the Security Services Inc. v Court of Appeals, G.R.
relationship without serving any notice on the No. 161196 (2008)]
employer for any of the following requirements:
1. Serious insult by the employer or his The rule requiring an employee to stay or
representative on the honor and person of complete the 30-day period prior to the
the employee; effectivity of his resignation becomes
2. Inhuman and unbearable treatment discretionary on the part of management, as an
accorded the employee by the employer or employee who intends to resign may be
his representative; allowed a shorter period before his resignation
3. Commission of a crime or offense by the becomes effective. [Hechanova Bugay Vilchez
employer or his representative against the Lawyers v. Matorre, G.R. No. 198261 (2013)]
person of the employee or any of the
immediate members of his family; and Requisites of a valid resignation
4. Other causes analogous to any of the 1. Voluntary, unconditional, and intentionally
foregoing. [Art. 300] to relinquish a portion of a term of
employment;
Notice is NOT required when termination is 2. Accompanied by an act of relinquishment.
with just cause. [Art. 300]
Intent to Relinquish
3. Distinguish voluntary resignation As the intent to relinquish must concur with the
and constructive dismissal overt act of relinquishment, the acts of the
employee before and after the alleged
Definition of Resignation resignation must be considered in determining
Resignation is the voluntary act of an employee whether he or she, in fact, intended to sever his
who finds himself in a situation where he or her employment. [Saudi Arabian Airlines v.
believes that personal reasons cannot be Rebesencio, G.R. No. 198587 (2015)]
sacrificed in favor of the exigency of the
service, such that he has no other choice but to Resignation is voluntary when the act of
disassociate himself from his employment. resignation and the intention to resign concur.
[Cervantes v. PAL Maritime Corp., G.R. No. If the resignation was done because of
175209 (2013)] oppressive conditions set by the employer,
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such is tantamount to constructive dismissal. What is Retirement

[Saudi Arabian Airlines v. Rebesencio, G.R. It is the result of a bilateral act of the parties, a
No. 198587 (2015)] voluntary agreement between the employer
and the employee whereby the latter, after
reaching a certain age agrees to sever his or
Constructive
Resignation her employment with the former.
Dismissal
Voluntary act of an Involuntary or forced Three kinds of retirement schemes

employee who is in resignation due to 1. Mandated by law: Compulsory and
a situation where the harsh, hostile, contributory in character
one believes that and unfavorable 2. CBA and other agreements: Agreement
personal reasons conditions set by the between the employer and the employees
cannot be sacrificed employer. It is 3. Voluntarily given by the employer:
in favor of the essentially quitting expressly as in an announced company
exigency of the or cessation of work policy or impliedly as in a failure to contest
service. It is a formal because continued the employee's claim for retirement
pronouncement or employment is benefits. [Gerlach v. Reuters Limited, PH,
relinquishment of an rendered impossible, G.R. No. 148542 (2005)]
office, with the unreasonable or
intention of unlikely; when there Requisites for Retroactive Application
relinquishing the is a demotion in rank 1. The claimant for retirement benefits was
office accompanied or a diminution of still in the employ of the employer at the
by the act of pay and other time the statute took effect; and
relinquishment. [Gan benefits. It exists if 2. The claimant had complied with the
v. Galderma an act of clear requirements for eligibility for such
Philippines, Inc.] discrimination, retirement benefits under the statute.
insensibility, or [Universal Robina Sugar Milling Corp. v.
disdain by an Caballeda, G.R. No. 156644 (2008)]
employer becomes
so unbearable on 1. Eligibility and Coverage
the part of the
employee that it Who are covered
could foreclose any All employees in the private sector, regardless
choice by him of their position, designation, or status, and
except to forego his irrespective of the method by which their
continued wages are paid [Sec. 1, IRR, RA 7641]
employment. [Gan v.
Galderma Exceptions:
Philippines, Inc.] 1. Employees covered by the Civil Service
Law;
Valid termination of Illegal dismissal 2. Employees in retail, service and
employment by the agricultural establishments or operations
employee. regularly employing not more than ten
employees [Sec. 2, IRR, RA 7641]
Note: Domestic helpers and those in the

D. RETIREMENT personal service of others used to be
exempted but such was deleted by D.O. 20
(1994).
[Art 302, LC; RA 7641 (The Retirement Pay
Law)] When the provisions of RA 7641 apply
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RA 7641 only applies in a situation where there Employee may still work after retirement
is: Upon retirement of an employee, whether
a. No CBA or other applicable employment optional or compulsory, his services may be
contract providing for retirement benefits; continued or extended on a case to case basis
OR upon the agreement of the employer and
b. Retirement benefits provided by CBA or employee. [Sec. 4, IRR, RA 7641]
other employment contract fall below the
requirements set by law. [Oxales v. Unilab, 2. Amount of Retirement Pay
G.R. No. 152991 (2008)]
Minimum Retirement Pay [Sec. 5, IRR, RA
Age of retirement 7641]
In the absence of a retirement plan or
agreement: Minimum Components
a. Compulsory retirement: 65 years old [Sec.
½ month salary for “One-half month
4, IRR, RA 7641]
every year of service salary” shall include
b. Optional retirement: 60 years or more (but
all of the following:
below 65) and having served the
NOTE: a fraction of Fifteen (15) days
establishment for at least 5 years. [Sec. 1,
at least 6 months salary based on the
IRR, RA 7641]
shall be considered latest salary rate;
a year
An employer is free to impose a retirement age
Cash equivalent of
less than 65 for as long as it has the
“one-half month five (5) days of
employees’ consent. [Jaculbe v. Silliman
salary” is equivalent service incentive
University, G.R. No. 156934 (2007)]
to 22.5 days. leave;
[Capitol Wireless,
For surface mine workers:
Inc. v. Sec. One-twelfth (1/12) of
a. Compulsory retirement age: 60 years old
Confessor, G.R. No. the 13th month pay.
b. Optional retirement age is 50 and having
117174 (1996); (1/12 x 365/12 =
served the establishment for at least 5
Reyes v. NLRC, .083 x 30.41 = 2.52)
years. [Sec. 2, RA 10757]
G.R. No. 160233
(2007)] All other benefits
Forfeiture of Benefits
that the employer
Employees dismissed for just cause are not
and employee may
entitled to retirement benefits and other
agree upon
privileges including reinstatement and
backwages. To rule otherwise would be to
reward acts of willful bread of trust by Retirement pay under RA 7641 vis-à-vis
employees. [Sy v. Metropolitan Bank, G.R. No retirement benefits under SSS and GSIS
160618 (2006)] laws
The benefits under RA 7641 are other than
those granted by the SSS or the GSIS. [Secs.
1 & 2, RA 7641]
Retirement Benefits under a CBA or

Applicable Contract
Any EE may retire or be retired by his/her ER
upon reaching the age established in the CBA
or other applicable agreement/contract and
shall receive the retirement benefits granted
therein; provided, however, that such
retirement benefits shall not be less than the
retirement pay required under RA 7641, and
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provided further that if such retirement benefits General Rule: Exempt from all taxes, not liable
under the agreement are less, the ER shall pay to attachment
the difference. [Art. 302; Sec. 3.2, IRR]
The retirement benefits received by officials
Where both the ER and the EE contribute to a and employees of private firms in accordance
retirement fund pursuant to the applicable with a reasonable private benefit plan
agreement, the ER’s total contributions and the maintained by the employer:
accrued interest thereof should not be less a. shall be exempt from all taxes and
than the total retirement benefits to which the b. shall not be liable to attachment,
EE would have been entitled had there been no garnishment, levy or seizure by or under
such retirement benefits’ fund. If such total any legal or equitable process whatsoever.
portion from the ER is less, the ER shall pay [Sec. 1, RA 4917]
the deficiency. [Sec. 3.3, IRR, RA 7641]
Exception: payment of debts
3. Retirement Benefits for Workers The benefits may be subject of attachment,
Paid by Results garnishment, levy or seizure to cover a debt of
the official or employee concerned to the
Basis for computation of salary for 15 days private benefit plan or that arising from liability
Average Daily Salary (ADS): The ADS is imposed in a criminal action. [Sec. 1, RA 4917]
derived by dividing the total salary for the last
12 months reckoned from the date of Requirements to Avail of Exemption
retirement by the number of actual working 1. That the retiring official or employee has
days in that particular period, provided that the been in the service of the same employer
determination of rates of payment by results for at least 10 years
are in accordance with established regulations. 2. He is not less than fifty years of age at the
[Sec. 5.3, IRR, RA 7641] time of his retirement;
3. That the retirement benefits shall be
4. Retirement Benefit of Part-Time availed of by an official or employee only
once [Sec. 1, RA 4917]
Workers 4. The benefit plan must be approved by the
BIR [Sec. 6, IRR, RA 7641]
Requisites
Part-time workers are also entitled to Coverage of Exemption from Income Tax
retirement pay of “one-half month salary” for Exempted from taxation are:
every year of service under RA 7641 after a. The retirement benefits received under RA
satisfying the following conditions precedent 7641;
for optional retirement: b. Those received by officials and employees
a. There’s no retirement plan between the ER of private firms, whether individual or
and the EE; and, corporate, in accordance with a reasonable
b. The EE should have reached the age of 60 private benefit plan maintained by the
years, and should have rendered at least 5 employer [Handbook on Workers’ Statutory
years of service with the ER. Monetary Benefits, 2018 ed.];
c. Amount received by the official/employee
Applying the foregoing principle, the or his heirs as a consequence of
components of retirement benefit of part-time separation due to death, sickness, or other
workers may likewise be computed at least in physical disability or for any cause beyond
proportion to the salary and related benefits the control of the said official or employee.
due them. [DOLE Handbook on Workers’ [Sec. 1, RA 4917]
Statutory Monetary Benefits, 2018 ed.]
Reasonable Private Benefit Plan Defined
5. Non-Taxable It refers to a pension, gratuity, stock bonus or
profit-sharing plan:
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a. Maintained by an employer for the

benefit of some or all of his officials and
employees,
b. Wherein contributions are made by such
employer or officials and employees, or
both, for the purpose of distributing to such
officials and employees the earnings and
principal of the fund thus accumulated, and
c. Wherein it is provided in said plan that at
no time shall any part of the corpus or
income of the fund be used for, or be
diverted to, any purpose other than for the
exclusive benefit of the said officials and
employees. [Sec. 1, RA 4917; Handbook
on Workers’ Statutory Monetary Benefits,
2018 ed.
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LABOR LAW 2
LABOR LAW
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6. Recognition of the tenets of the sect should

V. LABOR RELATIONS not infringe on the basic right of self-
organization granted by the [C]onstitution
to workers, regardless of religious
A. RIGHT TO SELF- affiliation. [Kapatiran sa Meat and Canning
Division v. Calleja, G.R. No. 82914 (1988)]
ORGANIZATION
1. Who May or May Not Exercise the
Right to Self-Organization: A Fundamental Right
Right
Self-organization is a fundamental right a. All employees
guaranteed by the Philippine Constitution and b. Government employees of corporations
the Labor Code. Employees have the right to
created under the Corporation Code
form, join or assist labor organizations for the c. Supervisory Employees
purpose of collective bargaining or for their
d. Aliens with valid working permits
mutual aid and protection. [UST Faculty Union
e. Security personnel
v. Bitonio, G.R. No. 131235 (1999)]
(a) All Employees
Infringement of the right to self-
organization All persons employed in commercial, industrial
It shall be unlawful for any person to restrain, and agricultural enterprises and in religious,
coerce, discriminate against or unduly interfere charitable, medical or educational institutions,
with employees and workers in their exercise whether operating for profit or not, shall have
of the right to self-organization [Art. 257] the right to self-organization and to form, join or
assist labor organizations of their own
Scope of right to self-organization choosing for purposes of collective bargaining.
1. Right to form, join or assist labor (Presumes an employer-employee
organizations of their own choosing for the relationship)
purpose of collective bargaining through
representatives of their own choosing [Art. Ambulant, intermittent and itinerant workers,
257]; self-employed people, rural workers and those
2. Right to engage in lawful concerted without any definite employers may form labor
activities for the same purpose (collective organizations for their mutual aid and
bargaining) or for their mutual aid and protection. [Art. 253]
protection [Art. 257]
3. The right of any person to join an Any employee, whether employed for a definite
organization also includes the right to leave period or not, shall, beginning on his first day of
that organization and join another one. service, be considered an employee for
[Heritage Hotel Manila v. PIGLAS- purposes of membership in any labor union.
Heritage, G.R. No. 177024 (2009)] [Art. 292(c)]
4. The right to form or join a labor organization
necessarily includes the right to refuse or Employee […] shall include any individual
refrain from exercising said right. [Reyes v. whose work has ceased as a result of or in
Trajano, G.R. No. 84433 (1992)] connection with any current labor dispute or
5. The freedom to form organizations would because of any unfair labor practice if he has
be rendered nugatory if they could not not obtained any other substantially equivalent
choose their own leaders to speak on their and regular employment. [Art. 219(f)]
behalf and to bargain for them. [Pan-
American World Airways, Inc v. Pan- Employees of non-profit organizations are now
American Employees Association, G.R. permitted to form, organize or join labor unions
No. L-25094 (1969)] of their choice for purposes of collective
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bargaining [FEU-Dr. Nicanor Reyes Medical General Rule: All aliens, natural or juridical,
Foundation Inc. v. Trajano, G.R. No. 76273 […] are strictly prohibited from engaging
(1987)] directly or indirectly in all forms of trade union
activities. [Art. 284]
(b) Government employees of
corporations created under the Exception: Aliens may exercise the right to
Corporation Code self-organization and join or assist labor unions
for purposes of collective bargaining, provided
The right to self-organization shall not be the following requisites are fulfilled:
denied to government employees. [Sec. 2(5), 1. With valid working permits issued by the
Art. IX-B, Constitution] DOLE; and
2. They are nationals of a country which
Employees of government corporations grants the same or similar rights to Filipino
established under the Corporation Code shall workers [Art. 284]
have the right to organize and to bargain a. As certified by DFA; OR
collectively with their respective employers b. Has ratified either ILO Conventions No.
87 and 98 [Sec. 2, Rule II, Book V, IRR]
All other employees in the civil service shall
have the right to form associations for (e) Security personnel
purposes not contrary to law. [Art. 254]
The security guards and other personnel
All government employees can form, join or employed by the security service contractor
assist employees’ organizations of their own shall have the right:
choosing for the furtherance and protection of 1. To form, join, or assist in the formation of a
their interests. They can also form, in labor organization of their own choosing for
conjunction with appropriate government purposes of collective bargaining and
authorities, labor-management committees, 2. To engage in concerted activities which are
work councils and other forms of workers’ not contrary to law including the right to
participation schemes to achieve the same strike. [D.O. No. 14 Series of 2001
objectives. [E.O. 180, Sec. 2 (1987)] (Guidelines Governing the Employment
and Working Conditions of Security Guards
(c) Supervisory Employees and Similar Personnel in the Private
Security Industry)]
Supervisory employees are those who, in the
interest of the employer, effectively On Dec. 24, 1986, President C. Aquino issued
recommend such managerial actions if the EO No. 111 which eliminated the provision
exercise of such authority is not merely which made security guards ineligible to join
routinary or clerical in nature but requires the any labor organization. In 1989, Congress
use of independent judgment. [Art. 219(m)] passed RA 6715 which also did not impose
limitations on the ability of security guards to
What is essential is the nature of the join labor organizations. Thus, security guards
employee’s function and not the nomenclature “may now freely join a labor organization of the
or title given to the job which determines rank-and-file or that of the supervisory union,
whether the employee has rank-and-file or depending on their rank.” [Manila Electric Co.
managerial status or whether he is a v. SOLE, G.R. No. 91902 (1991)]
supervisory employee. [Tagaytay Highlands
International Golf Club, Inc. v. Tagaytay
Highlands Employees Union-PTGWO, G.R.
142000 (2003)]
(d) Aliens with valid working permits
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Ineligibility of Managerial Employees; a. Doctrine of Necessary

Rights of Supervisory Employees Implication
Managerial employees are not eligible to join, While Art. 245 [now 255] of the Labor Code
assist or form any labor organization. [Art. 255] singles out managerial employees as ineligible
to join, assist or form any labor organization,
Supervisory employees shall not be eligible for under the doctrine of necessary implication,
membership in the collective bargaining unit of confidential employees are similarly
the rank-and-file employees but may join, disqualified. This doctrine states that what is
assist or form separate collective bargaining implied in a statute is as much a part thereof as
units and/or legitimate labor organizations of that which is expressed. [Metrolab Industries
their own. The rank and file union and the Inc. v. Roldan-Confessor, G.R. No. 108855
supervisors' union operating within the same (1996)]
establishment may join the same federation or
national union. Nature of Access Test
Confidential employees, by the nature of their
Rationale: Supervisory employees, while in functions, assist and act in a confidential
the performance of supervisory functions, capacity to, or have access to confidential
become the alter ego of the management in the matters of, persons who exercise managerial
making and the implementing of key decisions functions in the field of labor relations.
at the sub-managerial level. Certainly, it would
be difficult to find unity or mutuality of interests Requisites
in a bargaining unit consisting of a mixture of 1. The confidential relationship must exist
rank-and-file and supervisory employees. between the employees and his
[Toyota Motor Phil. Corp. v. Toyota Motor Phil. supervisor, and
Corp. Labor Union, G.R. No. 121084 (1997)] 2. The supervisor must handle the prescribed
responsibilities relating to labor relations.
Supervisor and Rank and File Union [San Miguel Supervisors and Exempt
Affiliation Union v. Laguesma, G.R. No. 110399
The rank and file union and the supervisors’ (1997)]
union operating within the same establishment
may join the same federation or national union. Function Test: Nomenclature is not
[Art. 255] controlling
The mere fact that an employee is designated
Note also: Prior to the enactment of RA 9481, “manager” does not ipso facto make him one.
which inserted a new provision [Art. 245-A, Designation should be reconciled with the
now Art. 256], the Court held in De La Salle actual job description of the employee. [Paper
University v. Laguesma that a local Industries Corp. of the Philippines. v.
supervisors’ union is not allowed to affiliate with Laguesma, G. R. No.101738 (2000)]
a national federation of unions of rank and file
employees only where two conditions concur: Confidential information: Must relate to
1. The rank-and-file employees are directly labor relations and not from a business
under the authority of supervisory standpoint
employees An employee must assist or act in a confidential
2. The national federation is actively involved capacity and obtain confidential information
in union activities in the company. [De La relating to labor relations policies. Exposure to
Salle University Medical Center and internal business operations of the company is
College of Medicine v. Laguesma, G.R. No. not per se a ground for the exclusion in the
102084 (1998)] bargaining unit. [Coca-Cola Bottlers v. IPTEU,
G.R. No. 193798 (2015)]
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Rationale of Exclusion of Confidential Irrespective of the degree of their participation

Employees in the actual management of the cooperative,
If confidential employees could unionize in all members thereof cannot form, assist or join
order to bargain for advantages for a labor organization for the purpose of
themselves, then they could be governed by collective bargaining. [Benguet Electric
their own motives rather than the interest of the Cooperative v. Ferrer-Calleja, G.R. No. 79025
employers. (1989)]
Moreover, unionization of confidential Exception: Employees who withdrew their

employees for the purpose of collective membership from the cooperative are entitled
bargaining would mean the extension of the to form or join a labor union for the negotiations
law to persons or individuals who are supposed of a Collective Bargaining Agreement. [Central
to act in the interest of the employers. It is not Negros Electric Cooperative, Inc. v. DOLE,
far-fetched that in the course of collective G.R. No. 94045 (1991)]
bargaining, they might jeopardize that interest
which they are duty bound to protect. [Metrolab (c) Employees of International
Industries Inc. v. Roldan-Confessor, G.R. No. Organizations
108855 (1996)]
International organizations are endowed with
Other People Who Cannot Form, Join or some degree of international legal personality.
Assist Labor Organizations They are granted jurisdictional immunity, as
provided in their organization’s constitutions, to
(a) New Employees safeguard them from the disruption of their
functions.
[Persons who] are not employees of [a
company] are not entitled to the constitutional Immunity […] is granted to avoid interference
right to join or form a labor organization for by the host country in their internal workings.
purposes of collective bargaining. […] The The determination [by the executive branch]
question of whether employer-employee has been held to be a political question
relationship exists is a primordial consideration conclusive upon the Courts in order not to
before extending labor benefits under the embarrass a political department of
workmen's compensation, social security, Government. [Hence], a certification election
Medicare, termination pay and labor relations cannot be conducted in an international
law. [Singer Sewing Machine Co. v. Drilon, organization to which the Philippine
G.R. No. 91307, 1991] Government has granted immunity from local
jurisdiction. [International Catholic Migration
But employees of the contractor can still form a Commission v. Calleja, G.R. No. 85750 (1990)]
labor union; the labor union can be established
to bargain with the contractor but not with the (d) Members of the AFP, Policemen, Police
principal employer. [Prof. Battad] Officers, Firemen, and Jail Guards
(b) Employee-member of a Cooperative Members of the AFP, Policemen, Police

Officers, Firemen and Jail Guards are
General Rule: An employee of a cooperative expressly excluded by EO 180, Sec. 4 from the
who is a member and co-owner thereof cannot coverage of the EO 180 which provides
invoke the right to collective bargaining for guidelines for the exercise of the right to
certainly an owner cannot bargain with himself organize of government employees.
or his co-owners. [Batangas-I Electric
Cooperative Labor Union v. Romeo A. Young, SUMMARY - Who Cannot Form, Join or
G.R. No. 62386 (1988)] Assist Labor Organizations
a. Managerial employees
b. Confidential employees
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c. Non-employees
d. Member-employee of a cooperative Prohibition on subversive activities or
e. Employees of international organizations membership
f. High-level government employees No labor organization shall knowingly admit as
g. Members of the AFP, police officers, members or continue in membership any
policemen, firemen and jail guards individual who:
1. Belongs to a subversive organization; or
2. Commingling or Mixture of 2. Who is engaged directly or indirectly in any
Membership subversive activity;
Effect of Inclusion of Employees Outside Unions cannot arbitrarily exclude qualified

the Bargaining Unit or Commingling applicants
General Rule: It shall not be a ground for the Unions are not entitled to arbitrarily exclude
cancellation of the registration of the union. qualified applicants for membership, and a
Said employees are automatically deemed closed-shop provision would not justify the
removed from the list of membership of said employer in discharging, or a union in insisting
union. [Art. 256] upon the discharge of, an employee whom the
union thus refuses to admit to membership,
Exception: Unless such mingling was brought without any reasonable ground therefor.
about by misrepresentation, false statement or Needless to say, if said unions may be
fraud under Art. 247 (Grounds for cancellation compelled to admit new members, who have
of Union Registration) of the Labor Code. the requisite qualifications, with more reason
[SMCC-Super v. Charter Chemical and may the law and the courts exercise the
Coating Corporation, G.R. No. 169717 (2011)] coercive power when the employee involved is
a long-standing union member, who, owing to
provocations of union officers, was impelled to
3. Rights and Conditions of tender his resignation which he forthwith
withdrew or revoked. [Salunga v. CIR, G.R.
Membership No. L-22456 (1967)]
a. Nature of Relationship Members who seek destruction of union
lose right to remain as members
i. Member-Labor Union Inherent in every labor union, or any
organization for that matter, is the right of self-
The nature of the relationship between the preservation. When members of a labor union,
union and its members is fiduciary in nature, therefore, sow the seeds of dissension and
which arises from the dependence of the strife within the union; when they seek the
employee on the union, and from the disintegration and destruction of the very union
comprehensive power vested in the union with to which they belong, they thereby forfeit their
respect to the individual. The union may be rights to remain as members of the union which
considered but the agent of its members for the they seek to destroy. [Villar v. Inciong, G.R. No.
purpose of securing for them fair and just L-50283-84 (1983)]
wages and good working conditions. [Heirs of
Cruz v. CIR, G.R. No. L-23331-32 (1969)] ii. Labor Union-Federation
Admission and Discipline of Members Local unions do not owe their creation and
No arbitrary or excessive initiation fees or fines. existence to the national federation to which
No arbitrary or excessive initiation fees shall be they are affiliated but, instead, to the will of their
required of the members of a legitimate labor members, […] The local unions remain the
organization nor shall arbitrary, excessive or basic units of association, free to serve their
oppressive fine and forfeiture be imposed. [Art. own interests subject to the restraints imposed
250(e)] by the constitution and by-laws of the national
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federation, and free also to renounce the only upon the submission of the following
affiliation upon the terms laid down in the documents in addition to its charter certificate:
agreement which brought such affiliation into 1. The names of the chapter's officers, their
existence. [Philippine Skylanders, Inc. v. addresses, and the principal office of the
NLRC, G.R. No. 127374 (2002)] chapter; and
2. The chapter's constitution and by-laws:
Union Chartering Provided, That where the chapter's
Affiliate constitution and by-laws are the same as
An independent union affiliated with a that of the federation or the national union,
federated, national union or a chartered local this fact shall be indicated accordingly.
which was subsequently granted independent
registration but did not disaffiliate from its The additional supporting requirements shall
federation, reported to the Regional Office and be:
the Bureau in accordance with Rule III, Secs. 6 1. Certified under oath by:
and 7 [Sec. 1(b), Rule I, Book V, IRR] a. Secretary; or
b. Treasurer
Independent Union 2. Attested by: Its president [Art. 241]
A labor organization operating at the enterprise
level that acquired legal personality through Lesser requirements for Chartered locals
independent registration under Art. 234 of the The intent of the law in imposing less
Labor Code and Rule III, Sec. 2-A [Sec. 1(x), requirements in the case of a branch or local of
Rule I, Book V] a registered federation or national union is to
encourage the affiliation of a local union with a
National Union or Federation federation or national union in order to increase
A group of legitimate labor unions in a private the local unions’ bargaining powers respecting
establishment organized for collective terms and conditions of labor. [SMCEU-
bargaining or for dealing with employers PTGWO v. SMPEU-PDMP, G.R. No. 171153
concerning terms and conditions of (2007)]
employment for their member union or for
participating in the formulation of social and Trade Union Centers cannot create locals
employment policies, standards and programs, or chapters
registered with the BLR in accordance with Art. 241 mentions only “a duly registered
Rule III Sec. 2-B [Sec. 1(ll), Rule I, Book V, federation or national union.”
IRR]
The solemn power and duty of the Court to
Chartered Local (Local Chapter) interpret and apply the law does not include the
A labor organization in the private sector power to correct by reading into the law what is
operating at the enterprise level that acquired not written therein. [SMCEU-PTGWO v.
legal personality through registration with SMPEU-PDMP, G.R. No. 171153 (2007)]
Regional Office [Sec. 1(j), Rule I, Book V, IRR]
National Union or Federation v. Trade
A duly registered federation or national union Unions
may directly create a local chapter by issuing a National Union or
charter certificate indicating the establishment Trade Unions
Federation
of the local chapter. The chapter shall acquire With at least ten Composed of a
legal personality only for purposes of filing a (10) locals or group of registered
petition for certification election from the date it chapters (or national unions or
was issued a charter certificate. independent unions federations
[Sec. 2-B(5), Rule
The chapter shall be entitled to all other rights III, Book V, IRR],
and privileges of a legitimate labor organization each of which must
be a duly
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recognized unions are considered principals while the

collective bargaining federation is deemed to be merely their agent.
agent [Art. 244] [Insular Hotel Employees Union NFL v.
Can directly create Cannot directly Waterfront Insular Hotel, G.R. No. 174040-41
local chapter [Art. create local chapter (2010)]
241] [SMCEU-PTGWO v.
SMPEU-PDMP,
G.R. No. 171153 (a) Disaffiliation
(2007)]
In the absence of specific provisions in the
Purpose of Affiliation federation’s constitution prohibiting
To foster the free and voluntary organization of disaffiliation or the declaration of autonomy of
a strong and united labor movement [Art. 218- a local union, a local may dissociate with its
A(c)] parent union. [Malayang Manggagawa sa M.
Greenfield v. Ramos, G.R. No. 113907 (2000)]
The sole essence of affiliation is to increase, by
collective action, the common bargaining Local unions have the right to separate from
power of local unions for the effective their mother federation on the ground that as
enhancement and protection of their interests. separate and voluntary associations, local
Admittedly, there are times when without unions do not owe their creation and existence
succor and support local unions may find it to the national federation to which they are
hard, unaided by other support groups, to affiliated but, instead, to the will of their
secure justice for themselves. [Philippine members. [Philippine Skylanders, Inc. v.
Skylanders, Inc. v. NLRC, G.R. No. 127374 NLRC, G.R. No. 127374 (2002)]
(2002)]
A local union is free to serve the interests of all
Nature of Relationship: Agency its members, including the freedom to
The mother union, acting for and on behalf of disaffiliate or declare its autonomy from the
its affiliate, had the status of an agent while the federation to which it belongs when
local union remained the basic unit of the circumstances warrant, in accordance with the
association, free to serve the common interest constitutional guarantee of freedom of
of all its members subject only to the restraints association. [Malayang Samahan ng mga
imposed by the constitution and by-laws of the Manggagawa sa M. Greenfield, Inc. v. Ramos,
association. [...] The same is true even if the G.R. No. 113907 (2000)]
local is not a legitimate labor organization.
[Filipino Pipe and Foundry Corp v. NLRC, G.R. Period of Disaffiliation
No. 115180 (1998)] Generally, a labor union may disaffiliate from
the mother union to form a local or independent
Effect of Affiliation union only during the 60-day freedom period
Inclusion of [the federation’s initials] in the immediately preceding the expiration of the
registration is merely to stress that they are its CBA. However, even before the onset of the
affiliates at the time of registration. It does not freedom period, disaffiliation may be carried
mean that said local unions cannot stand on out when there is a shift of allegiance on the
their own. [Adamson v. CIR, G.R. No. L-35120 part of the majority of the members of the
(1984)] union. [Alliance of Nationalist and Genuine
Labor Organization v. Samahan ng mga
Mere affiliation does not divest the local union Manggagawang Nagkakaisa sa Manila Bay
of its own personality, neither does it give the Spinning Mills, G.R. No. 118562 (1996)]
mother federation the license to act
independently of the local union. It only gives [A] local union which has affiliated itself with a
rise to a contract of agency, where the former federation is free to sever such affiliation
acts in representation of the latter. Hence, local anytime and such disaffiliation cannot be
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considered disloyalty. [Malayang Manggagawa must be understood. It only means that the
sa M. Greenfield v. Ramos, G.R. No. 113907 employees, thru their new bargaining agent,
(2000)] cannot renege on their collective bargaining
contract, except of course to negotiate with
Effect of Disaffiliation management for the shortening thereof.
On legal personality [Benguet Consolidated v. BCI Employees and
A registered independent union retains its legal Workers Union-PAFLU, G.R. No. L-24711
personality while a chartered local loses its (1968)]
legal personality unless it registers itself.
Conditions to apply the doctrine
No effect on CBA 1. Change of bargaining agent (through
A disaffiliation does not disturb the affiliation, disaffiliation, or other means);
enforceability and administration of a collective and
agreement; it does not occasion a change of 2. Existing CBA with the previous bargaining
administrators of the contract nor even an agent [Benguet Consolidated v. BCI
amendment of the provisions thereof. Employees and Workers Union-PAFLU,
[Volkschel Labor Union v. BLR, No. L-45824 G.R. No. L-24711 (1998)]
(1985)]
Effects
Obligation to pay union dues is 1. New bargaining agent cannot revoke and
coterminous with membership must respect the existing CBA; and
“The employees’ check-off authorization, even 2. It may negotiate with management to
if declared irrevocable, is good only as long as shorten the existing CBA’s lifetime.
they remain members of the union concerned”.
A contract between an employer and the
parent organization as bargaining agent for the B. BARGAINING UNIT
employees is terminated by the disaffiliation of
the local of which the employees are members.
[Volkschel Labor Union v. BLR, No. L-45824 Definition
(1985)] “Bargaining Unit” refers to a group of
employees sharing mutual interests within a
Power to represent principal severed given employer unit, comprised of all or less
By [the local union’s disaffiliation from the than all of the entire body of employees in the
federation], the vinculum that previously bound employer unit or any specific occupational or
the two entities was completely severed. [The geographical grouping within such employer
federation] was divested of any and all power unit. [Sec. 1(e), Rule I, Book V, IRR]
to act in representation of the union. Thus, any
act performed by [the federation] affecting the It is a group of employees of a given employer,
interests and affairs of the [local union] is comprised of all or less than all of the entire
rendered without force and effect. [ANGLO v. body of employees, which the collective
Samana, G.R. No. 118562 (1996)] interests of all the employees indicate to be
best suited to serve reciprocal rights and duties
(b) Substitutionary Doctrine of the parties consistent with equity to the
employer. [Belyca Corp. v. Calleja, G.R. No.
The “substitutionary” doctrine provides that the 77395 (1988) citing Rothenberg]
employees cannot revoke the validly executed
collective bargaining contract with their Functions of an Appropriate Bargaining
employer by the simple expedient of changing Unit
their bargaining agent. 1. An ELECTORAL DISTRICT. – It marks the
boundaries of those who may participate in
It is in the light of this that the phrase “said new a certification election.
agent would have to respect said contract”
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2. An ECONOMIC UNIT. – They are a group never bind subsequent federations and unions
of employees with community of interests. because it is a curtailment of the right to self--
3. A SOVEREIGN BODY. – It selects the sole organization guaranteed by the labor laws
and exclusive bargaining agent. [General Rubber & Footwear Corp. v. BLR,
G.R. No. 74262 (1987)]
Role of a bargaining unit
The labor organization designated or selected Corporate Entities
by the majority of the employees in an General Rule: Two companies having
appropriate collective bargaining unit shall be separate juridical personalities shall NOT be
the exclusive representative of the employees treated as a single bargaining unit. [Diatagon
in such unit for the purpose of collective Labor Federation Local v. Ople, G.R. No. L-
bargaining. [Art. 267] 44493-94 (1980)]
Right of individual or group of employees Exception: Pervasive Unitary Aspect of

to present grievances Management Doctrine
An individual employee or group of employees The cross-linking of the agencies’ command,
shall have the right at any time to present control, and communication systems indicate
grievances to their employer. [Art. 267] their unitary corporate personality. Accordingly,
the veil of corporate fiction [...] should be lifted
CBA Coverage for the purpose of allowing the employees of
It is a well-settled doctrine that the benefits of a the three agencies to form a single labor union.
collective bargaining agreement extend to the A settled formulation of the doctrine of piercing
laborers and employees in the collective the corporate veil is that when two business
bargaining unit, including those who do not enterprises are owned, conducted, and
belong to the chosen bargaining labor controlled by the same parties, both law and
organization. [Mactan Workers Union v. equity will, when necessary to protect the rights
Aboitiz, G.R. No. L-30241 (1972)] of third parties, disregard the legal fiction that
these two entities are distinct and treat them as
Note: An employee employed, whether for a identical or as one and the same. [Ang Lee v.
definite period is not, is an EE for purposes of Samahang Manggagawa ng Super
joining a union [Art. 292(c)]. But, whether or not Lamination, G.R. No. 193816 (2016)]
a union member, an EE part of the CBU is
entitled to CBA benefits unless excluded under Determining whether or not to establish
the CBA. separate bargaining units
The fact that the businesses are related, that
Effect of Prior Agreement some of the employees are the same persons
A prior CBA excluding a group of employees working in the other company and the physical
from the bargaining unit of rank-and-file plants, offices and facilities are in the same
employees does not bar the parties from compound are NOT sufficient to justify piercing
renewing the existing CBA and proposing and the corporate veil. [Indophil Textile Mills
discussing modifications or amendments Workers Union v. Calica, G.R. No. 96490
thereto during the freedom period. [De La Salle (1992)]
University v. DLSU Employees Association EA,
G.R. No. 109002, (2000)] Spun-off corporations
The transformation of the companies is a
Rationale management prerogative and business
A prior agreement as to the exclusion of judgment which the courts cannot look into
monthly-paid rank-and-file employees from the unless it is contrary to law, public policy or
bargaining union of the daily-paid rank-and-file morals. [...] Considering the spin-offs, the
can never bind subsequent federations and companies would consequently have their
unions. as employees were not privy to that respective and distinctive concerns in terms of
agreement. And even if [they were privy, it can the nature of work, wages, hours of work and
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other conditions of employment. [...] The nature The basic test in determining the appropriate
of their products and scales of business may bargaining unit is that a unit, to be appropriate,
require different skills, volumes of work, and must affect a grouping of employees who have
working conditions which must necessarily be substantial, mutual interests in wages, hours,
commensurate by different compensation working conditions, and other subjects of
packages. [San Miguel Union v. Confesor, collective bargaining. [UP v. Ferrer-Calleja,
G.R. No. 111262 (1996)] G.R. No. 96189, (1992)]
TEST TO DETERMINE THE CONSTITUENCY Rationale: There are greater chances of

OF AN APPROPRIATE BARGAINING UNIT – success for the collective bargaining process.
4 Factors: The bargaining unit is designed to maintain the
1. Will of the Employees (Globe Doctrine) mutuality of interest among the employees in
2. Affinity and unity of employees’ interest such unit.
(Substantial Mutual Interests Rule)
3. Prior collective bargaining history When the interest between groups has
4. Employment status [Democratic Labor changed over time, there is reason to dissolve,
Association v. Cebu Stevedoring Co. Inc, change or expand a certain bargaining unit.
G.R. No. L-10321 (1958); University of the
Philippines v. Ferrer-Calleja, G.R. No. Prior Collective Bargaining History
96189 (1992)] The existence of a prior collective bargaining
history is neither decisive nor conclusive in the
Note: Where the employment status was not at determination of what constitutes an
issue but the nature of work of the employees appropriate bargaining unit. [Sta. Lucia East
concerned; the Court stressed the importance Commercial Corporation v. SOLE, G.R. No.
of the 2nd factor. [Belyca Corp. v. Calleja, G.R. 162355 (2009)]
No. 77395 (1988)]
Employment Status
Other factors: Among the factors to be considered [is the]
1. Geography and Location employment status of the employees to be
2. Policy of avoiding fragmentation of the affected [regular, casual, seasonal,
bargaining unit probationary, etc.], that is the positions and
categories of work to which they belong [....]
Globe Doctrine [Belyca Corp. v. Calleja, G.R. No. 77395
A practice designated as the “Globe doctrine,” (1988)]
sanctions the holding of a series of elections,
not for the purpose of allowing the group Geography and Location
receiving an overall majority of votes to Geography and location only play a significant
represent all employees, but for the specific role if:
purpose of permitting the employees in each of a. The separation between the camps [...] and
the several categories to select the group the different kinds of work in each [...] all
which each chooses as a bargaining unit. militate in favor of the system of separate
[Kapisanan ng mga Manggagawa sa Manila bargaining units;
Road Co. v. Yard Crew Union, G.R. Nos. L- b. [When] the problems and interests of the
16292-94 (1960)] workers are peculiar in each camp or
department;
Rationale: Highly skilled or specialized c. The system of having one collective
technical workers may choose to form their bargaining unit in each camp [...] [has
own bargaining unit because they may be in operated satisfactorily in the past.]
better position to bargain with the employer [Benguet Consolidated Inc. and Balatok
considering the market value of their skills. Mining Co. v. Bobok Lumberjack
Association, G.R. No. L-11029 (1958)]
Community or Mutuality of Interests
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Policy of Avoiding Fragmentation of the

Bargaining Unit
It bears noting that the goal of the DOLE is C. BARGAINING
[geared] towards “a single employer wide unit REPRESENTATIVE
which is more to the broader and greater
benefit of the employees working force.” The labor organization designated or selected
by the majority of the employees in an
The philosophy is to avoid fragmentation of the
appropriate collective bargaining unit shall be
bargaining unit so as to strengthen the
the exclusive representative of the employees
employees’ bargaining power with the in such unit for the purpose of collective
management. To veer away from such goal bargaining. [Art. 267]
would be contrary, inimical and repugnant to
the objectives of a strong and dynamic
Labor Management Council
unionism. [Phil. Diamond Hotel and Resort Inc
Any provision of law to the contrary
v. Manila Diamond Hotel and Employees
notwithstanding, workers shall have the right:
Union, G.R. No. 158075 (2006)]
a. To participate in policy and decision-
making processes of the establishment
Confidential employees lumped with
where they are employed insofar as said
management processes will directly affect their rights,
Since the confidential employees are very few benefits and welfare.
in number and are, by practice and tradition, b. To form labor-management councils, for
identified with the supervisors in their role as
this purpose [Art. 267]
representatives of management, such identity
of interest has allowed their inclusion in the
Selection of Representatives
bargaining unit of supervisors-managers for
In organized establishments,
purposes of collective bargaining in turn as
the workers’ representatives to the council
employees in relation to the company as their
shall be nominated by the exclusive
employer. [Filoil Refinery Corp. v. Filoil
bargaining representative.
Supervisory and Confidential Employees
In establishments where no legitimate labor
Union, G.R. No. L-26736 (1972)]
organization exists,
the workers representative shall be elected
directly by the employees at large. [Sec. 2,
Rule XXI, Book V, IRR]
Qualification of Voters
Eligible Voter
Eligible voter refers to a voter belonging to the
appropriate bargaining unit that is the subject
of the petition for certification election [Sec.
1(q), Rule VIII, Book V, IRR]
All employees who are members of the

appropriate bargaining unit three (3) months
prior to the filing of the petition shall be eligible
to vote. [Sec. 6, Rule IX, Book V, IRR]
Note: Rule VIII, Sec. 14 (f) and Rule IX, Sec. 6

refer to employees as those employed 3
months prior to the issuance of the order/the
filing of the petition for certification election
while Rule IX, Sec. 2 reckon the period of
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employment from the “time of filing the Non-participation in previous election has
petition”. This difference has not been resolved no effect
in any case before the Supreme Court. [Failure to take part in previous elections is no
bar to the right to participate in future elections.]
All rank and file employees in the appropriate No law, administrative rule or precedent
bargaining unit, whether probationary or prescribes forfeiture of the right to vote by
permanent are entitled to vote. The Code reason of neglect to exercise the right in past
makes no distinction as to their employment certification elections. [Reyes v. Trajano, G.R.
status. [...] All they need to be eligible to No. 84433 (1992)]
support the petition is to belong to a bargaining
unit. [Airtime Specialists, Inc. v. Ferrer-Calleja, 1. Determination of Representation
G.R. No. 80612-16 (1990)] Status
Rationale for Non-Distinction Policy Methods of Establishing Majority Status
Collective bargaining covers all aspects of the a. Sole and Exclusive Bargaining Agent
employment relation and the resultant CBA (SEBA) Certification
binds all employees in the bargaining unit. All b. Consent Election
rank and file employees, probationary or c. Certification Election
permanent, have a substantial interest in the d. Run-Off Election
selection of the bargaining representative. e. Re-Run election
[Airtime Specialists, Inc. v Ferrer-Calleja,
supra.] Note: D.O. No. 40-I-15 replaced Voluntary
Recognition with SEBA certification, as of
Dismissed employees [Sec. 6, Rule IX, Book September 7, 2015.
V, IRR]
General Rule: [Dismissed] employees [who] a. SEBA Certification
contested legality of the dismissal in a forum of
appropriate jurisdiction at the time of the PROCEDURE [RULE VII, BOOK V, IRR]
issuance of the order for conduct of a 1. File Request for SEBA Certification [Sec.
certification election 1]
Exception: Dismissal was declared valid in a Who: Any legitimate labor organization
final judgment at the time of the conduct of the
certification election.
File where: Regional Office which issued
its certificate of registration or certificate of
Disagreement over voters’ list over creation of chartered local
eligibility of voters
All contested voters shall be allowed to vote 2. Indicate in the request [Sec. 2]:
[but] their votes shall be segregated and sealed a. Name and address of the requesting
in individual envelopes. [Sec. 6, Rule IX, Book
legitimate labor organization;
V, IRR] b. Name and address of the company
where it operates;
Voting List and Voters c. Bargaining unit sought to be
The basis of determining voters may be agreed represented;
upon by the parties (i.e. the use of payroll). d. Approximate number of employees in
[Acoje Workers Union v. NAMAWU, G.R. No. the bargaining unit; and
L-18848 (1963)] e. Statement of the existence/non-
existence of other labor
organization/CBA.
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officer for the conduct of election pursuant

Certificate of Duly Certified by
to Rule IX of this rules.
Registration President of
requesting union Note: If there is more than one Legitimate
Labor Organization, Art. 269 applies
Creation of chartered President of the
local local federation of If Organized Establishment [Sec. 6]
the local If the Regional Director finds the establishment
organized he/she shall refer it to the mediator-
arbitrator for determination and propriety of
Both certificates should be attached to the conducting a certification election.
request
4. Regional Director shall act on the
3. Regional Director shall act on the request submission [Sec. 4.1]
[Sec. 3]
When: Within one (1) day from submission Incomplete The request shall be
of request requirements referred to Election Officer
for the conduct of election
Action: pursuant to Rule IX.
a. Determine whether request is
compliant with Sec. 2 and whether the Complete Regional Director shall
bargaining unit sought to be requirements issue a certification as
represented is organized or not; and SEBA
b. Request a copy of the payroll
5. Regional Director shall post the SEBA
If the Regional Director finds it deficient, Certification [Sec. 4.1]
he/she shall advise the requesting union or
local to comply within ten (10) days from Period: Fifteen (15) consecutive days
notice. Failure to comply within the
prescribed period shall be deemed Where: At least two (2) conspicuous
withdrawal of the request. places in the establishment or covered
bargaining unit.
If Unorganized Establishment [Sec. 4]
a. Finding of only 1 legitimate labor EFFECT OF SEBA CERTIFICATION [Sec.
organization – Regional Director shall call 4.2]
a conference within five (5) working days Upon the issuance of the [SEBA Certification],
for the SUBMISSION of: the certified union or local shall enjoy all the
1. Names of employees in the covered rights and privileges of an exclusive bargaining
bargaining unit who signify support for agent of all the employees in the covered
certification; [and these] employees bargaining unit.
comprise at least majority of the
number of employees in the covered The certification shall bar the filing of a [PCE]
bargaining unit; and by any labor organization for a period of one (1)
2. Certification under oath by the year from the date of its issuance.
president of the requesting union or
local that all documents submitted are Upon expiration of this one-year period, any
true and correct based on personal legitimate labor organization may file a [PCE]
knowledge in the same bargaining unit represented by the
b. Failure to Complete Requirements for certified labor organization, unless a [CBA]
SEBA Certification - the request for SEBA between the employer and the certified labor
certification shall be referred to the election organization was executed and registered with
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the Regional Office in accordance with Rule BARS TO A CERTIFICATE ELECTION

XVII. Petition for certification may be filed:
General Rule: Anytime
b. Consent Election Exceptions:
1. One-year bar rule
Consent Election means the election 2. Negotiation bar rule
voluntarily agreed upon by the parties with or 3. Deadlock bar rule
without the intervention by DOLE [Sec. 1(i), 4. Contract bar rule
Rule I, Book V, IRR]
See Grounds for denying a Petition for
Procedure [Sec. 11, Rule VIII, Book V, IRR] Certification Election
1. The parties may agree to hold a consent
election (1) One-Year Bar Rule
a. Where no petition for certification
election was filed; or No certification election may be held within 1
b. Where a petition for certification year from the time a valid certification, consent
election had been filed, and upon the or run-off election has been conducted within
intercession of Med-Arbiter [Sec. 25, the bargaining unit.
Rule VIII, Book V, IRR]
2. Mediator-Arbiter shall call for the consent [If the order of the Med-Arbiter certifying the
election, reflecting the parties’ agreement results of the election has been appealed], the
and the call in the minutes of the running of the one-year period shall be
conference. Regional Director or suspended until the decision on the appeal
authorized representative shall determine becomes final and executory. [Sec. 3(a), Rule
the Election Officer by raffle in the VIII, Book V]
presence of representatives of the
contending unions if they so desire Note: This bar also applies to a SEBA
3. First pre-election conference is scheduled Certification under Rule VII. “The certification
within ten (10) days from the date of the shall bar the filing of a petition for certification
agreement. Subsequent conferences may election by any labor organization for a period
be called to expedite and facilitate the of one (1) year from the date of its issuance.”
holding of the consent election. [Sec. 4.2, Rule VII, Book V, IRR]
c. Certification Election (2) Negotiation Bar Rule
Certification Election is the process of No certification of election may be filed when:

determining, through secret ballot, the sole and 1. Within 1 year after the valid certification
exclusive representative of the employees in election
an appropriate bargaining unit for purposes of 2. The DULY CERTIFIED union has
collective bargaining or negotiation. [Sec. 1(i), COMMENCED AND SUSTAINED
Rule I, Book V, IRR] negotiations in good faith with the employer
3. In accordance with Art. 261 of the Labor
PURPOSE Code Sec. 3(b), Rule VIII, Book V
The purpose of a certification election is
precisely the ascertainment of the wishes of
the majority of the employees in the
appropriate bargaining unit: to be or not to be
represented by a labor organization, and in the
affirmative case, by which particular labor
organization. [Reyes v. Trajano, G.R. No.
84433 (1992)]
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(3) Deadlock Bar Rule The five-year representation status acquired by

an incumbent bargaining agent either through
No certification of election may be filed when: single enterprise collective bargaining or multi-
1. The incumbent or certified bargaining employer bargaining shall not be affected by a
agent is a party; subsequent [CBA] executed between the same
2. A bargaining deadlock had been: bargaining agent and the employer during the
a. Submitted to conciliation or arbitration same five-year period. [Sec. 7, Rule XVII, Book
or; V, IRR]
b. Had become the subject of a valid
notice of strike or lockout [Sec. 3(c), Despite an agreement for a CBA with a life of
Rule VIII, Book V, IRR] more than five years, either as an original
provision or by amendment, the bargaining
A “deadlock” is defined as the “counteraction of union’s exclusive bargaining status is effective
things producing entire stoppage; only for five years and can be challenged within
a state of inaction or of neutralization sixty (60) days prior to the expiration of the
caused by the opposition of persons or of CBA’s first five years. [FVC Labor Union-
factions (as in government or voting body): PTGWO v. SANAMA-FVC-SIGLO, G.R. No.
standstill.” [...] 176249 (2009)]
The word is synonymous with the word
impasse which [...] “presupposes The rule is that despite the lapse of the formal
reasonable effort at good faith bargaining effectivity of the CBA the law still considers the
which, despite noble intentions, does not same as continuing in force and effect until a
conclude in agreement between the new CBA shall have been validly executed.
parties” [Divine World University v. SOLE, Hence, the contract bar rule still applies.
G.R. No. 91915 (1992)] [Colegio de San Juan de Letran v. Association
of Employees, G.R. No. 141471 (2000)]
(4) Contract Bar Rule
Petition for cancellation of union
BLR shall not entertain any petition for registration DOES NOT suspend or prevent
certification election or any other action which filing of certification election
may disturb the administration of DULY A petition for cancellation of union registration
REGISTERED existing collective bargaining shall not:
agreements affecting the parties, except under 1. suspend the proceedings for certification
Arts. 264, 265, and 268 [(60-day freedom election; nor
period)]. [Art. 238] 2. prevent the filing of a petition for
certification election. [Art. 246]
No petition for certification election may be filed
when a [CBA] between the employer and a A certification election can be conducted
SEBA has been registered in accordance with despite pendency of a petition to cancel the
Art. 237. union registration certificate. For the fact is that
at the time the [union], whose registration
Where such [CBA] is registered, the petition certificate is sought to be cancelled, filed its
may be filed only within sixty (60) days prior to petition for certification, it still had the legal
its expiry. [Sec. 3(d), Rule VIII, Book V, IRR]. personality to perform such act absent an order
directing its cancellation. [Association of Court
The Contract-Bar Rule shall apply in any of the of Appeals Employees v. Calleja, G.R. No.
following: (1) when there exists an unexpired 94716, (1991)]
registered CBA; or (2) when there is no
challenge on the representation status of the
incumbent union during the freedom period.
[D.O. No. 40-1-15]
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Allegation of company union a prejudicial management. [Port Workers Union v.

question to a petition for certification Laguesma, G.R. Nos. 94929-30, (1992)]
election
A complaint for unfair labor practice may be Certification Union Election
considered a prejudicial question in a Election
proceeding for certification election when it is
charged therein that one or more labor unions To determine the To elect union
participating in the election are being aided, or Exclusive Bargaining officers
are controlled, by the company or employer Agent
[company union] [United CMC Textile Worker’s
Union v. BLR, G.R. No. 51337(1984)]. All members of the Only union members
appropriate may vote
Rationale: The certification election may lead bargaining unit
to the selection of an employer-dominated or
company union as the employees’ bargaining
WHO MAY VOTE [Sec. 6, Rule IX, Book V,
representative, and when the court finds that
said union is employer-dominated in the unfair IRR]
labor practice case, the union selected would All employees who are members of the
be decertified and the whole election appropriate bargaining unit three (3) months
proceedings would be rendered useless and prior to the filing of the petition/request shall be
nugatory. [B.F. Goodrich Phils. Marikina v. B.F. eligible to vote.
Goodrich Confidential and Salaried Employees
Union, G.R. No. L-34069-70 (1973)] An employee who has been dismissed from
work but has contested the legality of the
dismissal in a forum of appropriate jurisdiction
NATURE OF PROCEEDING
Certification election is the most effective and at the time of the issuance of the order for the
the most democratic way of determining which conduct of a certification election shall be
labor organization can truly represent the considered a qualified voter, unless his/her
working force in the appropriate bargaining unit dismissal was declared valid in a final judgment
of a company [Samangang Manggagawa sa at the time of the conduct of the certification
election.
PERMEX v SOLE, G.R. No. 107792 (1998)].
[It] is not a ‘litigation’ [...] but a mere In case of disagreement over the voters’ list or
over the eligibility of voters, all contested voters
investigation of a non-adversary, fact-finding
character. [...] shall be allowed to vote. But their votes shall be
segregated and sealed in individual envelopes.
The determination of the proceeding does not
entail the entry of remedial orders or redress of WHO MAY FILE [Sec. 1, Rule VIII, Book V,
rights, but culminates solely in an official IRR]
designation of bargaining units and an 1. Legitimate labor organization [Art. 219
affirmation of the employees’ expressed choice (h)]
of bargaining agent. [Angat River Irrigation 2. Local/chapter that has been issued a
System v. Angat River Worker’s Union charter certificate
(PLUM), G.R. Nos. L-10943 and L-10944 The chapter shall acquire legal personality
(1957)] only for purposes of filing a petition for
certification election from the date it was
Technical rules and objections should not issued a charter certificate. [Art. 241]
hamper the correct ascertainment of the labor 3. National union or federation that has
union that has the support or confidence of the issued a charter certificate to its
majority of the workers and is thus entitled to local/chapter [in behalf of the latter]
represent them in their dealings with 4. A group of legitimate labor unions in a
private establishment organized for
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collective bargaining or for dealing with The only instance when the employer may be
employers concerning terms and involved in that process is when it is obliged to
conditions of employment for their member file a petition for certification election on its
unions or for participating in the formulation workers’ request to bargain collectively
of social and employment policies, pursuant to Art. 258 [now Art. 270]. [Hercules
standards and programs, registered with Industries, Inc. v. Sec. of Labor, G.R. No.
the BLR in accordance with Rule III Sec. 2- 96255 (1992)]
B. [Sec. 1 (ll), Rule I, Book V, IRR]
5. Employer (when requested to bargain [The employer] did not possess the legal
collectively and no existing CBA) personality to file a motion to dismiss the
Requisites: petition for certification election even if based
a. Employer is requested to bargain on the ground that its supervisory employees
collectively; AND are in reality managerial employees.
b. No existing registered CBA in the unit
[Art. 270] It is well-settled that an employer has no
standing to question a certification election
BYSTANDER RULE since this is the sole concern of the workers.
In all cases, whether the petition for The only exception to this rule is Art. 258 [now
certification election is filed by an employer or Art. 270]. [PT&T v. Laguesma, G.R. No.
a legitimate labor organization, the employer 101730 (1993)]
shall not be considered a party thereto with a
concomitant right to oppose a petition for [A] company’s interference in the certification
certification election. [Art. 271] election below by actively opposing the same
[...] unduly creates a suspicion that it intends to
The employer’s participation shall be establish a company union. [Oriental Tin Can
limited to: Labor Union v. Secretary of Labor, G.R. No.
a. Being notified or informed of petitions of 116751 (1998)]
such nature
b. Submitting the list of employees during the VENUE FOR FILING PETITION
pre-election conference, should the Med- File with the Regional Office which issued the
Arbiter act favorably on the petition [Art. petitioning union’s certificate of registration or
271] certificate of creation of chartered local.
The principle of the employer as by-stander At [petitioner’s option], [it may file] the petition
shall be strictly observed throughout the and its supporting documents [...] online. [Sec.
conduct of certification election. 2, Rule VIII, Book V, IRR]
The employer shall not harass, intimidate, Where two or more petitions involving the
threat[en], or coerce employees before, during same bargaining unit [Sec. 2, Rule VIII, Book
and after elections. [Sec. 1, Rule IX, Book V, V, IRR]:
IRR] Filed in Automatically consolidated with
one [Med-Arbiter] who first acquired
However, manifestation of facts that would aid jurisdiction.
Regional
the [Med-Arbiter] in expeditiously resolving the
Office
petition such as existence of a contract-bar,
one year bar or deadlock bar may be Filed in The Regional Office in which
considered. [Sec. 1, Rule VIII, Book V, IRR] different the petition was first filed shall
Regional exclude all others; [...] the latter
The employer is not a party to a certification Offices shall indorse the petition to the
election, which is the sole or exclusive concern former for consolidation.
of the workers. [...]
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Procedure: CERTIFICATION ELECTION IN Freedom Period

AN UNORGANIZED ESTABLISHMENT Within the sixty (60)-day period before the
expiration of the collective bargaining
Unorganized Establishment agreement. [Art. 271]
[It is an] establishment where there is no
certified bargaining agent. [Art. 269] Note: The expiration referred to is the
expiration of the 5-year period for the
Procedure [Art. 269] representation aspect. (see Art. 265) [Prof.
1. File a petition for certification election. Battad]
2. Upon filing of the petition, the Med-Arbiter
shall automatically conduct a certification Rationale of Prohibition of Filing Outside
election. the Freedom Period
To ensure industrial peace between the
Filing of petition is by a legitimate labor employer and its employees during the
organization existence of the CBA. [Republic Planters Bank
It cannot be filed by an unregistered labor Union v. Laguesma, G.R. No. 119675 (1996)]
organization. Art. 251 enumerates the rights
granted to a legitimate labor organization and SIGNING OF AUTHORIZATION IS MERELY
one of those rights is the right to be chosen as PREPARATORY
the exclusive bargaining representative. This is What is prohibited is the filing of the petition for
one way the law encourages union registration. certification election outside the 60-day
freedom period. [...] The signing of the
Note: Art. 269 should be related to SEBA authorization to file was merely preparatory to
Certification. If there are multiple LLOs in an the filing of the Petition for Certification
unorganized establishment, Art. 269 applies. If Election, or an exercise of [the] right to self-
there is only one LLO in an unorganized organization. [PICOP Resources Inc. v.
establishment, Rule VII on SEBA Certification Ricardo Dequita, G.R. No. 172666 (2011)]
applies. Under this rule, when there is failure to
complete requirements, the Regional Director 25% SUBSTANTIAL SUPPORT RULE
will refer it to the Election Officer. In organized establishments, the incumbent
sole bargaining agent should not be easily
Procedure: CERTIFICATION ELECTION IN replaced for that would disturb industrial peace.
AN ORGANIZED ESTABLISHMENT To justify the disturbance, it must appear that
at least a substantial number (25%
Organized Establishment requirement) seeks to have a new exclusive
Refers to an enterprise where there exists a bargaining unit.
recognized or certified sole and exclusive
bargaining agent. [Sec. 1(ll), Rule I, Book V, DISCRETIONARY RULE
IRR] The [Med-Arbiter], in the exercise of sound
discretion, may order a certification election
Procedure [Art. 268] notwithstanding the failure to meet the [25%]
1. File a verified petition questioning the requirement [in petitions for certification
majority. election in an organized establishment]. [Scout
2. It must be filed within the 60-day period Albano Memorial College v. Noriel, G.R. No. L-
before expiration of CBA (freedom period). 48347 (1978)]
3. Supported by written consent of at least
25% of ALL employees in the bargaining INAPPLICABLE TO MOTIONS FOR
unit (substantial support). INTERVENTION
4. Med-Arbiter shall automatically order an [The] requisite written consent of at least 20%
election. (now 25%) of the workers in the bargaining unit
applies to certification election only, and not to
WHEN PETITION MUST BE FILED motions for intervention. Nowhere in the legal
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provisions [and in the Omnibus Rules] does it 2. After the filing of such petition is considered
appear that a motion for intervention in a to be involuntary and does not affect the
certification election must be accompanied by [petition]. [S.S. Ventures International v.
a similar written consent. [PAFLU v. Calleja, S.S. Ventures Labor Union, G.R. No.
G.R. No. 79347 (1989)] 161690 (2008)]
INTERVENORS
1. Incumbent bargaining agent as forced
intervenor: The incumbent bargaining
agent shall automatically be one of the
choices in the certification election as
forced intervenor. [Sec. 8, Rule VIII, Book
V, IRR]
2. Legitimate labor union other than the
incumbent bargaining agent operating
within the bargaining unit: When a
petition for certification election was filed in
an organized establishment, any legitimate
labor union other than the incumbent
bargaining agent operating within the
bargaining unit may file a motion for
intervention with the Med-Arbiter during the
freedom period of the collective bargaining
agreement.
In an unorganized establishment, the motion

shall be filed at any time prior to the decision of
the Med-Arbiter. The motion shall be resolved
in the same decision issued in the petition for
certification election.
In both cases, the form and contents of the

motion shall be the same as that of a petition
for certification election. [Sec. 9, Rule VIII,
Book V, IRR]
WHEN TO FILE MOTION FOR

INTERVENTION
Organized establishment: during the freedom
period of the collective bargaining agreement
Unorganized establishment: any time prior to

the decision of the Med-Arbiter [Sec. 9, Rule
VIII, Book V, IRR]
EFFECT OF WITHDRAWAL OF
SIGNATURES
The employees’ withdrawal from a labor
union made
1. Before the filing of the petition for
certification election is presumed voluntary
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Organized v. Unorganized Establishments

Art. 268: Organized Art. 269: Unorganized
Sole and exclusive Existing None

bargaining agent
Petition filed Must be VERIFIED No need to be verified
Freedom period No petition for certification election Not applicable (i.e. no

EXCEPT within 60 days before freedom period; petition can
the expiration of the collective be filed anytime)
bargaining agreement (See Arts.
264 and 265)
Rationale: To keep industrial

peace in organized establishments
Substantial support rule Must be duly supported by 25% of NO substantial support rule
ALL THE MEMBERS OF THE
APPROPRIATE BARGAINING Rationale: Intention of law is
UNIT to bring in the union, to
implement policy behind Art.
Rationale: Law wants to know the 218A.
intention of the employees – if they
really want a certification election,
since they already have a
bargaining agent
Certification Election v. Consent Election

Certification Election Consent Election
Purpose "Certification Election" or "Consent Election" refers to the process of

determining through secret ballot the sole and exclusive representative of
the employees in an appropriate bargaining unit for purposes of collective
bargaining or negotiation. A certification election is ordered by the
Department, while a consent election is voluntarily agreed upon by the
parties, with or without the intervention by the Department [Book V, Rule
1, Sec. 1(h)]
General Procedure Rule IX Rule VII, Sec. 11, pars. 1, 2
SECTION 2. Raffle of the Case. — The contending unions may agree

Within twenty-four (24) hours from to the holding of an election, in
receipt of the notice of entry of final which case it shall be called a
judgment granting the conduct of a consent election. The mediator-
certification election, the Regional arbiter shall forthwith call for the
Director shall cause the raffle of the consent election, reflecting the
case to an Election Officer who parties' agreement and the call in
shall have control of the pre- the minutes of the conference. The
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election conference and election mediator-arbiter shall immediately

proceedings. (1a) forward the records of the petition
to the regional director or his/her
authorized representative for the
determination of the election officer
who shall be chosen by raffle in the
presence of representatives of the
contending unions if they so desire.
With the exception of aforementioned provisions that specifically apply

only for Certification Election or Consent Election respectively, Rule IX,
on the Conduct of Certification, Secs. 3 – 21, applies to both certification
and consent elections
Conduct Ordered by the DOLE Voluntarily agreed upon by the

parties, with or without the
intervention of DOLE
d. Run-Off Election Pursuant to Art. 268, when an election which

provides for three or more choices results in no
Run-Off Election refers to an election choice receiving a majority of the valid votes
between the labor unions receiving the two (2) cast, a run-off election shall be conducted
highest number of votes in a certification or between the labor unions receiving the two
consent election when the following requisites highest number of votes. Thus, the run-off will
have been complied with: be among Union “A”, “B”, and “C.” [Azucena]
1. Valid election;
2. The certification or consent election Procedure for Run-Off Election
provides for three (3) or more choices Election Officer shall motu proprio conduct a
(Note: “No Union” is considered one choice run-off election within ten (10) days from the
– Prof. Battad); close of the election proceedings between the
3. None of the contending UNIONS received labor unions receiving the two highest number
a majority of the VALID VOTES cast; of votes.
4. No objections or challenges which if
sustained, can materially alter the results; “No Union” shall not be a choice in the run-off
and election [Sec. 1, Rule X, Book V, IRR].
5. The total number of votes for all contending
UNIONS is at least fifty (50%) of the Same voters’ list used in the certification
number of VOTES cast [Art. 268; Sec. election shall be used in the run-off election.
1(uu), Rule I, Book V, IRR; Sec. 1, Rule X,
Book V, IRR] The labor union receiving the GREATER
number of VALID VOTES cast shall be certified
Illustration as the winner [Sec. 2, Rule X, Book V, IRR].
The CBU has 100 members and 80 of which
voted. Union “A”= 30; Union “B”= 15; Union Note: Please note the difference between valid
“C”=15 and No Union= 20. There were no votes cast versus votes cast – valid votes
invalid votes. Since none got the majority of the excludes spoiled votes.
80 valid votes (40) and the contending unions
obtained 60 votes (which is at least 50% of the e. Re-Run Election
VOTES cast), a run-off election is proper. The
run-off will be between the labor unions Re-run Election refers to an election
receiving “the two highest number of votes.” conducted to break a tie between contending
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unions, including between "no union" and one if the latter so desires. [Sec. 5, Rule VIII, Book
of the unions. It shall likewise refer to an V, IRR]
election conducted after a failure of election
has been declared by the election officer (2) Preliminary Conference
and/or affirmed by the mediator-arbiter. [Sec.
1(tt), Rule 1, Book V, as amended by DO 40-I- Med-Arbiter shall conduct a preliminary
15] conference and hearing within ten (10) days
from receipt of the petition to determine the
Situations Contemplated following:
1. A tie between two (2) choices. 1. The bargaining unit to be represented;
2. Failure of Elections [see Definition] 2. Contending labor unions
3. Possibility of a consent election
Duty of Election Officer 4. Existence of any of the bars to certification
1. Notify parties of a re-run election election under Sec. 3[, Rule VIII]; and
2. Cause posting of notice within five (5) days 5. Such other matters as may be relevant for
from said election. the final disposition of the case [Sec. 10,
Rule VIII, Book V, IRR]
When will re-run be conducted
Within ten (10) days after the posting of the Note: If contending unions agree to holding of
notice of the union declared as winner and an election, [...] it shall be called a consent
certified choice receiving the HIGHEST election. [Sec. 11, Rule VIII, Book V, IRR]
VOTES CAST.
(3) Med-Arbiter to Conduct Hearings
PROCEDURE AFTER FILING PETITION FOR
CERTIFICATION ELECTION If contending unions fail to agree to a consent
1. Raffling of case to Med-Arbiter election during the preliminary conference
2. Preliminary Conference and hearing the Med-Arbiter may conduct as many
3. Conduct of hearings hearings as he/she may deem necessary
4. Determine if petition should be dismissed ○ but in no case shall the conduct thereof
on grounds stated in Sec. 15 exceed fifteen (15) days from date of
5. Order/Decision on the petition scheduled preliminary conference/
6. Appealing the order/decision on the hearing, after which the petition shall
petition be considered submitted for decision.
7. Raffling of the case to an Election Officer [...]
8. Pre-Election Conference
9. Conduct of election Within the same 15-day period [...], the
10. Challenging of votes and on the spot contending labor unions may file such
questions pleadings as they may deem necessary for the
11. Protesting immediate resolution of the petition.
12. Canvassing of votes Extensions of time shall not be entertained.
13. Nullification of Election Results [Sec. 12, Rule VIII, Book V, IRR]
14. Proclamation and Certification of the result
of the election
15. Appeal from Certification Election Order
(1) Raffling of Case to Med-Arbiter
The Regional Director or his/her duly

authorized representative shall immediately
assign it by raffle to a [Med-Arbiter]. The raffle
shall be done in the presence of the petitioner
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(4) Determine if Petition should be (5) Order or Decision on the Petition

dismissed based on Grounds Stated in
Sec. 15 [Med-Arbiter] shall issue a ruling granting or
denying the petition
The grounds to dismiss the petition are:
1. Petitioning union or national union/ When:
federation is: General rule: Within ten (10) days from last
a. Not listed in DOLE’s registry of hearing
legitimate labor unions; or
b. Registration certificate has been Exception: In organized establishments, grant
cancelled with finality of the petition can only be made after the lapse
2. Failure of a local/chapter or national of the freedom period [Sec. 14, Rule VIII, Book
union/federation to submit a duly issued V, IRR]
charter certificate upon filing of the petition
for certification election How:
3. Contract Bar rule 1. Personally to the parties
4. One-Year Bar rule 2. Copy furnished to the employer [Sec. 18,
5. Negotiation and Deadlock Bar Rule Rule VIII, Book V, IRR]
6. In an organized establishment, the failure
to submit the 25% signature requirement to The ruling for the conduct of a certification
support the filing of the petition. election shall state the following:
7. Non-appearance of the petitioner for two 1. Name of the employer or establishment;
(2) consecutive scheduled conferences 2. Description of the bargaining unit;
before the [Med-Arbiter] despite due 3. Statement that none of the grounds for
notice; and dismissal [...] in Sec. 14 exists;
8. Absence of employer-employee 4. Names of the contending labor unions [...]
relationship between all the members of in the following order:
the petitioning unit and the establishment a. Petitioner unions in the order of the
where the proposed bargaining unit is date of filing of their respective
sought to be represented. petitions
b. The forced intervenor
Note: See Bars to Certification Election under c. “No union”
“c. Certification Election” 5. [If] the local/chapter is one the contending
unions, a directive to an unregistered
Commingling is not a ground local/chapter or a federation/national union
The inclusion as union members of employees representing all unregistered local/chapter
outside the bargaining unit [is] not a ground for to personally submit to the Election Officer
cancellation of the registration of the union. its certificate of creation at least five (5)
Said employees are automatically deemed working days before the actual conduct of
removed from the list of membership. [Sec. 16, the certification election. [This is to afford
Rule VIII, Book V, IRR] an individual employee-voter an informed
choice.]
Posting of notice of Petition for Certificate 6. Non-submission of this requirement as
Election certified by Election Officer shall disqualify
The Regional Director or his/her authorized the local/ chapter from participating in the
DOLE personnel, and/or the petitioner shall be certification election
responsible for the posting of the notice of 7. Directive to the employer and the
petition for certification election. [Sec. 7, Rule contending unions to submit within ten (10)
VIII, Book V, IRR] days from receipt of order:
a. The certified list of employees in the
bargaining unit, or where necessary,
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b. Payrolls covering the members of the Decision of the Secretary

bargaining unit for the last three (3) Period to decide: Fifteen (15) days from receipt
months prior to the issuance of the of entire records of the petition to decide the
order appeal.
(6) Appealing the Order Granting or Secretary’s decision shall be final and
Denying the Conduct of Certification executory within ten (10) days from receipt by
Election [Sec. 19-20, RULE VIII, BOOK V, parties. [Sec. 23, Rule VIII, Book V, IRR]
IRR]
Note: No motion for reconsideration of decision
Form of appeal shall be entertained. [Sec. 23, Rule VIII, Book
1. Verified under oath V, IRR]
2. Consists of a memorandum of appeal
specifically stating the grounds relied upon Implementation of decision
by appellant with the supporting arguments General Rule: Shall not be stayed
and evidence Exception: Restrained by appropriate court
[Sec. 24, Rule VIII, Book V, IRR]
Dismissed
Organized or denied (7) Raffling of the Case to an Election
Appeal to Officer
Granted Office of
Secretary Regional Director shall cause the raffle of the
Dismissed
or denied case to an Election Officer who shall have
Unorganized control of:
Granted Unappealable 1. Pre-election conference; and
2. Election proceedings
When: Within ten (10) days from receipt of the When: Within twenty-four (24) hours from
order [of the Med-Arbiter]. receipt of notice of entry of final judgment
granting the conduct of a certification election
Where: Regional Office where the petition [Sec. 2, Rule IX, Book V, IRR]
originated
(8) Pre-Election Conference
Effect of Filing Memorandum of Appeal
Stays the holding of any certification election. Notice of Pre-Election Conference [Sec. 3,
[Sec. 23, Rule VIII, Book V, IRR] Rule IX, Book V, IRR]
The Election Officer shall cause the issuance
Reply to Appeal of notice of pre-election conference upon the
Reply by any party to the petition shall be filed contending unions
within ten (10) days from receipt of the
memorandum of appeal […] and filed directly When: Within twenty-four (24) hours from the
with the office of the Secretary. [Sec. 22, Rule [Election Officer’s] receipt of assignment for the
VIII, Book V, IRR] conduct of a certification election
When no appeal is filed Schedule of pre-election conference

The decision shall be final and executory if no When: Within ten (10) days from receipt of the
appeal is filed within the ten (10) day period. assignment
[Sec. 21, Rule VIII, Book V, IRR]
Completed within thirty (30) days from the date
of the first hearing [Sec. 5, Rule IX, Book V,
IRR]
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Employer to Submit: [Sec. 3, Rule IX, Book 2. Names of all contending unions;
V, IRR] 3. Description of the bargaining unit;
1. Certified list of employees in the bargaining 4. List of eligible and challenged voters.
unit; or where necessary,
2. Payrolls covering the members of the Posting of the list of employees comprising the
bargaining unit at the time of the filing of bargaining unit shall be done by the DOLE
petition personnel.
Failure of party to appear during pre- What cannot be waived by contending

election conference despite notice [Sec. 4, unions or employer:
Rule IX, Book V, IRR] 1. Posting of the notice of election
This shall be considered a waiver of right to: 2. Information required to be included therein
1. To be present; and 3. Duration of the posting
2. To question or object to any of the
agreements reached in the pre-election The parties agreed to conduct the election on
conference [...] a regular business day but a strike was held
on that day. The alleged strike and/or picketing
Shall NOT deprive the non-appearing party of of some employees at the company’s premises
the right to: which coincided with the actual conduct of
1. Be furnished notices; and certification election might, perhaps have
2. To attend subsequent pre-election affected the actual performance of works by
conferences some employees but did not necessarily make
said date an irregular business day of the
Minutes of pre-election conference [Sec. 5, company. [Asian Design and Manufacturing
Rule IX, Book V, IRR] Corp. v. Ferrer-Calleja, G.R. No. L-77415
Election Officer shall keep the minutes of (1989)]
matters raised and agreed upon.
(9) Conduct of Election
Parties shall acknowledge the completeness
and correctness of entries in the minutes by Inspection to ensure secrecy and sanctity
affixing their signatures. of ballot [Sec. 8, Rule IX, Book V, IRR]
When parties refuse to sign the minutes, the By whom:
Election Officer shall note such fact in the 1. Election Officer, together with
minutes, including the reason for refusal to sign 2. Contending unions’ authorized
the same. representative; and
3. Employer
In all cases, parties shall be furnished a copy
of the minutes. When: Before start of actual voting
Posting of Notices [Sec. 7, Rule IX, Book V, Shall inspect:

IRR] 1. Polling place;
Who: Election Officer and/or authorized DOLE 2. Ballot boxes; and
personnel shall cause the posting 3. Polling booths
What: Notice of election
Where: 2 most conspicuous places in the Prohibition on certain devices
company premises General Rule: No device that could record or
When: At least ten (10) days before the actual identify the voter or otherwise undermine the
[election date] secrecy and sanctity of the ballot shall be
allowed within the premises
Contents of Notice [Sec. 7, Rule IX, Book V, Exception: Devices brought in by the Election
IRR] Officer
1. Date and time of the election;
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Consequence: Any other device found within Shall be passed upon by the Med-Arbiter only
the premises shall be confiscated by the if the number of segregated votes will
Election Officer and returned to its owner after materially alter the results of the election.
conduct of the certification election.
On-the-spot Questions
Spoiled Ballots What the Election Officer shall rule on: Any
A ballot that is torn, defaced, or contains question relating to and raised during the
marking which can lead another to clearly conduct of election
identify the voter who casts such vote [Sec.
1(ww), Rule I, Book V, IRR] What the Election Officer SHALL NOT rule
on: Question of eligibility which shall be
If the voter inadvertently spoils a ballot, he shall decided by the Mediator-Arbiter
return it to the Election Officer who shall
destroy it and give him/her another ballot. [Sec. Failure of representative/s of the
10, Rule IX, Book V, IRR] contending unions to appear [Sec. 15, Rule
IX, Book V, IRR]
Member unintentionally omitted in the master Considered a waiver of the right to be present
list of voters may either be: and to question the conduct thereof
1. May be allowed to vote if both parties
agree; [OR] (11) Protest [Sec. 13, Rule IX, Book V, IRR]
2. Allowed to vote but the ballot is segregated
Who may file: Any party-in-interest
(10) Challenging of Votes and on the Spot
Questions [Sec. 11-12, Rule IX, Book V, Ground: On the conduct or mechanics of the
IRR] election
Ballot of the voter who has been properly When Protest is Perfected:
challenged during the pre-election conferences 1. [Record the protest] in the minutes of the
shall be: election proceedings; AND
1. Placed in an envelope sealed by Election 2. Formalize [the] protest with the Med-
Officer in the presence of: Arbiter, with specific grounds, arguments
a. the voter; and and evidence within five (5) days after the
b. representatives of the contending close of the election proceedings
unions.
2. Election Officer shall indicate on the Protests deemed dropped
envelope the: Protests [which are]:
a. Voter’s name; 1. Not recorded in the minutes; AND
b. Union challenging the voter; and 2. Formalized within the prescribed period
c. Ground for the challenge
3. Sealed envelope shall be signed by: General reservation to file protest
a. Election Officer; and prohibited
b. Representatives of the contending Protesting party shall specify the grounds for
unions protest.
Election Officer shall:

1. Note all challenges in the minutes of the
election proceedings; and
2. Have custody of all envelopes containing
the challenged votes
Opening of envelopes and question of

eligibility
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Failure to formalize within 5-days cannot be 1. Election Officer shall count and tabulate
taken against the union the votes in the presence of the
[The petitioner union misrepresented that they representatives of the contending unions.
were independent which caused the members 2. Upon completion of canvass, the Election
to disaffiliate and form a new union and their Officer shall give each representative a
protest was not filed within the 5-day period. copy of the minutes of the election
The] failure to follow strictly the procedural proceedings and results of the election.
technicalities regarding the period for filing their 3. Ballots and tally sheets shall be sealed in
protest should not be taken against them. an envelope and signed by the Election
Officer and the representatives of the
Mere technicalities should not be allowed to contending unions and transmitted to the
prevail over the welfare of the workers. What Med-Arbiter together with the minutes and
is essential is that they be accorded an results of the election within twenty-four
opportunity to determine freely and intelligently (24) hours from the completion of the
which labor organization shall act on their canvass.
behalf. [DHL-URFA-FFW v. BMP, G.R. No.
152094 (2004)] Election conducted in more than one
region Consolidation of results shall be made
Note: "Election Proceedings" refer to the period within fifteen (15) days from the conduct
during a certification election, consent or run- thereof.
off election and election of union officers,
starting from the opening to the closing of the Double Majority Rule
polls, including the counting, tabulation and It is well-settled that under the so-called
consolidation of votes, but excluding the period "double majority rule,” for there to be a valid
for the final determination of the challenged certification election, majority of the bargaining
votes and the canvass thereof. [Book V, Rule unit must have voted AND the winning union
1, Sec. 1 (q)] must have garnered majority of the valid votes
cast. [NUWHRAIN-Manila Pavilion Hotel
Included: Chapter v. Secretary of Labor and
1. Starting from the opening to the closing of Employment, G.R. No. 181531 (2009)]
the polls
2. Counting, tabulation and consolidation of Requisites:
votes 1. There must be a valid certification or
consent election
Excluded:
1. Period for the final determination of the Valid Election: At least majority of the
challenged votes number of eligible voters have cast their
2. Canvass of the challenged votes [Sec. votes (VOTES CAST) [Sec. 17, Rule IX,
1(q), Rule I, Book V, IRR] Book V, IRR]
(12) Canvassing of Votes [Sec. 15, Rule IX, 2. The winning union must garner majority of
Book V, IRR] the VALID VOTES CAST [Sec. 16, Rule IX,
Book V, IRR]
Election precincts shall open and close on the
date and time agreed upon during the pre- Winning union certified as SEBA if there is
election conference. no protest [Sec. 16, Rule IX, Book V, IRR]
The [winning union] shall be certified as the
The opening and canvass of votes shall [SEBA] in the appropriate bargaining unit within
proceed immediately after the precincts have five (5) days from date of election, provided no
closed. protest is recorded in the minutes of the
election.
Procedure [Sec. 14, Rule IX, Book V, IRR]
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When winning choice is local chapter Within twenty-four (24) hours from receipt of
without certificate of creation of chartered the motion, the Election Officer shall:
local 1. Immediately schedule another election
It must submit its DOLE issued certificate of within fifteen (15) days from receipt of
creation within five (5) days from the motion
conclusion of election 2. Cause posting of the notice of election
a. At least ten (10) days prior to the
Note: Please note that valid votes differ from scheduled date of election
mere votes as the former excludes spoiled b. In two (2) most conspicuous places in
ballots. the establishment
Abstention: refers to a blank or unfilled ballot Same guidelines and list of voters shall be
validly cast by an eligible voter. It is not used.
considered as a negative vote. However, it
shall be considered a valid vote for purposes of Nullification of Election Results
determining a valid election. [Sec. 1(a), Rule I, It is precisely because respect must be
Book V, IRR] accorded to the will of labor thus ascertained
that a general allegation of duress is not
Spoiled Ballot: Refers to a ballot that is torn, sufficient to invalidate a certification election; it
defaced, or contains markings which can lead must be shown by competent and credible
another to clearly identify the voter who casts proof. [United Employees Union of Gelmart
such vote. [Sec. 1(ww), Rule I, Book V, IRR] Industries Philippines (UEUGIP) v. Noriel, No.
L-40810 (1975)]
(13) Failure of Election [Sec. 17, Rule IX,
Book V, IRR] (14) Proclamation and Certification of the
result of the election
The Election Officer shall declare a failure of
election in the minutes of the election Certification of the Collective Bargaining
proceedings when: Agent [Sec. 21, Rule IX, Book V, IRR]
1. Number of VOTES CAST is less than the Within 24 hours from final canvass of votes,
majority of the number of eligible voters; there being a VALID election, the Election
AND Officer shall transmit the records of the case to
2. There are no material challenged votes the Med-Arbiter.
Effect of Failure of Election [Sec. 19, Rule IX, Within the same period from receipt of the
Book V, IRR] minutes and results of election, [the Med-
Shall not bar the filing of a motion for the Arbiter] shall issue an order proclaiming the
immediate holding of a certification or consent results of the election and certifying the union
election within six (6) months from date of as the [SEBA] under any of the following
declaration of failure of election. conditions:
1. No protests were filed, or even if one was
Note: Under Sec. 1(tt), Rule I, Book V, a RE- filed, [it] was not perfected within the five-
RUN ELECTION “shall likewise refer to an day period
election conducted after a failure of election 2. No challenge or eligibility issue was raised,
has been declared by the Election Officer or even if one was raised, [its] resolution
and/or affirmed by the [Med-Arbiter].” Thus, will not materially change the results of the
under the Rules, this is the other definition of a elections.
Re-Run Election.
Winning union shall have the rights, privileges,
Motion for another election after failure of and obligations of a duly certified collective
election [Sec. 20, Rule IX, Book V, IRR] bargaining agent from the time the certification
is issued.
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members specially concerned to the

Majority of valid votes cast results in “No Bureau.
Union” obtaining majority
Med-Arbiter shall declare such fact in the order Note: Secretary of Labor or his duly authorized
representative may inquire into financial
(15) Appeal from Certification Election activities of legitimate labor orgs
Orders [Art. 272] a. UPON filing of complaint under oath and
supported by written consent of at least
Who appeals: Any party to an election 20% of total membership,
b. Provided, such inquiry shall not be
What is appealed: Order or results of the conducted during (60)-day freedom period
election nor within the thirty (30) days immediately
preceding the date of election of union
Appeal to: Directly to SOLE officials. [Art. 289]
Ground: Rules and regulations established by ASSESSMENT

the SOLE for the conduct of the election have Special assessments are payments for a
been violated. special purpose, especially if required only for
a limited time. [Azucena]
No special assessment or other extraordinary
D. RIGHTS OF LABOR fees may be levied upon the members of a
ORGANIZATIONS labor organization
unless authorized by a written resolution of
a majority of all the members at a general
1. Check off, Assessment, Agency membership meeting duly called for the
Fees purpose. [Art. 250 (n)]
CHECK-OFF Other than for mandatory activities under the

A check-off is a process or device whereby the Code, the following may not be checked off
employer, on agreement with the Union, from any amount due to an employee without
recognized as the proper bargaining an individual written authorization duly signed
representative, or on prior authorization from by the employee:
the employees, deducts union dues or agency a. special assessments
fees from the latter’s wages and remits them b. attorney’s fees
directly to the Union. [Marino v. Gamilla, G.R. c. negotiation fees
No. 149763 (2009)] d. or any other extraordinary fees
The system of check-off is primarily for the The authorization should specifically state the
benefit of the Union and, only indirectly, for the amount, purpose and beneficiary of the
benefit of the individual employees. [Marino v. deduction. [Art. 250 (o)]
v Gamilla, G.R. No. 149763 (2009)]
Requisites for a Valid Special Assessment
Note: For a check-off to be valid, it must comply 1. Authorization by a written resolution of the
with the requirements of a valid special majority of ALL the members at the general
assessment. membership meeting called for the
purpose;
Jurisdiction over Check-off Disputes 2. Secretary’s record of the minutes of the
The Bureau of Labor Relations has jurisdiction meeting; AND
to hear, decide and to mete out punishment 3. Individual written authorization for check off
any violation under Art. 250 upon report of at duly signed by the employees concerned
least 30% of the union membership OR which indicates the:
a. Amount
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b. Purpose Cross of Davao College, Inc v. Hon. Joaquin,

c. Beneficiary of deduction [Gabriel v. G.R. No. 110007 (1996)]
SOLE, G.R. No. 115949 (2000)]
When Agency Fee Assessed
Strict compliance for special assessment If such non-union member accepts the benefits
There must be strict and full compliance with under the collective bargaining agreement.
the requisites. Substantial compliance is not [Art. 259(e)]
enough. [Palacol v. Ferrer-Calleja, G.R. No.
85333 (1990)] Measure of Fee
A reasonable fee equivalent to the dues and
AGENCY FEES other fees paid by members of the recognized
Art. 259 (e) [2nd sentence to last sentence] collective bargaining agent. [Art. 259(e)]
Nothing in this Code or in any other law shall
stop the parties from requiring membership in Requirements:
a recognized collective bargaining agent as a 1. Non-member of SEBA
condition for employment 2. Member of Collective Bargaining Unit
3. Reasonable fee equivalent to the dues and
EXCEPTION: Those employees who are other fees paid by members
already members of another union at the time 4. Acceptance of CBA benefits
of the signing of the collective bargaining
agreement UNION DUES
Union dues are payments to meet the union’s
Employees of an appropriate bargaining unit general and current obligations. The payment
who are not members of the recognized must be regular, periodic, and uniform.
collective bargaining agent may be assessed [Azucena]
a reasonable fee
Amount of reasonable fee: equivalent to Every payment of fees, dues or other
the dues and other fees paid by members contributions by a member shall be evidenced
of the recognized collective bargaining by a receipt:
agent a. signed by the officer or agent making the
Condition for assessment: If such non- collection and
union members accept the benefits under b. entered into the record of the organization
the collective bargaining agreement: to be kept and maintained for the purpose.
o Provided, That the individual [Art. 250 (h)]
authorization required under Article
242, paragraph (o) shall not apply to ATTORNEY’S FEES
the non-members of the recognized Payment of Attorney’s fees cannot be imposed
collective bargaining agent; in individual member.
An amount, equivalent to union dues, which a No attorney’s fees, negotiation fees, or similar
non-union member pays to the union because charges of any kind arising from any collective
he benefits from the CBA negotiated by the bargaining agreement or conclusion of the
union. [Azucena] collective agreement shall be imposed on any
individual member. [Art. 228(b)]
Rationale for Allowing Agency Fees
The legal basis of the union’s right to agency Proper charging of attorney’s fees:
fees is neither contractual nor statutory but a. Charges against union funds; AND
quasi-contractual, deriving from the b. In an amount agreed upon by the parties
established principle that non-union employees
may not unjustly enrich themselves by Any contract, agreement, or arrangement of
benefiting from employment conditions any sort to the contrary shall be void. [Art.
negotiated by the bargaining union. [Holy 228(b)]
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Different types of Attorney’s Fees It dispenses with the requirement of the

Ordinary Extraordinary individual written authorization duly signed by
Indemnity for the employee [Art. 250(o)]
Reasonable
damages ordered by
compensation paid
the court to be paid 2. Collective Bargaining
to a lawyer for legal
by the losing party to
services rendered
the winning party Definition, Nature, and Purpose
Agreed upon by the Awarded by the Collective bargaining is:
parties NLRC Defined as negotiations towards a
Payable to the collective agreement
Payable to the client
lawyer One of the democratic frameworks under
Not limited the [Labor] Code
Limited by Art. 111
(freedom to Designed to stabilize the relations between
to 10%
contract) labor and management and to create a
[Kaisahan at Kapatiran ng mga Manggagawa climate of sound and stable industrial
at Kawani sa MWC-East Zone Union v. Manila peace.
Water, G.R. No. 174179 (2011)] A mutual responsibility of the employer and
the Union and is characterized as a legal
There are two concepts of attorney's fees: In obligation. [Kiok Loy v. NLRC, G.R. No. L-
the ordinary sense, attorney's fees represent 54334 (1986)]
the reasonable compensation paid to a
lawyer by his client for the legal services a. Duty to Bargain Collectively
rendered to the latter.
i. In General
In its extraordinary concept, attorney's fees
may be awarded by the court as indemnity for Definition
damages to be paid by the losing party to the The duty to bargain collectively
prevailing party, such that, in any of the cases Meaning: the performance of a mutual
provided by law where such award can be obligation to meet and convene promptly and
made, e.g., those authorized in Art. 2208 of the expeditiously in good faith
Civil Code, the amount is payable not to the
lawyer but to the client, unless they have Purpose: negotiating an agreement with
agreed that the award shall pertain to the respect to:
lawyer as additional compensation or as part 1. wages
thereof. [Masmud v. NLRC, G.R. No. 183385 2. hours of work,
(2009)] 3. and all other terms and conditions of
employment including:
In Masmud, the contingency agreement a. proposals for adjusting any grievances,
between lawyer and client consisting of 39% of or
the monetary award was deemed not b. questions arising under such
unconscionable by the SC. agreement, and
c. executing a contract incorporating such
MANDATORY ACTIVITIES agreements,
Definition: A judicial process of settling d. if requested by either party, but such
dispute laid down by the law. [Vengco v. duty does not compel any party to
Trajano, G.R. No. 74453 (1989)] agree to a proposal or to make any
concession. [Art. 263]
Placement of re-negotiations for a CBA under
compulsory arbitration does not make it a Jurisdictional Preconditions on Duty To
“mandatory activity”. [Galvadores v. Trajano, Bargain
G.R. No. 70067 (1986)]
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1. Possession of the status of majority Filipro Employees v. Nestle, G.R. Nos.

representation of the employees’ 158930-31 (2008)]
representative in accordance with any of
the means of selection or designation Evading the Mandatory Subjects of
provided for by the Code; Bargaining
2. Proof of majority representation; AND The refusal to negotiate a mandatory subject of
3. Demand to bargain under Art. 261(a) [Kiok bargaining is an unfair labor practice, although
Loy v. NLRC, G.R. No. L-54334 (1986)] either party has every desire to reach
agreement and earnestly and in all good faith
Only the labor organization designated or bargains to that end. However, the duty to
selected by the majority of the employees in an bargain does not obligate the parties to make
appropriate collective bargaining unit is the concessions or yield a position fairly held.
exclusive representative of the employees in [Azucena]
such unit for the purpose of collective
bargaining. [Phil. Diamond Hotel and Resort The duty to bargain is limited to mandatory
Inc v. Manila Diamond Hotel and Employees bargaining subjects; as to other matters, he is
Union, G.R. No. 158075 (2006); Art. 267] free to bargain or not to bargain.
Meaning of Bargaining in Good Faith Over mandatory subjects, a party may insist
There is no per se test of good faith in on bargaining, even to the point of deadlock,
bargaining. and his insistence will not be construed as
bargaining in bad faith.
Good faith or bad faith is an inference to be
drawn from the facts. [Union of Filipino Over a non-mandatory subject, on the other
Employees v. Nestle Philippines, Inc., G.R. hand, a party may not insist on bargaining to
Nos. 158930-31 (2008)] the point of impasse, otherwise his insistence
can be construed as bargaining in bad faith.
[T]he failure to reach an agreement after
negotiations continued for a reasonable period Blue-Sky Bargaining
does not establish a lack of good faith. Blue-Sky Bargaining is defined as "unrealistic
and unreasonable demands in negotiations by
The laws invite and contemplate a collective either or both labor and management, where
bargaining contract, but they do not compel neither concedes anything and demands the
one. [Tabangao Shell Refinery Employees impossible." It actually is not collective
Association v. Pilipinas Shell Petroleum bargaining at all. [Roberts Dictionary of
Corporation, G.R. No. 170007 (2014)] Industrial Relations as cited in Standard Bank
Chartered Employees Union v. Confesor, G.R.
Duty to Bargain does NOT include: No. 114974 (2004)]
1. Any legal duty [on the employer] to initiate
contract negotiation [Kiok Loy v. NLRC,
G.R. No. L-54334 (1986)]
2. The obligation to reach an agreement:
While the law makes it an obligation for the
employer and the employees to bargain
collectively with each other, such
compulsion does not include the
commitment to precipitately accept or
agree to the proposals of the other. All it
contemplates is that both parties should
approach the negotiation with an open
mind and make reasonable effort to reach
a common ground of agreement. [Union of
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Surface Bargaining
Surface bargaining is defined as "going Duty to bargain collectively in the absence
through the motions of negotiating," without of collective bargaining agreements
any real intent to reach an agreement. [Roberts Condition: In the absence of an agreement or
Dictionary of Industrial Relations as cited in other voluntary arrangement providing for a
Standard Bank Chartered Employees Union v. more expeditious manner of collective
Confesor, supra.] bargaining
It violates the Act's requirement that parties Who has the duty: Employer and the
negotiate in "good faith." It is prohibited representatives of the employees
because the bargaining status of a union can
be destroyed by going through the motions of What is their duty: To bargain collectively in
negotiating almost as easily as by bluntly accordance with the provisions of this Code
withholding recognition […] As long as there [Art. 262]
are unions weak enough to be talked to death,
there will be employers who are tempted to iii. When there is a CBA
engage in the forms of collective bargaining
without the substance. [K-MART Corporation v. General Rule: The duty to bargain collectively
NLRB, 1980 626 F.2d 704] shall also mean that neither party shall
terminate nor modify such agreement during its
Individual Bargaining lifetime. [Art. 264]
It is an unfair labor practice for an employer
operating under a CBA to negotiate with his Substitutionary Doctrine
employees individually. Note: See also discussion under V.b.2
That constitutes interference because the General Rule: Even during the effectivity of a
company is still under obligation to bargain with collective bargaining agreement executed
the union as the bargaining representative. between employer and employees [through]
their agent, the employees can change said
Individual bargaining contemplates a situation agent but the contract continues to bind them
where the employer bargains with the union up to its expiration date. They may bargain,
through the employees instead of the however, for the shortening of said expiration
employees through the union. [The Insular Life date. [Elisco-Elirol Labor Union v. Noriel, G.R.
Assurance Co. Ltd., Employees Assn. v. No. L-41955 (1977)].
Insular Life Assurance Co. Ltd, G.R. No. L-
25291 (1971)] Exception: At least sixty (60) days prior to the
expiration of the collective bargaining
Boulwarism agreement, either party can serve a written
A take-it-or-leave-it approach in negotiation notice to terminate or modify the agreement
constitutes bad faith. "Although the law cannot [Art. 264].
open a man's mind, it can at least compel him
to conduct himself as if he were trying to Note: During this 60-day period, a verified
persuade and were willing to be persuaded. To petition questioning the majority status of the
offer the union a contract saying 'Take it or incumbent bargaining agent may also be filed
leave it,' is not bargaining collectively within the [Art. 268].
meaning of the act.” [Herald Delivery Carriers
Union v. Herald Publication Inc., G.R. No. L-
29966 (1974), citing NLRB v. Pilling and Son
Co. US, 119 F2D 32 (1941)]
ii. When there is an Absence of

CBA
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Effect on existing CBA and encourage the parties to submit their

It shall be the duty of both parties to keep the case to a voluntary arbitrator.
status quo and to continue in full force and 6. Prohibition against disruptive acts.
effect the terms and conditions of the existing During the conciliation proceedings in the
agreement during the 60-day period and/or Board, the parties are prohibited from
until a new agreement is reached by the doing any act which may disrupt or impede
parties. [Art. 264] the early settlement of the disputes. [Book
V, IRR Rule XII, Sec. 1]
iv. Bargaining Procedure [Art. 7. Deadlock. Any certified or duly recognized
262] bargaining representative may file a notice
or declare a strike or request for preventive
General Rule: Private Procedure - The mediation in cases of bargaining deadlocks
bargaining procedure shall be governed by [the and unfair labor practices. The employer
parties’] agreement or other voluntary may file a notice or declare lockout or
arrangement providing for a more expeditious request for preventive mediation in the
manner of collective bargaining [Art. 262] same cases. In the absence of certified or
duly recognized bargaining representative,
Rationale: It is the policy of the state to any legitimate labor organization in the
promote and emphasize the primacy of free establishment may file a notice, request
collective bargaining and negotiations [Art. preventive mediation or declare a strike but
218-A(a)] only on grounds of unfair labor practice
[NCMB Manual of Procedure, Rule IV, Sec.
Exception 3]
Labor Code Procedure – In absence of a
private agreement, the collective bargaining Period to Reply; Bad Faith
procedure under Art. 261 shall be followed. [The period to reply] is merely procedural, and
1. Written notice and statement of non-compliance cannot be automatically
proposals. When a party desires to deemed to be an act of unfair labor practice.
negotiate an agreement, it shall serve a [National Union of Restaurant Workers v. CIR,
written notice upon the other party with a G.R. No. L-20044 (1964)]
statement of its proposals.
2. Reply. The other party shall make a reply Failure to Reply as Indicia of Bad Faith
thereto not later than ten (10) calendar [The employer’s] refusal to make a counter-
days from receipt of such notice. proposal [...] is an indication of its bad faith.
3. Conference. Should differences arise on Where the employer did not even bother to
the basis of such notice and reply, either submit an answer to the bargaining proposals
party may request for a conference which of the union, there is a clear evasion of the duty
shall begin not later than ten (10) calendar to bargain collectively, [...] making it liable for
days from the date of request. unfair labor practice. [General Milling Corp. v.
4. Board intervention and conciliation. If CA, G.R. No. 146728 (2004)]
the dispute is not settled, the [NCMB] shall
intervene upon request of either or both v. Bargainable Issues
parties or at its own initiative and
immediately call the parties to conciliation Mandatory Bargainable Issues
meetings. The [NCMB] shall have the 1. Wages
power to issue subpoenas requiring the 2. Hours of work
attendance of the parties to such meetings. 3. All other terms and conditions of
It shall be the duty of the parties to employment including proposals for
participate fully and promptly in the adjusting any grievances or questions
conciliation meetings the Board may call. arising under such agreement [Art. 263]
5. Voluntary arbitration. The [NCMB] shall
exert all efforts to settle disputes amicably Examples:
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1. Vacations and holidays mandatory subjects of collective bargaining

2. Bonuses unless the agreement covers a matter which is
3. Seniority, Transfer, and Layoffs not a mandatory subject.
4. Employee workloads
5. Work rules and regulations It is no answer to the charge of refusal to
6. Union security arrangements bargain in good faith that the insistence on the
7. Pension and insurance benefits for active disputed clause was not the sole cause of the
employees failure to agree or that agreement was not
reached with respect to other disputed clauses.
Permissive Issues Such refusal will not be deemed as an unfair
Unilateral benefits extended by the employer labor practice.
[cf. Union of Filipino Employees v. Nestle, G.R.
Nos. 158930-31 (2008)] However, if a party refuses to contract based
on an issue which is not a mandatory
As in all other contracts, the parties in a CBA bargainable issue, the party will be guilty of
may establish such stipulations, clauses, terms ULP. [Samahang Manggagawa sa Top Form v.
and conditions as they may deem convenient NLRC, G.R. No. 113856 (1998)]
provided they are not contrary to law, morals,
good customs, public order or public policy. Minutes of Negotiation
[Manila Fashions v. NLRC, G.R. No. 117878 Where a proposal raised by a contracting party
(1996)] does not find print in the CBA, it is not a part
thereof and the proponent has no claim
Test for Mandatory Bargainable Issues whatsoever to its implementation. [...]
The nexus between the Nature of Employment
and the Nature of the Demand: For “other The Minutes [only] reflects the proceedings
terms and conditions of employment” to and discussions undertaken in the process of
become a mandatory bargainable issue, they bargaining for worker benefits in the same way
must have a connection between the proposal that the minutes of court proceedings show
and the nature of the work. what transpired therein.
In order for a matter to be subject to mandatory At the negotiations, it is but natural for both
collective bargaining, it must materially or management and labor to adopt positions or
significantly affect the terms and conditions of make demands and offer proposals and
employment. Whether the agreement concerns counter-proposals.
a mandatory subject of bargaining depends not
on its form, but on its practical effect. [Azucena] However, nothing is considered final until the
parties have reached an agreement.
Importance of Determining the Character of [Samahang Manggagawa sa Top Form v.
the Bargaining Issue NLRC, G.R. No. 113856 (1998)]
The question as to what are mandatory and
what are merely permissive subjects of Suspension of Bargaining Negotiations
collective bargaining is of significance on the In order to allow the employer to validly
right of a party to insist on his position to the suspend the bargaining process there must be
point of stalemate. a valid petition for certification election raising
a legitimate representation issue.
A party may refuse to enter into a collective
bargaining contract unless it includes a Hence, the mere filing of a petition for
desired provision as to a matter which is a certification election does not ipso facto justify
mandatory subject of collective bargaining. the suspension of negotiation by the employer.
[Colegio de San Juan de Letran v. Association
[But] a refusal to contract is in substance a of Employees, G.R. No. 141471 (2000)]
refusal to bargain about matters which are
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vi. Bargaining Deadlock Collective Bargaining Agreement or “CBA”

refers to the negotiated contract between a
Deadlock is defined as the “counteraction of legitimate labor organization and the employer
things producing entire stoppage: a state of concerning wages, hours of work and all other
inaction or of neutralization caused by the terms and conditions of employment in a
opposition of persons or of factions: a bargaining unit. [Sec. 1(k), Rule I, Book V, IRR]
standstill.
Nature of the CBA
There is a deadlock when there is a “complete The CBA is the law between the parties and
blocking or stoppage resulting from the action they are obliged to comply with its provisions.
of equal and opposed forces.” [Zuellig Pharma Corporation v. Alice Sibal,
G.R. No. 173587 (2013)]
The word is synonymous with the word
impasse which, “presupposes reasonable Although it is a rule that a contract freely
effort at good faith bargaining which, despite entered between the parties should be
noble intentions, does not conclude in respected, since a contract is the law between
agreement between the parties.” [Divine World the parties, said rule is not absolute. [... Citing
Tacloban v. Secretary of Labor, G.R. No. Art. 1700,] the relations between capital and
91915 (1992)] labor are not merely contractual. They are so
impressed with public interest that labor
Collective Bargaining Deadlock is defined as contracts must yield to the common good.
the situation between the labor and the [Halagueña v. Philippine Airlines, G.R. No.
management of the company where there is 172013 (2009)]
failure in the collective bargaining negotiations
resulting in a stalemate. [San Miguel Corp. v Beneficiaries of the CBA
NLRC, G.R. No. 99266 (1999)]. The labor organization
a. Designated, or
Privileged Communication in Conciliation b. Selected by the majority of the employees
Proceedings in an appropriate collective bargaining unit,
Information and statements made at shall be the exclusive representative of the
conciliation proceedings shall be treated as employees in such unit for the purpose of
privileged communication and shall not be collective bargaining. [Art. 267]
used as evidence in the Commission.
Conciliators and similar officials shall not testify When a collective bargaining contract is
in any court or body regarding any matters entered into by the union representing the
taken up at conciliation proceedings conducted employees and the employer, even the non-
by them. [Art. 233] member employees are entitled to the benefits
of the contract.
Rationale:
1. A person is entitled to ‘buy his or her peace’ To accord its benefits only to members of the
without danger of being prejudiced in case union without any valid reason would constitute
his or her efforts fail undue discrimination against non-members.
2. Offers for compromise are irrelevant [New Pacific Timber and Supply v. NLRC, G.R.
because they are not intended as No. 124224 (2000)]
admissions by the parties making them
[Pentagon Steel v. CA, G.R. No. 174141 Contract Interpretation
(2009)]
Art. 1702, Civil Code. In case of doubt, all
b. Collective Bargaining labor legislation and all labor contracts shall
Agreement be construed in favor of the safety and
decent living for the laborer.
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A CBA, as a labor contract within the

contemplation of Art. 1700 of the Civil Code of All grievances submitted to the grievance
the Philippines which governs the relations machinery which are not settled within seven
between labor and capital, [it] is not merely (7) calendar days from the date of its
contractual in nature but impressed with public submission shall automatically be referred to
interest, thus, it must yield to the common voluntary arbitration prescribed in the
good. Collective Bargaining Agreement.
As such, it must be construed liberally rather For this purpose, parties to a Collective
than narrowly and technically. Bargaining Agreement shall:
1. name and designate in advance a
The courts must place a practical and realistic Voluntary Arbitrator or panel of Voluntary
construction upon it, giving due consideration Arbitrators, or
to the context in which it is negotiated, and 2. include in the agreement a procedure for
purpose which it is intended to serve. [Davao the selection of such Voluntary Arbitrator or
Integrated Port Stevedoring Services v. panel of Voluntary Arbitrators, preferably
Abarquez, G.R. No. 102132 (1993)] from the listing of qualified Voluntary
Arbitrators duly accredited by the Board.
General Rule: [W]here the CBA is clear and
unambiguous, it becomes the law between the In case the parties fail to select a Voluntary
parties and compliance therewith is mandated Arbitrator or panel of Voluntary Arbitrators, the
by the express policy of the law. [Zuellig Board shall designate the Voluntary Arbitrator
Pharma Corporation v. Alice Sibal, G.R. or panel of Voluntary Arbitrators
No.173587 (2013)] When: as may be necessary
How: pursuant to the selection procedure
Exception: If the words appear to be contrary agreed upon in the Collective Bargaining
to the evident intention of the parties, the latter Agreement
shall prevail over the former. [Kimberly Clark Effect: designated Voluntary Arbitrator or
Phils. v. Lorredo, G.R. No. 103090 (1993)] panel of Voluntary Arbitrators shall act with
the same force and effect as if the
i. Mandatory provisions in a Arbitrator or panel of Arbitrators have been
Collective Bargaining selected by the parties as described above.
Agreement
ii. Administration and
Note: See also v. Bargainable Issues under “a. Enforcement of CBA
Duty to bargain collectively”
Substandard CBA
Art. 273. Grievance Machinery and A CBA that falls below the minimum standards
Voluntary Arbitration required by law is prohibited. Nonetheless, RA
The parties to a Collective Bargaining 9481 removed substandard CBAs as a ground
Agreement shall include therein provisions that for the cancellation of registration of union
will ensure the mutual observance of its terms registration.
and conditions.
Note: A substandard CBA cannot bar a petition
They shall establish a machinery for the for certification election under the contract-bar
adjustment and resolution of grievances rule. [Prof. Battad]
1. Arising from the interpretation or
implementation of their Collective Ratification
Bargaining Agreement, and Within thirty (30) days from the execution of a
2. Those arising from the interpretation or collective bargaining agreement
enforcement of company personnel
policies.
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The parties shall submit copies of the same

directly to the Bureau or the Regional Offices Registration
of the Department of Labor and Employment Within thirty (30) days from the execution of a
for registration, accompanied with: Collective Bargaining Agreement, the parties
1. Verified proofs of its posting in two shall submit copies of the same directly to the
conspicuous places in the place of work, Bureau or the Regional Offices of the
and Department of Labor and Employment for
2. Ratification by the majority of all the registration […]. [Art. 237]
workers in the bargaining unit. [Art. 237;
Book V, IRR Rule XVII, Sec. 2 (c)] iii. Requirements for Registration
[T]he posting of copies of the collective The application for CBA registration shall be
bargaining agreement is the responsibility of accompanied by the original and two (2)
the employer. duplicate copies of the following documents
which must be certified under oath by the
The fact that there were "no impartial members representative(s) of the employer(s) and labor
of the unit" is immaterial. union(s) concerned:
1. The collective bargaining agreement
The purpose of the requirement is precisely to 2. A statement that the collective bargaining
inform the employees in the bargaining unit of agreement was posted in at least two (2)
the contents of said agreement so that they conspicuous places in the establishment or
could intelligently decide whether to accept the establishments concerned for at least five
same or not. [Associated Labor Unions v. (5) days before its ratification
Ferrer-Calleja, G.R. No. L-77282 (1989)] 3. A statement that the collective bargaining
agreement was ratified by the majority of
Effect of Non-ratification the employees in the bargaining unit of the
General Rule: The collective bargaining employer or employees concerned. [Sec.
agreement should be ratified by the majority of 2, Rule XVII, Book V, IRR]
all the members of the bargaining unit. Non-
compliance with this requirement renders the Specific information submitted in
CBA ineffective. [Associated Trade Unions v. confidence
Trajano, G.R. No. 75321 (1988)] General rule: Shall not be disclosed
Exception: Even if there was no ratification, Exceptions:

the CBA will not be invalid or void considering 1. authorized by Secretary of Labor
that the employees have enjoyed benefits from 2. when it is at issue in any judicial litigation
it. 3. public interest or national security requires
[Art. 237]
[The employees] cannot receive benefits under
provisions favorable to them and later insist
that the CBA is void simply because other
provisions turn out not to the liking of certain
employees. [Planters Products Inc. v. National
Labor Relations Commission, G.R. No. 78524
(1989)]
Note: Ratification of the CBA by the employees

in the bargaining unit is not needed when the
CBA is a product of an arbitral award as a result
of voluntary arbitration under Art. 275 or from
the secretary’s assumption of jurisdiction or
certification under Art. 278 (g).
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Effect of Unregistered CBA When there is a representational issue, the

An unregistered CBA is binding upon the status quo provision insofar as the need to
parties but cannot serve as a bar to a petition await the creation of a new agreement will not
for certification election under the contract-bar apply.
rule.
Otherwise, it will create an absurd situation
Sec. 3, Rule VIII, Book V states: A petition for where the union members will be forced to
certification election may be filed anytime, maintain membership by virtue of the union
except: [...] (d) when a collective bargaining security clause existing under the CBA and,
agreement between the employer and a duly thereafter, support another union when filing a
recognized or certified bargaining agent has petition for certification election.
been registered in accordance with Art. 231
[now 237] of the Labor Code. If we apply it, there will always be an issue of
disloyalty whenever the employees exercise
iv. CBA Effectivity their right to self-organization. The holding of a
certification election is a statutory policy that
If it is the first ever CBA, the effectivity date is should not be circumvented, or compromised.
whatever date the parties agree on. [PICOP Resources, Inc. v. Taneca et al., G.R.
No. 160828 (2010)]
If it is a renegotiated CBA, the retroactivity of Arbitrated CBA
the date of effectivity depends upon the In the absence of an agreement between the
duration of conclusion [Art. 265]: parties, an arbitrated CBA takes on the nature
1. If it is concluded within 6 months from the of any judicial or quasi-judicial award. [Manila
expiry date, the new CBA will retroact to the Electric Company v. Quisumbing, G.R. No.
date following the expiry date [Illustration: 127598 (1999)]
expiry date: December 13; renegotiations
concluded on November 30; effectivity [I]n the absence of the specific provision of law
date: December 14]. prohibiting retroactivity of the effectivity of the
2. If it is concluded beyond 6 months from arbitral awards issued by the Secretary of
the expiry date, the matter of retroaction Labor pursuant to Art. 263(g) of the Labor
and effectivity is left with the parties. Code, [the Secretary] is deemed vested with
plenary powers to determine the effectivity
Hold Over Principle thereof. [LMG Chemicals v. Secretary of Labor,
It shall be the duty of both parties to keep the G.R. No. 127422 (2001)]
status quo and to continue in full force and
effect the terms and conditions of the existing v. CBA Duration
agreement:
a. during the 60-day period and/or Art. 265. Terms of a Collective Bargaining
b. until a new agreement is reached by the Agreement – Any Collective Bargaining
parties. [Art. 264, last sentence] Agreement that the parties may enter into
shall, insofar as the representation aspect is
The last sentence of Art. 264, which provides concerned, be for a term of five (5) years. [...]
for automatic renewal [upon expiry], pertains All other provisions of the Collective
only to the economic provisions of the CBA Bargaining Agreement shall be renegotiated
and does not include representational aspect not later than three (3) years after its
of the CBA. execution. [...]
A [CBA which continues to take effect beyond CBA Duration for economic provisions
its expiration date] cannot constitute a bar to a 3 years
filing of petition for certification election.
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CBA Duration for non-economic provisions

5 years for representational or political issues; Exception: When the liability therefore is
cannot be renegotiated to extend beyond 5 assumed by the new employer under the
years. [FVC Labor Union-PTGWO v. contract of sale, or when liability arises
SANAMA-FVC-SIGLO, G.R. No. 176249 because of the new owner's participation in
(2009)] thwarting or defeating the rights of the
employees.
CBA Duration: Freedom Period
No petition questioning the majority status of The most that the transferee may do, for
the incumbent bargaining agent shall be reasons of public policy and social justice, is to
entertained and no certification election shall give preference to the qualified separated
be conducted by the DOLE outside of the employees in the filling of vacancies in the
sixty-day period immediately before the facilities of the purchaser. [Manlimos v. NLRC,
date of the expiry of such five-year term of G.R. No. 113337 (1995)]
the Collective Bargaining Agreement. [Art.
265] The general rule applies only to the sale and
purchase of asset. If the method of acquisition
CBA and 3rd Party Applicability is by way of purchase of controlling shares, the
Labor contracts such as employment contracts employer remains the same and the new
and CBAs are not enforceable against a owners must honor the existing contracts.
transferee of an enterprise, labor contracts
being in personam, is binding only between the
parties. E. UNFAIR LABOR
PRACTICES
As a general rule, there is no law requiring a
bona fide purchaser of the assets of an on-
1. Nature, Aspects
going concern to absorb in its employ the
employees of the latter.
Unfair labor practice refers to acts that violate
the workers’ right to organize. The prohibited
However, although the purchaser of the assets
acts are related to the workers’ right to self-
or enterprise is not legally bound to absorb in
its employ the employees of the seller of such organization and to the observance of a
assets or enterprise, the parties are liable to the CBA. Without that element, the acts, no matter
employees if the transaction between the how unfair, are not unfair labor practices. The
only exception is Art. 259(f) [i.e. to dismiss,
parties is colored or clothed with bad faith.
[Sundowner Development Corporation v. discharge or otherwise prejudice or
Drilon, G.R. No. 82341 (1989)] discriminate against an employee for having
given or being about to give testimony under
this Code]. [Philcom Employees Union v. Phil.
Where the change of ownership is in bad faith
Global, G.R. No. 144315 (2006)]
or is used to defeat the rights of labor, the
successor-employer is deemed to have
absorbed the employees and is held liable for Nature of ULP
the transgressions of his or her predecessor a. inimical to the legitimate interests of both
[Philippine Airlines, Inc. v. NLRC, G.R. No. labor and management, including their
125792 (1998)] right to bargain collectively and otherwise
deal with each other in an atmosphere of
freedom and mutual respect
General Rule: An innocent transferee of a
b. disrupt industrial peace
business establishment has no liability to the
c. hinder the promotion of healthy and stable
employees of the transferor to continue
labor-management relations
employing them. Nor is the transferee liable for
past unfair labor practices of the previous
owner.
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d. violations of the civil rights of both labor and an unfair labor practice. [HSBC Employee
management but are also criminal offenses Union v. NLRC, G.R. No. 125038 (1997)]
[Art. 258]
Note: Bargaining in bad faith constitutes Unfair
Four forms of Unfair Labor Practice in Labor Practice, which may be committed by
Collective Bargaining either Employer or Labor Organization.
1. Failure or refusal to meet and convene
2. Evading the mandatory subjects of 2. By Employers
bargaining
3. Bargaining in bad faith a. Interference/Restraint/Coercion
4. Gross violation of the CBA b. Yellow Dog Contracts
c. Contracting Out Services which
Purpose of the Policy Against ULPs Discourage Unionism
Protection of right to self-organization and/or d. Company Union
collective bargaining: e. Discrimination to Encourage/ Discourage
a. The employee is not only protected from Unionism
the employer but also from labor f. Discrimination for having given or about to
organizations. give testimony
b. The employer is also protected from ULP g. Violation of Duty to Bargain Collectively
committed by a labor organization. h. Payment of Negotiation or Attorney’s Fees
i. Violation of a Collective Bargaining
The public is also protected because it has an Agreement
interest in continuing industrial peace.
a. Interference/Restraint/Coercion
Employer-Employee Relationship Required
General Rule: An unfair labor practice may be Art. 259(a). Unfair Labor Practices of
committed only within the context of an Employers. – To interfere with, restrain or
employer-employee relationship [American coerce employees in the exercise of their
President Lines v. Clave, G.R. No. L-51641 right to self-organization
(1982)]
The fact that the resignations of the union
Exception: “Yellow Dog” condition or members occurred during the pendency of the
contract: to require as a condition of case before the labor arbiter shows GMC’s
employment that a person or an employee desperate attempts to cast doubt on the
shall not join a labor organization or shall legitimate status of the union. The ill-timed
withdraw from one to which he belongs. [Art. letters of resignation from the union members
259 (b)] indicate that GMC had interfered with the right
of its employees to self-organization. [General
Parties Not Estopped from Raising ULP by Milling Corporation v. Court of Appeals, G.R.
Eventual Signing of the CBA 146728 (2004)]
The eventual signing of the CBA does not
operate to estop the parties from raising unfair Interrogation
labor practice charges against each other. General rule: employer may interrogate its
[Standard Chartered Bank Union v. Confesor, employees regarding their union affiliation for
G.R. No. 114974 (2004)] legitimate purposes and with the assurance
that no reprisals would be taken against the
Statutory Construction unionists.
The Labor Code leaves to the court the work of
applying the law's general prohibitory Exception: when interrogation interferes with
language, in light of infinite combinations of or restrains employees' right to self-
events, which may be charged as constituting organization. [Phil. Steam Navigation Co. v.
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Phil. Marine Officer’s Guild, G.R. Nos. L-20667 Art. 259(b). Unfair Labor Practices of
and 20669 (1965)] Employers. – To require as a condition of
employment that a person or an employee
Note: The interrogation of the ER should not be shall not join a labor organization or shall
persistent and/or hostile withdraw from one to which he belongs;
Speech Yellow dog contracts require, as a condition of

The acts of a company which subjects a union employment, that a person or an employee
to vilification and its participation in soliciting shall not join a labor organization or shall
membership for a competing union are also withdraw from one to which he belongs.
acts constituting a ULP. [Phil. Steam
Navigation Co. v. Phil. Marine Officer’s Guild, Requisites of a Yellow Dog Contract:
G.R. Nos. L-20667 and 20669 (1965)] 1. A representation by the employee that he
is not a member of a labor organization
An employer may not send letters containing 2. A promise by the employee that he will not
promises or benefits, nor of threats of obtaining join a union
replacements to individual workers while the 3. A promise by the employee that upon
employees are on strike due to a bargaining joining a labor organization, he will quit his
deadlock. This is tantamount to interference employment [Azucena]
and is not protected by the Constitution as free
speech. [Insular Life Assurance Co. c. Contracting Out Services which
Employees Assn. v. Insular Life Assurance Discourage Unionism
Co. Ltd, G.R. No. L-25291 (1971)]
Art. 259(c). Unfair Labor Practices of
Espionage Employers. – To contract out services or
Espionage and/or surveillance by the employer functions being performed by union
of union activities are instances of interference, members when such will interfere with,
restraint or coercion of employees in restrain or coerce employees in the exercise
connection with their right to organize, form of their right to self-organization;
and join unions as to constitute unfair labor
practice. […] The information obtained by General Rule: contracting out is not a ULP, but
means of espionage is invaluable to the is covered by the employer’s management
employer and can be used in a variety of cases prerogative.
to break a union. [Insular Life Assurance Co.
Employees Assn. v. Insular Life Assurance Exception [Art. 259 (c)]:
Co. Ltd, G.R. No. L-25291 (1971)] 1. contracted-out services or functions are
performed by union members AND
Concerted Activities 2. contracting out will interfere with, restrain,
The mass demonstration and stoppage of work or coerce employees in the exercise of their
of the Union is not ULP. They didn’t right to self-organization.
demonstrate against the employer, but against
the Pasig police for alleged human rights d. Company Union
abuses. This is merely an exercise of their
freedom of expression, assembly, and right to Art. 259(d). Unfair Labor Practices of
redress of grievances enshrined in the Employers. – To initiate, dominate, assist or
Constitution. [Philippine Blooming Mills otherwise interfere with the formation or
Employment Organization v. Philippine administration of any labor organization,
Blooming Mills Co., Inc., G.R. No. L-31195 including the giving of financial or other
(1973)] support to it or its organizers or supporters;
b. Yellow Dog Contracts Company union means any labor
organization whose formation, function or
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administration has been assisted by any act Art. 259(e). Unfair Labor Practices of
defined as unfair labor practice by this Code. Employers. – Nothing in this Code or in any
[Art. 219(i)] other law shall stop the parties from requiring
membership in a recognized collective
The employer commits ULP if it initiates, bargaining agent as a condition for
dominates, or otherwise interferes with the employment, except those employees who
formation or administration of any labor are already members of another union at the
organization. time of the signing of the collective
bargaining agreement.
Example: giving out financial aid to any union's
supporters or organizers. The law has allowed stipulations for 'union
shop' and 'closed shop' as means of
e. Discrimination to Encourage/ encouraging workers to join and support the
Discourage Unionism [Art. 259 union of their choice in the protection of their
(e)] rights and interests vis-a-vis the employer. [Del
Monte Philippines v. Salvidar, G.R. No. 158620
General Rule: it is ULP to discriminate in (2006)]
regard to wages, hours of work, and other
terms and conditions of employment in order to Purpose
encourage or discourage membership in any To safeguard and ensure the existence of the
labor organization. union and thus, promote unionism in general
as a state policy.
Exception: Union security clauses
It is the policy of the State to promote unionism
Union security is a generic term which is to enable the workers to negotiate with the
applied to and comprehends “closed shop,” management on the same level and with more
“union shop,” “maintenance of membership” or persuasiveness than if they were to individually
any other form of agreement which imposes and independently bargain for the
upon employees the obligation to acquire or improvement of their respective conditions. […]
retain union membership as a condition For this reason, the law has sanctioned
affecting employment. [NUWHRAIN v. NLRC, stipulations for the union shop and closed shop
G.R. No. 179402 (2008)] as a means of encouraging the workers to join
and support the labor union of their own choice
[Union security clause] is an indirect restriction vis-à-vis the employer. [Liberty Flour Mills
on the right of an employee to self- Employees v. Liberty Flour Mills, G.R. No.
organization. It is a solemn pronouncement of 58768-70 (1989)]
a policy that while an employee is given the
right to join a labor organization, such right Coverage
should only be asserted in a manner that will General Rule: All employees in the bargaining
not spell the destruction of the same unit covered by the union security clause are
organization. [Tanduay Distillery Labor Union subject to its terms
v. NLRC, G.R. No. 75037 (1987)]
[Employees], although entitled to disaffiliation

from their union to form a new organization of
their own, must, however, suffer the
consequences of their separation from the
union under the security clause of the CBA.
[Villar v. Inciong, G.R. No. L-50283-84 (1983)].
Statutory Basis and Rationale
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Exception: in the first place. Hence, any doubt as to the

1. Employees who are already members of existence of a closed shop provision in the CBA
another union at the time of the signing of will be resolved in favor of the nonexistence of
the collective bargaining agreement may the closed shop provision. [Azucena]
not be compelled by any union security
clause to join any union. [Art. 254 (e)] 2. Maintenance of membership shop
2. Employees already in service at the time
the closed shop union security clause took Condition for continued employment
effect. An agreement where present and future
A closed shop provision in a CBA is not to employees are not compelled to join the SEBA,
be given a retroactive effect as to preclude but once so joined, they must maintain their
its being applied to employees already in membership as a condition for continued
service. [Guijarno v. CIR, G.R. No. L- employment until they are promoted or
28791-93 (1973)] transferred out of the bargaining unit or the
3. Any employee who, at the time the union agreement is terminated.
security clause took effect, is a bona fide
member of religious organization which There is maintenance of membership shop
prohibits its members from joining labor when employees, who are union members as
unions on religious grounds [Reyes v. of the effective date of the agreement, or who
Trajano, 209 SCRA 484 (1992)]. thereafter become members, must maintain
4. Confidential employees who are excluded union membership as a condition for [their]
from the rank-and-file bargaining unit. continued employment until they are promoted
5. Employees excluded from the union or transferred out of the bargaining unit or the
security provisions by express terms of the agreement is terminated. [General Milling
agreement [BPI v. BPI Employees Union- Corporation (GMC) v. Casio, G.R. No. 149552
Davao Chapter, G.R. No. 164301 (2010)]. (2010)]
TYPES OF UNION SECURITY CLAUSE 3. Union shop
1. Closed shop Condition for continued employment

There is union shop when all new regular
Condition for employment employees are required to join the union within
An agreement where only union members may a certain period as a condition for their
be employed and, for the duration of the continued employment. [General Milling
agreement, remains a member in good Corporation (GMC) v. Casio, G.R. No. 149552
standing of a union. (2010)]
A closed shop may be defined as an enterprise Non-members may be hired, but to retain
in which, by agreement between the employer employment, they must become union
and his employees or their representatives, no members after a certain period. The
person may be employed in any or certain requirement applies to present and future
agreed departments of the enterprise unless employees. [Azucena]
he or she is, becomes, and, for the duration of
the agreement, remains a member in good 4. Modified union shop
standing of a union entirely comprised of or of
which the employees in interest are a part. Condition for continued employment of
[General Milling Corporation (GMC) v. Casio, future employees
G.R. No. 149552 (2010)] Employees who are not union members at the
time of signing the contract need not join the
The closed shop provision can also be a potent union, but all workers hired thereafter must
weapon wielded by the union against the join. [Azucena]
workers whom the union is supposed to protect
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5. Agency shop always with due process. Even if there are

valid grounds to expel the union officers, due
Employees belonging to an appropriate process requires that these union officers be
collective bargaining unit who are not members accorded a separate hearing by respondent
of the recognized collective bargaining agent company. [Malayang Samahan ng
may be assessed a reasonable fee equivalent Manggagawa sa M. Greenfield v. Ramos, G.R.
to the dues and other fees paid by members of No. 113907 (2000)]
the recognized collective bargaining agent, if
such non-union members accept the benefits Requirement of Due Process
under the collective agreement. The requirements laid down by the law in
determining whether or not an employee was
Provided, That the individual authorization validly terminated must still be followed even if
required under Art. [250], paragraph (o) of [the it is based on a [union security clause] of a
Labor] Code shall not apply to non-members of CBA, i.e. the substantive as well as the
the recognized collective bargaining agent [Art. procedural due process requirements. [Del
259(e)]. Monte v. Saldivar, G.R. No. 158620 (2006)]
ENFORCEMENT OF UNION SECURITY Obligations and Liabilities

CLAUSE Where the employer dismissed his employees
in the belief in good faith that such dismissal
Termination due to Union Security was required by the [union security provision]
Provision of the collective bargaining agreement with the
Termination of employment by virtue of a union union, he may not be ordered to pay back
security clause strengthens the union and compensations to such employees although
prevents disunity in the bargaining unit within their dismissal is found to be illegal.
the duration of the CBA. The authorized [Confederated Sons of Labor v. Anakan
bargaining representative gains more numbers Lumber Co., G.R. No. L-12503 (1960)]
and strengthens its position as against other
unions which may want to claim majority As dictated by fairness, […] the union shall be
representation. [Alabang Country Club v. liable to pay their backwages. This is because
NLRC, G.R. No. 170287 (2008)] management would not have taken the action
it did, had it not been for the insistence of the
Requisites for the enforcement of Union labor union seeking to give effect to its
Security Clauses interpretation of a closed shop provision.
In terminating the employment of an employee [Guijarno v. CIR, G.R. No. L-28791-93 (1973)]
by enforcing the union security clause, the
employer needs only to determine and prove f. Discrimination for having given
that: or about to give testimony
1. The union security clause is applicable;
2. The union is requesting for the Art. 259(f). Unfair Labor Practices of
enforcement of the union security provision Employers. — To dismiss, discharge or
in the CBA; otherwise prejudice or discriminate against
3. There is sufficient evidence to support the an employee for having given or being about
union’s decision to expel the employee to give testimony;
from the union. [Alabang Country Club v.
NLRC, G.R. No. 170287 (2008)] Note: This is broader than the prohibition under
Art. 118 because Art. 259 (f) covers testimony
Company must conduct separate under the whole Code, while Art. 118 only
investigation or hearing covers testimony under Book I: Pre-
The enforcement of union security clauses is Employment, Title II: Wages.
authorized by law provided such enforcement
is not characterized by arbitrariness, and
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Note further: Includes not giving testimony

[Azucena]. 3. Implied refusal
g. Violation of Duty to Bargain The school is guilty of unfair labor practice

Collectively when it failed to make a timely reply to the
proposals of the union more than one month
Art. 259(g). Unfair Labor Practices of after the same were submitted by the union. In
Employers — To violate the duty to bargain explaining its failure to reply, the school merely
collectively as prescribed by this Code; offered a feeble excuse that its Board of
Trustees had not yet convened to discuss the
Collective bargaining does not end with the matter. Clearly, its actuation showed a lack of
execution of an agreement. Being a continuous sincere desire to negotiate. [Colegio de San
process, the duty to bargain necessarily Juan de Letran v. Association of Employees
imposes on the parties the obligation to live up and Faculty of Letran, G.R. No. 141471 (2000)]
to the terms of such a collective bargaining
agreement if entered into, it is undeniable that ACTS NOT DEEMED REFUSAL TO
non-compliance therewith constitutes an unfair BARGAIN
labor practice. [Shell Oil Workers Union v. Shell 1. Adoption of an adamant bargaining
Co., G.R. No. L-28607 (1971)] position in good faith, particularly where the
company is operating at a loss
Note: See ULP in Collective Bargaining above. 2. Refusal to bargain over demands for
commission of unfair labor practices
ACTS DEEMED AS REFUSAL TO BARGAIN 3. Refusal to bargain during period of illegal
strike
1. Refusal to bargain when there is an 4. Not initiating the bargaining
unresolved petition for union 5. Refusal to bargain where the union
cancellation demands for recognition and bargaining
within the year following a certification
“That there is a pending cancellation election, and the clear choice is no union
proceedings against the union is not a bar to and no ad interim significant change has
set in motion the mechanics of collective taken place in the unit
bargaining. […] Unless [the union’s] certificate 6. Refusal to bargain because the other party
of registration and status as the certified is making unlawful bargaining demands
bargaining agent is revoked, [the employer], by
express provision of the law, is duty bound to h. Payment of Negotiation or
collectively bargain with the Union.” [Capitol Attorney’s Fees
Medical Center v. Trajano, G.R. No. 155690
(2005)] Art. 259(h). Unfair Labor Practices of
Employers — To pay negotiation or
2. Employer’s suspension of operations in attorney's fees to the union or its officers or
order to forestall a demand for agents as part of the settlement of any issue
collective bargaining in collective bargaining or any other dispute;
By admitting that the closure [of the business] Sweetheart contracts are favorable both to the
was due to irreconcilable differences between union and the employer at the expense of the
the Union and the school management, […] employees. The settlement of bargaining
SJCI in effect admitted that it wanted to end the issues must be made by fair bargaining in good
bargaining deadlock and eliminate the problem faith, and not through the payment of
dealing with the demands of the union. [St. negotiation or attorney's fees which will
John Colleges Inc. v. St. John Academy ultimately lead to sweetheart contracts.
Faculty and Employees Union, G.R. No.
167892 (2006)]
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i. Violation of a Collective
Bargaining Agreement [Art. 259 Motive, Conduct, Proof
(i)] To constitute ULP, the dismissals by the ER
need not be entirely motivated by union
Art. 259(i) Unfair Labor Practices of activities or affiliations. It is enough that
Employers — To violate a collective discrimination was a factor. [Me-Shurn Corp. v.
bargaining agreement. Me-Shurn Workers Union-FSM, G.R. No.
156292 (2005)]
Flagrant and/or Malicious Refusal to
Comply with Economic Provisions Note: The basic inspiration of the dismissals
Required should concern the right to self-organization.
Art. 274. Jurisdiction of Voluntary
Arbitrators. – Accordingly, violations of a Totality of Evidence
Collective Bargaining Agreement, except Where the attendant circumstances, the history
those which are gross in character, shall no of the employer's past conduct and like
longer be treated as unfair labor practice and considerations, coupled with an intimate
shall be resolved as grievances under the connection between the employer's action and
Collective Bargaining Agreement. the union affiliations or activities of the
particular employee or employees, taken as a
For purposes of this Art., gross violations of whole, raise a suspicion as to the motivation for
Collective Bargaining Agreement shall mean the employer's action, the failure of the
flagrant and/or malicious refusal to comply employer to ascribe a valid reason therefor
with the economic provisions of such may justify an inference that his unexplained
agreement. conduct in respect of the particular employee
or employees was inspired by the latter's union
Violations of collective bargaining agreements, membership or activities. [Royal Undergarment
except flagrant and/or malicious refusal to Corporation of the Philippines v. CIR, G.R. No.
comply with its economic provisions, shall not L-39040 (1990)]
be considered unfair labor practice and shall
not be strikeable. [Book V, Rule XXII, Sec. 5] 3. By Labor Organizations
Note: The list in Art. 259 is not exhaustive. a. Restraint or Coercion

Other acts which are analogous to those b. Discrimination: Encourage/Discourage
enumerated can be ULPs. Unionism
c. Violation of Duty, or Refuse to Bargain
The alleged violation of the CBA, even d. Illegal Exaction (Featherbedding)
assuming it was malicious and flagrant, is not e. Asking or Accepting Negotiation and other
a violation of an economic provision, thus Attorney's Fees
not an Unfair Labor Practice. [BPI Employees f. Violation of a Collective Bargaining
Union-Davao FUBU v. BPI, G.R. No. 174912 Agreement
(2013)]
a. Restraint or Coercion
An employer cannot be considered to have
committed a gross and economic violation of Art. 260(a). Unfair Labor Practices of
the CBA when it, in good faith, withheld union Labor Organizations — To restrain or
dues and death benefits from the union upon coerce employees in the exercise of their
written request of the union members in light of right to self-organization. However, a labor
the conflict between the members and the organization shall have the right to prescribe
union officers and instead deposited such its own rules with respect to the acquisition
amount to the DOLE. [Arellano University or retention of membership;
Employees and Workers Union v. Court of
Appeals, G.R. 139940 (2006)]
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“Interfere” is not included in Art. 260 simply The practice of the labor organization to cause
because any act of a labor organization or attempt to cause an employer to pay or
amounts to interference to the right of self- deliver or agree to pay or deliver money or
organization. other things of value, in the nature of an
exaction, for services which are not performed
b. Discrimination: Encourage/ or are not to be performed, including the
Discourage Unionism demand for a fee for union negotiations.
Art. 260(b). Unfair Labor Practices of e. Asking or Accepting

Labor Organizations — To cause or Negotiation and other
attempt to cause an employer to discriminate Attorney's Fees
against an employee, including
discrimination against an employee with Art. 260(e). Unfair Labor Practices of
respect to whom membership in such Labor Organizations — To ask for or
organization has been denied; or terminate accept negotiation or attorney's fees from
an employee on any ground other than the employers as part of the settlement of any
usual terms and conditions under which issue in collective bargaining or any other
membership or continuation of membership dispute
is made available to other members;
See counterpart in ULP by Employers
General rule: It is a ULP for a labor (sweetheart contracts).
organization to cause an employer to
discriminate against an employee. f. Violation of a Collective
Bargaining Agreement
Exception: Provisions of a valid union security
clause and other company policies applicable Art. 260(f). Unfair Labor Practices of
to all employees. Labor Organizations — To violate a
collective bargaining agreement.
c. Violation of Duty, or Refuse to
Bargain Gross Violations of the CBA
Art. 274. Jurisdiction of Voluntary
Art. 260(c) Unfair Labor Practices of Arbitrators. – Accordingly, violations of a
Labor Organizations — To violate the duty, Collective Bargaining Agreement, except
or refuse to bargain collectively with the those which are gross in character, shall no
employer, provided it is the representative of longer be treated as unfair labor practice and
the employees; shall be resolved as grievances under the
Collective Bargaining Agreement.
Note: See ULP in Collective Bargaining above.
Note further: See discussion under 2(g). For purposes of this Art., gross violations of
Collective Bargaining Agreement shall mean
d. Illegal Exaction flagrant and/or malicious refusal to comply
(Featherbedding) with the economic provisions of such
agreement.
Art. 260(d). Unfair Labor Practices of
Labor Organizations — To cause or See counterpart in ULP by Employers.
attempt to cause an employer to pay or
deliver or agree to pay or deliver any money
or other things of value, in the nature of an F. PEACEFUL CONCERTED
exaction, for services which are not ACTIVITIES
performed or not to be performed, including
the demand for fee for union negotiations;
Definition
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A concerted activity is one undertaken by two Response to Concerted Activities available

or more employees to improve their terms and to Employers:
conditions of work. a. Lockout
Nature of the Right to Strike and Lockout
The right to strike is a constitutional and legal 1. By Labor Organization
right of the workers, as the employers have the
inherent and statutory right to lockout within the a. Strike
context of labor relations and collective
bargaining. Definition
Any temporary stoppage of work by the
It is a means of last resort and presupposes concerted action of employees as a result of an
that the duty to bargain in good faith has been industrial or labor dispute. [Art. 219(o)]
fulfilled and other voluntary modes of dispute
settlement have been tried and exhausted. Labor Dispute
[Guidelines Governing Labor Relations (1987)] Includes any controversy or matter concerning
terms and conditions of employment or the
Non-abridgment of right to self- association or representation of persons in
organization negotiating, fixing, maintaining, changing or
It shall be unlawful for any person to restrain, arranging the terms and conditions of
coerce, discriminate against or unduly interfere employment, regardless of whether or not the
with employees and workers in their exercise disputants stand in the proximate relation of
of the right to self-organization. Such right shall employers and employees. [Solidbank Corp. v.
include the right to (…) engage in lawful EU Gamier, G.R. No. 159460 and G.R. No.
concerted activities for the same purpose or for 159461 (2010)]
their mutual aid and protection, subject to the
provisions of Art. [279] of this Code. [Art. 257] Strikes not limited to work stoppages
The term “strike” shall comprise not only
Limitation: Concerted activities must be in concerted work stoppages, but also
accordance with law slowdowns, mass leaves, sit-downs, attempts
The strike is a powerful weapon of the working to damage, destroy or sabotage plant
class. Thus, it must be declared only after the equipment and facilities, and similar activities.
most thoughtful consultation among them, [Samahang Manggagawa v. Sulpicio Lines,
conducted in the only way allowed; that is, G.R. No. 140992 (2004)]
peacefully, and in every case conformably to
reasonable regulation. Any violation of the As coercive measure by employees
legal requirements and strictures will render A strike is a coercive measure resorted to by
the strike illegal, to the detriment of the very laborers to enforce their demands. The idea
workers it is supposed to protect. [Batangas behind a strike is that a company engaged in a
Laguna Tayabas Bus Co. v. NLRC, G.R. No. profitable business cannot afford to have its
101858 (1992)] production or activities interrupted, much less,
paralyzed. [Phil. Can Co. v. CIR, G.R. No. L-
FORMS OF CONCERTED ACTIVITIES 3021 (1950)]
Concerted Activities by Labor
Organization: Who may declare a strike
a. Strike (includes slow downs, mass leaves, 1. The certified or duly recognized bargaining
sitdowns, attempts to damage destroy or representative
sabotage plant equipment and similar 2. Any legitimate labor organization in the
activities) absence of a certified or duly recognized
b. Picketing bargaining representative, but only on
c. Boycott grounds of ULP [Sec. 6, Rule XXII, Book V,
IRR]
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No severance of employer-employee It would be inapplicable to prevent a strike

relationship during lawful strike which is grounded on unfair labor practice.
Although during a strike the worker renders no [Panay Electric Co. v. NLRC, G.R. No. 102672
work or service and receives no compensation, (1995); Malayang Samahan ng mga
yet his relationship as an employee with his Manggagawa sa Greenfield v. Ramos, G.R.
employer is not severed or dissolved. [Elizalde No. 113907 (2000)]
Rope Factory, Inc. v. SSS, G.R. No. L-15163
(1962)] Other Forms of Strike
Payment of wages during lawful strikes AS TO GROUNDS

General rule: Striking employees are not 1. Economic strike – one staged by workers
entitled to the payment of wages for un-worked to force wage or other economic
days during the period of the strike pursuant to concessions from the employer which he is
the “no work-no pay” principle. not required by law to grant; not a
strikeable ground [Consolidated Labor
Exception: If there is no work performed by Association of the Phil. v. Marsman and
the employee there can be no wage or pay Company, G.R. No. L-17038 (1964)]
unless the laborer was able, willing and ready 2. ULP strike – called against a company's
to work but was illegally locked out, suspended unfair labor practice to force the employer
or dismissed or otherwise illegally prevented to desist from committing such practices.
from working. For this exception to apply, it is
required that the strike be legal. [Visayas AS TO HOW COMMITTED
Community Medical Center v. Yballe, G.R. No. 1. Slowdown strike – one by which workers,
196156 (2014)] without a complete stoppage of work,
retard production or their performance of
Reinstatement after a lawful strike duties and functions to compel
When strikers abandon the strike and apply for management to grant their demands.
reinstatement despite the existence of valid
grounds, but the employer either: A slowdown is inherently illicit and
a. refuses to reinstate them or unjustifiable because while the employees
b. imposes upon their reinstatement new continue to work, they, at the same time,
conditions, select what part of their duties they
then the employer commits an act of ULP. perform. In essence, they work on their
own terms. It is a strike on installment
The strikers who refuse to accept the new basis. [Ilaw at Buklod ng Manggagawa v.
conditions and are consequently refused NLRC, G.R. No. 91980 (1991)]
reinstatement are entitled to the losses of pay
they may have suffered by reason of the 2. Wild-cat strike – one declared and staged
employer’s discriminatory acts from the time without filing the required notice of strike
they were refused reinstatement. [Philippine and without the majority approval of the
Marine Officers’ Guild v. Compania Maritima, recognized bargaining agent [NUWHRAIN
G.R. Nos. L-20662 and L-20663 (1968)] – The Peninsula Manila Chapter v. NLRC,
G.R. No. 125561 (1998)]
No Strike No Lockout Clause
A "no strike, no lock-out" provision in the [CBA] 3. Sit-down strike – one wherein workers
is a valid stipulation, although the clause may take over possession of the property of
be invoked by an employer only when the strike such business to cease production and to
is economic in nature or one which is refuse access to owners. [Sukhothai
conducted to force wage or other concessions Cuisine & Restaurant v. CA, G.R. No.
from the employer that are not mandated to be 150437 (2006)]
granted by the law itself.
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4. Sympathetic strike – one in which the 1. Bargaining deadlocks

striking workers have no demands of their 2. ULP [Art. 278(c)]
own, but strike to make common cause
with other strikers in other establishments Note: A strike, justified by the employees’ belief
(ex. Welga ng Bayan). This is illegal in good faith that ULP was done by the
because there is no labor dispute between employer at the time the strikers went on strike,
workers who are joining the workers [Biflex is presumed valid even if the fact of ULP was
Phils. Inc. Labor Union v. Filflex Industrial later found to be untrue [Master Iron Labor v.
and Manufacturing Corporation, G.R. No. NLRC, 219 SCRA 47 (1993)].
155679 (2006)]
Procedural Requirements for Strike [Art.
5. Mass leave – one in which workers 278]
collectively abandon or boycott regular 1. Effort to bargain (for bargaining deadlock
work causing temporary stoppage of work strikes)
[Solidbank Corp. v. E.U. Gamier, G.R. No. 2. Filing and service of notice of strike
159460-61 (2010)] 3. Observance of cooling-off period
a. 15 days for ULP
Conversion from economic to ULP strike No cooling-off period when the ULP
It is possible for a strike to change its character can be considered union busting
from an economic to a ULP strike. (dismissal of duly elected union officers
from employment)
In the instant case, initially, the strike staged by b. 30 days for bargaining deadlock
the Union was meant to compel the Company 4. Notice of strike vote meeting to NCMB
to grant it certain economic benefits set forth in within 24 hours before the strike vote [Sec.
its proposal for collective bargaining. However, 10, Rule XXII, Book V, IRR]
the strike changed its character from the time 5. Strike vote
the Company refused to reinstate 6. Strike vote report sent to NCMB
complainants because of their union activities 7. Observance of the waiting period (7-day
after it had offered to admit all the strikers and strike ban)
in fact did readmit the others. It was then
converted into an unfair labor practice strike.
[Consolidated Labor Association of the Phil. v.
Marsman and Company, G.R. No. L-17038
(1964)]
Strike cannot be converted to a lockout by

a return to work offer
A strike cannot be converted into a pure and
simple lockout by the mere expedient filing
before the trial court a notice of offer to return
to work during the pendency of the labor
dispute between the union and the employer.
[Rizal Cement Workers Union v. CIR, G.R. No.
L-18442 (1962)]
Requisites for a Valid Strike

A valid strike must have a lawful ground and
must conform with the procedural requirements
set by law.
Substantial Requirements/Grounds
A strike or lockout may be declared in cases of:
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(1) EFFORT TO BARGAIN constitute union-busting, where the existence

of the union is threatened, the 15-day cooling-
No labor organization […] shall declare a strike off period shall not apply and the union may
[…] without first having bargained collectively take action immediately.
in accordance with Title VII of this Book […]
[Art. 279(a)] Notice to the Employer
In case of unfair labor practice and/or union
In case of bargaining deadlocks, the notice busting, the notice must be served to the
shall, as far as practicable: employer. Failure to do so will constitute
a. Further state the unresolved issues in the noncompliance with the procedural
bargaining negotiations; and requirements and will result to an illegal strike.
b. Be accompanied by the written proposals [Filipino Pipe and Foundry Corp v. NLRC, G.R.
of the union, the counter-proposals of the No. 115180 (1999)]
employer and the proof of a request for
conference to settle differences. Rationale: Due process. [IRR]
In cases of unfair labor practices, the notice Contents of Notice of Strike

shall, as far as practicable, state the acts 1. Names and addresses of the employer and
complained of, and efforts taken to resolve the the union involved
dispute amicably. [Sec. 4, Rule XXII, Book V, 2. Nature of the industry to which the
IRR] employer belongs
3. Number of union members and of workers
The Implementing Rules use the words as far in the bargaining unit
as practicable. In this case, attaching the 4. Such other relevant data as may facilitate
counter-proposal of the company to the notice the settlement of the dispute.
of strike of the union was not practicable. It was
absurd to expect the union to produce the Additional Requirements
company’s counter-proposal which it did not In case of Bargaining Deadlocks:
have. [Club Filipino, Inc. v. Bautista, G.R. No. 1. Statement of unresolved issues in the
168406 (2009)] bargaining negotiations
2. Written proposals of the union
(2) FILING AND SERVICE OF NOTICE OF 3. Counter-proposals of the employer
STRIKE 4. Proof of a request for conference to settle
the differences. [Sec. 4, Rule XXII, Book V,
Ground: Bargaining Deadlocks [Art. 278(c)] IRR]
Filed by: The duly certified or recognized
bargaining agent may file a notice of strike In cases of ULP:
Filed with: With the Ministry [now DOLE] 1. Statement of acts complained of
When: At least 30 days before the intended 2. Efforts taken to resolve the dispute
date of the strike amicably. [Sec. 4, Rule XXII, Book V, IRR]
Ground: Unfair Labor Practice [Art. 278(c)] Action on Notice:

Filed by: The duly certified or recognized 1. Upon receipt of a valid notice of strike or
bargaining agent, or in the absence of such lockout, the NCMB, through its Conciliator-
agent, any legitimate labor organization in Mediators, shall call the parties to a
behalf of its members may file a notice of strike conference the soonest possible time in
Filed with: With the Ministry [now DOLE] order to actively assist them to explore all
When: The period of notice shall be 15 days possibilities for amicable settlement.
2. The Conciliator-Mediator may
Note: In case of dismissal from employment of suggest/offer proposals as an alternative
union officers duly elected in accordance with avenue for the resolution of their
the union constitution and by-laws, which may
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disagreement/conflict which may not

necessarily bind the parties. Art. 278 (f). Strikes, Picketing and
3. If conciliation/mediation fails, the parties Lockouts. – A decision to declare a lockout
shall be encouraged to submit their dispute must be approved by a majority of the board
for voluntary arbitration. of directors of the corporation or association
or of the partners in a partnership, obtained
(3) OBSERVANCE OF COOLING-OFF by secret ballot in a meeting called for that
PERIODS purpose […]
Cooling off periods
1. Bargaining deadlock – 30 days Requirements for a declaration of a strike
2. ULP but not union busting – 15 days in a strike vote
3. ULP and union busting – no cooling-off 1. approval by a majority of the total union
period membership in the bargaining unit
concerned
Purpose of Cooling Off Period 2. approval is obtained by secret ballot in a
During the cooling-off period, it shall be the meeting/referendum called for the purpose
duty of the Ministry [now DOLE] to exert all
efforts at mediation and conciliation to effect a Duration of the Validity of the Strike-Vote
voluntary settlement. Art. 278 (f). Strikes, Picketing and
Lockouts. – [T]he decision shall be valid for
Should the dispute remain unsettled until the the duration of the dispute based on
lapse of the requisite number of days from the substantially the same grounds considered
mandatory filing of the notice, the labor union when the strike or lockout vote was taken.
may strike or the employer may declare a […]
lockout. [Art. 278 (e)]
(6) STRIKE VOTE REPORT
The purpose of the cooling-off period is to
provide an opportunity for mediation and Art. 278 (f). Strikes, Picketing and
conciliation. [National Federation of Sugar Lockouts. – [I]n every case, the union or the
Workers v. Ovejera, G.R. No. L-59743 (1982)] employer shall furnish the Department the
results of the voting at least 7 days before
(4) NOTICE OF STRIKE-VOTE MEETING the intended strike or lockout, subject to
the cooling-off period herein provided.
Art. 278 (f). Strikes, Picketing and
Lockouts. – [T]he Department may, at its (7) OBSERVANCE OF THE 7-DAY WAITING
own initiative or upon the request of any PERIOD
affected party, supervise the conduct of the
secret balloting. […] 7 Day Observance of the Strike Ban
The waiting period, on the other hand, is
Sec. 10, Rule XXII, Book V. Strike or intended to provide opportunity for the
Lockout Vote. – In every case, the union or members of the union or the management to
the employer shall furnish the regional take the appropriate remedy in case the strike
branch of the Board the notice of meetings or lockout vote report is false or inaccurate.
referred to in the preceding paragraph at [National Federation of Sugar Workers v.
least twenty-four (24) hours before such Ovejera, G.R. No. L-59743 (1982)]
meetings […]
The waiting period is intended to give the
The purpose of the notice is to allow the NCMB DOLE an opportunity to verify whether the
to decide whether or not they will send a projected strike really carries the imprimatur of
representative to supervise the strike vote. the majority of the union members. [Lapanday
Workers Union v. NLRC, G.R. Nos. 95494-97
(5) STRIKE VOTE (1995)]
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EFFECT OF ILLEGALITY / LIABILITY OF

Compliance with Both Cooling-off and PARTICIPATING MEMBERS/OFFICERS OF
Waiting Periods THE UNION
The observance of both periods must be a. Ordinary Striking Worker – cannot be
complied with, although a labor union may take terminated for mere participation in an
a strike vote and report the same within the illegal strike; proof must be adduced
statutory cooling-off period. The cooling-off and showing that he or she committed illegal
7-day strike ban provisions of law constitute a acts during the strike.
valid exercise of police power of the State. b. Participating Union Officer – may be
[National Federation of Sugar Workers v. terminated, not only when he actually
Ovejera, G.R. No. L-59743 (1982)] commits an illegal act during a strike, but
also if he knowingly participates in an
Mutually exclusive periods (used in the illegal strike [Phimco Industries, Inc. v.
NCMB Manual) PILA, G.R. No. 170830 (2010)]
The cooling off period and the 7-day period are
mutually exclusive. Thus, in the case of Capitol Prohibited Grounds for Strike
Medical Center v. NLRC [G.R. No. 147080 1. Labor standards cases such as wage
(2005)], the Court held that when the strike vote orders
is conducted within the cooling-off period, the 2. Issues involving wage distortion caused by
7-day requirement shall be counted from the legislated wage orders
day following the expiration of the cooling off 3. Inter or intra union disputes
period. 4. Execution and enforcement of final orders
or awards of cases pending at the DOLE
Improved Offer Balloting Regional Offices, BLR, NLRC, VA, CA and
In case of a strike, the regional branch of the SC and related offices
Board shall, at its own initiative or upon the 5. Violations of the CBA which are not gross
request of any affected party, conduct a in character (not ULP) [BPI Employees
referendum by secret balloting on the improved Union-Davao FUBU v. BPI, G.R. No.
offer of the employer on or before the 30th day 174912 (2013)]
of strike. Gross in character shall mean flagrant
and/or malicious refusal to comply with the
When at least a majority of the union members economic provisions of such agreement.
vote to accept the improved offer: [Art. 274]
a. The striking workers shall immediately
return to work and; PROHIBITED ACTIVITIES IN STRIKE
b. The employer shall thereupon re-admit 1. By anyone. No person shall obstruct,
them upon the signing of the agreement impede, or interfere with, by force,
[Sec. 12, Rule XXII, Book V] violence, coercion, threats, or intimidation,
any peaceful picketing by employees [Art.
i. Valid Strikes as 279(b)];
distinguished from Illegal a. Blocking the free ingress to/ egress
Strikes from work premises for lawful purposes
b. Obstruction of public thoroughfares
VALID v. ILLEGAL STRIKE c. Threatening, coercing and intimidating
a. Legal strike – one called for a valid non-striking employees, officers,
purpose and conducted through means suppliers and customers
allowed by law. d. Resistance and defiance of
b. Illegal strike – one staged for a purpose assumption of jurisdiction by the Labor
not recognized by law, or if for a valid Secretary or an injunction
purpose, conducted through means not e. Acts of violence [Association of
sanctioned by law. Independent Unions in the Philippines
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(AIUP), et. al. v. NLRC, G.R. No. the employer even if it turned out that there was
120505 (1999)] no act of ULP. However, the mandatory
procedural requirements cannot be dispensed
The violence must be pervasive and with (notice of strike, cooling-off period, strike
widespread, consistently and deliberately vote, strike vote report). [Grand Boulevard
resorted to as a matter of policy [Shell Oil Hotel v. GLOWHRAIN, G.R. No. 153664
Workers v. Shell Company of the Phil., 39 (2003)]
SCRA 276 (1971)] (if violence was resorted
to by both sides, such violence cannot be a Good faith strike requires rational basis
ground for declaring the strike as illegal) A mere claim of good faith would not justify the
[Malayang Samahan ng Manggagawa sa holding of a strike under the aforesaid
M. Greenfield v. Ramos, 357 SCRA 77 exception as, in addition thereto, the
(2000)] circumstances must have warranted such
belief. It is, therefore, not enough that the union
2. By employer. No employer shall use or believed that the employer committed acts of
employ any strike-breaker, nor shall any ULP when the circumstances clearly negate
person be employed as a strike-breaker. even a prima facie showing to sustain such
[Art. 279(c)] belief. [Interwood Employees Assoc. v. Int’l
Hardwood, G.R. No. L-7409 (1956)]
3. By public official or police force. No
public official or employee, including 3. Noncompliance with Procedural
officers and personnel of the New Armed Requirements
Forces of the Philippines or the Integrated
National Police, or armed person, shall See: Procedural requirements of a valid strike
bring in, introduce or escort in any manner, previously discussed
any individual who seeks to replace strikers
in entering or leaving the premises of a A strike which does not strictly comply with the
strike area, or work in place of the strikers. procedural requirements set by law and the
[Art. 279(d)] rules is an unlawful/illegal strike. [Sta. Rosa
Coca-Cola Plant Employees Union v. Coca-
CATEGORIES OF ILLEGAL STRIKE Cola Bottlers Philippines, Inc., G.R. Nos.
164302-03 (2007)]
1. Prohibited by Law (e.g. Strike By
Government Employees) Note: Good faith strike must still comply
with procedural requirements.
Government employees Even if the union acted in good faith in the
While the Constitution guarantees the right of belief that the company was committing an
government employees to organize, they are unfair labor practice, if no notice of strike and a
not allowed to strike. strike vote were conducted, the said strike is
illegal. [Grand Boulevard Hotel v.
2. Improper Grounds (e.g. Intra or Inter GLOWHRAIN, G.R. No. 153664 (2003)]
Union Dispute, Wage Distortion)
General Rule: A strike based on a non-
A legal strike must be based on a bargaining strikeable ground is an illegal strike; a strike
deadlock and/or a ULP act only. grounded on ULP is illegal if no such acts
actually exist.
Intra-union and inter-union disputes are not
proper grounds to strike. Exception: Even if no ULP acts are committed
by the employer, if the employees believe in
Note: Good faith strike good faith that ULP acts exist so as to
Good faith may be used as a defense if the constitute a valid ground to strike, then the
strike is held on the basis of an act of ULP by strike held pursuant to such belief may be legal.
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[NUWHRAIN v. NLRC, G.R. No. 125561 and deliberately resorted to as a matter of

(1998)] policy. It could be reasonably concluded
then that even if justified as to ends, it
4. Unlawful Means and Methods becomes illegal because of the means
employed.
Purpose and means test 4. This is not by any means to condone the
There must be concurrence between the utilization of force by labor to attain its
validity of the purpose of the strike and the objectives. It is only to show awareness
means of conducting it. that in labor conflicts, the tension that fills
the air as well as the feeling of frustration
To be valid, a strike must be pursued within and bitterness could break out in sporadic
legal bounds. The right to strike as a means acts of violence.
for the attainment of social justice is never
meant to oppress or destroy the employer. It would be unjustified, considering all the facts
disclosed, to stamp the strike with illegality. It is
The law provides limits for its exercise. Among enough that individual liability be incurred by
such limits are the prohibited activities under those guilty of such acts of violence that call for
Art. [279], particularly paragraph (e), which loss of employee status. [Shell Oil Workers
states that no person engaged in picketing Union v. Shell Co. of the Phils, G.R. No. L-
shall: 28607 (1971)]
1. commit any act of violence, coercion, or
intimidation or It bears stressing that the requirements of
2. obstruct the free ingress to or egress from strike notice and strike-vote report are
the employer's premises for lawful mandatory, meaning, non-compliance
purposes or therewith makes the strike illegal. The evident
3. obstruct public thoroughfares. intention of the law in requiring these is to
reasonably regulate the right to strike.
A legal strike may turn into an illegal strike [Stamford Mark Corp. v. Julian, G.R. No.
Even if the strike is valid because its objective 145496 (2004)]
or purpose is lawful, the strike may still be
declared invalid where the means employed 5. Violation of Injunction Order
are illegal. [Phil. Diamond Hotel and Resort,
Inc. v. Manila Diamond Hotel Employees An automatic injunction under Art. 278(g) or a
Union, G.R. No. 158075 (2006)] valid injunction order under the exceptions to
Art. 279 must be complied with. Otherwise, the
Examples of unlawful means and methods strike becomes illegal.
1. Acts of violence and terrorism
2. Destruction of property
Guidelines and balancing of Interest

1. A strike, otherwise valid, if violent in
character, may be placed beyond the pale.
2. Care is to be taken especially where an
unfair labor practice is involved, to avoid
stamping it with illegality just because it is
tainted by such acts. To avoid rendering
illusory the recognition of the right to strike,
responsibility in such a case should be
individual and not collective.
3. A different conclusion would be called for if
the existence of force while the strike lasts
is pervasive and widespread, consistently
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6. Those Contrary to an Existing of dismissal [Toyota Motors Philippines

Agreement Workers Association v. NLRC, 537 SCRA 171
(2007)].
(e.g. No strike/lockout provisions in the CBA)
[Citing Ludwig Teller in Toyota Motors v. Note: The mere fact that the criminal
NLRC, G.R. Nos. 158786 & 158787 (2007)] complaints against terminated Union members
were subsequently dismissed does not
No Strike/Lockout Provisions in the CBA extinguish their liability under the Labor Code
A “no strike, no lock-out” is a valid provision in [C. Alcantara & Sons, Inc. v. CA, G.R. No.
the CBA. However, it only applies to economic 155109 (2011)].
provisions. It cannot prevent a strike which is
grounded on unfair labor practice. [Malayang Liability of Employer
Samahan ng mga Manggagawa sa Greenfield Any worker whose employment has been
v. Ramos, G.R. No. 113907 (2000)] terminated as a consequence of any unlawful
lockout shall be entitled to reinstatement with
7. The Strikers do not belong to a full backwages. [Art. 279(a)]
Legitimate Labor Organization [Magdala
Multipurpose & Livelihood Coop. v. WAIVER OF ILLEGALITY OF STRIKE/
Kilusang Manggagawa Ng LGS, G.R. Nos. CONDONATION DOCTRINE
191138-39 (2011)]
When defense of illegality of strike is
Liabilities of Parties deemed waived
Any union officer who knowingly participates in An employer can be deemed to have waived
an illegal strike and any worker or union officer the defense that a strike is illegal. In one case,
who knowingly participates in the commission the Court held that: “Admitting for the sake of
of illegal acts during a strike may be declared argument that the strike was illegal for being
to have lost his employment status. [Art. premature, this defense was waived by the
279(a)] [Company], when it voluntarily agreed to
reinstate the radio operators.” [Bisaya Land
Note: Mere participation in an illegal strike by a Transportation Co., Inc. v. CIR, G.R. No. L-
union officer is sufficient ground to terminate 10114 (1957)]
his employment. In case of a lawful strike, the
union officer must commit illegal acts during a When defense of illegality of strike is not
strike for him to be terminated. [Art. 279(a)] deemed waived
The ruling cited in the Bisaya case that the
Procedural due process is still required for employer waives his defense of illegality of the
dismissing union officers/ordinary workers. strike upon reinstatement of strikers is
Where an opportunity to be heard either applicable only to strikers who signified their
through oral arguments or through pleadings is intention to return to work and were accepted
accorded, there is no denial of procedural due back. […]
process. [Equitable PCI Banking Corp. v.
RCBC Capital Corp, 574 SCRA 858 (2004)] Condonation shall apply only to strikers who
signified their intention to return, and did return
Liability of Ordinary Workers to work, since these strikers took the initiative
General rule: Participation by a worker in a in normalizing relations with their employer and
lawful strike is not ground for termination of his thus helped promote industrial peace.
employment. [Art. 279(a)] However, as regards the strikers who
decided to pursue with the case, […] the
Exception: When the worker participated in employer could not be deemed to have
illegal acts during the strike; needs clear, condoned their strike, because they had not
substantial and convincing proof available shown any willingness to normalize relations
under the circumstances to justify the penalty
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with it. [Philippine Inter-Fashion, Inc. v. NLRC,

G.R. No. L-59847 (1982)] PROHIBITED ACTIVITIES IN PICKETING
1. By any person. No person shall obstruct,
However, the mere act of entering into a impede, or interfere with, by force,
compromise agreement cannot be deemed to violence, coercion, threats or intimidation,
be a waiver of the illegality of the strike, unless any peaceful picketing by employees
such a waiver is clearly shown in the during any labor controversy or in the
agreement. [Filcon Manufacturing Corp v. exercise of the right to self-organization or
Lakas Manggagawa sa Filcon – Lakas collective bargaining, or shall aid or abet
Manggagawa Labor Center, G.R. No. 150166 such obstruction or interference. [Art.
(2004)] 279(b)]
2. By police force. The police force shall
b. Picket keep out of the picket lines unless actual
violence or other criminal acts occur
The right of legitimate labor organizations to therein: Provided, That nothing herein shall
strike and picket and of employers to lockout, be interpreted to prevent any public officer
consistent with the national interest, shall from taking any measure necessary to
continue to be recognized and respected. [Art. maintain peace and order, protect life and
278(b)] property, and/or enforce the law and legal
orders. [Art. 279(d)]
Picketing involves merely the marching to and 3. By person engaged in picketing. No
fro at the premises of the employer, usually person engaged in picketing shall commit
accompanied by the display of placards and any act of violence, coercion or intimidation
other signs making known the facts involved in or obstruct the free ingress to or egress
a labor dispute. from the employer’s premises for lawful
purposes, or obstruct public thoroughfares.
As applied to a labor dispute, to picket means [Art. 279(e)]
the stationing of one or more persons to
observe and attempt to observe. The purpose Picketing as Part of Freedom of
of pickets is said to be a means of peaceable Speech/Expression
persuasion. [Sta. Rosa Coca-Cola Plant General rule: picketing enjoys constitutional
Employees Union v. Coca-Cola Bottlers protection as part of freedom of speech and/or
Philippines, Inc., G.R. Nos. 164302-03 (2007)] expression.
Peaceful Picketing is the right of workers Exceptions/limitations:

during strikes consisting of marching to and fro a. When picketing is coercive rather than
before an establishment involved in a labor persuasive [Security Bank Employees
dispute generally accompanied by the carrying Union v. Security Bank, G.R. No. L-28536
and display of signs, placards and banners (1968)]
intended to inform the public about the dispute. b. When picketing is achieved through illegal
[Guidelines Governing Labor Relations, means [Mortera v. CIR, G.R. No. L-1340
October 19, 1987; NCMB Manual, Sec. 1] (1947)]
c. Courts may confine the communication/
Purpose demonstration to the parties to the labor
The purpose of the picket line is to persuade dispute [PCIB v. Philnabank Employees
employers peacefully by publicizing the labor Association, G.R. No. L-29630 (1981)]
dispute to inform the public of what is d. Innocent bystander rule. Courts may
happening and thus cause other workers not to insulate establishments or persons with no
work in the establishment and for customers industrial connection or having interest
not to do business there [Phimco Industries, totally foreign to the context of the dispute
Inc. v. Phimco Industries Labor Association [PCIB v. Philnabank Employees
(PILA), et al., 628 SCRA 119 (2010)]. Association, G.R. No. L-29630 (1981)]
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2. Filing and service of notice of lockout to the

Picketing and Libel NCMB
Libel laws are not applied strictly considering 3. Observance of cooling-off period
that there is emotional tension in the picket 4. 15 days for ULP
lines and expected discourteous and impolite 5. 30 days for bargaining deadlock
exchanges between the employees and the 6. Notice of lockout vote meeting within 24
employer. [PCIB v. Philnabank Employees hours before the intended vote [Sec. 10,
Association, G.R. No. L-29630 (1981)] Rule XXII, Book V, IRR]
7. Lockout vote
Peaceful picketing is legal even in the 8. Report of lockout vote
absence of employer-employee 9. Observance of the waiting period (7-day
relationship strike ban)
Picketing, peacefully carried out, is not illegal
even in the absence of employer-employee (1) Effort to Bargain
relationship, for peaceful picketing is a part of No employer shall declare a […] lockout
the freedom of speech guaranteed by the without first having bargained collectively in
Constitution. [De Leon v. National Labor Union, accordance with Title VII of this Book. [Art.
G.R. No. L-7586 (1957)] 279(a)]
2. By Employer (2) Filing and Service of Notice of Lockout

Filed by: The duly certified or recognized
a. Lockout bargaining agent may file notice of lockout
Lockout is the temporary refusal of an Filed with: With the Department

employer to furnish work as a result of an
industrial or labor dispute. [Art. 219 (p)] When: At least 30 days before the intended
date of the lockout [Art. 278(c)]
Illegal strike and illegal lockout/In Pari
Delicto Doctrine Note: The notice must be served to the
When the employer engaged in illegal lockout employees through the SEBA or the legitimate
and the employee engaged in illegal strike, labor organization (if no SEBA).
both parties are in pari delicto, and such
situation warrants the restoration of the status Contents of notice
quo ante and bringing the parties back to the 1. Names and addresses of the employer and
respective positions before the illegal strike the union involved
and illegal lockout. [Philippines Inter-Fashion 2. Nature of the industry to which the
Inc. v. NLRC, G.R. No. L-59847 (1982)] employer belongs
3. Number of union members and of workers
Similar to a strike, the proper grounds for a in the bargaining unit
lockout are 4. Such other relevant data as may facilitate
1. Bargaining deadlock the settlement of the dispute.
2. ULP by labor organizations
Additional Requirements [Sec. 8, Rule XXII,
Art. 278 (b). Strikes, Picketing and Book V, IRR]
Lockouts. – [N]o employer may declare a In cases of bargaining deadlocks
lockout on grounds involving inter-union and 1. Statement of unresolved issues in the
intra-union disputes. bargaining negotiations
2. Written proposals of the union
Procedural Requirements 3. Counter-proposals of the employer
1. Effort to bargain (in case of bargaining 4. Proof of a request for conference to settle
deadlock) the differences.
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In cases of ULP Art. 278 (f). Strikes, Picketing and

1. Statement of acts complained of Lockouts. – In every case, the union or the
2. Efforts taken to resolve the dispute employer shall furnish the Ministry the
amicably. results of the voting at least seven days
before the intended strike or lockout, subject
Action on notice to the cooling-off period herein provided.
1. Upon receipt of a valid notice of strike or
lockout, the NCMB, through its Conciliator- (7) Observance of Waiting Period (7 Days)
Mediators, shall call the parties to a
conference the soonest possible time in See notes under Strike.
order to actively assist them to explore all
possibilities for amicable settlement. Effect of Illegal Lockout
2. The Conciliator-Mediator may suggest/
offer proposals as an alternative avenue for Par. 3, Art. 279 (a). Prohibited Activities. –
the resolution of their disagreement/conflict Any worker whose employment has been
which may not necessarily bind the parties. terminated as a consequence of any
3. If conciliation/mediation fails, the parties unlawful lockout shall be entitled to
shall be encouraged to submit their dispute reinstatement with full backwages.
for voluntary arbitration. [Sec. 9, Rule XXII,
Book V, IRR] 3. Assumption of Jurisdiction by
Secretary of Labor and
(3) Observance of Cooling-off Periods
Lockout cooling-off periods: Employment
1. Based on bargaining deadlock – 30 days
2. Based on ULP – 15 days [Art. 278(c)] When May the SOLE Assume Jurisdiction
When in his opinion, there exist a labor dispute
(4) Notice of Lockout Vote Meeting causing or likely to cause a strike or lockout in
an industry indispensable to the national
Sec. 10, Rule XXII, Book V. Strick or interest, the SOLE may assume jurisdiction
Lockout Vote – In every case, the union or over the dispute and decide it or certify the
the employer shall furnish the regional same to the Commission for compulsory
branch of the Board the notice of meetings arbitration. [Art. 278(g)]
referred to in the preceding paragraph at
least twenty-four (24) hours before such Requisites for Assumption of Jurisdiction
meetings [...] 1. Both parties have requested the SOLE to
assume  jurisdiction; or  
2. After a conference called by the Office of
(5) Lockout Vote
the  SOLE on the propriety of its issuance,
motu proprio or upon a request or petition
Art. 278 (f). Strikes, Picketing and
by either parties to the labor dispute [Book
Lockouts. – A decision to declare a lockout
V, IRR Rule XXII, sec. 15, IRR as amended
must be approved by a majority of the board
by D.O. No. 40-H-13 s 2013]  
of directors of the corporation or association
or of the partners in a partnership, obtained
Immediately Executory
by secret ballot in a meeting called for that
The assumption and certification orders are
purpose. The decision shall be valid for the
executory in character and must be strictly
duration of the dispute based on
complied with by the parties. [Allied Banking v.
substantially the same grounds considered
NLRC, G.R. No. 116128 (1996)]
when the strike or lockout vote was taken.
Effect of defiance of assumption or
(6) Report of Lockout Vote
certification orders
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No strike or lockout shall be declared after to the Commission for compulsory arbitration.
assumption of jurisdiction by the President or [Art. 278, par. 2]
the Minister or after certification or submission
of the dispute to compulsory or voluntary Rationale: The highest respect is accorded to
arbitration or during the pendency of cases the right of patients to life and health.
involving the same grounds for the strike or
lockout. [Art. 279(a), par. 2] b. Effects of Assumption of
Jurisdiction
A strike undertaken despite the issuance by the
Secretary of Labor of an assumption or Automatic Injunction of Intended of
certification order becomes a prohibited activity Impending Strike or Lockout
and thus, illegal, pursuant to Art. 279(a) of the The assumption of jurisdiction by the SOLE
Labor Code. [Allied Banking v. NLRC, G.R. No. automatically enjoins intended or impending
116128 (1996)] strike or lockout. [Art. 278 (g)]
a. Industry Indispensable to the Return-to-work and readmission if strike or

National Interest lockout has already taken place
If strike or lockout has already taken place at
1. Hospital sector  the time of assumption or certification,
2. Electric power industry  1. All striking or locked out employees shall
3. Water supply service, to exclude small immediately return-to-work; and
water supply services, such as bottling and 2. The employer shall immediately resume
refilling stations  operations and readmit all workers under
4. Air traffic control  the same terms and conditions prevailing
5. Other industries as may be recommended before the strike or lockout. [Art. 278 (g)]
by the National Tripartite Industrial Peace
Council (TIPC) [Sec. 16, Rule XXII, Book The SOLE may also determine the retroactivity
V, IRR as amended by D.O. No. 40-H-13] of arbitral awards pursuant to power to assume
jurisdiction as part of his/her plenary powers to
Who determines industries indispensable determine the effectivity thereof in absence of
to the national interest [Art. 278(g)]  specific provision of law [LMG Chemicals Corp.
1. Secretary of Labor and Employment  v. Sec. of Labor and Employment, 356 SCRA
2. President 577 (2001)]
Strikes and lockouts in hospitals, clinics Nature of return-to-work order

and similar medical institutions  The return-to-work order not so much confers
It shall be the duty of the striking union or a right as it imposes a duty; and while as a right
locking-out employer to provide and maintain it may be waived, it must be discharged as a
an effective skeletal workforce of medical and duty even against the worker's and/or
other health personnel, whose movement and employers’ will.
services shall be unhampered and
unrestricted, as are necessary to insure the The worker must return to his job together with
proper and adequate protection of the life and his co-workers so the operations of the
health of its patients, most especially company can be resumed and it can continue
emergency cases, for the duration of the strike serving the public and promoting its interest.
or lockout. That is the real reason such return can be
compelled. So imperative is the order in fact
In such cases, therefore, the Secretary of that it is not even considered violative of the
Labor and Employment may immediately right against involuntary servitude. [Kaisahan
assume, within twenty-four (24) hours from ng Mga Manggagawa sa Kahoy v. Gotamco
knowledge of the occurrence of such a strike or Sawmills, G.R. No. L-1573 (1948)]
lockout, jurisdiction over the same or certify it
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Note: It must be strictly complied with even Definition

during the pendency of any petition questioning “Management Prerogative” is the right of an
its validity. [Manila Hotel Employees employer to regulate all aspects of
Association and its Members v. Manila Hotel employment.
Corp., 517 SCRA 349 (2007)]
Courts often decline to interfere in legitimate
The purpose of SOLE’s extraordinary power is business decisions of employers. In fact, labor
aimed at arriving at a peaceful and speedy laws discourage interference in employers’
solution to labor disputes without jeopardizing judgment concerning the conduct of their
national interest [Union of Filipro Employees- business.
Drug v. Nestle, 499 SCRA 521 (2006)]
Scope
Management prerogative gives employers the
VI. MANAGEMENT freedom to regulate, according to their
PREROGATIVE discretion and best judgment, all aspects of
employment, including:
Basis a. Work assignment
The State recognizes the indispensable role of b. Working methods,
c. Processes to be followed,
the private sector, encourages private
enterprise, and provides incentives to needed d. Working regulations,
investments. [Sec. 20, Art. II, 1987 e. Transfer of employees,
Constitution] f. Work supervision, lay-off of workers and
the discipline, dismissal and recall of
workers.
The State shall regulate the relations between
workers and employers, recognizing the right
of labor to its just share in the fruits of Limits to Management Prerogative
production and the right of enterprises to 1. Good faith - So long as a company’s
reasonable returns to investments, and to management prerogatives are exercised in
expansion and growth. [Sec. 3, pars. 4, Art. good faith for the advancement of the
XIII, 1987 Constitution] employer’s interest and not for the purpose
of defeating or circumventing the rights of
The law in protecting the rights of the the employees under special laws or under
employees authorizes neither oppression nor valid agreements, this Court will uphold
self-destruction of the employer. It should be them. [Ernesto G. Ymbong v. ABS-CBN
made clear that when the law tilts the scale of Broadcasting Corp.]
justice in favor of labor, it is but a recognition of
the inherent economic inequality between labor It is incumbent upon the company to show
and management. Never should the scale be that decisions made under management
so tilted if the result is an injustice to the prerogative are in good faith and not
employer. [Panuncillo v. CAP, G.R. No. intended to circumvent employees’ rights.
161305 (2007)] [San Miguel Brewery Sales Force Union
(PTGWO) v. Ople, G.R. No. L-53515
(1989)]
The exercise of management prerogative

is valid, provided it is not performed in a
malicious, harsh, oppressive, vindictive or
wanton manner or out of malice or spite.
[Magdadaro v. PNB, G.R. No. 166198
(2009)]
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2. Without grave abuse of discretion - The 5. Equity and/or Substantial Justice – The
managerial prerogative to transfer Court should still ensure that the employer
personnel must be exercised without grave exercises the prerogative to discipline
abuse of discretion, bearing in mind the humanely and considerately, and that the
basic elements of justice and fair play. sanction imposed is commensurate to the
Having the right should not be confused offense involved and to the degree of the
with the manner in which the right is infraction. [Dongon v. Rapid Movers and
exercised. [Tinio v. CA, G.R. No. 171764 Forwarders Co., Inc., G.R. No. 163431
(2007)] (2013)]
3. Law – The privilege of management

prerogative is not absolute, but subject to
limitations imposed by law.
A. DISCIPLINE
Management prerogative is limited by Sec.

Management has the prerogative to discipline
236(g), which gives the Secretary the
its employees and to impose appropriate
power to assume jurisdiction and resolve
penalties on erring workers pursuant to
labor disputes involving industries
company rules and regulations. [Jose P.
indispensable to national interest. The
Artificio v. NLRC, G.R. No. 172988 (2010)]
company’s management prerogatives are
not being unjustly curtailed but duly
Among the employer’s management
tempered by the limitations set by law,
prerogatives is the right to prescribe
taking into account its special character
reasonable rules and regulations necessary or
and the particular circumstances in the
proper for the conduct of its business or
case at bench. [Metrolab Industries, Inc. v.
concern, to provide certain disciplinary
Roldan-Confesor, G.R. No. 108855 (2013);
measures to implement said rules and to
University of Immaculate Concepcion Inc.
assure that the same would be complied with.
v. Sec. of Labor, G.R. No. 151379 (2005)]
[St. Luke’s Medical Center, Inc. v. Sanchez,
G.R. 212054 (2015)]
Although management prerogative refers
to the right to regulate all aspects of
The employer’s right to conduct the affairs of
employment, it cannot be understood to
his business, according to its own discretion
include the right to temporarily withhold
and judgment, includes the prerogative to instill
salary/wages without the consent of the
discipline in its employees and to impose
employee. To sanction such an
penalties, including dismissal, upon erring
interpretation would be contrary to Art. 116
employees. [Consolidated Food Corporation v.
of the Labor Code. [SHS Perforated
NRLC, G.R. No. 118647 (1999))]
Materials, Inc. v. Diaz, G.R. No. 185814
(2010)]
Right to dismiss or otherwise impose
disciplinary sanctions upon an employee for
4. Collective Bargaining – The CBA
just and valid cause, pertains in the first place
provisions agreed upon by the Company
to the employer, as well as the authority to
and the Union delimit the free exercise of
determine the existence of said cause in
management prerogative. The parties in a
accordance with the norms of due process.
CBA may establish such stipulations, [Makati Haberdashery, Inc. v. NLRC, G.R. Nos.
clauses, terms and conditions as they may
83380-81 (1989)]
deem convenient provided these are not
contrary to law, morals, good customs,
public order or public policy. [Goya Inc. v.
Goya, Inc., Employees Union-FFW, G.R.
No. 170054 (2013)]
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Corollary Duty of Employees

The employee has the corollary duty to obey all Management has the prerogative on whether
reasonable rules, orders, and instructions of or not to renew the contract of a fixed-term
the employer; and willful or intentional employee. [Fonterra Brands Phils., Inc. v.
disobedience thereto, as a general rule, Largado, G.R. No. 205300 (2015)]
justifies termination of the contract of service
and the dismissal of the employee. [St. Luke’s Criteria
Medical Center, Inc. v. Sanchez, G.R. 212054 Provided there is no demotion in rank or
(2015)] diminution of salary, benefits and other
privileges and not motivated by discrimination
Criteria or made in bad faith, or effected as a form of
The policies, rules and regulations on work- punishment or demotion without sufficient
related activities of the employees must cause. [Westin Phil. Plaza Hotel v. NLRC, G.R.
always be fair and reasonable and the No. 121621 (1999)]
corresponding penalties, when prescribed,
commensurate to the offense involved and When the transfer is not unreasonable, or
to the degree of the infraction. [Consolidated inconvenient, or prejudicial to the employee,
Food Corporation v. NRLC, G.R. No. 118647 and it does not involve a demotion in rank or
(1999); St. Michael’s Institute v. Santos, G.R. diminution of salaries, benefits, and other
No. 145280 (2001)] privileges, the employee may not complain that
it amounts to a constructive dismissal. [Bisig ng
Although the right of employers to shape their Manggagawa sa TRYCO v. NLRC, G.R. No.
own work force is recognized, this 151309 (2008)]
management prerogative must not curtail the
basic right of employees to security of It is management prerogative for employers to
tenure. [Alert Security & Investigation Agency, transfer employees on just and valid grounds
Inc. v. Saidali Pasawilan, et. al., G.R. No. such as genuine business necessity. [William
182397 (2011)] Barroga v. Data Center College of the
Philippines, G.R. No. 174158 (2011)]
Disciplinary action against an erring employee
is a management prerogative which, generally, Re-assignments
is not subject to judicial interference. However, Re-assignments made by management
this policy can be justified only if the disciplinary pending investigation of irregularities allegedly
action is dictated by legitimate business committed by an employee fall within the ambit
reasons and is not oppressive. [Areno v. of management prerogative. The purpose of
Skycable, G.R. No 180302 (2010)] reassignments is no different from that of
preventive suspension which management
could validly impose as a disciplinary measure
B. TRANSFER OF for the protection of the company's property,
EMPLOYEES pending investigation of any alleged
malfeasance or misfeasance committed by the
employee. [Ruiz v. Wendel Osaka Realty
An employee’s right to security of tenure does Corp., G.R. No. 189082 (2012)]
not give him such a vested right in his position,
as would deprive the company of its Employer Bears the Burden of Proof
prerogative to change his assignment or In cases of a transfer of an employee, the rule
transfer him where he will be most useful. is settled that the employer is charged with the
burden of proving that its conduct and action
The employer has the right to transfer or assign are for valid and legitimate grounds such as
employees from one area of operation to genuine business necessity and that the
another, or one office to another or in pursuit of transfer is not unreasonable, inconvenient or
its legitimate business interest. prejudicial to the employee. If the employer
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cannot overcome this burden of proof, the

employee’s transfer shall be tantamount to
D. BONUS
unlawful constructive dismissal. [Jonathan
Morales v. Harbor Centre Port Terminal Inc.,
G.R. No. 174208 (2012)]
A bonus is "a gratuity or act of liberality of the
giver which the recipient has no right to
C. PRODUCTIVITY demand as a matter of right" [Philippine
National Construction Corp. v. National Labor
STANDARDS Relations Commission, 345 Phil. 324, 331
(1997)]. It is something given in addition to
The employer has the right to demote and what is ordinarily received by or strictly due the
transfer an employee who has failed to observe recipient.
proper diligence in his work and incurred
habitual tardiness and absences and indolence The granting of a bonus is basically a
in his assigned work. [Petrophil Corporation v. management prerogative which cannot be
NLRC, G.R. No. L-64048 (1986)] forced upon the employer "who may not be
obliged to assume the onerous burden of
In the consolidated cases of Leonardo v. NLRC granting bonuses or other benefits aside from
[G.R. No. 125303 (2000)] and Fuerte v. Aquino the employee's basic salaries or wages" xxx.
[G.R. No. 126937 (2000)], the employer [Kamaya Point Hotel v. National Labor
claimed that the employee was demoted Relations Commission, Federation of Free
pursuant to a company policy intended to foster Workers and Nemia Quiambao, G.R. No.
competition among its employees. Under this 75289, (1989); Traders Royal Bank v. NLRC,
scheme, its employees are required to comply G.R. No. 120592 (1990)]
with a monthly sales quota. Should a
supervisor such as the employee fail to meet The matter of giving a bonus over and above
his quota for several consecutive months, he the worker’s lawful salaries and allowances is
will be demoted, whereupon his supervisor’s entirely dependent on the financial capability of
allowance will be withdrawn and be given to the the employer to give it. [Kimberly-Clark
individual who takes his place. When the Philippines, Inc. v. Dimayuga, G.R. No. 177705
employee concerned succeeds in meeting the (2009)]
quota again, he is re-appointed supervisor and
his allowance is restored.
E. CHANGE OF WORKING
The Supreme Court held that this arrangement HOURS
is an allowable exercise of company rights
since an employer is entitled to impose
Management retains the prerogative,
productivity standards for its workers. In fact,
whenever exigencies of the service so require,
non-compliance may be visited with a penalty
to change the working hours of its employees.
even more severe than demotion.
So long as such prerogative is exercised in
good faith for the advancement of the
employer’s interest and not for the purpose of
defeating or circumventing the rights of the
employees under special laws or under valid
agreements, this Court will uphold such
exercise. [Sime Darby Pilipinas Inc. v. NLRC,
G.R. No. 119205 (1998)]
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the possibility that a competitor company will

F. BONA FIDE OCCUPATIONAL gain access to its secrets and procedures.
QUALIFICATIONS [Star Paper Corp. v. Simbol, G.R. No. 164774
(2006)]
General Rule: Employment in particular jobs
A requirement that a woman employee must
may not be limited to persons of a particular
remain unmarried could be justified as a "bona
sex, religion, or national origin unless the
fide occupational qualification," or BFOQ,
employer can show that sex, religion, or
where the particular requirements of the job
national origin is an actual qualification for
would justify the same, but not on the ground
performing the job.
of a general principle, such as the desirability
of spreading work in the workplace. A
Exception: The exception is called a bona fide
requirement of that nature would be valid
occupational qualification (BFOQ).
provided it reflects an inherent quality
reasonably necessary for satisfactory job
In the United States, there are a few federal
performance. [Phil. Telegraph and Telephone
and many state job discrimination laws that
Company v. NLRC, G.R. No. 118978 (1997)]
contain an exception allowing an employer to
engage in an otherwise unlawful form of
prohibited discrimination when the action is G. POST-EMPLOYMENT
based on a BFOQ necessary to the normal
operation of a business or enterprise. BFOQ is
RESTRICTIONS
valid "provided it reflects an inherent quality
reasonably necessary for satisfactory job In cases where an employee assails a contract
performance." [Yrasuegui v. PAL, G.R. No. containing a provision prohibiting him or her
168081 (2008)] from accepting competitive employment as
against public policy, the employer has to
BFOQ in Philippine Jurisdiction adduce evidence to prove that the restriction is
The concept of a bona fide occupational reasonable and not greater than necessary to
qualification is not foreign in our jurisdiction. protect the employer’s legitimate business
We employ the standard of reasonableness of interests. The restraint may not be unduly
the company policy which is parallel to the harsh or oppressive in curtailing the
bona fide occupational qualification employee’s legitimate efforts to earn a
requirement. livelihood, and must be reasonable in light of
sound public policy. [Rivera v. Solidbank, G.R.
In Duncan Association of Detailman-PTGWO No. 163269 (2006)]
and Pedro Tecson v. Glaxo Wellcome
Philippines, Inc., we passed on the validity of
the policy of a pharmaceutical company H. MARRIAGE BETWEEN EMPLOYEES
prohibiting its employees from marrying OF COMPETITOR-EMPLOYERS
employees of any competitor company. We
held that Glaxo has a right to guard its trade See F. Bonafide Occupational Qualifications,
secrets, manufacturing formulas, marketing above
strategies and other confidential programs and
information from competitors. We considered
the prohibition against personal or marital
relationships with employees of competitor VII. SOCIAL LEGISLATION
companies upon Glaxo’s employees
reasonable under the circumstances because
relationships of that nature might compromise
A. SOCIAL SECURITY
the interests of Glaxo. In laying down the SYSTEM LAW
assailed company policy, we recognized that
Glaxo only aims to protect its interests against
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[Republic Act 8282, as amended by RA 11199] (2) Self-employed persons as may be

determined by the Commission,
1. Coverage and Exclusions including but not limited to:
a. All self-employed professionals
a. Compulsory b. Partners and single proprietors of
businesses
(1) Employees not over 60 years old and c. Actors and actresses, directors,
their employers, including domestic scriptwriters and news correspondents
helpers [Sec. 9(1), RA 11199] who do not fall within the definition of
the term “employee” under Sec. 8 (d) of
Provided, That any benefit already earned by this Act;
the employees under private benefit plans
existing at the time of the approval of this Act Employee [Sec 8(d), RA 11199] - Any
shall not be discontinued, reduced or otherwise person who performs services for an
impaired. employer in which either or both mental
or physical efforts are used and who
Private plans which are existing and in force at receives compensation for such
the time of compulsory coverage shall be services, where there is an employer-
integrated with the plan of the SSS, in such a employee relationship: Provided, That
way where the employer’s contribution to his a self-employed person shall be an
private plan is more than required of him in employer and employee at the same
this Act: time.
a. He shall pay to the SSS only the
contribution required of him; and d. Professional atheism coaches, trainers
b. He shall continue his contribution to such and jockeys
private plan less his contribution to the SSS e. Individual farmers and fishermen [Sec.
c. So that the employer’s total contribution to 9-A, RA11199]
his benefit plan and to the SSS shall be the
same as his contribution to his private (3) All sea-based and land-based Overseas
benefit plan before the compulsory Filipino Workers (OFWs) not over 60
coverage. [Sec. 9(1), RA 11199] years of age [Sec. 9-B, RA 11199]
Domestic workers or “kasambahays” as b. Voluntary

defined under RA10361 or the Batas
Kasambahay, who are receiving a monthly 1. Spouses who devote full time to managing
income lower than minimum salary credit household and family affairs, unless they
prescribed under this Act, shall pay are also engaged in another vocation or
contributions based on their actual monthly employment (in which case, coverage will
salary. [Sec. 4(a)(9), RA 11199] be mandatory). [Sec. 9(b), RA 11199]
2. Employees previously under compulsory
coverage) already separated from
employment or those self-employed (under
compulsory coverage) with no realized
income for a given month, who chose to
continue with contributions to maintain the
right to full benefit. [Sec. 11, RA 11199]
3. Self-employed members realizing no
income in any given month, who choose to
continue paying contributions under the
same rules and regulations applicable to a
separated employee member. [Sec. 11-A,
RA 11199]
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1. Receives only when the primary

Note: Foreign governments and international beneficiaries are absent
organizations or their wholly owned 2. Dependent parents
instrumentality employing workers in the
Philippines or employing Filipinos outside of Others
the Philippines, may enter into an agreement 1. Receives only when primary and
with the Philippine Government for the secondary beneficiaries are absent
inclusion of such employees in the SSS, except 2. Any other person designated by member
those already covered by their civil service as his/her secondary beneficiary. [Sec. 8
retirement system. [Sec. 8(j)(3), RA 11199] (k), RA 11199]
c. Exclusions 3. Benefits
1. Services where there is no employer- a. Monthly Pension [Sec. 12, RA
employee relationship in accordance with 11199]
existing labor laws, rules, regulations and
jurisprudence; The monthly pension shall be the highest of the
2. Service performed in the employ of the following amounts:
Philippine Government or instrumentality 1. P300 + [20% x (average monthly credit)] +
or agency thereof; [2% x (average monthly credit) x (# of cash
3. Service performed in the employ of a credit years of service in excess of 10
foreign government or international years)]
organization, or their wholly-owned 2. 40% x [average monthly credit]
instrumentalities; and 3. P1000, provided that the monthly pension
shall in no case be paid for an aggregate
Note: Foreign governments and international amount of less than 60 months [Sec. 12 (a)]
organizations may enter into an agreement 4. Notwithstanding the above mentioned,
with the PH government to include their minimum pension is:
employees in the Philippines in the SSS. a. P1,200 - members with at least 10
years credit service
4. Services performed by temporary and b. P 2,400 - members with at least 20
other employees which may be excluded years
by regulation of the Social Security
Commission. Employees of bona fide b. Dependents' Pension [Sec. 12-
independent contractors shall not be A, RA 11199]
deemed employees of the employer
engaging the services of said contractors. 1. Paid on account of members’
[Sec. 8(j), RA 11199] a. Death
b. Permanent total disability, or
2. Dependents and Beneficiaries c. Retirement
2. Paid to each child conceived on or prior to
Primary contingency, but not exceeding 5,
1. Dependent spouse - until remarriage beginning with the youngest and preferring
2. Dependent children [legitimate, the legitimate
legitimated, legally adopted and 3. Amount is either P250 or 10% of the
illegitimate] - Illegitimate children are monthly pension as computed above,
entitled only to 50% of the share of whichever is higher.
legitimate children. Where there are no c. Retirement benefits [Sec. 12-B,
legitimate children, the illegitimate children RA 11199]
get 100%.
Requisites for Eligibility
Secondary 1. 120 monthly contributions
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2. Age Monthly pension

a. Has reached the age of 60 years and is The monthly pension of a member who retires
already separated from employment or after reaching age 60 shall be the highest of
has ceased to be self-employed; or either:
b. Has reached the age of 65 years 1. The monthly pension computed at the
earliest time he could have retired had he
Period of entitlement - From retirement until been separated from employment or
death ceased to be self-employed plus all
adjustments thereto; or
The monthly pension shall be suspended upon 2. The monthly pension computed at the time
the reemployment or resumption of self- when he actually retires.
employment of a retired member who is less
than 65 years old. d. Permanent disability benefits
[Sec. 13-A, RA 11199]
In Case of Death of Member
1. His/her primary beneficiaries as of the date Eligibility
of his/her retirement shall be entitled to 1. 36 monthly contributions prior to the
receive the monthly pension; semester of disability
2. If he/she has no primary beneficiaries AND
he/she dies within 60 months from the start Note: This is the same as death benefit, but
of his/her monthly pension, his/her permanent disability pension is paid
secondary beneficiaries shall be entitled to directly to the member.
a lump sum benefit equivalent to the total
monthly pensions corresponding to the 2. In case the permanently disabled member
balance of the 5 year guaranteed period, dies, he/she is given the same treatment as
excluding the dependents’ pension. a retiree dying.
Lump Sum Alternative 3. For permanent partial disability, the

The member may opt to receive the first 8 pension is not lifetime. It shall be paid in
monthly pensions in lump sum but such is lump sum if the period is less than 12
discounted at a preferential rate of interest to months.
be determined by the SSS.
Ex. loss of thumb entitles member to 10
Lump Sum Eligibility (Equal to total months of pension; loss of arm entitles
contributions) member to 50 months.
A covered member who is 60 years old at
retirement and who does not qualify for 4. For multiple partial disabilities, they shall
pension benefits (see requisites for eligibility) be additive when related or deteriorating -
shall be entitled to a lump sum benefit equal to the percentage shall be equal to the
the total contributions paid by him and on his number of months the partial disability is
behalf: Provided, That he is separated from entitled to, divided by 75 months.
employment and is not continuing payment of
contributions to the SSS on his own. Ex. loss of sight in 1 eye - 25/75; loss of
arm = 50/75
If both occur due to same cause then 25/75

+ 50/75 = 100% (as if it were a permanent
total disability)
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Lump Sum Alternative

A member is entitled to a lump sum benefit f. Funeral benefits [Sec. 13-B, RA
equivalent to the monthly pension x number of 11199]
monthly contributions paid to the SSS or 12
times the monthly pension, whichever is P12,000 in cash or in kind, upon the death of
higher. To be entitled, he must not have paid at member.
least 36 monthly contributions.
g. Loan
Subject to compulsory coverage again
A member who: Social Security Commission Reso. No. 669,
1. Received a lump sum benefit, and SSS Circular No. 21-P and 52 pertain to
2. Is reemployed or resumed self- treatment of salary loans, which sometimes
employment not earlier than 1 year from provide for more flexible payment terms or
date of disability , condonation for delinquent payers.
shall be subject to compulsory coverage and
considered a new member. h. Sickness benefits [Sec. 14, RA
11199]
Death of Member
1. His/her primary beneficiaries as of the date Eligibility
of his/her retirement shall be entitled to 1. Inability to work due to sickness or injury,
receive the monthly pension; 2. Confined for more than 3 days either in a
2. If he/she has no primary beneficiaries AND hospital or elsewhere with SSS approval
he/she dies within 60 months from the start 3. At least 3 months of contribution paid in the
of his/her monthly pension, his/her 12 month period immediately before the
secondary beneficiaries shall be entitled to semester of sickness or injury
a lump sum benefit equivalent to the total 4. All company sick leaves with pay for the
monthly pensions corresponding to the current year have been used up;
balance of the 6 year guaranteed period, 5. Maximum of 120 days per 1 calendar year
excluding the dependents’ pension. (i.e. max permissible for the same sickness
and confinement is 240 days for 2
e. Death Benefits [Sec. 13, RA consecutive years)
11199] 6. Employer has been notified, or, if a
separated, voluntary or self-employed
Eligibility member, the SSS has been directly notified
36 monthly contributions prior to the semester within 5 days from confinement.
of death
Notice to employers or SSS is not needed
Benefit when confinement is in a hospital.
1. Monthly pension to primary beneficiaries,
or Notice to employer is not required when
2. If no primary beneficiaries, lump sum employee became sick or injured while working
equivalent to 36 times the monthly pension or within the premises of the employer.
to secondary beneficiaries
Benefit
If ineligible/has not paid 36 monthly Daily cash allowance paid for the number of
contributions days a member is unable to work due to
A lump sum benefit which shall be that which is sickness of injury equivalent to 90% x (average
higher between the ff. will be given to the daily salary credit)
beneficiaries:
a. (monthly pension) x 12, or
b. (monthly pension) x (# of monthly
contributions)
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Reimbursement of SSS to Employer Full payment shall be advanced by the

Upon satisfactory proof of payment and legality employer within 30 days from filing the
of sickness benefits, reimbursement shall be maternity leave application.
made by the SSS if the following conditions are
met: SSS shall reimburse the employer of 100% of
1. Employer notified SSS of the confinement the amount of maternity benefits advanced
within 5 calendar days after receipt of the upon receipt of satisfactory proof of payment
notification from the employee-member - and legality thereof.
100% reimbursement
2. If the notification to SSS is made beyond 5 Note: All benefits herein mentioned are tax-
calendar days after receipt of notification exempt.
from the employee-member -
reimbursement only for each day of j. Unemployment Insurance or
confinement starting from the 10th Involuntary Separation Benefits
calendar day immediately preceding the [Sec. 14-B, RA 11199]
date of notification to SSS
Eligibility
SSS shall reimburse the employer or pay the 1. Not over 60 years of age
unemployed member only for confinement 2. At least 36 months contributions, 12
within the 1 year period immediately preceding months of which should be in the 18th
the date the claim for benefit/reimbursement is month period immediately preceding the
received by SSS. involuntary unemployment or separation
Exception: Confinement in a hospital - the Benefit

claim for benefit or reimbursement must be Monthly cash payments equivalent to 50% of
filed within 1 year from the last day of the average monthly salary credit for a
confinement maximum of 2 months
i. Maternity Leave benefits [Sec. Frequency of claiming benefit

14-A, RA 11199] An employee who is involuntarily unemployed
can only claim unemployment benefits once
Eligibility every 3 years.
1. Female member
2. Paid at least 3 monthly contributions in the In case of concurrence of 2 or more
12-month period immediately preceding compensable contingencies, only the highest
the semester of her childbirth or benefit shall be paid, subject to the rules and
miscarriage regulations that the Commission may
3. Member notified her employer of her prescribe.
pregnancy and probable date of childbirth,
which notice shall be transmitted to the
SSS B. GOVERNMENT SERVICE
INSURANCE SYSTEM LAW
Full payment shall be advanced by the
[Republic Act 8291]
employer within 30 days from filing the
maternity leave application.
1. Coverage and Exclusions
Coverage
Covers only the first four deliveries or Coverage
miscarriages. All public sector employees below the
compulsory retirement age of 65, irrespective
Employer’s reimbursement of employment status. [Sec. 3]
Exclusions
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1. AFP and PNP The amount shall be [37.5% x (revalued

2. Members of the Judiciary and average monthly compensation)] + [2.5 x
Constitutional Commissions who are (revalued average monthly compensation) x
covered only by life insurance as they have (years in service in excess of 15 years)]
separate retirement schemes
3. Contractual employees with no employer- Provided, the monthly pension shall not exceed
employee relationship [Sec. 3] 90% of the average monthly compensation.
2. Dependents and Beneficiaries It shall not be less than P24,000 for those with
20 years of service and not less than P1,300
Primary for everyone else.
1. Dependent spouse - until remarriage
2. Dependent children (legitimate, b. Retirement Benefits [Sec. 13]
legitimated, legally adopted and
illegitimate) Eligibility
1. At least 15 years of service
Note: Unlike the SSS law, the GSIS law does 2. At least 60 years of age
not distinguish between the share of legitimate 3. Not receiving pension benefit from
and illegitimate children. permanent total disability
Secondary Compulsory Retirement [Sec. 13-A]

In the absence of primary beneficiaries, Retirement is compulsory for employees:
1. Dependent parents 1. 60 years of age
2. Legitimate descendants (excluding 2. Who have rendered at least 15 years of
dependent children) service
3. Benefits If employee has less than 15 years of service,

he may be allowed to continue in accordance
Computation of service [Sec. 10] with civil service laws.
From date of original appointment/election
including periods of service at different times Benefit [Sec. 13]
under 1 or more employers, those performed The member may choose between
overseas under the authority of the Republic of 1. 60 x (basic monthly pension) lump sum
the Philippines, and those that may be payment at the time of retirement + basic
prescribed by the GSIS in coordination with the monthly pension payable monthly for life
Civil Service Commission. after expiry of the 5-year guaranteed period
which is already covered by the lump sum,
In case of reinstatement in the service of an or
employer and subsequent retirement or 2. Cash payment equal to 18 x (basic monthly
separation which is compensable under this pension) + monthly pension for life
Act, all service credited for retirement, immediately but with no 5-year guarantee
resignation or separation for which
corresponding benefits have been awarded
under this Act or other laws shall be excluded
in the computation.
GSIS may prescribe rules for the inclusion of

part time and other services with
compensation.
a. Monthly Pension [Sec. 9]
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c. Permanent Disability Benefits Ineligible members

If member has rendered at least 3 years of
service, he shall receive cash payment equal
Total and Partial and
to 100% of average monthly compensation for
Permanent Permanent
each year of service (essentially total amount
[Sec. 16] [Sec. 17]
of contributions made) or P12,000 whichever is
higher [Sec. 16].
1. Complete loss of 1. Complete and
sight of both permanent loss
eyes of the use of Partial Disability
2. Loss of 2 limbs a. Any finger Paid according to GSIS prescribed schedule.
at or above the b. Any toe Member must satisfy conditions regarding the
ankle or wrist c. One arm disability not being due to his own fault and
3. Permanent d. One hand regarding employment status and services
complete e. One foot rendered.
paralysis of 2 f. One leg
limbs g. One/both d. Death benefits [Sec. 21]
4. Brain injury ears
resulting in h. Hearing of When member dies, the primary beneficiaries
incurable one/both are entitled to only ONE of the following:
imbecility or ears 1. Survivorship pension
insanity i. Sight of one a. He was in service when he died, or
5. Other cases as eye b. Even if separated from service, he has
determined by 2. Other cases as at least 3 years of service and has paid
GSIS determined by 36 monthly contributions within the 5
GSIS years preceding death, or
c. Even if separated from the service, he
has paid 180 monthly contributions
Eligibility for Permanent Total Disability prior to death.
1. Disability not due to employee’s own grave 2. Survivorship pension + cash payment of
misconduct, notorious negligence, habitual 100% of average monthly compensation
intoxication, or willful intention to kill himself for every year of service [pension + total
for another [Sec. 15] contributions made]
2. Employee is: a. He was in service when he died, and
a. In service at time of disability b. With 3 years of service
b. Even if separated, has paid at least 36 3. Cash payment equivalent to 100% average
monthly contributions within the 5-year monthly compensation for each year of
period immediately prior to disability or service he paid contributions or P12,000
has paid a total of at least 180 monthly whichever is higher
contributions prior to disability a. With 3 years of service
c. Not enjoying old-age retirement benefit b. He has failed to qualify in the prior 2
[Sec. 16]. schemes.
Benefit for Permanent Total Disability e. Funeral Benefits [Sec. 23]

1. Monthly income benefit for life equal to
basic monthly pension, from date of Eligibility
disability 1. Active member
2. If member is in service at time of disability 2. Member separated from service but still
and has paid at least 180 monthly entitled to the benefit
contributions, he receives an additional 3. Pensioner
cash payment of 18 x basic monthly 4. Retiree who at time of retirement was of
pension pensionable age but opted to retire under
RA 1616
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1. Employee separated from service due to

f. Loan abolition of his office or position and
2. Employee has been paying integrated
The following are the loans provided: contributions for at least 1 year prior to
1. Consolidated Loan separation
2. Policy loan
3. Emergency loan Benefit
4. Pension loan Monthly cash payments of 50% x average
monthly compensation for a duration which is
g. Temporary Disability Benefits proportional to years rendered, ranging from 2
[Sec. 18] to 6 months.
Eligibility j. Survivorship Benefits

1. Employee must be:
a. In service at time of disability, or Benefit
b. If separated, he has rendered at least 1. Basic survivorship pension - 50% x basic
3 years of service and paid at least 6 monthly pension (see Death Benefits) and
monthly contributions in the 12 month 2. Dependent children’s pension not
period immediately prior to disability exceeding 50% of the basic monthly
2. All sick leave credits including those in the pension
CBA for the current year have been used
3. Maximum of 120 days per 1 calendar year k. Life Insurance Benefits
Ex. maximum for the same sickness and Members of the Judiciary and Constitutional
confinement is 240 days for 2 consecutive Commissions are only entitled to life insurance.
years
Benefit
75% x current daily compensation for every
day or fraction thereof of disability OR P70.00,
whichever is higher.
h. Separation Benefits [Sec. 11]
Eligibility and benefit received

1. 60 years of age, or separation from service
with at least 3 years but not over 15 years
served – cash payment of 100% of ave.
monthly compensation for each year of
service (total amount of all contributions
paid) or P12,000 whichever is higher
2. Below 60 years of age, but at least 15 years
of service rendered – cash payment of 18
x (monthly pension) at time of
resignation/separation + old age pension
benefit (equal to basic monthly pension)
i. Unemployment Benefits [Sec.

12]
Eligibility
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SSS GSIS
RA 1161 as amended by RA 8282 or the PD 1146 as amended by RA 8291

Enabling
Social Security Act of 1997, and RA11199
law
or the Social Security Act of 2018
Employer – any person, natural or Employer – National government, its

juridical, domestic or foreign, who carries political subdivisions, branches, agencies
on in the Philippines any trade business, or instrumentalities, including
industry, undertaking, and uses the government- owned or controlled
services of another person who is under his corporations and financial institutions
orders as regards the employment, except with original charters [GOCCs];
those considered as employer under constitutional commissions; and judiciary
the GSIS. A self- employed person shall be
both employer and employee at the same
time.
Employee – any person who performs Employee – any person receiving

services for an employer in which either or compensation while in service of an
both mental and physical efforts are used employer whether by election or
and who receives compensation for such appointment, irrespective of status of
services, where there is an employer— appointment; barangay officials; and
employee relationship; also, a self- sanggunian officials
employed person who is both employee
and employer at the same time.
Self-employed - any person whose No counterpart

Definition
income is not derived from employment,
of terms
including but not limited to
a. Self-employed professionals
b. Partners and single proprietors of
businesses
c. Actors, directors, scriptwriters, news
correspondents not considered as
employees under the above definition
d. Individual farmers and fishers
Dependents Same, except child here is below 18

a. Legal spouses entitled by law to years old.
receive support
b. Child - unmarried, not gainfully
employed, and below 21 or
c. Child over 21 if he or she became
permanently incapacitated and
incapable of self-support, physically or
mentally; child may be legitimate,
legitimated, legally adopted or
illegitimate
d. Parent who is receiving legal support
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Beneficiaries Same except no distinction in the share

Primary of legitimate and illegitimate children
1. Dependent spouse - until remarriage
2. Dependent children [legitimate,
legitimated, legally adopted and
illegitimate] - Illegitimate children are
entitled only to 50% of the share of
legitimate children. Where there are no
legitimate children, the illegitimate
children get 100%
Secondary
1. Receives only when the primary
beneficiaries are absent
2. Dependent parents
Others
1. Receives only when primary and
secondary beneficiaries are absent
2. Any other person designated by
member as his/her secondary
beneficiary.
Compensation – all actual remuneration Compensation – basic pay received

for employment, including mandated cost- excluding per diems, bonuses, overtime,
of-living allowance, as well as the cash honoraria, allowances and other
value of any remuneration paid in any emoluments not integrated into the basic
medium other than cash except that portion pay under existing laws.
already above the max salary credit as
provided in this Act.
Compulsory Public sector employees below the

1. Employers as defined above compulsory retirement age of 65.
2. Employees not over 60 years including
household helpers Exceptions:
3. Self-employed 1. AFP & PNP
2. Members of Judiciary and
Voluntary Constitutional Commissions who are
1. Spouses who devote full time to covered only by life insurance
managing household and family affairs 3. Contractual employees with no EER
2. Employers already separated form with the agency they serve
employment or those self-employed
with no realized income for a given
month, who chose to continue with
contributions to maintain right to full
benefit
Note: Foreign governments, international
organizations or their wholly owned
instrumentality employing workers in the
Philippines may enter into an agreement
with the Philippine government to include
their employees in the SSS except those
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already covered by their civil service

retirement system.
1. Monthly pension 1. Monthly pension

2. Dependents’ pension 2. Dependents’ pension
3. Retirement benefits 3. Retirement benefits
4. Permanent disability benefits 4. Permanent disability benefits
5. Death benefits 5. Death benefits
6. Funeral benefits 6. Funeral benefits
Summary 7. Loan 7. Loan
of 8. Sickness benefits 8. Separation benefits
Benefits 9. Maternity leave benefits 9. Unemployment benefits
10. Unemployment benefit 10. Survivorship benefits
11. Life insurance benefits
Note: Members of the Judiciary and

Constitutional Commissions are entitled
to life insurance only.
1. Employer’s contribution, and Continued membership for the

Effects of employee’s obligation to pay unemployed member, and entitlement to
separa- contribution both cease at the end of whatever benefits he has qualified to in
tion from the month of separation the event of any compensable
employ- 2. Employee shall be credited with all contingency.
ment contributions paid on his behalf and
entitled to all benefits set forth by law.
Dispute Social Security Commission CA (Rule GSIS CA (Rule 43) SC (Rule 45);
settle- 43, questions of law & fact) SC (Rule 45, appeal does not stay execution
ment questions of law only)
Prescrip- 20 years 4 years

tive
period
years of contribution to the national economy.

C. LIMITED PORTABILITY Towards this end, the State shall institute a
LAW scheme for totalization and portability of social
security benefits, with the view of establishing
within a reasonable period a unitary social
[RA 7699: “An Act Instituting Limited Portability
security system [Section 1, RA 7699].
Scheme in the Social Security Insurance
Systems by Totalizing the Workersʹ Creditable
Services or Contributions in each of the Coverage
All worker‐members of the Government
Systems”]
Service Insurance System (GSIS) and/or
Social Security System (SSS) who transfer
Policy declaration
from one sector to another, and who wish to
To promote the welfare of our workers by
retain their membership in both Systems.
recognizing their efforts in productive
Portability
endeavors and to further improve their
conditions by providing benefits for their long
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Refers to the transfer of funds for the account benefits [Rule V, Sec. 1, RA 7699 Rules and
and benefit of a worker who transfers from one Regulations].
system to the other [Section 2(b), RA 7699].
Totalization shall apply in the following
Provisions of any general or special law or instances:
rules and regulations to the contrary a. If a worker is not qualified for any benefits
notwithstanding, a covered worker shall have from both Systems;
his credible services or contributions in both b. If a worker in the public sector is not
Systems credited to his service or contribution qualified for any benefits in the GSIS; or
record in each of the Systems and shall be c. If a worker in the private sector is not
totalized for purposes of old-age, disability, qualified for any benefits from the SSS.
survivorship and other benefits in case the
covered member does not qualify for such For the purpose of computation of benefits,
benefits in either or both Systems without totalization shall apply in all cases so that the
totalization. contributions made by the worker‐member in
both Systems shall provide maximum benefits
Provided: That overlapping periods of which otherwise will not be available. In no
membership shall be credited only once for case shall the contribution be lost or forfeited
purposes of totalization [Section 4, RA 7699]. [Rule V, Sec. 3, RA 7699 Rules and
Regulations].
Totalization
Refers to the process of adding up the period If after totalization the worker‐member still
of creditable services or contributions under does not qualify for any benefit listed in Rule III,
each of the Systems, for purposes of eligibility Section 1 (j), the member will then get whatever
and computation of benefits [Section 2(e), RA benefits correspond to his/her contributions in
7699]. either or both Systems [Rule V, Sec. 4, RA
7699 Rules and Regulations].
Totalization of service credits is only resorted
to when the retiree does not qualify for benefits If a worker qualifies for benefits in both
in either or both of the System. In this case, Systems, totalization shall not apply [Rule V,
since the petitioner may be entitled to some Sec. 5, RA 7699 Rules and Regulations].
benefits from the GSIS, he cannot avail of the
benefits under RA 7699 [Gamogamo v. PNOC The process of totalization of creditable
Shipping and Transport Corp, G.R. No. 141707 services or periods of contributions and
(2002)]. computation of benefits provided for under the
Act shall be the joint responsibility of the GSIS
All contributions paid by such member and the SSS [Rule V, Sec. 6, RA 7699 Rules
personally, and those that were paid by his and Regulations].
employers to both Systems shall be considered
in the processing of benefits which he can Overlapping periods of creditable services or
claim from either or both Systems: Provided, contributions in both Systems shall be credited
however, that the amount of benefits to be paid only once for purposes of totalization [Rule V,
by one System shall be in proportion to the Sec. 7, RA 7699 Rules and Regulations].
number of contributions actually remitted to
that System. [Section 4, RA 7699].
All creditable services or periods of

contributions made continuously or in the
aggregate of a worker under either of the
Sectors shall be added up and considered for
purposes of eligibility and computation of
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1. The daily income benefit is not less than

D. DISABILITY AND DEATH Ten (10) pesos nor more than Ninety (90)
BENEFITS pesos, nor paid for a continuous period
longer than 120 days. [Art. 197]
2. The monthly income benefit shall be
1. Labor Code suspended if the employee fails to submit
a monthly medical report certified by its
Under the Labor Code, employees' attending physician [Art.194]
compensation (EC) benefits are granted to
employees or their dependents for work- Period of Entitlement
connected disability or death, or those The employee is entitled to the benefit from the
resulting from accident arising out of and in day of the start of the disability. It shall not be
the course of employment. [Art. 166, LC in paid longer than 120 consecutive days except
rel. to Sec. 1, Rule III, IRR] where such injury or sickness still requires
medical attendance beyond 120 days but not
Types of disability to exceed 240 days from onset of disability.
1. Temporary Total Disability [Art. 197]
2. Permanent Total Disability [Art. 198] When after the period of temporary total
3. Permanent Partial Disability [Art. 199] disability had ceased, an employee was found
to be suffering from a permanent partial
a. Disability Benefits disability, he was entitled to an award based
upon partial disability permanent in character.
Disability does not refer to the injury nor to the [Cañete v. Insular Lumber Co., 61 Phil. 592
pain and suffering it has occasioned, but to the (1935)]
loss and impairment of earning capacity.
There is disability when there is a loss or PERMANENT TOTAL DISABILITY
diminution of earning power because of actual A disability is total and permanent if as a result
absence from work due to injury or illness of the injury or sickness the employee is unable
arising out of and in the course of employment. to perform any gainful occupation for a
The basis of compensation is reduction of continuous period exceeding 120 days. [Art.
earning power. [Azucena, p. 525] 198 in rel. to Sec. 2(b), Rule VII]
TEMPORARY TOTAL DISABILITY The test of whether or not an employee suffers

A total disability is temporary if as a result of from ‘permanent total disability’ is a showing of
the injury or sickness, the employee is unable the capacity of the employee to continue
to perform any gainful occupation for a performing his work notwithstanding the
continuous period not exceeding 120 days disability he incurred. It does not mean an
[Art. 197 in rel. to Sec. 2(a), Rule VII, Amended absolute helplessness but rather an incapacity
Rules on Employees’ Compensation]. to perform gainful work which is expected to be
permanent. [Vicente vs. ECC, G.R. No. 85024,
The object of the law in allowing compensation (1991)]
during temporary disability is to compensate
the laborer or employee for what he might have The Labor Code enumerates six instances
earned during the period of the treatment of his considered to be a permanent total disability:
injury. [Cañete v. Insular Lumber Co., 61 Phil. 1. Temporary total disability lasting
592 (1935)] continuously for more than one hundred
twenty days, except as otherwise provided
Amount of benefit for in the Rules;
An employee suffering from temporary total 2. Complete loss of sight of both eyes;
disability shall be paid by the System an 3. Loss of two limbs at or above the ankle or
equivalent of ninety percent (90%) of the wrist;
average salary credit, provided:
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4. Permanent complete paralysis of two designated physician has sufficient

limbs; justification to extend the period; and
5. Brain injury resulting in incurable imbecility 4. If the company-designated physician still
or insanity; and fails to give his assessment within the
6. Such cases as determined by the Medical extended period of 240 days, then the
Director of the System and approved by the seafarer's disability becomes permanent
Commission. [Art. 197(c)] and total, regardless of any justification.
Rules for the determination of disability It must be emphasized that the company-
(120-day or 240-day) designated physician must:
Initially, there was confusion as to the 1. ISSUE a final medical assessment of the
application of the 120-day period found in seafarer's medical condition; AND
Article 192 (c) (1) of the Labor Code vis-à-vis 2. GIVE his assessment to the seafarer
the application of the 240-day period found in concerned.
Section 2, Rule X of the Amended Rules on
Employees' Compensation Implementing Title That is to say that the seafarer must be fully
II, Book IV of the Labor Code. and properly informed of his medical
condition.
Permanent disability:
Article 192(c)(1): Temporary total disability The results of his/her medical examinations,
lasting continuously for more than one hundred the treatments extended to him/her, the
twenty days, except as otherwise provided in diagnosis and prognosis, his/her disability
the Rules. grading must be fully explained to him/her by
no less than the company-designated
Section 2, Rule X: …where such injury or physician.
sickness still requires medical attendance
beyond 120 days but not to exceed 240 days The company-designated physician is
from onset of disability. mandated to issue a medical certificate,
which should be personally received by the
To reconcile these provisions, the Supreme seafarer, or, if not practicable, sent to him/her
Court laid down the following rules in the case by any other means sanctioned by present
of Dagasdas v. Grand Placement and General rules.
Services Corporation. [G.R. No. 205727,
(2017)] To require the seafarer to seek the decision of
1. The company-designated physician must a neutral third-party physician without primarily
issue a final medical assessment on the being informed of the assessment of the
seafarer's disability grading within a period company-designated physician is a clear
of 120 days from the time the seafarer violation of the tenets of due process.
reported to him;
2. If the company-designated physician fails Amount of Benefit
to give his assessment within the period of The employee suffering from a permanent total
120 days, without any justifiable reason, disability shall be entitled to an amount
then the seafarer's disability becomes equivalent to the monthly income benefit, plus
permanent and total; ten percent thereof for each dependent child,
3. If the company-designated physician fails but not exceeding five, beginning with the
to give his assessment within the period of youngest and without substitution: Provided,
120 days with a sufficient justification (e.g. That the monthly income benefit shall be the
seafarer required further medical treatment new amount of the monthly benefit for all
or seafarer was uncooperative), then the covered pensioners. [Art. 198]
period of diagnosis and treatment shall be
extended to 240 days. The employer has Period of Entitlement
the burden to prove that the company-
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An employee with permanent total disability

One arm 50
shall be entitled to receive benefits monthly for
five (5) years.
One hand 39
However, Art. 198(b) provides that the benefits
may be suspended if the employee is gainfully One foot 31
employed, or recovers from his permanent total
disability, or fails to present himself for One leg 46
examination at least once a year.
One ear 10
PERMANENT PARTIAL DISABILITY
A disability is partial and permanent if as a Both ears 20
result of the injury or sickness the employee
suffers a permanent partial loss of the use of
any part of his body. [Art. 199 in rel. to Sec. Hearing of one ear 10
2(c), Rule VII, Amended Rules on Employees’
Compensation]. Hearing of both ears 50
The object of the law in granting compensation Sight of one eye 25

for a permanent partial disability is to
compensate the injured laborer or employee
for the actual and permanent loss of a member Notes:
of the body, or the use thereof. [Cañete v. 1. A loss of a wrist shall be considered as a
Insular Lumber Co., 61 Phil. 592 (1935)] loss of the hand, and a loss of an elbow
shall be considered as a loss of the arm.
Amount of benefits 2. A loss of an ankle shall be considered as
For an employee who has suffered a loss of a foot, and a loss of a knee shall be
permanent partial disability, the amount of considered as a loss of the leg.
benefits, as well as the period of entitlement to 3. A loss of more than one joint shall be
receive such benefits is based upon the degree considered as a loss of one-half of the
of disability, as well as the lost body part. The whole finger or toe: Provided, That such a
body parts and the corresponding period of loss shall be either the functional loss of the
equivalent disability are specified in Art 199. use or physical loss of the member. [Art.
199(c)]
Table of benefits [Art. 199(b)]
Body part/s Number of months In case of permanent partial disability less
than the total loss of the member specified
One thumb 10 in Art. 199(b), the same monthly income
benefit shall be paid for a portion of the period
One index finger 8 established for the total loss of the member, in
accordance with the proportion that the partial
loss bears to the total loss. If the result is a
One middle finger 6
decimal fraction, the same shall be rounded off
to the next higher integer [Art. 199(d)].
One ring finger 5
In cases of simultaneous loss of more than
One little finger 3 one member or a part thereof as specified
in Art. 199(b) the same monthly income
One big toe 6 benefit shall be paid for a period equivalent to
the sum of the periods established for the loss
One toe 3 of the member or the part thereof. If the result
is a decimal fraction, the same shall be
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rounded off to the next higher integer [Art. b. Death Benefits

199(e)].
Monthly Income Benefit
In cases of injuries or illnesses resulting in Under such regulations as the Commission
a permanent partial disability not listed in may approve, the System shall pay to the
the Art. 199(b), the benefit shall be an income primary beneficiaries:
benefit equivalent to the percentage of the 1. Upon the death of the covered
permanent loss of the capacity to work [Art. employee under this Title:
199(f)]. a. An amount equivalent to his monthly
income benefit;
Distinguished from permanent total b. Plus 10% thereof for each dependent
disability child, but not exceeding five, beginning
While “permanent total disability” invariably with the youngest and without
results in an employee’s loss of work or inability substitution, except as provided for in
to perform his usual work, “permanent partial par. (j) of Article 167 hereof: Provided,
disability,” on the other hand, occurs when an That –
employee loses the use of any particular i. The monthly income benefit shall
anatomical part of his body which disables him be guaranteed for five years;
to continue with his former work. [Vicente v. ii. If he has no primary beneficiary,
ECC, G.R. No. 85024, (1991)] the System shall pay to his
secondary beneficiaries the
Conversion from permanent partial monthly income benefit but not to
disability to permanent total disability exceed sixty months; and
A person’s disability may not manifest fully at iii. The minimum death benefit shall
one precise moment in time but rather over a not be less than fifteen thousand
period of time. It is possible that an injury which pesos. (As amended by Section 4,
at first was considered partial disability may Presidential Decree No. 1921).
become totally and permanently disabled from 2. Upon the death of a covered employee
the same cause. There is nothing in the law who is under permanent total disability
that prohibits the conversion of permanent under this Title: 80% of the monthly
partial disability benefit to permanent total income benefit and his dependents to the
disability benefit, if it is shown that the dependents’ pension: Provided, That –
employee’s ailment qualifies as such. [GSIS v. a. The marriage must have been validly
Court of Appeals and R. Balais, G.R. No. subsisting at the time of disability;
117572 (1998)]. b. If he has no primary beneficiary, the
System shall pay to his secondary
When salary is higher after the injury beneficiaries the monthly pension
In a case where the employee filed a claim for excluding the dependents’ pension, of
permanent partial disability but the ECC denied the remaining balance of the five-year
the claim because in fact his salary was higher guaranteed period; and
than before, the Court ruled that the fact of c. The minimum death benefit shall not be
higher earning capacity fact would not in itself less than fifteen thousand pesos. (As
necessarily affect the laborer’s claim for amended by Section 4, Presidential
compensation for a permanent partial Decree No. 1921).
disability. The amount of his salary may be
affected by various extraneous matters or Note: The monthly income benefit provided
factors. [Central Azucarera Don Pedro v. C. de herein shall be the new amount of the monthly
Leon, in his capacity as Workmen’s income benefit for the surviving beneficiaries
Compensation Commissioner and L. Alla, G.R. upon the approval of this decree. [Art. 200 (a)-
No. L-10036 (1957)]. (c)]
Condition to entitlement
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The beneficiaries of a deceased employee Dependents

shall be entitled to an income benefit if all of the "Dependent" means:
following conditions are satisfied: 1. The legitimate, legitimated or legally
1. The employee has been duly reported to adopted or acknowledged natural child
the System; who is:
2. He died as a result of an injury or sickness; a. Unmarried,
and b. Not gainfully employed, and
3. The System has been duly notified of his c. Not over twenty-one (21) years of age
death, as well as the injury or sickness or over twenty-one (21) years of age
which caused his death. His employer shall provided he is incapacitated and
be liable for the benefit if such death incapable of self-support due to a
occurred before the employee is duly physical or mental defect which is
reported for coverage to the System. [Sec. congenital or acquired during minority;
1(a), Rule XIII, IRR] 2. The legitimate spouse living with the
employee and the parents of said
Notes: employee wholly dependent upon him for
1. If the employee has been receiving regular support. [Art. 173(i)]
monthly income benefit for permanent total
disability at the time of his death, the The test of dependency is not merely whether
surviving spouse must show that the the contributions were necessary to bare
marriage has been validly subsisting at the subsistence. Dependency may exist if such
time of his disability. contributions were relied on by claimant for
2. In addition, the cause of death must be a his/her means of living as determined by
complication or natural consequence of the his/her position in life. [Malate Taxicab v. Del
compensated Permanent Total Disability. Villar, G.R. No. L-7489 (1956)]
[Sec. 1(b), Rule XIII, IRR]
Period of entitlement
Beneficiaries For primary beneficiaries
The beneficiaries are: The income benefit shall be paid beginning at
1. Primary beneficiaries: the month of death and shall continue to be
a. Dependent spouse until he/she paid for as long as the beneficiaries are entitled
remarries; thereto. [Sec. 2, Rule XII, IRR]
b. Dependent children (legitimate,
legitimated, natural-born, or legally For secondary beneficiaries
adopted). The income benefit shall be sixty (60) times the
2. Secondary beneficiaries: monthly income benefit of a primary beneficiary
1. Illegitimate children and legitimate which in no case be less than P 15,000.00,
descendants; which shall likewise be paid in monthly
2. Parents, grandparents, grandchildren. pension. [Sec. 2(a), Rule XII, IRR]
[Azucena, p. 541]
Manner of payment
Death benefits are paid in the form of cash
monthly pension:
1. For life to the primary beneficiaries,
guaranteed for five years;
2. For not more than 60 months to the
secondary beneficiaries in case there are
no primary beneficiaries;
3. In no case shall the total benefit be less
than P15,000. [Art. 200]
Amount of benefits
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For primary beneficiaries Prescription of claims

Monthly income benefit shall be equivalent to All money claims arising from employer-
the monthly income benefit for permanent total employee relations shall be filed within three
disability, which shall be guaranteed for five (3) years from the time the cause of action
years, increased by ten percent for each accrued; otherwise they shall forever be
dependent child but not exceeding 5, beginning barred. [Art. 306]
with the youngest and without substitution.
[Sec. 3, Rule XII, IRR] 2. Employees Compensation and
State Insurance Fund
Notes:
1. The aggregate monthly benefit payable in Policy
the case of the GSIS shall in no case To promote and develop a tax-exempt
exceed the monthly wage or salary actually employees’ compensation program whereby
received by the employee at the time of his employees and their dependents, in the
death; event of work-connected disability or death,
2. The minimum income benefit shall not be may promptly secure adequate income
less than Fifteen Thousand Pesos benefit and medical related benefits [Art.
(P15,000.00). [Sec. 3, Rule XII, IRR] 172 [166]]
For secondary beneficiaries "Dependent" means:
Income benefit is payable in monthly pension 1. The legitimate, legitimated or legally
which shall not exceed the period of 60 months adopted or acknowledged natural child
and the aggregate income benefit shall not be who is:
less than P15, 000.00. [Sec. 3, Rule XII, IRR] a. Unmarried,
b. Not gainfully employed, and
Death benefits after retirement are allowed c. Not over twenty-one (21) years of age
Generally, the term “covered employees” or over twenty-one (21) years of age
refers to an employee who, at the time of his provided he is incapacitated and
death, is still covered by the GSIS. However, incapable of self-support due to a
the implementing rules and regulations of the physical or mental defect which is
Employees’ Compensation Commission allows congenital or acquired during minority;
death benefits to those retired employees 2. The legitimate spouse living with the
whose retirement was brought about by employee and the parents of said
permanent disability. employee wholly dependent upon him for
regular support. [Art. 173(i)]
The Court is aware that death benefits must be
granted to the primary beneficiaries of the The beneficiaries are:
decedent to help the family of a permanent and 1. Primary beneficiaries:
totally disabled person who was so disabled a. Dependent spouse until he/she
because of causes that are work-oriented. The remarries;
rule applies all the more when the disabled b. Dependent children (legitimate,
person later dies because of the same cause legitimated, natural-born, or legally
or related cause. [Manuzon v. ECC, G.R. No. adopted).
88573, (1990)] 2. Secondary beneficiaries:
a. Illegitimate children and legitimate
Death of a person receiving permanent descendants;
total disability benefits b. Parents, grandparents, grandchildren.
Under Art. 200(b), death benefit shall be paid [Art. 173(j)]
to the beneficiaries if an employee, while Compulsory coverage
receiving permanent total disability benefit, Coverage in the State Insurance Fund shall be
dies. compulsory upon all employers and their
employees not over sixty (60) years of age:
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Provided, That an employee who is over (60) herein provided, may be revised as the
years of age and paying contributions to qualify experience in risk, cost of administration
for the retirement or life insurance benefit and actual or anticipated as well as
administered by the System shall be subject to unexpected losses, may require.
compulsory coverage [Art. 174[168]] (“System” c. Contributions under this Title shall be paid
- SSS or GSIS, as the case may be). in their entirety by the employer, and any
contract or device for the deductions of any
Foreign employment - Filipino employees portion thereof from the wages or salaries
employed abroad shall be adequately covered, of the employees shall be null and void.
subject to regulations as the Commission may d. When a covered employee dies, becomes
prescribe [Art. 175[169]] (“Commission” - disabled or is separated from employment,
Employees Compensation Commission) his employer’s obligation to pay the
monthly contribution arising from that
Limitation of liability employment shall cease at the end of the
The State Insurance fund shall be liable for month of contingency and during such
compensation to the employee or his months that he is not receiving wages or
dependents, except when the disability or salary [Art. 189[183]].
death was occasioned by the employees’
intoxication, willful intention to injure or kill Medical benefits
himself or another, notorious negligence, or Immediately after an employee contracts
otherwise provided in this title. [Art. 178 [172]] sickness or sustains an injury, he shall be
provided by the System during the subsequent
Extent of liability period of his disability with such medical
Unless otherwise provided, the liability of the services and appliances as the nature of his
State Insurance Fund under this Title shall be sickness or injury and progress of his recovery
exclusive and in place of all other liabilities of may require, subject to the expense limitation
the employer to the employee, his dependents prescribed by the Commission [Art. 191[185]]
or anyone otherwise entitled to receive
damages on behalf of the employee or his Rehabilitation services
dependents. The payment of compensation The System shall establish:
under this Title shall not bar the recovery of a. A continuing program, for the
benefits as provided for in Section 699 of the rehabilitation of injured and handicapped
Revised Administrative Code, Republic Act employees who shall be entitled to
Numbered Eleven hundred sixty-one, as rehabilitation services, which shall consist
amended, Republic Act Numbered Forty-eight of medical, surgical or hospital treatment,
hundred sixty-four as amended, and other laws including appliances to help them become
whose benefits are administered by the physically independent.
System or by other agencies of the government b. Centers equipped and staffed to provide a
[Art. 179 [173]]. balanced program of remedial treatment,
vocational assessment and preparation
Employer’s contributions designed to meet the individual needs of
a. Under such regulations as the System may each handicapped employee to restore him
prescribe, beginning as of the last day of to suitable employment, including
the month when an employee’s assistance to help each rehabilitee to
compulsory coverage takes effect and develop his mental, vocational or social
every month thereafter during his potential. [Art. 196 [190]]
employment, his employer shall prepare to 3. Philippine Overseas Employment
remit to the System a contribution Administration-Standard
equivalent to one percent of his monthly Employment Contract
salary credit.
b. The rate of contribution shall be reviewed
As part of a seafarer's deployment for overseas
periodically and subject to the limitations
work, he/she and the vessel owner or its
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representative local manning agency are serious dental, surgical and hospital treatment
required to execute the POEA-SEC. as well as board and lodging until the seafarer
Containing the standard terms and conditions is declared fit to work or to be repatriated.
of seafarers' employment, the POEA-SEC is
deemed included in their contracts of However, if after repatriation, the seafarer still
employment in foreign ocean-going vessels. requires medical attention arising from said
[Sharpe Sea Personnel Inc. v. Mabunay, G.R. injury or illness, he/she shall be so provided at
No. 206113 (2017)] cost to the employer until such time he/she is
declared fit or the degree of his/her disability
a. Compensation and benefits for has been established by the company-
injury or illness designated physician. [Sec. 20, A.2, POEA-
SEC]
There are two requisites for a seafarer’s injury
or disability to be considered compensable: (1) 2. Sickness allowance
“the injury or illness must be work-related;” and
(2) “the work-related injury or illness must have The seafarer shall also receive sickness
existed during the term of the seafarer's allowance from his/her employer in an amount
employment contract.” [Magsaysay Maritime equivalent to his/her basic wage computed
Services v. Laurel, 707 Phil. 210 (2013)] from the time he/she signed off until he is
declared fit to work, or the degree of disability
Work-related injury or illness has been assessed by the company-
For an illness to be compensable, "it is not designated physician.
necessary that the nature of the employment
be the sole and only reason for the illness The period within the seafarer shall be entitled
suffered by the seafarer." to sickness allowance shall not exceed 120
days. Payment of the sickness allowance shall
It is enough that there is "a reasonable linkage be made on a regular basis, but not less than
between the disease suffered by the employee once a month. [Sec. 20. A.3, POEA-SEC]
and his work to lead a rational mind to conclude
that his work may have contributed to the 3. Cost of medicines, mode of
establishment or, at the very least, aggravation transportation and accommodation
of any pre-existing condition he might have
had.” [Madridejos v. NYK-FIL Ship The seafarer shall be entitled to reimbursement
Management, Inc., 810 Phil. 704 (2017)] of the cost of medicines prescribed by the
company-designated physician.
See Sec. 32 of POEA-SEC for the schedule of
disability or impediment for injuries suffered In case treatment of the seafarer is on an out-
and diseases including occupational diseases patient basis as determined by the company-
of illness contracted in the course of work. designated physician, the company shall
approve the appropriate mode of transportation
Those illnesses not listed in Sec. 32 are and accommodation.
disputably presumed as work-related. [Sec. 20,
A.4, POEA-SEC] The reasonable cost of actual traveling
expenses and/or accommodation shall be paid
LIABILITIES OF EMPLOYER IN CASE OF subject to liquidation and submission of official
WORK-RELATED INJURY OR ILLNESS receipts and/or proof of expenses. [Sec. 20,
A.3, POEA-SEC]
1. Medical expenses
Mandatory post-employment medical
If the injury or illness requires medical and/or examination; strict compliance
dental treatment in a foreign port, the employer General rule: The seafarer shall submit
shall be liable for the full cost of such medical, himself/herself to a post-medical examination
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by a company-designated physician within In the course of the treatment, the seafarer

three working days upon his return. shall also report regularly to the company-
designated physician specifically on the dates
Exceptions: as prescribed by the company-designated
a. When the seafarer is physically physician and agreed to by the seafarer.
incapacitated to do so. In which case, a Failure of the seafarer to comply with the
written notice to the agency within the mandatory reporting requirement shall result in
same period is deemed as compliance. his forfeiture of the right to claim the above
[Sec. 20, A.3, POEA-SEC] benefits. [Sec. 20, A.3, POEA-SEC]
b. When the non-compliance with the
mandatory post-employment medical GUIDELINES FOR THE CLAIM OF
examination was “not due to the seafarer’s PERMANENT TOTAL DISABILITY
fault but to the inadvertence or deliberate BENEFITS
refusal of the [employer].” [Interorient The employer must also compensate the
Maritime Enterprises, Inc. v. Remo, 636 seafarer for his/her permanent total disability
Phil. 240 (2010)] as finally determined by the company-
designated physician.
Rationale
The rationale for the rule [on the mandatory The following guidelines shall govern
post-employment medical examination] is that seafarers' claims for permanent and total
reporting the illness or injury within three days disability benefits:
from repatriation fairly makes it easier for a 1. The company-designated physician must
physician to determine the cause of the illness issue a final medical assessment on the
or injury. To ignore the rule might set a seafarer's disability grading within a period
precedent with negative repercussions, like of 120 days from the time the seafarer
opening floodgates to a limitless number of reported to him.
seafarers claiming disability benefits. [Wallem 2. If the company-designated physician fails
Maritime Services, Inc. v. Tanawan, 693 Phil. to give his/her assessment within the
416 (2012)] period of 120 days, without any justifiable
reason, then the seafarer's disability
Third Doctor Opinion Rule becomes permanent and total;
If a doctor appointed by the seafarer disagrees 3. If the company-designated physician fails
with the assessment [of the company- to give his/her assessment within the
designated physician], a third doctor may be period of 120 days with a sufficient
agreed jointly between the employer and the justification, then the period of diagnosis
seafarer. and treatment shall be extended to 240
days. The employer has the burden to
The third doctor’s decision shall be final and prove that the company-designated
binding on both parties. [Sec. 20, A.4, POEA- physician has sufficient justification to
SEC] extend the period; and
4. If the company-designated physician still
Rationale: It is understandable that a company- fails to give his assessment within the
designated physician is more positive than that extended period of 240 days, then the
of a physician of the seafarer's choice. It is on seafarer's disability becomes permanent
this account that a seafarer is given the option and total, regardless of any justification.
by the POEA Standard Employment Contract [Jebsens Maritime Inc. v. Rapiz, G.R. No.
to seek a second opinion from his preferred 218871 (2017)]
physician [Abante v. KJGS Fleet Management
Manila, G.R. No. 182430 (2009)] b. Compensation and benefits for
death
Mandatory reporting requirement
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In case of work-related death of the seafarer, case death occurs at sea, the disposition of
during the term of his contract, the employer the remains shall be handled or dealt with
shall pay his/her beneficiaries the Philippine in accordance with the master’s best
currency equivalent to the amount of Fifty judgment. In all cases, the
Thousand US dollars (US$50,000) and an employer/master shall communicate with
additional amount of Seven Thousand US the manning agency to advise for
dollars (US$7,000) to each child under the age disposition of seafarer’s remains.
of twenty-one (21) but not exceeding four (4) c. The employer shall pay the beneficiaries of
children, at the exchange rate prevailing during the seafarer the Philippine currency
the time of payment. [Sec. 20, B.1, POEA- equivalent to the amount of One Thousand
SEC] US dollars (US$1,000) for burial expenses
at the exchange rate prevailing during the
Requisites time of payment. [Sec. 20, B.4, POEA-
For death to be compensable, the claimant SEC]
bears the burden to establish that:
1. The seafarer died during the duration of When compensation is not payable (applies
his/her contract, and to both disability and death benefits)
2. His/her illness was work-related. [Sec. 20, No compensation and benefits shall be
B.1, POEA-SEC] payable in respect of any injury, incapacity,
disability or death of the seafarer resulting from
Exception: When the seafarer’s death his willful or criminal act or intentional breach of
occurred after the termination of his/her his duties, provided however, that the employer
contract after medical repatriation repatriation can prove that such injury, incapacity, disability
on account of a work-related injury or illness or death is directly attributable to the seafarer.
[Sec. 20, D, POEA-SEC]
Rationale: The 2000 POEA-SEC must be
liberally construed, as impelled by the plight of Prescription of claims
the bereaved heirs who stand to be deprived of All claims arising from this contract shall be
a just and reasonable compensation for the made within three (3) years from the date the
seafarer’s death, notwithstanding its evident cause of action arises, otherwise the same
work-connection. [Racelis v. United Philippine shall be barred. [Sec. 30, POEA-SEC]
Lines, 746 Phil. 758 (2014)]
When compensation payable is double

Where death is caused by warlike activity while
sailing within a declared war zone or war risk
area, the compensation payable shall be
doubled. [Sec. 20, B.2, POEA-SEC]
Other liabilities of the employer when the

seafarer dies as a result of work-related injury
or illness during the term of employment are as
follows:
a. The employer shall pay the deceased’s
beneficiary all outstanding obligations due
the seafarer under this Contract.
b. The employer shall transport the remains
and personal effects of the seafarer to the
Philippines at employer’s expense, except
if the death occurred in a port where local
government laws or regulations do not
permit the transport of such remains. In
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strategy designed to assist solo parents in

coping with crisis situations and cases of
E. SOLO PARENTS abuse;
e. Special projects for individuals in need of
protection which include temporary shelter,
counseling, legal assistance, medical care,
[RA 8972: Solo Parents’ Welfare Act]
self-concept or ego-building, crisis
management and spiritual enrichment.
See also III. C. 2. a. and III. E. 7. for work
[Sec. 15, IRR]
entitlements of solo parents
Educational benefits
Non work-related support for solo parents
The DepEd, CHED, and TESDA shall provide
1. Comprehensive Package of Social
the following benefits and privileges:
Development and Welfare Services [Sec.
1. Scholarship programs for qualified solo
5]
parents and their children in institutions of
2. Educational Benefits [Sec. 9]
basic, tertiary, and technical/skills
3. Housing Benefits [Sec. 10]
education;
4. Medical Assistance [Sec. 11]
2. Non-formal education programs
appropriate for solo parents and their
Criteria for Support
children. [Sec. 22, IRR]
1. Solo parent,
2. Income in the place of domicile falls below
Housing benefits
the poverty threshold as set by the NEDA,
Solo parents who meet the eligibility criteria for
and
housing assistance under R.A. No. 7279
3. Assessed by the DSWD.
(Urban Development and Housing Act of 1992)
and other related rules and regulations of
Note: If the solo parent’s income is above the
participating housing agencies shall be
poverty threshold, he shall still enjoy the
provided with liberal terms of payment on
benefits of Flexible Work Schedule, Protection
government low-cost housing projects, in
against Work Discrimination, and Parental
accordance with housing law provisions,
Leave [Sec. 4].
prioritizing applicants below the poverty line as
declared by the NSCB. [Sec. 23, IRR]
Comprehensive Package of Social
Development and Welfare Services
The National Housing Authority shall make
The package will initially include:
available housing units to solo parents in its
a. Livelihood development services, which
housing projects, subject to existing disposition
include training on livelihood skills, basic
policies, or may refer them to other housing
business management, value orientation
projects, as appropriate, provided:
and the provision of seed capital or job
a. The identified solo parent must be eligible
placement;
for assistance under the provisions of this
b. Counseling services, which include
Act;
individual, peer group or family counseling.
b. Solo parents applying for housing benefits
These will focus on the resolution of
must meet the qualification criteria for
personal relationship and role conflicts;
housing assistance under Republic Act
c. Parent effectiveness services which
7279, or the Urban Development and
include the provision and expansion of
Housing Act (UDHA) and other NHA
knowledge and skills of the solo parent on
eligibility criteria under existing policies,
early childhood development, behavior
rules and regulations; and
management, health care and proper
c. Eligible solo parents shall file their
nutrition, rights and duties of parents and
application for housing unit directly with the
children;
concerned NHA Project Offices. [Sec. 24,
d. Critical incidence stress debriefing, which
IRR]
includes preventive stress management
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a. Production or profit-sharing,
Medical Assistance b. Labor administration, and
The DOH shall develop a comprehensive c. The distribution of shares of stocks,
health care program for solo parents and their which will allow beneficiaries to receive
children. [Sec. 25, IRR] a just share of the fruits of the lands
they work. [Sec. 3(a), RA 6657]
Health/medical services shall be made
available at all times, in all levels of health care 2. Existence and Concept of
delivery system as mentioned in the previous Agricultural Tenancy
section. [Sec. 26, IRR]
Agricultural tenancy – The physical
possession by a person of land devoted to
F. KASAMBAHAY agriculture belonging to, or legally possessed
by another:
1. For the purpose of production through the
[RA 10361: Batas Kasambahay or Domestic labor of the former and of the members of
Workers Act] his immediate farm household
2. In consideration of which the former agrees
See III. E. 5. Kasambahays to:
a. Share the harvest with the latter; OR
b. Pay a price certain, either in produce or
in money, or both. [Sec. 3, RA 1199,
G. AGRARIAN RELATIONS Agricultural Tenancy Act]
Tenancy relationship defined [Sec. 6,

1. Concept of Agrarian Reform RA1199]
Tenancy relationship is a juridical tie which
Declaration of Policy arises between a landholder and a tenant,
The agrarian reform program is founded on the wherein:
right of farmers and regular farmworkers, who a. They agree, expressly or impliedly, to
are landless, to own directly or collectively the undertake jointly the cultivation of land
lands they till or, in the case of other farm belonging to the former, either under the
workers, to receive a just share of the fruits share tenancy or leasehold tenancy
thereof. system;
b. The tenant acquires the right to continue
To this end, the State shall encourage and working on and cultivating the land, until
undertake the just distribution of all agricultural and unless he is dispossessed of his
lands, subject to the payment of just holdings for any of the just causes, or the
compensation. [Sec. 2, RA 6657, relationship is terminated in accordance
Comprehensive Agrarian Reform Law] with [the Agricultural Tenancy Act].
Definition Requisites for the existence of agricultural

Agrarian Reform – The redistribution of lands, tenancy relationship
regardless of crops or fruits produced to 1. The parties are landowner and the tenant
farmers and regular farmworkers who are or agricultural lessee;
landless, irrespective of tenurial arrangement, 2. The subject of the relationship is
including: agricultural land;
1. The totality of factors and support services 3. There is mutual consent to the tenancy
designed to lift the economic status of the between the parties;
beneficiaries; and 4. The purpose of the relationship is
2. All other arrangements alternative to the agricultural production;
physical redistribution of lands, such as:
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5. There is personal cultivation by the tenant 1. Be free to work elsewhere whenever the
or agricultural lessee; and nature of his farm obligation;
6. There is a sharing of harvests between the 2. Have the right to provide any of the
parties. [Fuentes v. Caguimbal, G.R. No. contributions for production, aside from his
150305 (2007)] labor, whenever he can do so adequately
and on time subject to the provisions of
Establishment of tenancy relationship [Sec. Sec. 14 of this Act
7, RA 1199]
Tenancy relationships may be established Sec. 14, RA 1199, as amended by RA 2263
either verbally or in writing, expressly or – The tenant shall have the right to change
impliedly. Once such relationship is the tenancy contract from one of share
established, the tenant shall be entitled to tenancy to leasehold tenancy and vice versa
security of tenure. and from one crop sharing arrangement to
another of the share tenancy. If the share
Types of agricultural tenancy [Sec. 4, RA tenancy contract is in writing and is duly
1199, as amended by RA 2263] registered, the right to change from one crop
1. Share tenancy exists when sharing arrangement to another or from one
a. Two persons agree on a joint tenancy system or another may be exercised
undertaking for agricultural production; at least one month before the beginning of
b. Wherein one party furnishes land and the next agricultural year after the expiration
the other his labor; of the period of the contract, the right may be
c. With either or both contributing any one exercised at least one month before the
or several of the items of production; agricultural year when the change shall be
d. The tenant cultivating the land effected.
personally with the aid of labor
available to members of his immediate 3. Have the right to demand for a home lot
farm household; suitable for dwelling with an area:
e. And the produce thereof to be divided a. not more than 3% of the area of his
between the landholder and the tenant landholding; provided
in proportion to their respective b. it does not exceed 1000 sq. m.; and
contributions. that
2. Leasehold tenancy exists when c. it shall be located at a convenient and
a. A person, who either personally or with suitable place within the land of the
the aid of labor available from the landholder to be designated by the
members of his immediate farm latter where the tenant shall construct
household; his dwelling and may raise vegetables,
b. Undertakes to cultivate a piece of poultry, pigs and other animals and
agricultural land susceptible of engage in minor industries, the
cultivation by a single person, together products of which shall accrue to the
with members of his immediate farm tenant exclusively.
household; d. The tenant’s dwelling shall not be
c. Belonging to or legally possessed by, removed from the lot already assigned
another, in consideration of a fixed to him by the landholder, except:
amount in money or in produce or in i. If the landholder designates
both. another site for the tenant’s home
3. Rights of Agricultural Tenants lot and the tenant agrees to the
transfer [Sec. 26, RA1199, as
Rights common to both share and amended by RA2263]
leasehold tenants [Sec. 22, RA 1199, as ii. There is a severance of the
amended by RA 2263] tenancy relationship
The tenant shall: iii. The tenant is ejected for cause
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In any case, the tenant shall only be removed provided they are reasonable and adequate to
after the expiration of 45 days following such the purposes of the lease.
severance of relationship or dismissal for
cause. 4. Concept of Farmworkers
Specific rights of rice share tenants [Sec. A farmworker is a natural person who renders
36, RA 1199] services for value as an employee or laborer in
The rice share tenant shall have the right to: an agricultural enterprise or farm regardless of
1. Determine when to scatter the seeds, to whether his compensation is paid on a daily,
transplant the seedlings, and to reap the weekly, monthly or “pakyaw” basis.
harvest, provided they shall be in
accordance with proven farm practices and The term includes an individual whose work
after due notice to the landholder. has ceased as a consequence of, or in
2. Choose the thresher which shall thresh the connection with, a pending agrarian dispute
harvest whenever it is the best available in and who has not obtained a substantially
the locality and the best suited to the equivalent and regular farm employment. [Sec.
landholder’s and tenant’s needs and 3(g), RA 6657, Comprehensive Agrarian
provided that the rate charged by the Reform Law]
owner of other threshers under similar
circumstances. Types of farmworkers
1. Regular Farmworker - a natural person
If there are multiple tenants, the choice of who is employed on a permanent basis by
the majority of the tenants shall prevail. an agricultural enterprise or farm. [Sec.
3(h), RA 6657]
If the landholder is the owner of a thresher 2. Seasonal Farmworker - a natural person
and is ready and willing to grant equal or who is employed on a recurrent, periodic or
lower rates under the same conditions, the intermittent basis by an agricultural
use of the landholder’s thresher shall be enterprise or farm, whether as a permanent
given preference. or a non-permanent laborer, such as
“dumaan,” “sacada,” and the like. [Sec. 3(i),
3. Apply appropriate pest, insect, disease and RA 6657]
rodent control measures whenever in his 3. Other Farmworker - a farmworker who
judgment such action is necessary. does not fall under Sec. 3(g) (farmworker),
4. Apply fertilizer of the kind or kinds shown Sec. 3(h) (regular farmworker), and Sec.
by proven farm practices to be adapted to 3(i) (seasonal farmworker). [Sec. 3(j), RA
the requirements of the land, provided the 6657]
landholder has not exercised his right to
require the use of such fertilizer. Entitlements of different farmworkers
under the Constitution
Specific rights of leasehold tenants [Sec.
43, RA 1199] Sec. 4, Art. XIII, 1987 Constitution – The
The tenant-lessee shall have the right to: State shall, by law, undertake an agrarian
1. Enter the premises of the land, and to the reform program founded on the right of
adequate and peaceful enjoyment thereof; farmers and regular farm workers, who are
2. Work the land according to his best landless, to own directly or collectively the
judgment, provided this manner and lands they till on, or in the case of other farm
method of cultivation and harvest are in workers, to receive a just share of the fruits
accordance with proven farm practices. thereof.
Upon termination of the relationship, have ½ of The 1987 Constitution distinguishes between
the value of the improvements made by him, regular farmworkers and other farmworkers.
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1. Farmers and regular farmworkers have the cognizant of the differences in culture,
right to own directly or collectively the lands values, and beliefs. [Sec. 2]
they till on.
2. Other farmworkers have the right to receive The Universal Health Care Act seeks to:
a just share of the fruits thereof. a. Progressively realize universal health care
in the country through a systemic approach
Seasonal farm workers have no and clear delineation of roles of key
constitutional right to own land agencies and stakeholders towards better
Seasonal farm workers, not having a performance in the health system; and
constitutional right to own land, do not have a b. Ensure that all Filipinos are guaranteed
legal or actual and substantial interest in the equitable access to quality and affordable
land subject of agrarian reform. They may not health care goods and services, and
be allowed to intervene in the case concerning protected against financial risk. [Sec. 3]
the land. [Fortich v. Corona, G.R. No. 131457
(1998)] 2. Coverage
Population coverage [Sec. 5]

H. UNIVERSAL HEALTH CARE Every Filipino citizen shall be automatically
included into the National Health Insurance
Program.
[RA 11223]
Service coverage [Sec. 6]
1. Policy Every Filipino shall be granted immediate
eligibility and access to preventive, promotive,
curative, rehabilitative, and palliative care for
It is the policy of the State to promote and
medical, dental, mental and emergency health
protect the right to health of all Filipinos and
services, delivered either as population-based
instill health consciousness among them.
or individual-based health services.
Towards this end, the State shall adopt:
a. An integrated and comprehensive
Provided, That the goods and services to be
approach to ensure that all Filipinos are
included shall be determined through a fair and
health literate, provided with healthy living
transparent Health Technology Assessment
conditions, and protected from hazards
(HTA) Process. [Sec. 6(a)]
and risks that could affect their health;
b. A health care model that provides all
HTA - The systematic evaluation of properties,
Filipinos access to a comprehensive set of
effects, or impact of health-related
quality and cost-effective, promotive,
technologies, devices, medicines, vaccines,
preventive, curative, rehabilitative and
procedures and all other health-related
palliative health services without causing
systems developed to solve a health problem
financial hardship, and prioritizes the
needs of the population who cannot afford and improve quality of lives and health
outcomes. [Sec. 4(n)]
such services;
c. A framework that fosters a whole-of-
Every Filipino shall register with a public or
system, whole-of-government, and whole-
private primary care provider of choice. The
of-society approach in the development,
implementation, monitoring, and DOH shall promulgate the guidelines on the
licensing of primary care providers and the
evaluation of health policies, programs and
registration of every Filipino to a primary care
plans; and
provider. [Sec. 6(d)]
d. A people-oriented approach for the delivery
of health services that is centered on
people's needs and well-being, and Financial coverage [Sec. 7]
Population-based health services shall be
financed by the National Government through
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the DOH and provided free of charge at point elective or appointive position, regardless
of service for all Filipinos. [Sec. 7(a)] of the status of appointment, whose
premium contribution payments are equally
Population-based health service - shared by the employee and the employer;
interventions such as health promotion, 2. Kasambahays, as defined in the
disease surveillance, and vector control, which Kasambahay Law;
have population groups as recipients. [Sec. 3. All other workers who are not covered by
4(p)] formal contracts or agreements or who
have no employee-employer relationship
Individual-based health services shall be and whose premium contributions are self-
financed primarily through prepayment paid, and with capacity to pay premiums,
mechanisms such as social health insurance, such as the following:
private health insurance, and HMO plans to a. Self-earning individuals; and
ensure predictability of health expenditures. b. Professional practitioners;
[Sec. 7(b)] 4. Overseas Filipino Workers
5. Filipinos living abroad;
Individual-based health services - services 6. Filipinos with dual citizenship;
which can be accessed within a health facility 7. Lifetime members as defined in RA 10606
or remotely that can be definitively traced back (National Health Insurance Act); and
to 1 recipient, has limited effect at a population 8. All Filipinos aged 21 years and above who
level and does not alter the underlying cause of have the capacity to pay premiums. [Sec.
illness such as ambulatory and inpatient care, 8, IRR]
medicines, laboratory tests and procedures,
among others [Sec. 4(p)] Indirect contributors
1. Indigents identified by the DSWD;
3. National Health Insurance 2. Beneficiaries of Pantawid Pamilyang
Program Pilipino Program/Modified Conditional
Cash Transfer (4Ps/MCCT);
Membership into the NHIP falls under 2 3. Senior citizens who are not currently
categories [Sec. 8] covered by the Program;
1. Direct contributors - Those who have the 4. Persons with disability, as defined in RA
capacity to pay premiums, are gainfully 10754 (An Act Expanding the Benefits and
employed and are bound by an employer- Privileges of Persons with Disability);
employee relationship, or are self-earning, 5. All Filipinos aged 21 years old and above
professional practitioners, migrant workers, without the capacity to pay premiums;
including their qualified dependents, and 6. Sangguniang Kabataan officials, as
lifetime members [Sec. 4(f)] defined in RA 10742 (Sangguniang
2. Indirect contributors - All others not Kabataan Reform Act); and
included as direct contributors, as well as 7. Those previously identified at point-of-
their qualified dependents, whose premium service (POS) or during registration,
shall be subsidized by the national members previously sponsored by LGUs
government including those who are and those who are not yet in the PhilHealth
subsidized as a result of special laws [Sec. database and are financially incapable to
4(o)] pay premiums. [Sec. 8, IRR]
Direct contributors Dependents

1. Employees with formal employment 1. Legal spouse/s who is/are not an active
characterized by the existence of an member;
employer-employee relationship, which 2. Unmarried and unemployed legitimate,
include workers in the government and illegitimate children, and legally adopted or
private sector, whether regular, casual, or stepchildren below twenty-one (21) years
contractual, are occupying either an of age;
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3. Foster children as defined in RA 10165 1. Jurisdiction of the Labor Arbiter

(Foster Care Act of 2012); and as distinguished from the
4. Parents who are sixty (60) years old and
Regional Director
above, not otherwise an enrolled member.
[Sec. 8, IRR]
JURISDICTION OF THE LABOR ARBITER
Except as otherwise provided under the Code,
Benefits [Sec. 9]
the Labor Arbiters shall have original and
Every member shall be granted immediate
exclusive jurisdiction to hear and decide:
eligibility for health benefit package under the
a. Unfair labor practices cases;
NHIP under the following rules:
b. Termination disputes;
1. The PhilHealth ID Card shall not be
c. Cases that workers may file involving
required in the availing of any health
wages, rates of pay, hours of work and
service.
other terms and conditions of employment,
2. No co-payment shall be charged for
if accompanied with a claim for
services rendered in basic or ward
reinstatement;
accommodation.
d. Claims for actual, moral, exemplary and
3. Co-payments and co-insurance for
other forms of damages arising from the
amenities in public hospitals shall be
employer-employee relations;
regulated by the DOH and PhilHealth
e. Cases arising from any violation of Art.
[279] of this Code, including questions
Co-payment - a flat fee or predetermined
involving the legality of strikes and
rate paid at point of service [Sec. 4(e)]
lockouts;
f. Except claims for Employees
Co-insurance - a percentage of a medical Compensation, Social Security, Medicare
charge that is paid by the insured, with the [Philhealth] and maternity benefits, all other
rest paid by the health insurance plan [Sec.
claims, arising from employer-employee
4(d)]
relations, including those of persons in
domestic or household service, involving
4. The current PhilHealth package for an amount exceeding P5,000 regardless of
members shall not be reduced.
whether accompanied with a claim for
reinstatement. [Art. 224]
PhilHealth shall provide additional NHIP g. Money claims arising out of employer-
benefits for direct contributors, where
employee relationship or by virtue of any
applicable: Provided,
law or contract, involving claims for actual,
1. Failure to pay premiums shall not prevent moral, exemplary and other forms of
the enjoyment of NHIP benefits.
damages, as well as employment
2. Employers and self-employed direct termination of OFWs;
contributors shall be required to pay all
h. Wage distortion disputes in unorganized
missed contributions with an interest, establishments not voluntarily settled by
compounded monthly, of at least 3% for
the parties. [Art. 124]
employers and not exceeding 1.5% for self- i. Enforcement of compromise agreements
earning, professional practitioners, and when there is non-compliance by any of the
migrant workers.
parties. [Art. 233]
j. Other cases as may be provided by law.
VIII. JURISDICTION AND
Requisites of LA’s jurisdiction over Money
REMEDIES Claims
1. Money claims arose from ER-EE relations;
A. LABOR ARBITER Note: If not, regular courts have jurisdiction
2. Money claims arose from law or contracts
other than a CBA.
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Note: If not, Voluntary Arbitrator has The Labor Arbiter shall use all reasonable
jurisdiction means to ascertain the facts in each speedily
and objectively. [Art. 227]
LABOR ARBITER v. REGIONAL DIRECTOR
[Art. 129] 2. Requirements to perfect appeal to
A money claim arising from employer- National Labor Relations
employee relations, except SSS, Commission
ECC/Medicare [Philhealth] claims, is within the
jurisdiction of a Labor Arbiter if:
Period of Appeal
a. The claim, regardless of amount, is
Labor Arbiter to NLRC: Decisions, awards, or
accompanied with a claim of reinstatement;
orders of the [LA] shall be final and executory
or
unless appealed to the [NLRC] by any or both
b. The claim exceeds P5,000, whether or not
parties within 10 calendar days from receipt
there is a claim for reinstatement.
[thereof]. [Art. 229]
The Regional Director has jurisdiction if:
Note: If the last day of the reglementary period
a. Money claim arose out of employer-
falls on a Sunday or a holiday, the last day shall
employee relationships;
be the next working day.
b. Money claim is NOT accompanied by a
claim for reinstatement; AND
Grounds of Appeal [Art. 229]
c. Money claim does not exceed P5,000,
a. If there is prima facie evidence of abuse of
whether or not claim arose from ER-EE
discretion on the part of the Labor Arbiter
relationships.
or Regional Director;
b. If the decision, resolution or order was
PROCEDURE BEFORE LABOR ARBITER
secured through fraud or coercion,
Where to File [Sec. 1, Rule IV, 2011 NLRC
including graft and corruption;
Rules of Procedure]
c. If made purely on questions of law; and/or
All cases which Labor Arbiters have authority
d. If serious errors in the findings of fact are
to hear and decide may be filed in the Regional raised which, if not corrected, would cause
Arbitration Branch (RAB) having jurisdiction
grave or irreparable injury to the appellant.
over the workplace of the complainant or
petitioner.
When Appeal is Perfected
a. Workplace – place or locality where the
Judgment involving a monetary award
employee is regularly assigned at the time
An appeal by the employer may be perfected
the cause of action arose. It shall include
only upon the posting of a cash or surety bond
the place where the employee is supposed
issued by a reputable bonding company duly
to report back after a temporary detail,
accredited by the Commission in the amount
assignment, or travel.
equivalent to the monetary award in the
b. In the case of field employees, ambulant or
judgment appealed from. [Art. 229]
itinerant workers, their workplace is (a)
where they are regularly assigned or (b)
It is clear from the NLRC Rules of Procedure
where they are supposed to regularly
that appeals must be verified and certified
receive their salaries and wages or work
against forum-shopping by the parties-in-
instructions from, and report the results of
interest themselves. [Antonio B. Salenga, et al.
their assignment to their employers.
v. CA, G.R. No. 174941 (2012)]
NATURE OF THE PROCEEDING
Note: Decisions of the Labor Arbiter are
Proceedings before the LA are non-litigious.
appealable to the NLRC. Decisions by the
The Labor Arbiter is not bound by the technical
NLRC are appealable to the CA via Rule 65.
rules of procedure.
[St. Martin’s Funeral Homes v. NLRC, 295
SCRA 494 (1998)]
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Memorandum of Appeal 1. Jurisdiction/Powers

In all cases, the appellant shall furnish a copy
of the memorandum of appeal to the other NLRC en banc
party who shall file an answer not later than ten a. To promulgate rules and regulations
(10) calendar days from receipt thereof. [Art. governing the hearing and disposition of
229] cases  
b. To formulate policies affecting its
3. Reinstatement and/or execution administration and operations  
pending appeal c. To allow cases within the jurisdiction of any
division to be heard and decided by
Reinstatement Pending Appeal and Effect another division  
of NLRC reversal of Labor Arbiter’s order of d. To recommend appointment of a Labor
reinstatement Arbiter  
In any event, the decision of the Labor Arbiter
reinstating a dismissed or separated NLRC in divisions (8 divisions with 3
employee, insofar as the reinstatement aspect commissioners each)
is concerned, shall immediately be a. Exclusive appellate jurisdiction from
executory, even pending appeal. decisions of LA  (within respective territorial
jurisdiction)  
The employee shall either be: b. Jurisdiction over petitions for injunction or
a. Admitted back to work under the same temporary restraining order under Art.
terms and conditions prevailing prior to his 225(e)
dismissal or separation; or c. Certified cases: “national interest” labor
b. Merely reinstated in the payroll, at the disputes  certified (or referred) to the
option of the employer. Commission by the SOLE  for compulsory
arbitration  under Art. 278 (g)
The posting of a bond by the employer shall not
stay the execution for reinstatement provided Exclusive Appellate Jurisdiction: over all
herein. [Art. 229] cases decided by Labor Arbiters [Art. 224(b)]
and the DOLE Regional Directors under Art.
Reversal of the order of reinstatement of 129.
the Labor Arbiter
During the period of appeal until reversal by the 2. Remedies
higher court, it is obligatory on the part of the
employer to: Appeal: Appeal from decisions of the NLRC
1. Reinstate, and after denial of Motion for Reconsideration
2. Pay the wages of the dismissed employee. appealed via Rule 65 to CA then Rule 45 to the
SC. [St. Martin’s Funeral Homes v. NLRC, 295
If the employee has been reinstated during the SCRA 494 (1998)]
appeal period and such reinstatement order is
reversed with finality, the employee is NOT Requisites for Perfection of Appeal to the
required to reimburse whatever salary he Court of Appeals [Rule VI, 2011 NLRC Rules
received. He is entitled to such especially if he of Procedure]
actually rendered services during the period. 1. The appeal shall be:
[Garcia v. Philippine Airlines, Inc., G.R. No. a. Filed within the reglementary period;
164856 (2009)] b. Verified by the appellant himself in
accordance with Sec. 4, Rule 7 of the
Rules of Court;
B. NATIONAL LABOR c. In the form of a memorandum of appeal
RELATIONS COMMISSION which shall state the grounds relied
upon and the arguments in support
thereof, the relief prayed for, and with a
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statement of the date the appellant Definition

received the appealed decision, Certified labor disputes are cases certified to
resolution or order; the Commission for compulsory arbitration
d. In three (3) legibly typewritten or under Art. 278(g) of the Labor Code. [Sec. 2,
printed copies; and The 2011 NLRC Rules and Procedures]
e. Accompanied by (a) proof of payment
of the required appeal fee; (b) posting Power of the Secretary of Labor to Certify
of a cash or surety bond as provided in Cases
Sec. 6 of the NLRC Rules; and (c) proof When, in his opinion, there exists a labor
of service upon the other parties. dispute causing or likely to cause a strike or
2. A mere notice of appeal without complying lockout in an industry indispensable to the
with the other requisites aforestated shall national interest, the Secretary of Labor and
not stop the running of the period for Employment may:
perfecting an appeal. 1. Assume jurisdiction over the dispute; and
3. The appellee may file with the Regional 2. Decide it or certify the same to the
Arbitration Branch or Regional Office Commission for compulsory arbitration.
where the appeal was filed, his answer or
reply to appellant’s memorandum of Such assumption or certification shall have the
appeal, not later than 10 calendar days effect of automatically enjoining the intended or
from receipt thereof. impending strike or lockout as specified in the
a. Failure on the part of the appellee who assumption or certification order. [Art. 278(g)]
was properly furnished with a copy of
the appeal to file his answer or reply Function of the NLRC
within the said period may be When sitting in a compulsory arbitration
construed as a waiver on his part to file certified to by the Secretary of Labor, the NLRC
the same. is tasked:
4. Subject to the provisions of Art. [225] of the a. To implement the order of the Secretary as
Labor Code, once the appeal is perfected an administrative body, not as a judicial
in accordance with these Rules, the court
Commission shall limit itself to reviewing b. To formulate the terms and conditions of
and deciding only the specific issues that the CBA, staying within the scope of the
were elevated on appeal. order
c. To act within the earliest time possible and
EXTRAORDINARY REMEDY with the end in view that its action would not
Verified Petition: A party aggrieved by any only serve the interests of the parties
order or resolution of the Labor Arbiter, alone, but would also have favorable
including a writ of execution and others issued implications to the community and to the
during execution proceedings, may file a economy as a whole. [Art. 278(g); Union of
verified petition to annul or modify the same. Filipino Employees v. NLRC, G.R. No.
91025 (1990)]
The petition may be accompanied by an
application for the issuance of a temporary Effects of Certification
restraining order and/or writ of preliminary or 1. Upon certification, the intended or
permanent injunction: impending strike or lockout is automatically
a. To enjoin the Labor Arbiter, or any person enjoined, notwithstanding:
acting under his/her authority a. The filing of any motion for
b. To desist from enforcing said resolution, reconsideration of the certification
order or writ. [Rule XII, Sec. 1, 2011 NLRC order;
Rules of Procedure, as amended by En b. The non-resolution of any such motion,
Banc Resolution No. 07-14] which may have been duly submitted to
the Office of the Secretary of Labor and
CERTIFIED CASES Employment.
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2. If a work stoppage has already taken place The Commission may also seek the assistance
at the time of the certification: of law enforcement agencies to ensure
a. All striking or locked out employees compliance and enforcement of its orders and
shall immediately return to work; and resolutions. [Sec. 4, Rule VIII, 2011 NLRC
b. The employer shall immediately Rules and Procedures]
resume operations and readmit all
workers under the same terms and Strict Compliance of Assumption and
conditions prevailing before the strike Certification Orders
or lockout. The Secretary's assumption and certification
3. All cases between the same parties, shall orders being executory in character are to be
be considered subsumed or absorbed by strictly complied with by the parties even during
the certified case, and shall be decided by the pendency of a petition questioning their
the appropriate Division of the validity.
Commission, EXCEPT where the
certification order specifies otherwise the The extraordinary authority given by law to the
issues submitted for arbitration which are: Secretary of Labor is "aimed at arriving at a
a. Already filed or may be filed, and peaceful and speedy solution to labor disputes,
b. Relevant to or are proper incidents of without jeopardizing national interests." [Union
the certified case. of Filipino Employees v. NLRC, G.R. No.
4. The parties to a certified case, under pain 91025 (1990)]
of contempt, shall inform their counsels
and the Division concerned of all cases Procedure in certified cases
pending with the Regional Arbitration a. When there is no need to conduct a
Branches and the Voluntary Arbitrators clarificatory hearing, the Commission
relative or incident to the certified case shall resolve all certified cases within 30
before it. calendar days from receipt by the assigned
5. When a certified labor dispute involves a Commissioner of the complete records,
business entity with several workplaces which shall include the position papers of
located in different regions, the Division the parties and the order of the SOLE
having territorial jurisdiction over the denying the motion for reconsideration of
principal office of the company shall the certification order, if any.
acquire jurisdiction to decide such labor b. Where a clarificatory hearing is needed,
dispute; unless the certification order the Commission shall, within 5 calendar
provides otherwise. [Sec. 3, Rule VIII, 2011 days from receipt of the records, issue a
NLRC Rules and Procedures] notice to be served on the parties through
the fastest means available, requiring them
Effects of Defiance to appear and submit additional evidence,
Non-compliance with the certification order of if any. All certified cases shall be resolved
the SOLE shall: by the Commission within 60 calendar days
1. Be considered as an illegal act committed from receipt of the complete records by the
in the course of the strike or lockout; and assigned Commissioner.
2. Authorize the Commission to enforce the
same under pain of immediate disciplinary No motion for extension or postponement shall
action, including: be entertained. [Sec. 5, Rule VIII, 2011 NLRC
a. Dismissal or loss of employment Rules and Procedures]
status; or
b. Payment by the locking-out employer Execution of Judgment
of backwages, damages; and/or Upon issuance of the entry of judgment, the
c. Other affirmative relief, even criminal Commission motu proprio or upon motion by
prosecution against the liable parties. the proper party, may cause the execution of
the judgment in the certified case. [Sec. 6,
Rule VIII, 2011 NLRC Rules and Procedures]
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The petition shall be accompanied by:

1. A certified true copy of the judgment, order
C. COURT OF APPEALS or resolution subject thereof;
2. Copies of all pleadings and documents
relevant and pertinent thereto; and
3. A sworn certification of non-forum
Appeal via Rule 65, Rules of Court
shopping as provided in the third
Petition for certiorari
paragraph of Sec. 3, Rule 46.
A person may file a verified petition in the
proper court, alleging the facts with certainty
Petition for prohibition
and praying that judgment be rendered
annulling or modifying the proceedings of
any tribunal, board or officer exercising judicial
or quasi-judicial functions, and granting such
commanding the any tribunal, corporation,
incidental reliefs as law and justice may
board, officer or person, whether exercising
require:
judicial, quasi-judicial or ministerial functions to
1. When such tribunal, board or officer has
desist from further proceedings in the action
acted:
or matter specified therein, or otherwise
a. Without or in excess its or his
granting such incidental reliefs as law and
jurisdiction, or
justice may require:
b. With grave abuse of discretion
1. When the proceedings of such tribunal,
amounting to lack or excess of
corporation, board, officer or person are:
jurisdiction; AND
a. Without or in excess of its or his
2. When there is no appeal, or any plain,
jurisdiction; or
speedy, and adequate remedy in the
b. With grave abuse of discretion
ordinary course of law.
amounting to lack or excess of
jurisdiction, AND
2. When there is no appeal or any other plain,
speedy, and adequate remedy in the
ordinary course of law.
The petition shall be accompanied by:

1. A certified true copy of the judgment, order
or resolution subject thereof;
2. Copies of all pleadings and documents
relevant and pertinent thereto; and
3. A sworn certification of non-forum
shopping as provided in the third
paragraph of Sec. 3, Rule 46.
Petition for mandamus

commanding any tribunal, corporation, board,
officer or person, immediately or at some other
time to be specified by the court, to do the act
required to be done to protect the rights of the
petitioner, and to pay the damages sustained
by the petitioner by reason of the wrongful acts
of the respondent:
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1. When any tribunal, corporation, board, cannot avail himself of the writ of certiorari, his
officer or person: predicament being the effect of his deliberate
a. Unlawfully neglects the performance of inaction. [Tirazona v Phil EDS Techno-Service
an act which the law specifically Inc, G.R. No. 169712 (2009)]
enjoins as a duty resulting from an
office, trust, or station; or Note: Review of decisions of the NLRC shall be
b. Unlawfully excludes another from the done through (in order):
use and enjoyment of a right or office 1. Motion for reconsideration
to which such other is entitled; AND 2. Rule 65 to the CA
2. When there is no other plain, speedy and 3. Rule 45 to the SC
adequate remedy in the ordinary course of
law.
E. BUREAU OF LABOR
RELATIONS
D. SUPREME COURT
1. Jurisdiction
All references in the amended Sec. 9 of B.P. The Bureau of Labor Relations and the Labor
No. 129 to supposed appeals from the NLRC Relations Divisions in the regional offices of the
to the Supreme Court are interpreted and Department of Labor and Employment shall
hereby declared to mean and refer to petitions have original and exclusive authority:
for certiorari under Rule 65. a. To act –
1. At their own initiative, or
Consequently, all such petitions should hence 2. Upon request of either or both parties,
forth be initially filed in the Court of Appeals, in b. On all inter-union and intra-union conflicts,
strict observance of the doctrine on the and
hierarchy of courts, as the appropriate forum c. All disputes, grievances or problems
for the relief desired. [St. Martin Funeral Home arising from or affecting labor-management
v. NLRC, G.R. No. 130866 (1998)] relations in all workplaces –
1. Whether agricultural or non-agricultural
Rule 45, Rules of Court 2. Except those arising from the
Filing of petition with Supreme Court implementation or interpretation of
A party desiring to appeal by certiorari from a collective bargaining agreements
judgment or final order or resolution of the which shall be the subject of grievance
Court of Appeals, the Sandiganbayan, the procedure and/or voluntary arbitration.
Regional Trial Court or other courts whenever [Art. 232]
authorized by law, may file with the Supreme
Court a verified petition for review on certiorari. The Bureau shall have fifteen (15) calendar
The petition shall raise only questions of law days to act on labor cases before it, subject to
which must be distinctly set forth. [Sec. 1] extension by agreement of the parties.
Original Jurisdiction
Since the Court of Appeals had jurisdiction a. Inter-union and intra-union disputes and
over the petition under Rule 65, any alleged other related labor relations disputes.
errors committed by it in the exercise of its b. All disputes, grievances or problems
jurisdiction would be errors of judgment which arising from or affecting labor-management
are reviewable by timely appeal, and not by a relations in all workplaces whether
special civil action of certiorari. agricultural or non-agricultural, except
those arising from the implementation or
If the aggrieved party fails to do so within the interpretation of collective bargaining
reglementary period, and the decision agreements which shall be the subject of
accordingly becomes final and executory, he
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grievance procedure and/or voluntary 7. Disagreements over chartering or

arbitration. [Art. 232] registration of labor organizations and
collective bargaining agreements [Sec.
Note: If the complaint involves an independent 1(k)]
union, chartered local or worker’s association, 8. Violations of –
file with the DOLE Regional Office but if the a. The rights and conditions of union or
complaint involves a federation or an workers' association membership [Sec.
industry/national union, file with the BLR. 1(l)]
b. The rights of legitimate labor
Inter-Union Dispute: one which occurred organizations, except interpretation of
between or among legitimate labor unions collective bargaining agreements [Sec.
involving representation questions for 1(m)]; and
purposes of collective bargaining or to any 9. Such other disputes or conflicts involving
other conflict or dispute between legitimate the rights to self-organization, union
labor unions [IRR Book V, IRR Rule 1, Sec. 1 membership and collective bargaining
(x)] a. Between and among legitimate labor
organizations; or
Intra-Union Dispute: conflict within and inside b. Between and among members of a
a union between and among union members union or workers' association [Sec.
including grievances from any violation of 1(n)]
rights and conditions of membership or
provisions from the union’s constitution and by- Appellate Jurisdiction
laws and chartering of unions [D.O. No. 40-03, The BLR Director exercises exclusive
Rule I, Sec. 1 (bb)] appellate jurisdiction over:
1. All decisions of the Med-Arbiter in:
Inter/Intra – Union Disputes shall include: a. Inter/Intra-union disputes (Note:
[DO No. 040-I-15, Book V, Rule XI] Complaints involving Federations,
1. Cancellation of registration of a labor National Unions, etc. pursuant to Rule
organization filed by its members or by XI Sec. 4, formerly Sec. 5, as amended
another labor organization [Sec. 1a] by D.O. 40-F-03).
2. Conduct of election of union and workers' b. Other related labor relations disputes.
association officers/nullification of election 2. All decisions from the DOLE Regional
of union and workers' association officers Director in the cases falling under their
[Sec. 1(b)] original jurisdiction as enumerated. [Sec.
3. Audit/accounts examination of union or 14, Rule XI, Book V, IRR]
workers' association funds [Sec. 1(c)]
4. Deregistration of collective bargaining Decisions of the BLR through its appellate
agreements [Sec. 1(d)] jurisdiction are final and executory 10 days
5. Validity/invalidity after receipts by the parties. [Sec. 20, Rule XI,
a. Of union affiliation or disaffiliation [Sec. Book V, IRR].
1(e)]
b. Of acceptance/non-acceptance for
union membership [Sec. 1(f)]
c. Of impeachment/expulsion of union
and workers' association officers and
members [Sec. 1(g)]
d. Of the SEBA certification [Sec. 1(h)]
e. Or disagreements over any provision in
a union or workers' association
constitution and by-laws [Sec. 1(j)]
6. Opposition to application for union and
CBA registration [Sec. 1(i)]
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2. Appeals
Nature of proceedings
Decisions of the BLR through its original Conciliation and mediation is non-litigious/non-
jurisdiction are appealable to the Secretary of adversarial, less expensive, and expeditious.
Labor and Employment. [Sec. 15, Rule XI, Under this informal set-up, the parties find it
Book V, IRR]. more expedient to fully ventilate their
respective positions without running around
Decisions of the BLR in its appellate jurisdiction with legal technicalities and, in the course
are final and executory, unless appealed to the thereof, afford them wider latitude of possible
CA via Rule 65 and later to the SC via Rule 45. approaches to the problem.
[Abbot Laboratories Philippines, Inc. v. Abbot
Laboratories Employees Union, 323 SCRA 392 SENA
(2000)] The Single-Entry Approach (SENA) is a
prescribed 30-day Mandatory Conciliation-
3. Administrative Functions of the Mediation Services to be made operational
through the Single Entry Approach Desk
BLR
(SEAD) for all labor and employment cases
except:
a. Regulation of registration of the labor
1. cases on notices of strikes or lock-outs, or
unions;
on preventive mediation cases (NCMB)
b. Keeping a registry of legitimate labor
2. interpretation and implementation of CBA
unions;
(Grievance Machinery) [D.O. No. 107-10]
c. Maintenance of a file of CBAs;
d. Maintenance of a file of all settlements or
final decisions in the SC, CA, NLRC and 1. Jurisdiction
other agencies on labor disputes.
The NCMB is an agency attached to the DOLE
principally in charge of the settlement of labor
F. NATIONAL CONCILIATION disputes through conciliation, mediation and of
AND MEDIATION BOARD the promotion of voluntary approaches to labor
dispute prevention and settlement. [NCMB
All issues arising from labor and employment Manual of Procedures for Conciliation and
shall be subject to mandatory conciliation- Preventive Mediation Cases, Rule III, sec. 1]
mediation.
The following procedures shall be observed in
Exception: As provided in Title VII-A, Book V collective bargaining:
of this Code, as amended, or as may be 1. When a party desires to negotiate an
excepted by the Secretary of Labor and agreement, it shall serve a written notice
Employment. upon the other party with a statement of its
proposals [Art. 261(a)].
The Labor Arbiter or the appropriate DOLE a. The other party shall make a reply
agency or office that has jurisdiction over the
thereto not later than ten (10) calendar
dispute shall entertain only endorsed or
days from receipt of such notice [Art.
referred cases by the duly authorized officer.
261(a)];
Any or both parties involved in the dispute may b. Should differences arise on the basis of
pre-terminate the conciliation-mediation such notice and reply, either party may
proceedings and request referral or request for a conference which shall
endorsement to the appropriate DOLE agency begin not later than ten (10) calendar
or office which has jurisdiction over the dispute, days from the date of request [Art.
or if both parties so agree, refer the unresolved 261(b)].
issues to voluntary arbitration. [Art. 228]
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2. If the dispute is not settled, the Board shall b. If unorganized establishments without
intervene upon request of either or both CBA:
parties or at its own initiative and i. Submit issue before the NCMB for
immediately call the parties to conciliation conciliation after endeavors to
meetings [Art. 261(c)]. correct have failed
a. The Board shall have the power to ii. If not fruitful within 10 days, refer to
issue subpoenas requiring the the NLRC for arbitration to be
attendance of the parties to such decided within 20 days from
meetings. submission [Rule VII, Rules of
i. It shall be the duty of the parties to Procedure of Minimum Wage
participate fully and promptly in the Fixing]
conciliation meetings the Board
may call [Art. 261(c)]; 2. Conciliation as distinguished from
b. During the conciliation proceedings in mediation
the Board, the parties are prohibited
from doing any act which may disrupt Conciliation Mediation
or impede the early settlement of the Both refer to a process where a third
disputes [Art. 261(d)]; and person called a Conciliator/Mediator
c. The Board shall exert all efforts to intervenes in a dispute to reconcile
settle disputes amicably and differences or persuade them to adjust or
encourage the parties to submit their settle their dispute
case to a voluntary arbitrator [Art. C-M facilitates C-M assists parties
261(e)]. disputants to keep to voluntarily reach
things calm, delivers mutually
messages back and acceptable
In Collective Bargaining:
forth between the settlement.
1. If the dispute is not settled, the NCMB will
parties.
intervene upon request of either party or at
[Conciliation-Mediation, DOLE – NCMB
its own initiative to call for conciliation with Website, available at:
the power to issue subpoenas requiring http://ncrwp.ncmb.ph/?page_id=99]
attendance:
a. During conciliation proceedings, Conciliator-Mediator [C-M] — Official of the
parties are prohibited from doing any NCMB whose principal function is to settle and
act which may disrupt or impede the dispose potential and actual labor disputes
early settlement of the dispute; through conciliation and preventive mediation
b. NCMB will exert all efforts to settle including the promotion and encouragement of
disputes amicable and encourage voluntary approaches to labor disputes
submission to a voluntary Arbitrator. prevention and settlement. [Sec. 1, Rule III,
[Art. 261(c)(d)] NCMB Manual of Procedure for Conciliation
and Preventive Mediation Cases]
2. Procedure for Correction of Wage
Distortion:
Pre-Termination of Conciliation-Mediation:
a. In organized establishments with CBA Any or both parties in the dispute may pre-
i. Submit issue to grievance terminate the proceedings and request referral
machinery or endorsement to the appropriate DOLE
ii. If unresolved, refer to voluntary agency or office with jurisdiction or to the
arbitration who will decide within 10 voluntary arbiter if both parties agreed.
days unless otherwise agreed Privileged Communication not Available as
upon by parties in writing Evidence: Any statement made in conciliation
proceedings shall be treated as privileged
communication, and shall not be used as
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evidence in the NLRC. Conciliators may not

testify in any court or body regarding any G. DEPARTMENT OF LABOR AND
matter during the conciliation proceedings. EMPLOYMENT REGIONAL DIRECTORS
[D.O. No. 40-03, Rule XXII, Sec. 2]
3. Preventive mediation 1. Jurisdiction
The DOLE Regional Directors shall have

Note: Refer also to Sec. 3 (Action on Non-
original and exclusive jurisdiction over:
Strikeable Issues) & Sec. 4 (Notice Converted
a. Labor standards enforcement cases under
to Preventive Mediation) of Rule V of the
Art. 128;
NCMB Manual of Procedure for Conciliation
Note: as the duly authorized representative
and Preventive Mediation Cases involving non-
of the SOLE
strikeable issues.
b. Small money claims from labor standards
violations not exceeding P5,000 and not
Definition [Sec. 1(20), Rule III, NCMB Manual
accompanied with a claim for
of Procedure for Conciliation and Preventive
reinstatement under Art. 129;
Mediation Cases]
c. Operational safety and health conditions
(can order stoppage or suspension of
Preventive Mediation Cases - refer to the
operations) [Art. 128; Bk. IV, Rule II, Sec.
potential labor disputes which are the subject
8];
of a formal or informal request for conciliation
d. Registration of unions and cancellations
and mediation assistance –
thereof, cases filed against unions and
a. Sought by either or both parties, or
other labor relations related cases [Sec. 4,
b. Upon the initiative of the NCMB to avoid the
Rule XI (renumbered, D.O. 40-F-03];
occurrence of actual labor disputes.
Note: only if against an independent labor
union, chartered local or workers’
Purpose of Preventive Mediation — to
association;
remedy, contain or prevent potential labor
e. Complaints against private recruitment and
disputes’ degeneration into a full-blown
placement agencies (PRPAs) for local
dispute through amicable settlement. It can be
employment [Secs. 45/46, D.O. 141-14];
initiated by:
and
a. Filing a notice or request of preventive
f. Cases submitted to voluntary arbitration in
mediation; or
their capacity as Ex Officio Voluntary
b. Conversion of the notice of strike/lockout
Arbiters under D.O 83-07 (2007).
into at preventive mediation case.
Note: The DOLE Regional Director, as the duly
Note: If the subject of the strike is non-
authorized representative of the SOLE, also
strikeable, the NCMB can motu proprio convert
has visitorial and enforcement power under:
the notice into preventive mediation or refer the
1. Art. 37, Art. 128 (have access to
issues to voluntary arbitration
employer’s records and premises with right
to copy or investigate to determine
violations of law); and
2. Art. 289 (where it can inquire into the
financial activities of any legitimate labor
organization and examine their books and
records to determine compliance with the
law if requested by at least 20% of total
membership).
Appeal: Appeal of decisions from visitorial and

enforcement power to the SOLE within 10
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calendar days from receipt thereof [Rule IV, be used exclusively for the amelioration and
sec. 1, Rules on Disposition of Labor Standard benefit of workers –
Cases in the Regional Offices] When any such sum not paid to the
employee or househelper because he
2. Recovery and adjudicatory power cannot be located after diligent and
reasonable effort to locate him within a
Art. 129. Recovery of Wages, Simple Money period of three (3) years [Art. 129, par. 4]
Claims and Other Benefits.
Who: The Regional Director of the Department Appeal of decision or resolution [Art. 129,
of Labor and Employment or any of the duly par. 5]:
authorized hearing officers of the Department Any decision or resolution of the Regional
[par. 1] Director or hearing officer pursuant to this
provision may be appealed on the same
What: They are empowered to hear and grounds provided in Article 223 of this Code.
decide any matter involving the recovery of
wages and other monetary claims and benefits Period: Within five (5) calendar days from
including legal interest, owing to an receipt of a copy of said decision or resolution
employee or person employed in domestic
or household service or househelper under To whom: To the National Labor Relations
this Code, arising from employer-employee Commission which shall resolve the appeal
relations within ten (10) calendar days from the
submission of the last pleading required or
How: Through summary proceeding and after allowed under its rules.
due notice
The Secretary of Labor and Employment or his
When: Upon complaint of any interested party duly authorized representative may supervise
the payment of unpaid wages and other
Conditions: monetary claims and benefits, including legal
a. Provided that such complaint does not interest, found owing to any employee or
include a claim for reinstatement; househelper under this Code [Art. 129, par. 6].
b. Provided, further, That the aggregate
money claims of each employee or Small money claims
househelper do not exceed five thousand Note: See also discussion in VI.F. on Money
pesos (P5,000). Claims arising from Employer-Employee
Relationship
Period to decide: The Regional Director or
hearing officer shall decide or resolve the Period of Appeal to NLRC: Decisions of the
complaint within thirty (30) calendar days from Regional director on recovery of wages, simple
the date of the filing of the same [Art. 129, par. money claims and other benefits, shall be final
2]. and executory unless appealed within 5 days
from receipt thereof. [Art. 129]
Effects of decision to the recovered sum on
behalf of any employee or househelper Definition: Recovery/adjudicatory power is the
General rule: Shall be held in a special deposit power of the Regional Director or any duly
account by, and shall be paid, on order of the authorized hearing officer of DOLE to
Secretary of Labor and Employment or the adjudicate on recovery of wages of
Regional Director directly to the employee or employees/househelpers employed in a
househelper concerned [Art. 129, par. 3]. domestic household for claims not exceeding
P5,000 and without seeking reinstatement.
Exception: Shall be held as a special fund of [Art. 129].
the Department of Labor and Employment to
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If any of the requisites are missing, the Labor Industries Indispensable to the National
Arbiter shall have jurisdiction over claims Interest
arising from ER-EE relations except claims for a. Hospital sector
employees’ compensation, SSS, PhilHealth b. Electric power industry
and maternity benefits. [Art. 224] c. Water supply service, to exclude small
water supply services such as bottling and
Money claims should be filed within 3 years refilling stations
from the time the cause of action accrued. [Art. d. Air traffic control
306] e. Other industries as may be recommended
by the National Tripartite Industrial Peace
Council (TIPC) [Sec. 16, Rule XXII, Book
H. DEPARTMENT OF LABOR AND V, IRR as amended by D.O. No. 40-H-13]
EMPLOYMENT SECRETARY
Who determines industries indispensable
POWERS to the national interest [Art. 278(g)]
1. Visitorial (access to employer’s records a. Secretary of Labor and Employment
and premises and to copy therefrom) and b. President
enforcement powers (to question any
employee and investigate any fact which Power of the Secretary of Labor to Assume
may be necessary to determine violations) Jurisdiction (alternative)
2. Power to suspend effects of termination a. Decide the labor dispute himself/herself.
3. Assumption of jurisdiction b. Certify the labor dispute to the NLRC for
4. Appellate jurisdiction compulsory arbitration.
5. Voluntary arbitration powers
Scope: The authority of the Secretary to
assume jurisdiction over a labor dispute
1. Jurisdiction
includes and extends to all questions and
controversies arising from such labor dispute.
a. Assumption of jurisdiction
The power is plenary and discretionary in
nature to enable him to effectively and
When May the SOLE Assume Jurisdiction
efficiently dispose of the dispute. [Philcom
Art. 278 (g). Strikes, Picketing and
Employees Union v. Philippine Global
Lockouts. – The SOLE may: Communications, 495 SCRA 214 (2006)]
a. Assume jurisdiction over the dispute and
decide it; or Powers of the President (Not precluded by
b. Certify the same to the Commission for
the powers of the Secretary of Labor)
compulsory arbitration,
a. Determine the industries indispensable to
when in his opinion there exists a labor dispute
the national interest
causing, or likely to cause, a strike or lockout in
b. Assume jurisdiction over any such labor
an industry indispensable to the national
dispute to settle or terminate such dispute
interest.
Effects of Assumption of Jurisdiction:
Requisites for Assumption of Jurisdiction Automatically enjoins intended or impending
1. Both parties have requested the SOLE to strike or lockout. If one has already taken place
assume jurisdiction; or at the time of assumption or certification, all
2. After a conference called by the Office of
striking or locked out employees shall
the SOLE on the propriety of its issuance,
immediately return-to-work and the employer
motu proprio or upon a request or petition
shall immediately resume operations and
by either party to the labor dispute. [Book
readmit all workers under the same terms and
V, IRR Rule XXII, sec. 15, IRR as amended
conditions prevailing before the strike or
by D.O. No. 40-H-13 s 2013]
lockout. [Art. 278 (g)]
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The SOLE may also determine the retroactivity That is the real reason such return can be
of arbitral awards pursuant to power to assume compelled. So imperative is the order in fact
jurisdiction as part of his/her plenary powers to that it is not even considered violative of the
determine the effectivity thereof in absence of right against involuntary servitude. [Kaisahan
specific provision of law. [LMG Chemicals ng Mga Manggagawa sa Kahoy v. Gotamco
Corp. v. Sec. of Labor and Employment, 356 Sawmills, G.R. No. L-1573 (1948)]
SCRA 577 (2001)]
Note: It must be strictly complied with even
i. Automatic Injunction of during the pendency of any petition questioning
Intended Of Impending Strike its validity. [Manila Hotel Employees
or Lockout Association and its Members v. Manila Hotel
Corp., 517 SCRA 349 (2007)]; the purpose of
Art. 278 (g). Strikes, Picketing and SOLE’s extraordinary power is aimed at
Lockouts. – [S]uch assumption or arriving at a peaceful and speedy solution to
certification shall have the effect of labor disputes without jeopardizing national
automatically enjoining the intended or interest. [Union of Filipro Employees-Drug v.
impending strike or lockout as specified in Nestle, 499 SCRA 521 (2006)]
the assumption or certification order. […]
The SOLE also has plenary powers to
determine the retroactivity of its arbitral
ii. Return-to-work and
awards. [LMG Chemicals Corp. v. Sec. of
readmission if strike or
Labor and Employment, 356 SCRA 577
lockout has already taken
(2001)]
place
Immediately Executory
Art. 278 (g). Strikes, Picketing and The assumption and certification orders are
Lockouts. – [I]f one has already taken place executory in character and must be strictly
at the time of assumption or certification, all complied with by the parties. [Allied Banking v.
striking or locked out employees shall NLRC, G.R. No. 116128 (1996)]
immediately return-to-work and the
employer shall immediately resume Strikes and lockouts in hospitals, clinics
operations and readmit all workers under the and similar medical institutions
same terms and conditions prevailing before It shall be the duty of the striking union or
the strike or lockout. […] locking-out employer to provide and maintain
an effective skeletal workforce of medical and
Nature of return-to-work order other health personnel, whose movement and
[T]he return-to-work order not so much confers services shall be unhampered and
a right as it imposes a duty; and while, as a unrestricted, as are necessary to insure the
right, it may be waived, it must be discharged proper and adequate protection of the life and
as a duty even against the worker's and/or health of its patients, most especially
employers’ will. emergency cases, for the duration of the strike
or lockout.
Returning to work in this situation is not a
matter of option or voluntariness but of In such cases, therefore, the Secretary of
obligation. Labor and Employment may immediately
assume, within twenty-four (24) hours from
The worker must return to his job together with knowledge of the occurrence of such a strike or
his co-workers so the operations of the lockout, jurisdiction over the same or certify it
company can be resumed and it can continue to the Commission for compulsory arbitration.
serving the public and promoting its interest. [Art. 278, par. 2]
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Rationale: The highest respect is accorded to Stricter penalties for non-compliance with
the right of patients to life and health. orders, prohibitions, and/or injunctions
issued by the Secretary of Labor in strikes
Effect of defiance of assumption or involving hospitals, clinics, and similar
certification orders medical institutions
Par. 2, Art. 279 (a). Prohibited Activities. – 1. Immediate disciplinary action against both
No strike or lockout shall be declared: union and employer
a. after assumption of jurisdiction by the 2. Dismissal/loss of employment for members
President or the Minister; of the striking union
b. after certification or submission of the 3. Payment by employer of backwages,
dispute to compulsory or voluntary damages, and other affirmative relief
arbitration; or 4. Criminal prosecution against either or both
c. during the pendency of cases involving the the union and employer
same grounds for the strike or lockout.
INJUNCTIONS
Strike/lockout becomes illegal
A strike undertaken despite the issuance by the Art. 266. Injunction Prohibited. – No
Secretary of Labor of an assumption or temporary or permanent injunction or
certification order becomes a prohibited activity restraining order in any case involving or
and thus, illegal, pursuant to Art. 279(a) of the growing out of labor disputes shall be issued
Labor Code. [Allied Banking v. NLRC, G.R. No. by any court or other entity, except as
116128 (1996)] otherwise provided in Arts. [225] and [279]
of this Code.
See notes on Liabilities of employer, union
officers, and ordinary workers under illegal
General Rule: Injunctions are prohibited.
strike.
Exceptions: Those provided under Art. 225
SUMMARY OF LIABILITIES OF
(referring to the Powers of the NLRC) in
PARTICIPANTS IN AN ILLEGAL STRIKE/ connection with Art. 279 (on Prohibited
LOCKOUT [Art. 279] Activities) under the Labor Code.
1. Employer in an illegal lockout – workers
terminated due to illegal lockout shall be Findings of fact by the NLRC for an
entitled to reinstatement plus full Injunction to issue
backwages.
Art. 225(e) Powers of the Commission
2. Union officers who knowingly
a. To enjoin or restrain any actual or
participated in illegal strike – deemed to threatened commission of any or all
have lost their employment prohibited or unlawful acts; or
3. Union officers who knowingly b. To require the performance of a particular
participated in illegal acts during a act in any labor dispute which, if not
LAWFUL strike – deemed to have lost restrained or performed forthwith, may
their employment. cause grave or irreparable damage to any
4. Ordinary workers – deemed to have lost party or render ineffectual any decision in
their employment only if they knowingly favor of such party
participated in illegal acts.
Provided, That no temporary or permanent
injunction in any case involving or growing out
of a labor dispute as defined in this Code shall
be issued except:
1. After hearing the testimony of witnesses
2. With opportunity for cross-examination, in
support of the allegations of a complaint
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made under oath, and testimony in cases involving the same grounds for
opposition thereto, if offered, and the strike or lockout.
3. Only after a finding of fact by the
Commission, to the effect: Any worker whose employment has been
a. That prohibited or unlawful acts have terminated as a consequence of any
been threatened and will be committed unlawful lockout shall be entitled to
unless restrained, or have been reinstatement with full backwages.
committed and will be continued unless
restrained Any union officer who knowingly
i. But no injunction or temporary participates in an illegal strike, and any
restraining order shall be issued on worker or union officer who knowingly
account of any threat, prohibited or participates in the commission of illegal
unlawful act acts during a strike may be declared to
ii. Except against the person or have lost his employment status:
persons, association or Provided, That mere participation of a
organization making the threat or worker in a lawful strike shall not constitute
committing the prohibited or sufficient ground for termination of his
unlawful act or actually authorizing employment, even if a replacement had
or ratifying the same after actual been hired by the employer during such
knowledge thereof; lawful strike.
b. That substantial and irreparable injury
to complainant's property will follow; 2. No person shall:
c. That as to each item of relief to be a. Obstruct, impede, or interfere with, by
granted, greater injury will be inflicted force, violence, coercion, threats or
upon complainant by the denial of relief intimidation, any peaceful picketing by
than will be inflicted upon defendants employees during any labor
by the granting of relief; controversy or in the exercise of the
d. That complainant has no adequate right to self-organization or collective
remedy at law; and bargaining; or
e. That the public officers charged with b. Aid or abet such obstruction or
the duty to protect complainant's interference.
property are unable or unwilling to
furnish adequate protection. 3. No employer shall use or employ any
strike-breaker, nor shall any person be
Prohibited Activities [Art. 279] employed as a strike-breaker.
1. No labor organization or employer shall
declare a strike or lockout: 4. No public official or employee, including
a. Without first having bargained officers and personnel of the New Armed
collectively in accordance with Title VII Forces of the Philippines or the Integrated
of this Book or without first having filed National Police, or armed person, shall:
the notice required in the preceding a. Bring in, introduce or escort in any
Art.; or manner, any individual who seeks to
b. Without the necessary strike or lockout replace strikers in entering or leaving
vote first having been obtained and the premises of a strike area, or work in
reported to the Ministry [DOLE]. place of the strikers.
No strike or lockout shall be declared: 5. The police force shall keep out of the picket
a. After assumption of jurisdiction by the lines unless actual violence or other
President or the Minister; or criminal acts occur therein:
b. After certification or submission of the a. Provided, That nothing herein shall
dispute to compulsory or voluntary be interpreted to prevent any public
arbitration or during the pendency of officer from taking any measure
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necessary to maintain peace and TRO

order, protect life and property, Art. 225, last 2 pars. – A temporary restraining
and/or enforce the law and legal order may be issued.
order.
Why issued: If a complainant shall also allege
6. No person engaged in picketing shall that a substantial and irreparable injury to
commit any act of violence, coercion or complainant's property will be unavoidable
intimidation or obstruct the free ingress to unless a temporary restraining order shall be
or egress from the employer’s premises for issued without notice/
lawful purposes, or obstruct public
thoroughfares. When issued: Upon testimony under oath,
sufficient, if sustained, to justify the
INNOCENT BYSTANDER RULE Commission in issuing a temporary injunction
Test to Determine if a Party is an “Innocent upon hearing after notice.
Bystander”
An "innocent bystander," who seeks to enjoin a Conditions before issuing the TRO:
labor strike, must satisfy the court that aside The complainant shall first file an undertaking
from the grounds specified in Rule 58 of the with adequate security in an amount to be fixed
Rules of Court, it is entirely different from, by the Commission –
without any connection whatsoever to, a. Sufficient to recompense those enjoined
either party to the dispute and, its interests for any loss, expense or damage caused
are totally foreign to the context thereof. by the improvident or erroneous issuance
[MSF Tire and Rubber Inc. v. CA, G.R. No. of such order or injunction;
128632 (1999)] b. Including all reasonable costs, together
with a reasonable attorney's fee, and
Injunction Available to Innocent expense of defense against the order or
Bystanders against the granting of any injunctive relief
An innocent by-stander is entitled to injunction sought in the same proceeding and
if it is affected by the activities of a picketing subsequently denied by the Commission.
union.
Effectivity of TRO:
Rationale Period: It shall be effective for no longer than
The right [to picket] may be regulated at the twenty (20) days and shall become void at the
instance of […] `innocent bystanders' if it expiration of said twenty (20) days.
appears that the inevitable result of its exercise
is: Effect: It shall be understood to constitute an
a. To create an impression that a labor agreement entered into by the complainant and
dispute with which they have no connection the surety –
or interest exists between them and the a. Upon which an order may be rendered in
picketing union; or the same suit or proceeding against said
b. Constitute an invasion of their rights. complainant and surety upon a hearing to
[Liwayway Publishing v. Permanent assess damages, of which hearing,
Concrete Worker's Union, G.R. No. L- complainant and surety shall have
25003 (1981)] reasonable notice, the said complainant
and surety submitting themselves to the
jurisdiction of the Commission for that
purpose.
b. But nothing herein contained shall deprive
any party having a claim or cause of action
under or upon such undertaking from
electing to pursue his ordinary remedy by
suit at law or in equity:
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1. Provided, further, That the reception of

DOLE Circular No. 1 Series of 2006. –
evidence for the application of a writ of
…this administrative procedure for the
injunction may be delegated by the
voluntary settlement of labor disputes is
Commission to any of its Labor Arbiters
hereby established:
who shall conduct such hearings in
such places as he may determine to be
1. Either or both the employer and the
accessible to the parties and their
certified collective bargaining agent (or
witnesses and shall submit thereafter
representative of the employees where
his recommendation to the
there is no certified bargaining agent)
Commission.
may voluntarily bring to the Office of the
SOLE through a REQUEST FOR
b. Appellate Jurisdiction
INTERVENTION, any potential or
ongoing dispute defined below.
1. Orders issued by the duly authorized
representative of the SOLE under Art. 128
A potential or ongoing dispute refers to:
may be appealed to the latter.
a. live and active dispute;
2. Denial of application for union registration
b. that may lead to a strike or lockout or
or cancellation of union registration
to massive labor unrest;
originally rendered by the BLR may be
c. is not the subject of any complaint or
appealed to the SOLE (if originally
notice of strike or lockout at the time
rendered by the Regional Office, appeal
a REQUEST FOR INTERVENTION
should be made to the BLR)
is made.
3. POEA — The Office of the SOLE shall
have exclusive jurisdiction to act on
This recourse is separate from the
appeals from the Orders of the
established dispute resolution modes of
Administration. [Sec. 185, Rule VII,
mediation, conciliation and arbitration
Revised POEA Rules and Regulations
under the Labor Code, and is an
Governing The Recruitment And
alternative to other voluntary modes of
Employment Of Landbased Overseas
dispute resolution such as the voluntary
Filipino Workers Of 2016]
submission of a dispute to the Regional
4. Decisions of the Med-Arbiter in certification
Director for mediation, to the NCMB for
election cases are appealable to the SOLE.
preventive mediation, or to the
[Art. 272] (decisions of med-arbiters in
intervention of a regional or local
intra-union disputes are appealable to the
tripartite peace council for the same
BLR [Sec. 15, Rule XI, Book V, IRR])
purpose.
c. Voluntary Arbitration Powers 2. All REQUESTS shall be in writing and
filed with the Office of the Secretary. A
Art. 278 (h). Strikes, Picketing and REQUEST shall state:
Lockouts. – The parties may opt to submit a. the name and address of the
their dispute to voluntary arbitration. employer;
b. the name of the certified bargaining
When: Before or at any stage of the agent, or the employee
compulsory arbitration process. representative duly designated in
writing by a majority of the
Sec. 15, Rule XXII, Book V. Assumption by employees where there is no
the Secretary of Labor and Employment. – collective bargaining agent;
… parties to the case may agree at any time to c. the number of employees affected by
submit the dispute to the SOLE or his/her duly the potential or ongoing dispute; and
authorized representative as Voluntary d. a brief description of the potential
Arbitrator… or ongoing dispute.
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Code. Alternatively, the parties may

3. Upon receipt of the REQUEST, the submit their dispute to the Office of
Office of the Secretary shall forthwith the Secretary for voluntary
notify the parties and invite them for arbitration. Such voluntary arbitration
conference. The conference for shall be limited to the issues defined
REQUESTS coming from the National in the parties’ submission to
Capital Region, Regions III, IV-A or IV- B voluntary arbitration agreement and
shall be held at the Office of the shall be decided on the basis of the
Secretary of Labor and Employment parties’ position papers and
unless the Secretary otherwise directs. submitted evidence. The Office of
The conference for REQUESTS coming the Secretary shall resolve the
from the other regions shall be dispute within sixty (60) days from
conducted by the Regional Director for the parties’ submission of the dispute
the Secretary. for resolution.
b. This circular shall take effect fifteen
4. The Office of the Secretary or the (15) days after publication in a
Regional director, in the proper case, newspaper of general publication.
shall proceed to intervene after the Done in the City of Manila,
parties shall have manifested that; Philippines, 11 August 2006.
a. they voluntarily submit their potential
or ongoing dispute to intervention by
Administrative Intervention for Dispute
the Office of the Secretary of Labor
Avoidance: Separate from established modes
and Employment;
of mediation, conciliation and arbitration and is
b. there is no pending notice of strike or
an alternative to other voluntary modes of
lockout or any related complaint in
dispute resolution [DOLE Circular No. 1, series
relation with their potential or
of 2006]
ongoing dispute;
c. they shall refrain from any strike or
Pre-Requisite for the Intervention by the
lockout or any form of work stoppage
SOLE: The parties must have manifested that:
or from filing any related complaint
a. They voluntarily submit their potential or
while the SOLE’s intervention is in
ongoing dispute to intervention by the
effect; and
Office of the SOLE;
d. they shall abide by the agreement
b. No pending notice of strike or lockout or
reached, whose terms may be
any related complaint in relation to their
enforced through the appropriate
potential or ongoing dispute;
writs issued by the SOLE
c. They shall refrain from any strike or lockout
or any form of work stoppage or filing any
All agreements settling the dispute shall
related complaint while the SOLE’s
be in writing and signed by the parties as
intervention is in effect;
well as the official who mediated the
d. They shall abide by the agreement reached
dispute.
whose terms may be enforced through the
appropriate writs issued by the SOLE;
5. The parties and officials or employees of
the DOLE who took part in the
Note: DOLE Regional Directors and Assistant
proceedings shall not testify in any court
Regional Directors may act as ex-officio
or body regarding the disclosures,
voluntary arbitrators [D.O No. 83-07, 2007]
submissions or positions made by the
parties in these proceedings.
a. If the intervention fails, either or both 2. Visitorial and enforcement powers
parties may avail themselves of the
remedies provided under the Labor Art. 128. Visitorial and Enforcement Power
- The Secretary of Labor and Employment or
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his duly authorized representatives, including 1. To inquire into the financial activities of
labor regulation officers, shall: legitimate labor organizations
1. Have access to employer’s records and a. Upon the filing of a complaint under
premises at any time of the day or night oath and duly supported by the written
whenever work is being undertaken therein consent of at least twenty percent
a. And the right: (20%) of the total membership of the
i. To copy therefrom, labor organization concerned
ii. To question any employee and 2. To examine their books of accounts and
iii. To investigate any fact, condition or other records to determine compliance or
matter which may be necessary to non-compliance with the law
determine violations or which may 3. To prosecute any violations of the law and
aid in the enforcement of this Code the union constitution and by-laws
and of any labor law, wage order or
rules and regulations issued Provided, That such inquiry or examination
pursuant thereto. shall not be conducted during the sixty (60)-day
2. Have the power to issue compliance orders freedom period nor within the thirty (30) days
a. Purpose: to give effect to the labor immediately preceding the date of election of
standards provisions of this Code and union officials.
other labor legislation based on the
findings of labor employment and The visitorial and enforcement powers of the
enforcement officers or industrial DOLE Regional Director to order and enforce
safety engineers made in the course of compliance with labor standard laws can be
inspection. exercised even where the individual claim
b. Notwithstanding the provisions of Arts. exceeds P5,000.00. [Cirineo Bowling Plaza,
129 and [224] of this Code to the Inc. v. Sensing, G.R. No. 146572 (2005)].
contrary, and in cases where the
relationship of employer-employee still If a complaint is brought before the DOLE to
exists give effect to the labor standards provisions of
3. Issue writs of execution to the appropriate the Labor Code or other labor legislation, and
authority for the enforcement of their orders there is a finding by the DOLE that there is an
a. Exception: cases where the employer existing employer-employee relationship, the
contests the findings of the labor DOLE exercises jurisdiction to the exclusion of
employment and enforcement officer the NLRC.
and raises issues supported by
documentary proofs which were not The findings of the DOLE, however, may still
considered in the course of inspection. be questioned through a petition for certiorari
under Rule 65 of the Rules of Court.
Art. 37. Visitorial Power. – The Secretary of
Labor or his duly authorized representatives The DOLE's labor inspection program can now
may, at any time – proceed without being sidetracked by
1. Inspect the premises, books of accounts unscrupulous employers who could render
and records of any person or entity covered nugatory the "expanded visitorial and
by this Title enforcement power of the DOLE granted by RA
2. Require it to submit reports regularly on 7730 . . . by the simple expedient of disputing
prescribed forms, and the employer-employee relationship [and] force
3. Act on violation of any provisions of this the referral of the matter to the NLRC.”
Title. [People's Broadcasting Service v. Secretary of
the Department of Labor and Employment,
Art. 289. Visitorial Power. –The Secretary of G.R. No. 179652 (2012 Resolution)]
Labor and Employment or his duly authorized
representative is hereby empowered: The factual findings of the SOLE or the
Regional Directors made in the exercise of
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their visitorial and enforcement powers are shall automatically be referred to voluntary
binding on Labor Arbiters and the NLRC under arbitration prescribed in the CBA. [Art. 273]
the doctrine of res judicata [Norkis Trading v.
Buenavista, G.R. No. 182018, (2012)] Constitutional Basis
Sec. 3, Art. XIII, 1987 Constitution - The State
3. Power to suspend effects of shall promote:
termination 1. The principle of shared responsibility
between workers and employers and
Art. 292 (b). Visitorial and Enforcement 2. The preferential use of voluntary modes in
Power - The SOLE may suspend the effects of settling disputes, including conciliation,
a termination pending resolution of the dispute 3. And shall enforce their mutual compliance
in the event of a prima facie finding by the therewith to foster industrial peace.
appropriate official of the DOLE that:
a. The termination may cause a serious labor Who is a voluntary arbitrator
dispute (may or may not be a strike or a A “voluntary arbitrator” is:
lockout) 1. Any person accredited by the [National
b. The termination is in implementation of a Conciliation and Mediation Board] as such;
mass lay-off. or
2. Any person named or designated in the
Collective Bargaining Agreement by the
4. Remedies
parties to act as their Voluntary Arbitrator;
or
The aggrieved party from a decision of the
3. One chosen, with or without the assistance
SOLE may file one motion for reconsideration
of the National Conciliation and Mediation
within ten (10) days from receipt thereof.
Board, pursuant to a selection procedure
agreed upon in the Collective Bargaining
If the motion for reconsideration is denied, the
Agreement; or
party may appeal via Rule 65 to the CA 60 days
4. Any official that may be authorized by the
from receipt of the denial. Upon denial, the
Secretary of Labor and Employment to act
party may proceed via Rule 45 to the SC. [Rule
as Voluntary Arbitrator upon the written
65, ROC; St. Martin Funeral Home v. NLRC,
request and agreement of the parties to a
G.R. No. 130866 (1998)]
labor dispute. [Art. 219 (n)]
Clearly, before a petition for certiorari under
Provision for Voluntary Arbitration in the
Rule 65 of the Rules of Court may be availed
of, the filing of a motion for reconsideration is a CBA
1. Parties to a CBA shall:
condition sine qua non to afford an opportunity
for the correction of the error or mistake a. Name and designate in advance a
complained of. [PIDLTRANCO Service Voluntary Arbitrator or panel of
Voluntary Arbitrators, OR
Enterprises Inc v. PWU – AGLO, G.R. No.
180962 (2014)] b. Include in the agreement a procedure
for the selection of such Voluntary
Arbitrator or panel of Voluntary
Arbitrators, preferably from the listing
I. VOLUNTARY ARBITRATOR of qualified Voluntary Arbitrators duly
accredited by the Board.
2. In case the parties fail to select a Voluntary
Automatic Referral If Grievance Machinery Arbitrator or panel of Voluntary Arbitrators,
Fails the Board shall designate the Voluntary
All grievances submitted to the grievance Arbitrator or panel of Voluntary Arbitrators,
machinery which are not settled within 7 as may be necessary, pursuant to the
calendar days from the date of its submission selection procedure agreed upon in the
[CBA], which shall act with the same force
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and effect as if the has been selected by

the parties as described above. [Art. 273] If such is filed before the LA, these cases shall
be dismissed by the LA for lack of jurisdiction
Voluntary Arbitration as a Condition and referred to the concerned NCMB Regional
Precedent Branch for appropriate action towards an
The stipulation to refer all future disputes to an expeditious selection by the parties of a VA or
arbitrator or to submit an ongoing dispute to Panel of Arbitrators based on the procedures
one is valid. Being part of a contract between agreed upon in the CBA. [Policy Instruction #56
the parties, it is binding and enforceable in (April 6, 1993)]
court in case one of them neglects, fails or
refuses to arbitrate. Even if the specific issue brought before the
arbitrators merely mentioned the question of
In the event that they declare their intention to “whether an employee was discharged for just
refer their differences to arbitration first before cause,” they could reasonably assume that
taking court action, this constitutes a condition their powers extended beyond the
precedent, such that where a suit has been determination thereof to include the power to
instituted prematurely, the court shall suspend reinstate the employee or to grant back wages.
the same and the parties shall be directed
forthwith to proceed to arbitration. [...] A court In the same vein, if the specific issue brought
action may likewise be proper where the before the arbitrators referred to the date of
arbitrator has not been selected by the parties. regularization of the employee, law and
[Chung Fu Industries v. CA, G.R. No. 96283 jurisprudence gave them enough leeway as
(1992)] well as adequate prerogative to determine the
entitlement of the employees to higher benefits
1. Jurisdiction in accordance with the finding of regularization.
[Manila Pavilion Hotel, etc. v. Henry Delada,
EXCLUSIVE AND ORIGINAL JURISDICTION G.R. No. 189947 (2011)]
OVER UNRESOLVED GRIEVANCES
a. Interpretation or implementation of the Other Labor Disputes
CBA [Art. 274]
b. Interpretation or enforcement of company Art. 275. Jurisdiction Over Other Labor
personnel policies [Art. 274] Disputes. – The VA or panel of VAs, upon
c. Violations of a CBA which are not gross in agreement of the parties, shall also hear and
character (gross being flagrant and/or decide all other labor disputes including ULP
malicious refusal to comply with the and bargaining deadlocks.
economic provisions of [the CBA]) [Art.
274] Art. 274. Jurisdiction of Voluntary
Arbitrators or Panel of Voluntary
Note: Gross violations of the CBA shall mean Arbitrators. – The Commission, its Regional
flagrant and/or malicious refusal to comply with Offices and the Regional Directors of the
the economic provisions of such agreement. DOLE:
1. Shall not entertain disputes, grievances
Termination Cases: Plenary Jurisdiction of or matters under the exclusive and
Voluntary Arbitrator vis-à-vis Labor Arbiter original jurisdiction of the Voluntary
Termination cases arising in or resulting from Arbitrator or panel of Voluntary
the interpretation and implementation of CBAs Arbitrators and
and interpretation and enforcement of 2. Shall immediately dispose and refer the
company personnel policies which were initially same to the grievance machinery or
processed at the various steps of the plant- Voluntary Arbitration provided in the
level Grievance Procedures under the parties' Collective Bargaining Agreement.
CBAs fall within the original and exclusive
jurisdiction of the VA.
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Art. 224 (c). Jurisdiction of the Labor accomplishing the rationale of the law on
Arbiters and the Commission. – Cases voluntary arbitration – speedy labor justice.
arising from the interpretation or [Goya, Inc. v. Goya, Inc. Employees Union-
implementation of CBAs and those arising FFW, G.R. No. 170054 (2013)]
from the interpretation or enforcement of
company personnel policies shall be PROCEDURE
disposed of by the LA by referring the same Art. 276. Procedures. — The Voluntary
to the grievance machinery and VA as may Arbitrator or panel of Voluntary Arbitrators shall
be provided for in said agreements. have the power to:
a. Hold hearings,
Option – Voluntary Arbitration b. Receive evidences, and
c. Take whatever action is necessary to
Art. 278 (h). Strikes, Picketing and resolve the issue or issues subject of the
Lockouts. – Before or at any stage of the dispute,
compulsory arbitration process, the parties d. Including efforts to effect a voluntary
may opt to submit their dispute to voluntary settlement between parties.
arbitration.
All parties to the dispute shall be entitled to
Summary of Arbitrable Issues attend the arbitration proceedings. The
a. Interpretation or implementation of the attendance of any third party or the exclusion
CBA [Art. 274] of any witness from the proceedings shall be
b. Interpretation or enforcement of company determined by the Voluntary Arbitrator or panel
personnel policies [Art. 274] of Voluntary Arbitrators. Hearing may be
c. Violations of a CBA which are not gross in adjourned for cause or upon agreement by the
character (gross being flagrant and/or parties.
malicious refusal to comply with the
economic provisions of [the CBA]) [Art. Unless the parties agree otherwise, it shall be
274] mandatory for the Voluntary Arbitrator or panel
d. All other labor disputes including ULP and of Voluntary Arbitrators to render an award or
bargaining deadlock, if the parties agree decision within twenty (20) calendar days from
[Art. 275] the date of submission of the dispute to
e. Wage distortions arising from application of voluntary arbitration.
any wage orders in organized
establishments [Art. 124] The award or decision of the Voluntary
f. Unresolved grievances arising from the Arbitrator or panel of Voluntary Arbitrators shall
interpretation and implementation of the contain the facts and the law on which it is
productivity incentives program under RA based. It shall be final and executory after ten
6971 [Book V, IRR Rule XIX. Sec. 4] (10) calendar days from receipt of the copy of
the award or decision by the parties.
In general, the arbitrator [“VA”] is expected to
decide those questions expressly stated and Upon motion of any interested party, the
limited in the submission agreement. Voluntary Arbitrator or panel of Voluntary
However, since arbitration is the final resort for Arbitrators or the Labor Arbiter in the region
the adjudication of disputes, the arbitrator can where the movant resides, in case of the
assume that he has the power to make a final absence or incapacity of the Voluntary
settlement. Arbitrator or panel of Voluntary Arbitrators, for
any reason, may issue a writ of execution
[The VA has] plenary jurisdiction and authority requiring either of the following to execute the
to interpret the [CBA] and to determine the final decision, order or award:
scope of his [or her] own authority. [...] Subject a. The sheriff of the Commission or regular
to judicial review, this leeway of authority [and] courts; or
adequate prerogative is aimed at
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b. Any public official whom the parties may

designate in the submission agreement. Voluntary Arbitrator's Fee
The fixing of the fee of the Voluntary Arbitrators
[Rule XI, Book V, IRR] or panel of Voluntary Arbitrators, whether
shouldered wholly by the parties or subsidized
Hearing by the special voluntary arbitration fund, shall
All parties to the dispute shall be entitled to take into account the following factors:
attend the arbitration proceedings. The a. Nature of the case;
attendance of any third party or the exclusion b. Time consumed in hearing the case;
of any witness from the proceedings shall be c. Professional standing of the voluntary
determined by the VA or panel of VAs. Hearing arbitrator;
may be adjourned for cause or upon d. Capacity to pay of the parties;
agreement by the parties. e. Fees provided for in the Rules of Court [Art.
277]
Days to render an award/decision
Unless the parties agree otherwise, it shall be 2. Remedies
mandatory for the VA or panel of VAs to render
an award or decision within 20 calendar days Motion for Reconsideration
from the date of submission of the dispute to The absence of a categorical language in Art.
voluntary arbitration. [276] does not preclude the filing of a motion
for reconsideration of the VA’s decision within
Form of award/decision the 10-day period. [Teng v Pahagac, G.R.
The award or decision of the VA or panel of 169704 (2010)]
VAs must state in clear, concise and definite
terms the facts, the law and/contract upon Appeal
which it is based. The decision of a Voluntary Arbitrator or panel
of Voluntary Arbitrators is appealable by
Finality ordinary appeal under Rule 43 of the Rules of
It shall be final and executory after 10 calendar Civil Procedure directly to the Court of Appeals.
days from the receipt of the copy of the award [AMA Computer College-Santiago City, Inc. v.
or decision by the parties. Nacino, G.R. No. 162739 (2008)]
Execution of award/decision But See: Guagua National Colleges v. CA,

Upon motion of any interested party, the G.R. 188412, Aug. 28, 2018, the 10-day period
Voluntary Arbitrator or panel of Voluntary under Article 276 of the Labor Code refers to
Arbitrators or the Labor Arbiter in the region the filing of a motion for reconsideration vis-à-
where the movant resides, in case of the vis the Voluntary Arbitrator's decision or award,
absence or incapacity of the Voluntary while the 15 days is the period to file petition for
Arbitrator or panel of Voluntary Arbitrators, for review under Rule 43 of the Rules of Court.
any reason, may issue a writ of execution
requiring either the sheriff of the Commission
or regular courts or any public official whom the J. PRESCRIPTION OF
parties may designate in the submission ACTIONS
agreement to execute the final decision, order
or award.
1. Money claims
Costs
The parties to a Collective Bargaining Art. 306. Money claims. – All money claims
Agreement shall provide therein a arising from employer-employee relations
proportionate sharing scheme on the cost of accruing during the effectivity of this Code shall
the voluntary arbitration including the Voluntary be filed within three (3) years from the time
Arbitrator’s fee. [Art. 277]
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the cause of action accrued; otherwise they plaintiff, the same must be brought within
shall be forever barred. one year. [As amended by PD No. 1755,
Dec. 24, 1980.]
All money claims accruing prior to the
effectivity of this Code 4 years from dismissal
a. Shall be filed with the appropriate entities In illegal dismissal cases, the employee
established under this Code within one (1) concerned is given a period of four years from
year from the date of effectivity, and the time of his dismissal within which to institute
b. Shall be processed or determined in a complaint. This is based on Art. 1146 of the
accordance with the implementing rules Civil Code which states that actions based
and regulations of the Code; upon an injury to the rights of the plaintiff must
c. Otherwise, they shall be forever barred. be brought within four years. [Victory Liner, Inc.
v. Race, G.R. No. 164820 (2007)]
Workmen's compensation claims accruing
prior to the effectivity of this Code and during 3. Unfair labor practice
the period from November 1, 1974 up to
December 31, 1974, All unfair labor practice arising from Book V
a. Shall be filed with the appropriate regional a. Shall be filed with the appropriate agency
offices of the Department of Labor not within one (1) year from accrual of such
later than March 31, 1975; unfair labor practice;
b. Otherwise, they shall forever be barred. b. Otherwise, they shall be forever barred.
c. The claims shall be processed and
adjudicated in accordance with the law and Art. 258. Concept of unfair labor practice
rules at the time their causes of action and procedure for prosecution thereof – No
accrued. criminal prosecution under this Title may be
instituted without a final judgment finding that
The Labor Code has no specific provision on an unfair labor practice was committed, having
when a monetary claim accrues. Thus, again been first obtained in the preceding paragraph.
the general law on prescription applies. Art.
1150 of the Civil Code provides that, “The time During the pendency of such administrative
for prescription for all kinds of actions, when proceeding, the running of the period of
there is no special provision which ordains prescription of the criminal offense herein
otherwise, shall be counted from the day they penalized shall be considered interrupted:
may be brought.” a. The final judgment in the administrative
proceedings shall not be binding in the
The day the action may be brought is the day a criminal case nor be considered as
claim started as a legal possibility. [Anabe v. evidence of guilt
Asian Construction, G.R. No. 183233 (2009)] b. But merely as proof of compliance of the
requirements therein set forth.
2. Illegal dismissal
4. Offenses under the Labor Code
Art. 1146, Civil Code. – The following
actions must be instituted within four years: Art. 305, LC. – Offenses penalized under
a. Upon an injury to the rights of the this Code and the rules and regulations
plaintiff; issued pursuant thereto shall prescribe in
b. Upon a quasi-delict; three (3) years.
However, when the action arises from or out
of any act, activity, or conduct of any public Art. 305, Civil Code. – Offenses penalized
officer involving the exercise of powers or under this Code and the rules and
authority arising from Martial Law including regulations issued pursuant thereto shall
the arrest, detention and/or trial of the prescribe in three (3) years.
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SECTION 4. Acts of Trafficking in

3 years, except ULP (see: above) Persons. — It shall be unlawful for any
person, natural or juridical, to commit any of
5. Illegal recruitment the following acts:
(a) To recruit, obtain, hire, provide, offer,
Illegal recruitment cases under this Act shall transport, transfer, maintain, harbor, or
prescribe in five (5) years. receive a person by any means,
including those done under the pretext of
Provided, however, that illegal recruitment domestic or overseas employment or
cases involving economic sabotage as defined training or apprenticeship, for the
herein shall prescribe in twenty (20) years. purpose of prostitution, pornography, or
[Migrant Workers and Overseas Filipinos Act of sexual exploitation;
1995, Sec. 12] (b) To introduce or match for money, profit,
or material, economic or other
consideration, any person or, as
LAWS AND RULES OF provided for under Republic Act No.
6955, any Filipino women to a foreign
PROCEDURE national, for marriage for the purpose of
acquiring, buying, offering, selling or
The Civil Code of the Philippines trading him/her to engage in prostitution,
pornography, sexual exploitation, forced
Article 1700. The relations between capital labor, slavery, involuntary servitude or
and labor are not merely contractual. They debt bondage;
are so impressed with public interest that (c) To offer or contract marriage, real or
labor contracts must yield to the common simulated, for the purpose of acquiring,
good. Such contracts are subject to the buying, offering, selling, or trading them
special laws on labor unions, collective to engage in prostitution, pornography,
bargaining, strikes and lockouts, closed sexual exploitation, forced labor or
shop, wages, working conditions, hours of slavery, involuntary servitude or debt
labor and similar subjects. bondage;
(d) To undertake or organize tours and
Article 1701. Neither capital nor labor shall travel plans consisting of tourism
act oppressively against the other, or impair packages or activities for the purpose of
the interest or convenience of the public. utilizing and offering persons for
prostitution, pornography or sexual
Article 1702. In case of doubt, all labor exploitation;
legislation and all labor contracts shall be (e) To maintain or hire a person to engage
construed in favor of the safety and in prostitution or pornography;
decent living for the laborer. (f) To adopt persons by any form of
consideration for exploitative purposes
Article 1703. No contract which practically or to facilitate the same for purposes of
amounts to involuntary servitude, under any prostitution, pornography, sexual
guise whatsoever, shall be valid. exploitation, forced slavery, involuntary
servitude or debt bondage;
Migrant Workers and Overseas Filipinos (g) To adopt or facilitate the adoption of
Act of 1995 persons for the purpose of prostitution,
See II. Recruitment and Placement, and III. E. pornography, sexual exploitation, forced
9. Migrant workers labor, slavery, involuntary servitude or
debt bondage;
Anti-Trafficking in Persons Act of 2003 (h) To recruit, hire, transport, obtain,
transfer, harbor, maintain, provide, offer,
receive, or abduct a person, by means of
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threat or use of force, fraud, deceit, (5) To organize or direct other persons
violence, coercion, or intimidation for the to commit the offenses defined as
purpose of removal or sale of organs of acts of trafficking under this Act.
said person;
(i) To recruit, transport, obtain, transfer, SECTION 4-A. Attempted Trafficking in
harbor, maintain, offer, hire, provide, Persons. — Where there are acts to initiate
receive or adopt a child to engage in the commission of a trafficking offense but
armed activities in the Philippines or the offender failed to or did not execute all
abroad; the elements of the crime, by accident or by
(j) To recruit, transport, transfer, harbor, reason of some cause other than voluntary
obtain, maintain, offer, hire, provide or desistance, such overt acts shall be deemed
receive a person by means defined in as an attempt to commit an act of trafficking
Section 3 of this Act for purposes of in persons. As such, an attempt to commit
forced labor, slavery, debt bondage and any of the offenses enumerated in Section 4
involuntary servitude, including a of this Act shall constitute attempted
scheme, plan, or pattern intended to trafficking in persons.
cause the person either:
(1) To believe that if the person did not In cases where the victim is a child, any of
perform such labor or services, he or the following acts shall also be deemed as
she or another person would suffer attempted trafficking in persons:
serious harm or physical restraint; or (a) Facilitating the travel of a child who
(2) To abuse or threaten the use of law travels alone to a foreign country or
or the legal processes; and territory without valid reason therefor
(k) To recruit, transport, harbor, obtain, and without the required clearance or
transfer, maintain, hire, offer, provide, permit from the Department of Social
adopt or receive a child for purposes of Welfare and Development, or a written
exploitation or trading them, including permit or justification from the child's
but not limited to, the act of buying parent or legal guardian;
and/or selling a child for any (b) Executing, for a consideration, an
consideration or for barter for purposes affidavit of consent or a written consent
of exploitation. Trafficking for purposes for adoption;
of exploitation of children shall include: (c) Recruiting a woman to bear a child for
(1) All forms of slavery or practices the purpose of selling the child;
similar to slavery, involuntary (d) Simulating a birth for the purpose of
servitude, debt bondage and forced selling the child; and
labor, including recruitment of (e) Soliciting a child and acquiring the
children for use in armed conflict; custody thereof through any means from
(2) The use, procuring or offering of a among hospitals, clinics, nurseries,
child for prostitution, for the daycare centers, refugee or evacuation
production of pornography, or for centers, and low-income families, for the
pornographic performances; purpose of selling the child.
(3) The use, procuring or offering of a
child for the production and SECTION 4-B. Accomplice Liability. —
trafficking of drugs; and Whoever knowingly aids, abets, cooperates
(4) The use, procuring or offering of a in the execution of the offense by previous
child for illegal activities or work or simultaneous acts defined in this Act shall
which, by its nature or the be punished in accordance with the
circumstances in which it is carried provisions of Section 10(c) of this Act.
out, is likely to harm their health,
safety or morals; and SECTION 4-C. Accessories. — Whoever
has the knowledge of the commission of the
crime, and without having participated
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therein, either as principal or as that are mandated to provide pre-

accomplices, take part in its commission in departure registration and services for
any of the following manners: departing persons for the purpose of
(a) By profiting themselves or assisting the promoting trafficking in persons;
offender to profit by the effects of the (e) To facilitate, assist or help in the exit and
crime; entry of persons from/to the country at
(b) By concealing or destroying the body of international and local airports, territorial
the crime or effects or instruments boundaries and seaports who are in
thereof, in order to prevent its discovery; possession of unissued, tampered or
(c) By harboring, concealing, or assisting in fraudulent travel documents for the
the escape of the principal of the crime, purpose of promoting trafficking in
provided the accessory acts with abuse persons;
of his or her public functions or is known (f) To confiscate, conceal, or destroy the
to be habitually guilty of some other passport, travel documents, or personal
crime. documents or belongings of trafficked
persons in furtherance of trafficking or to
Acts defined in this provision shall be prevent them from leaving the country or
punished in accordance with the provision of seeking redress from the government or
Section 10(d) as stated thereto. appropriate agencies; and
(g) To knowingly benefit from, financial or
SECTION 5. Acts that Promote otherwise, or make use of, the labor or
Trafficking in Persons. — The following services of a person held to a condition
acts which promote or facilitate trafficking in of involuntary servitude, forced labor, or
persons shall be unlawful: slavery.
(a) To knowingly lease or sublease, use or (h) To tamper with, destroy, or cause the
allow to be used any house, building or destruction of evidence, or to influence
establishment for the purpose of or attempt to influence witnesses, in an
promoting trafficking in persons; investigation or prosecution of a case
(b) To produce, print and issue or distribute under this Act;
unissued, tampered or fake counseling (i) To destroy, conceal, remove, confiscate
certificates, registration stickers, or possess, or attempt to destroy,
overseas employment certificates or conceal, remove, confiscate or possess,
other certificates of any government any actual or purported passport or other
agency which issues these certificates, travel, immigration or working permit or
decals and such other markers as proof document, or any other actual or
of compliance with government purported government identification, of
regulatory and pre-departure any person in order to prevent or restrict,
requirements for the purpose of or attempt to prevent or restrict, without
promoting trafficking in persons; lawful authority, the person's liberty to
(c) To advertise, publish, print, broadcast or move or travel in order to maintain the
distribute, or cause the advertisement, labor or services of that person; or
publication, printing broadcasting or (j) To utilize his or her office to impede the
distribution by any means, including the investigation, prosecution or execution
use of information technology and the of lawful orders in a case under this Act.
internet, of any brochure, flyer, or any
propaganda material that promotes SECTION 6. Qualified Trafficking in
trafficking in persons; Persons. — The following are considered
(d) To assist in the conduct of as qualified trafficking:
misrepresentation or fraud for purposes (a) When the trafficked person is a child;
of facilitating the acquisition of (b) When the adoption is effected through
clearances and necessary exit Republic Act No. 8043, otherwise known
documents from government agencies as the "Inter-Country Adoption Act of
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1995" and said adoption is for the but not more than Two million pesos
purpose of prostitution, pornography, (P2,000,000.00);
sexual exploitation, forced labor, (b) Any person found guilty of committing
slavery, involuntary servitude or debt any of the acts enumerated in Section 4-
bondage; A of this Act shall suffer the penalty of
(c) When the crime is committed by a imprisonment of fifteen (15) years and a
syndicate, or in large scale. Trafficking is fine of not less than Five hundred
deemed committed by a syndicate if thousand pesos (P500,000.00) but not
carried out by a group of three (3) or more than One million pesos
more persons conspiring or (P1,000,000.00);
confederating with one another. It is (c) Any person found guilty of Section 4-B of
deemed committed in large scale if this Act shall suffer the penalty of
committed against three (3) or more imprisonment of fifteen (15) years and a
persons, individually or as a group; fine of not less than Five hundred
(d) When the offender is a spouse, an thousand pesos (P500,000.00) but not
ascendant, parent, sibling, guardian or a more than One million pesos
person who exercises authority over the (P1,000,000.00);
trafficked person or when the offense is In every case, conviction shall cause
committed by a public officer or and carry the automatic revocation of the
employee; license or registration of the recruitment
(e) When the trafficked person is recruited agency involved in trafficking. The
to engage in prostitution with any license of a recruitment agency which
member of the military or law trafficked a child shall be automatically
enforcement agencies; revoked.
(f) When the offender is a member of the (d) Any person found guilty of committing
military or law enforcement agencies; any of the acts enumerated in Section 5
(g) When by reason or on occasion of the shall suffer the penalty of imprisonment
act of trafficking in persons, the offended of fifteen (15) years and a fine of not less
party dies, becomes insane, suffers than Five hundred thousand pesos
mutilation or is afflicted with Human (P500,000.00) but not more than One
Immunodeficiency Virus (HIV) or the million pesos (P1,000,000.00);
Acquired Immune Deficiency Syndrome (e) Any person found guilty of qualified
(AIDS); trafficking under Section 6 shall suffer
(h) When the offender commits one or more the penalty of life imprisonment and a
violations of Section 4 over a period of fine of not less than Two million pesos
sixty (60) or more days, whether those (P2,000,000.00) but not more than Five
days are continuous or not; and million pesos (P5,000,000.00);
(i) When the offender directs or through (f) Any person who violates Section 7
another manages the trafficking victim in hereof shall suffer the penalty of
carrying out the exploitative purpose of imprisonment of six (6) years and a fine
trafficking. of not less than Five hundred thousand
pesos (P500,000.00) but not more than
SECTION 10. Penalties and Sanctions. — One million pesos (P1,000,000.00);
The following penalties and sanctions are (g) If the offender is a corporation,
hereby established for the offenses partnership, association, club,
enumerated in this Act: establishment or any juridical person,
(a) Any person found guilty of committing the penalty shall be imposed upon the
any of the acts enumerated in Section 4 owner, president, partner, manager,
shall suffer the penalty of imprisonment and/or any responsible officer who
of twenty (20) years and a fine of not less participated in the commission of the
than One million pesos (P1,000,000.00) crime or who shall have knowingly
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permitted or failed to prevent its The prescriptive period shall commence to

commission; run from the day on which the trafficked
(h) The registration with the Securities and person is delivered or released from the
Exchange Commission (SEC) and conditions of bondage, or in the case of a
license to operate of the erring agency, child victim, from the day the child reaches
corporation, association, religious the age of majority, and shall be interrupted
group, tour or travel agent, club or by the filing of the complaint or information
establishment, or any place of and shall commence to run again when the
entertainment shall be cancelled and proceedings terminate without the accused
revoked permanently. The owner, being convicted or acquitted or are
president, partner or manager thereof unjustifiably stopped for any reason not
shall not be allowed to operate similar imputable to the accused.
establishments in a different name;
(i) If the offender is a foreigner, he or she Handbook for OFWs Act of 2018
shall be immediately deported after
serving his or her sentence and be SECTION 2. Creating a Handbook for
barred permanently from entering the Overseas Filipino Workers. — The
country; handbook for overseas Filipino workers,
(j) Any employee or official of government known in this Act as "Handbook," shall be
agencies who shall issue or approve the created and issued to every land-based and
issuance of travel exit clearances, sea-based worker free of charge. It shall
passports, registration certificates, serve as a ready reference for migrant
counseling certificates, marriage workers when they need to assert their rights
license, and other similar documents to and responsibilities. It shall also deal with
persons, whether juridical or natural, key issues that they need to know in order to
recruitment agencies, establishments or maintain decent employment conditions
other individuals or groups, who fail to overseas.
observe the prescribed procedures and
the requirement as provided for by laws, PAR. b.1, SEC. 23 (Migrant Workers and
rules and regulations, shall be held Overseas Filipinos Act of 1995, amended
administratively liable, without prejudice by Handbook for OFWs Act of 2018). The
to criminal liability under this Act. The [POEA] is hereby mandated to develop,
concerned government official or publish, disseminate and update periodically
employee shall, upon conviction, be a Handbook on the rights and
dismissed from the service and be responsibilities of migrant workers as
barred permanently to hold public office. provided by Philippine laws and the existing
His or her retirement and other benefits labor and social laws of the countries of
shall likewise be forfeited; and destination that will protect and guarantee
(k) Conviction, by final judgment of the the rights of migrant workers. The Handbook
adopter for any offense under this Act shall be written in simple words that can be
shall result in the immediate rescission easily understood with translation in local
of the decree of adoption. language as may be necessary.
SECTION 12. Prescriptive Period. — It shall also be responsible for the

Trafficking cases under this Act shall implementation, in partnership with other law
prescribe in ten (10) years: Provided, enforcement agencies, of an intensified
however, That trafficking cases committed program against illegal recruitment activities.
by a syndicate or in a large scale as defined For this purpose, the POEA shall provide
under Section 6, or against a child, shall comprehensive gender-sensitive Pre-
prescribe in twenty (20) years. employment Orientation Seminars (PEOS)
that will discuss topics not only on the
prevention of illegal recruitment but also on
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the content of the Handbook on the rights those provided in applicable laws, and
and responsibilities of migrant workers. collective bargaining agreements.
(b) Have the right to rest periods, regular
Amending Certain Articles of the Labor holidays, and special nonworking days.
Code (c) Have the same or equivalent workload
[amendments already incorporated into the and performance standards as those of
aforecited provisions of the Labor Code] comparable workers at the employer's
premises.
13th Month Pay Law (d) Have the same access to training and
See III. B. 1. c. Bonus, 13th month pay career development opportunities as
those of comparable workers at the
Telecommuting Act employer's premises, and be subject to
the same appraisal policies covering
SECTION 3. Telecommuting Defined. — these workers.
As used in this Act, the term (e) Receive appropriate training on the
"telecommuting" refers to a work technical equipment at their disposal,
arrangement that allows an employee in the and the characteristics and conditions of
private sector to work from an alternative telecommuting.
workplace with the use of (f) Have the same collective rights as the
telecommunication and/or computer workers at the employer's premises, and
technologies. shall not be barred from communicating
with workers' representatives.
SECTION 4. Telecommuting Program. —
An employer in the private sector may offer The employers shall also ensure that
a telecommuting program to its employees measures are taken to prevent the
on a voluntary basis, and upon such terms telecommuting employee from being
and conditions as they may mutually agree isolated from the rest of the working
upon: Provided, That such terms and community in the company by giving the
conditions shall not be less than the telecommuting employee the opportunity to
minimum labor standards set by law, and meet with colleagues on a regular basis, and
shall include compensable work hours, allowing access to company information.
minimum number of work hours, overtime,
rest days, and entitlement to leave benefits. SECTION 6. Data Protection. — The
employer shall be responsible for taking the
The employer shall provide the appropriate measures to ensure the
telecommuting employee with relevant protection of data used and processed by
written information in order to adequately the telecommuting employee for
apprise the individual of the terms and professional purposes. The employer shall
conditions of the telecommuting program, inform the telecommuting employee of all
and the responsibilities of the employee. relevant laws, and company rules
concerning data protection. The
SECTION 5. Fair Treatment. — The telecommuting employee shall ensure that
employer shall ensure that the confidential and proprietary information are
telecommuting employees are given the protected at all times.
same treatment as that of comparable For this purpose, the provisions of the Data
employees working at the employer's Privacy Act of 2012 shall have suppletory
premises. All telecommuting employees effect.
shall:
(a) Receive a rate of pay, including overtime SECTION 7. Administration. — The parties
and night shift differential, and other to a telecommuting work arrangement shall
similar monetary benefits not lower than be primarily responsible for its
administration. In case of differences in
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interpretation, the following guideline shall 105 Day Expanded Maternity Leave Law
be observed: See III. C. 2. b. Expanded Maternity Leave
(a) The differences shall be treated as
grievances under the applicable Paternity Leave Act of 1996
grievance mechanism of the company. See III. C. 2. c. Paternity Leave
(b) If there is no grievance mechanism or if
the mechanism is inadequate, the Solo Parents’ Welfare Act
grievance shall be referred to the See III. C. 2. a., Parental Leave for Solo
regional office of the Department of Parents, III. E. 7. Solo Parents, and VII. E. Solo
Labor and Employment (DOLE) which Parents
has jurisdiction over the workplace for
conciliation. Magna Carta of Women
(c) To facilitate the resolution of grievances, See III. E. 3. a. Discrimination
employers shall keep and maintain, as
part of their records, the documents Amending Art. 135 of the Labor Code Re:
proving that the telecommuting work Prohibition on Discrimination Against
arrangement was voluntarily adopted. Women
See III. E. 3. c. Prohibited Acts
Anti-Violence Against Women and Their

Children Act of 2004
See III. C. 2. e. Battered women leave
Safe Spaces Act

See III. D. Sexual Harassment in the Work
Environment
Special Protection of Children Against

Abuse, Exploitation, and Discrimination Act
See III. E. 4. Minors
Batas Kasambahay
See III. E. 5. Kasambahays
Anti-Sexual Harassment Act of 1995

See III. D. Sexual Harassment in the Work
Environment
Portability Law
See VII. C. Limited Portability Law
New Labor Relations Law

[amended certain Articles in the Labor Code;
already incorporated into the provisions
previously cited]
Wage Rationalization Act

See III. B. Wages
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Productivity Incentives Act of 1990 labor and management, be integrated in the

collective bargaining agreement that may be
SECTION 5. Labor-Management entered into between them.
Committee. — a) A business enterprise or
its employees, through their authorized SECTION 7. Benefits and Tax Incentives.
representatives, may initiate the formation of — (a) Subject to the provisions of Section 6
a labor-management committee that shall be hereof, a business enterprise which adopts
composed of an equal number of a productivity incentives program, duly and
representatives from the management and mutually agreed upon by parties to the labor-
from the rank-and-file employees: Provided, management committee, shall be granted a
That both management and labor shall have special deduction from gross income
equal voting rights: Provided, further, That at equivalent to fifty percent (50%) of the total
the request of any party to the negotiation, productivity bonuses given to employees
the National Wages and Productivity under the program over and above the total
Commission of the Department of Labor and allowable ordinary and necessary business
Employment shall provide the necessary deductions for said bonuses under the
studies, technical information and National Internal Revenue Code, as
assistance, and expert advice to enable the amended.
parties to conclude productivity agreements.
(b) Grants for manpower training and special
(b) In business enterprises with duly studies given to rank-and-file employees
recognized or certified labor organizations, pursuant to a program prepared by the labor-
the representatives of labor shall be those management committee for the
designated by the collective bargaining development of skills identified as necessary
agent(s) of the bargaining unit(s). by the appropriate government agencies
shall also entitle the business enterprise to a
(c) In business enterprises without duly special deduction from gross income
recognized or certified labor organizations, equivalent to fifty per cent (50%) of the total
the representatives of labor shall be elected grants over and above the allowable
by at least a majority of all rank-and-file ordinary and necessary business deductions
employees who have rendered at least six for said grants under the National Internal
(6) months of continuous service. Revenue Code, as amended.
SECTION 6. Productivity Incentives (c) Any strike or lockout arising from any
Program. — a) The productivity incentives violation of the productivity incentives
program shall contain provisions for the program shall suspend the effectivity thereof
manner of sharing and the factors in pending settlement of such strike or lockout:
determining productivity bonuses: Provided, Provided, That the business enterprise shall
That the productivity bonuses granted to not be deemed to have forfeited any tax
labor under this program shall not be less incentives accrued prior to the date of
than half of the percentage increase in the occurrence of such strike or lockout, and the
productivity of the business enterprise. workers shall not be required to reimburse
the productivity bonuses already granted to
b) Productivity agreements reached by the them under the productivity incentives
parties as provided in this Act supplement program. Likewise, bonuses which have
existing collective bargaining agreements. already accrued before the strike or lockout
shall be paid the workers within six (6)
c) If, during the existence of the productivity months from their accrual.
incentives program or agreement, the
employees will join or form a union, such (d) Bonuses provided for under the
program or agreement may, in addition to productivity incentives program shall be
the terms and conditions agreed upon by given to the employees not later than every
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six (6) months from the start of such program families. It is endowed with powers to
over and above existing bonuses granted by administer a trust fund to be called the
the business enterprise and by law: OWWA Fund. Being a chartered institution,
Provided, That the said bonuses shall not be the OWWA shall not fall under any of the
deemed as salary increases due the following categories: government
employees and workers. instrumentalities with corporate powers
(e) The special deductions from gross (GICPs), government corporate entities
income provided for herein shall be allowed (GCEs), government financial institutions
starting the next taxable year after the (GFIs) and/or government- owned or -
effectivity of this Act. controlled corporations (GOCCs).
SECTION 9. Disputes and Grievances. — The OWWA shall be an attached agency of

Whenever disputes, grievances, or other the Department of Labor and Employment
matters arise from the interpretation or (DOLE). Its officials and employees are
implementation of the productivity incentives covered by the Salary Standardization Law.
program, the labor-management committee
shall meet to resolve the dispute, and may SECTION 6. Functions. — The OWWA
seek the assistance of the National shall exercise the following functions:
Conciliation and Mediation Board of the (a) To protect the interest and promote the
Department of Labor and Employment for welfare of member-OFWs in all phases
such purpose. Any dispute which remains of overseas employment in recognition
unresolved within twenty (20) days from the of their valuable contribution to the
time of its submission to the labor- overall national development effort;
management committee shall be submitted (b) To protect the interest and promote the
for voluntary arbitration in line with the welfare of member-OFWs in all phases
pertinent of the Labor Code, as amended. of overseas employment in recognition
of their valuable contribution to the
The productivity incentives program shall overall national development effort;
include the name(s) of the voluntary (c) To facilitate the implementation of the
arbitrator or panel of voluntary arbitrators provisions of the Labor Code of the
previously chosen and agreed upon by the Philippines (Presidential Decree No.
labor-management committee. 442, as amended) and the Migrant
Workers and Overseas Filipinos Act of
SSS Law 1995 (Republic Act No. 8042, as
See VII. A. Social Security System Law amended), concerning the responsibility
of the government to promote the well-
GSIS Law being of OFWs. Pursuant thereto, and in
See VII. B. Government Service Insurance furtherance thereof, it shall provide legal
Service Law assistance to member-OFWs;
(d) To provide social and welfare programs
Social Security Act of 2018 and services to member-OFWs,
See VII. A. Social Security System Law including social assistance, education
and training, cultural services, financial
Overseas Workers Welfare Administration management, reintegration, and
Act entrepreneurial development services;
(e) To provide prompt and appropriate
SECTION 4. Nature of the OWWA. — The response to global emergencies or crisis
OWWA is a national government agency situations affecting OFWs and their
vested with the special function of families;
developing and implementing welfare (f) To ensure the efficiency of collections
programs and services that respond to the and the viability and sustainability of the
needs of its member-OFWs and their OWWA Fund through sound, judicious,
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and transparent investment and member-OFWs, the OWWA Board may

management policies; adjust or modify the amount of membership
(g) To undertake studies and researches for contribution.
the enhancement of the social,
economic, and cultural well-being of SECTION 11. Proof of Membership. —
member-OFWs and their families; Upon payment of the required contribution,
(h) To develop, support and finance specific an OWWA member shall be issued an
projects for the welfare of member- official receipt, an OWWA E-Card,
OFWs and their families; and identification card, or other proof of
(i) To ensure the implementation of all laws membership. No additional or extra charges
and ratified international conventions shall be levied on the member-OFW.
within its jurisdiction.
The OWWA shall maintain a comprehensive
SECTION 8. Registration of Membership. database of member-OFWs, which shall be
— Membership in the OWWA may be updated regularly.
obtained in two (2) ways:
(a) By compulsory registration upon SECTION 13. Authorized Collecting
processing of employment contracts of Officers. — (a) Membership contributions
OFWs at the POEA; and shall be collected by duly authorized OWWA
(b) By voluntary registration of OFWs at job collecting officers, deputized collecting
sites, or through electronic registration. officers, or accredited collecting agents. The
collection of membership contributions shall
SECTION 9. Amount of Contribution and be made at the POEA contract processing
Effectivity of Membership. — Membership hub, OWWA regional and overseas offices,
in the OWWA, either through the compulsory and other accredited collection centers.
or voluntary coverage, shall be effective
upon payment of membership contribution in (b) In case of voluntary members who
the amount of twenty-five US dollars register at the job site, membership
(US$25.00) or its equivalent in the prevailing contributions shall be made directly to the
foreign exchange rates. Such membership OWWA Overseas Offices located in the
shall be considered active until the expiration respective foreign service posts of the
of the OFWs existing employment contract Philippines.
or after two (2) years from contract
effectivity, whichever comes first. SECTION 14. Reportorial Requirements.
— The collecting officer, deputized collecting
In case of voluntary registration, officer, or the accredited collecting agent
membership shall be considered active until shall prepare and submit the required
the expiration of the OFWs existing monthly reports to the OWWA Central Office
employment contract or after two (2) years in the Philippines.
from the date of voluntary registration,
whichever comes first. SECTION 17. Prohibition against
Discrimination on Membership. — No
The OWWA shall be allowed to collect a OFW shall be denied membership to the
subsequent membership contribution from OWWA by reason of age, gender, religious
the member-OFW only after every two (2) belief, or political affiliation. The OWWA shall
years from the last membership contribution take affirmative steps to enhance the access
made. of OFWs to its programs and services.
SECTION 10. Power of the Board to SECTION 18. Payment of Contribution or

Adjust the Membership Contribution. — OWWA Fee by Employer. — Contributions
Based on actuarial studies and taking into to the OWWA Fund must be paid by the
consideration the welfare and interest of the employers or principals, or in their default, by
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the recruitment/manning agency in the case authority to hire experts in finance or

of new hires. The POEA shall ensure that banking to assist in implementing the
this stipulation is made an integral part of the said loan programs.
overseas employment contract. (d) Workers Assistance and On-site
Services. — The OWWA shall sustain
SECTION 19. Penalty for Violation by and maintain assistance to member-
Recruitment/Manning Agency. — OFWs in all its overseas and regional
Violation by a recruitment/manning agency offices. Services shall be gender-
of the preceding section shall constitute an responsive and shall include information
offense punishable by revocation of its regarding the names, occupation/job
license and all its officers and directors shall categories and addresses of the
be perpetually disqualified from engaging in member-OFWs; legal assistance
the business of recruitment/placement of providing guidance and information on
overseas workers. Such penalty is without protection of migrant rights, including the
prejudice to any other liability which the prevention of gender-based violence;
officers and directors may have incurred developing materials for the
under existing laws, rules and regulations. predeparture orientation seminars;
conducting psycho-social counseling
SECTION 35. Benefits and Services to services; conciliation services;
OFWs. — appropriate services and intervention for
(a) Reintegration of OFWs. — The victims of gender-based violence, and
reintegration of OFWs, taking into outreach missions, among others. The
consideration the needs of women OWWA shall likewise make competent
migrant workers, shall be one of the core representations with employers, agents,
programs of the OWWA. In this regard, and host government authorities to
and for purposes of policy and program assist member-OFWs in obtaining relief
coordination, the National Reintegration from grievances and work-related
Center for OFWs created under issues, including claims for unpaid
Republic Act No. 10022 shall be an wages, and illegal recruitment cases
attached office of the OWWA. It shall be among others.
headed by an Executive Director who
shall be under the supervision of the (e) Social Benefits. — A member-OFW shall
OWWA Administrator. be covered with the following social
benefits:
To be able to sustain the viability of this (1) Death and Disability Benefits:
program, not less than ten percent (10%) (i) Death Benefits. — A member
of OWWA's collection of contribution for shall be covered with life insurance
the immediately preceding year shall be for the duration of his or her
allocated annually for the reintegration employment contract. The coverage
program. shall include one hundred thousand
pesos (P100,000.00) for natural
(b) Repatriation Assistance. — Consistent death and two hundred thousand
with the provisions of Republic Act No. pesos (P200,000.00) for accidental
8042, as amended, the OWWA shall death;
assist the Department of Foreign Affairs
in providing OFWs with services (ii) Disability and Dismemberment
necessary to facilitate repatriation, as Benefits. — Disability and
may be required. dismemberment benefits shall be
included in a member's life
(c) Loan and Other Credit Assistance. — insurance policy, as provided for in
The OWWA shall provide low-interest the impediment schedule contained
loans to member-OFWs. It shall have the in the OWWA Manual of Systems
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4989302
and Procedures. The coverage is technical or vocational training

within the range of two thousand scholarship;
pesos (P2,000.00) to fifty thousand
pesos (P50,000.00); (iii) Education for Development
Scholarship Program. — For
(iii) Total Disability Benefit. — In baccalaureate programs; and
case of total permanent disability, a
member shall be entitled to one (iv) Seafarers' Upgrading Program.
hundred thousand pesos — To ensure the competitive
(P100,000.00); and advantage of Filipino seafarers in
meeting competency standards, as
(iv) Burial Benefit. — A burial benefit required by the International
of twenty thousand pesos Maritime Organization (IMO),
(P20,000.00) shall be provided in International Labor Organization
case of the member's death. (ILO) conventions, treaties and
agreements, sea-based members
Based on actuarial studies, the shall be entitled to one upgrading
Board may increase the amount of program for every three (3)
the abovementioned benefits. membership contributions.
(2) Health Care Benefits. — Within two The annual scholarship lists of all
(2) years from the effectivity of this these programs shall be submitted to
Act, the OWWA shall develop and the Board.
implement health care programs for
the bene t of member-OFWs and Universal Health Care Act
their families, taking into See VII. H. Universal Health Care
consideration the health care needs
of women as provided for in Rules 45 and 65
Republic Act No. 9710, or the
Magna Carta of Women, and other RULE 45
relevant laws. Appeal by Certiorari to the Supreme Court
(3) Education and Training Benefits. —
A member, or the member's Section 1. Filing of petition with Supreme
designated beneficiary, may avail Court. — A party desiring to appeal by
any of the following scholarship certiorari from a judgment or final order or
programs, subject to a selection resolution of the Court of Appeals, the
process and accreditation of Sandiganbayan, the Regional Trial Court or
participating institutions: other courts whenever authorized by law,
may file with the Supreme Court a verified
(i) Death Benefits. — A member petition for review on certiorari. The petition
shall be covered with life insurance shall raise only questions of law which must
for the duration of his or her be distinctly set forth.
employment contract. The coverage
shall include one hundred thousand Section 2. Time for filing; extension. —
pesos (P100,000.00) for natural The petition shall be filed within fifteen (15)
death and two hundred thousand days from notice of the judgment or final
pesos (P200,000.00) for accidental order or resolution appealed from, or of the
death; denial of the petitioner's motion for new trial
or reconsideration filed in due time after
(ii) Skills-for-Employment notice of the judgment. On motion duly filed
Scholarship Program. — For and served, with full payment of the docket
and other lawful fees and the deposit for
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costs before the expiration of the non-forum shopping as provided in the third
reglementary period, the Supreme Court paragraph of section 3, Rule 46.
may for justifiable reasons grant an
extension of thirty (30) days only within Section 2. Petition for prohibition. —
which to file the petition. When the proceedings of any tribunal,
corporation, board, officer or person,
Section 6. Review discretionary. — A whether exercising judicial, quasi-judicial or
review is not a matter of right, but of sound ministerial functions, are without or in excess
judicial discretion, and will be granted only of its or his jurisdiction, or with grave abuse
when there are special and important of discretion amounting to lack or excess of
reasons thereof. The following, while neither jurisdiction, and there is no appeal or any
controlling nor fully measuring the court's other plain, speedy, and adequate remedy in
discretion, indicate the character of the the ordinary course of law, a person
reasons which will be considered: aggrieved thereby may file a verified petition
a. When the court a quo has decided a in the proper court, alleging the facts with
question of substance, not theretofore certainty and praying that judgment be
determined by the Supreme Court, or rendered commanding the respondent to
has decided it in a way probably not in desist from further proceedings in the action
accord with law or with the applicable or matter specified therein, or otherwise
decisions of the Supreme Court; or granting such incidental reliefs as law and
b. When the court a quo has so far justice may require.
departed from the accepted and usual
course of judicial proceedings, or so far The petition shall likewise be accompanied
sanctioned such departure by a lower by a certified true copy of the judgment,
court, as to call for an exercise of the order or resolution subject thereof, copies of
power of supervision. all pleadings and documents relevant and
pertinent thereto, and a sworn certification of
RULE 65 non-forum shopping as provided in the third
Certiorari, Prohibition and Mandamus paragraph of section 3, Rule 46.
Section 1. Petition for certiorari. — When Section 3. Petition for mandamus. —

any tribunal, board or officer exercising When any tribunal, corporation, board,
judicial or quasi-judicial functions has acted officer or person unlawfully neglects the
without or in excess its or his jurisdiction, or performance of an act which the law
with grave abuse of discretion amounting to specifically enjoins as a duty resulting from
lack or excess of jurisdiction, and there is no an office, trust, or station, or unlawfully
appeal, or any plain, speedy, and adequate excludes another from the use and
remedy in the ordinary course of law, a enjoyment of a right or office to which such
person aggrieved thereby may file a verified other is entitled, and there is no other plain,
petition in the proper court, alleging the facts speedy and adequate remedy in the ordinary
with certainty and praying that judgment be course of law, the person aggrieved thereby
rendered annulling or modifying the may file a verified petition in the proper court,
proceedings of such tribunal, board or alleging the facts with certainty and praying
officer, and granting such incidental reliefs that judgment be rendered commanding the
as law and justice may require. respondent, immediately or at some other
time to be specified by the court, to do the
The petition shall be accompanied by a act required to be done to protect the rights
certified true copy of the judgment, order or of the petitioner, and to pay the damages
resolution subject thereof, copies of all sustained by the petitioner by reason of the
pleadings and documents relevant and wrongful acts of the respondent.
pertinent thereto, and a sworn certification of
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The petition shall also contain a sworn

certification of non-forum shopping as
provided in the third paragraph of section 3,
Rule 46.
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What are the main principles of labor law discussed in the document?

What are the main principles of labor law discussed in the document?

What are some of the regulations discussed around recruitment and placement of workers?

What are some of the regulations discussed around recruitment and placement of workers?

U.P.

LAW BOC LABOR LAW

LABOR LAW 1............................................................. 1 III. LABOR STANDARDS .................................. 26

4. Money Claims arising from Employer- F. BONA FIDE OCCUPATIONAL

D. SUPREME COURT ............................. 230

Labor as Protected Class; Presumption of

Wearing armbands and putting up placards to 2. Civil Code

Neither capital nor labor shall of their adoption in newspapers of general

Such rules and regulations shall become

Social justice means: Not every improper act should be taken to

Art. 253, Labor Code one. [Heritage Hotel Manila v. PIGLAS-

6. Burden of proof and quantum of “Recruitment and placement" refers to any

Provided, That any person or entity which, in

Require- License Authority

Policy of Close Government Regulation

Recruitment of Local and Migrant Workers: with internationally-accepted standards. [Sec.

license or authority to recruit workers. All organizations, domestic or foreign, in the

The Administration shall also establish and

b. Regulatory and Visitorial 2. Ban on Direct Hiring

other matters or information, as may be

e. To influence or attempt to influence any recruitment when committed by a

g. For a recruitment/manning agency or a b. Illegal Recruitment of Migrant Workers

Note: The Migrant Workers’ Act (R.A. No.

Prohibited Not allowed [7 acts under

Prohibited Not allowed [Art. 34; 38,]

Recruitment Allowed Not

Prohibited Not allowed [Sec. 6, R.A.

Number of victims must be alleged confederating with one another in carrying

a. For Local Workers (Elements) In Large Scale

In Large Scale Simple Illegal Recruitment

under the LC does not bar conviction for

If the offender is a corporation, partnership, liable as PRINCIPAL, together with his

deployment including claims for damages is representatives done in connection with

Corporate officers and directors and 2. Theory of Imputed Knowledge

Purpose of solidary liability A local employment agency is considered the

In the case of Yap v. Thenamaris Ship’s

6. Representative of the Foreign

Fees Processing and Issuance

1. The Regional Director shall revoke the 5. Revocation; Cancellation

When and where to file

The decision of the DOLE Secretary shall be

reconsideration shall be allowed. [Sec. 16, General principles in determining if time is

If the work performed was necessary, or it

1. Hours of Work Employees exempted or not covered

2. Managerial Employees [Art. 82]

Effective recommendatory power Definition

The definition of “Kasambahay” excludes:

not entitled to receive overtime pay. [Sec.

ii. Night shift differential

Rationale OTRD = Hourly wage x 125% x number of

Overtime on ordinary working day

Work on Scheduled Rest Day (WRD) conditions where performance or quality of

3. Compensation for work rendered in excess councils, employee assemblies or

1. Where the work is non-manual work in

If they last more than 20 minutes, the time