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Labor Relations University of the Cordilleras College of Law Note: The Labor Code articles cited here are

those that are numbered according to the Codal of Rex Bookstore, 2013 edition. The renumbering accommodated the revisions introduced to the Code by RA 10151. If you are using an older codal version, just subtract six from the article number (e.g., ULP of employers in the 2013 Rex codal is Art. 254. Old number is Art. 248) Preliminary Discussions Constitutional Mandates on Labor, Labor Law Labor Legislation, Social Legislation What is Labor? As an act: Exertion by human beings of physical or mental efforts, or both, towards the production of goods and services. As a sector of society: That sector or group in a society, which derives its livelihood chiefly from rendition of work or services in exchange for compensation under managerial direction (Mendoza, 2001). Refers to workers, whether agricultural or non-agricultural Constitutional Mandates on Labor The State shall protect and promote the interests of the Filipino Laborer: Art. II, Sec. 9. The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide adequate social services, promote full employment, a rising standard of living and improved quality of life for all. Art. II, Sec. 18. The State affirms labor as a primary social economic force. It shall protect the rights, of workers and promote their welfare. Constitutional Mandates on Labor The State shall protect and promote the interests of the Filipino Laborer: Art. XII, Sec. 12. The State shall promote the preferential use of Filipino labor, domestic materials and locally produced goods, and adopt measures that help make them competitive. Art XIII, Sec. 14. The State shall protect women by providing safe and healthful working conditions, taking into account their maternal functions, and such facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation. Art. XV, Sec. 8. The State shall, from time to time, review to upgrade the pensions and other benefits due to retirees of both the government and the private sectors. Constitutional Mandates on Labor Rights of Workers Art. Ill, Sec. 8. The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law, shall not be abridged. (formation of labor organizations) Art. Ill, Sec. 18(2). No involuntary servitude in any form shall exist except as a punishment for a crime whereof the party shall have been duly convicted. Constitutional Mandates on Labor Protection to Labor Clause Art. XIII, Sec. 3 The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making process affecting their rights and benefits as may be provided by law. Participation in Policy and Decision Making Processes Phrase included in the 1987 constitution to highlight workers participation in policy-making; Added in the Labor Code Article 217, Declaration of Policy Article 261, Exclusive Bargaining Representation and Workers Participation in Policy and Decision-Making Constitutional Mandates on Labor Protection to Labor Clause Art. XIII, Sec. 3 , cont.

The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace. The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production' and the right of enterprises to reasonable returns of investments, and to expansion and growth. Commit Art. XIII, Sec. 3 to memory! Defines rights of workers under Labor Standards and Labor Relations: Under Labor Standards Security of Tenure; Living wage; Share in the fruits of production; and Humane conditions of work. Under Labor Relations Self-organization Collective bargaining and negotiations Peaceful concerted activities, including strike; Participation in policy and decision-making processes. Social, Labor and Welfare Legislation Constitutional provisions on labor are not self-executory, hence the need for Social Legislation, Labor Legislation and Welfare Legislation Social Legislation - Laws that provide particular kinds of protection or benefits to society or segments thereof in furtherance of social justice. Labor Legislation - Statutes, regulations and jurisprudence governing the relations between capital and labor. It provides for certain employment standards and a legal framework for negotiating, adjusting and administering those standards and other incidents of employment. Welfare Legislation - Provides for the minimum economic security, of the worker and his family in case, of loss of earnings due to death, old age, disability, dismissal, injury or disease. Social Legislation and Labor Legislation, Distinguished Labor Law, defined. The law governing the rights and duties of employers and employees with respect to Labor Standards and Labor Relations. Labor Standards Law deals with the minimum standards as to wages, hours of work and other terms and conditions of employment that employers must provide their employees. Labor Relations Law defines the status, rights and duties as well as the institutional mechanisms that govern the individual and collective interactions between employers, employees and their representatives. The Philippine Labor Code, and Other Laws Presidential Decree No. 442 Deals with Labor Standards and Labor Relations Became effective November 1, 1974 Special Laws: Laws on Social Security (SSS Law, GSIS Law, Limited Portability Law (RA 7699) National Health Insurance Act Paternity Leave Act Retirement Pay Law Home Mutual Development Fund Law Anti-Sexual Harassment Act Anti-Child Labor Act 13th Month Pay Law Migrant Workers and Overseas Filipinos Act of 1995 (R.A. No. 8042, as amended by RA 10151) Expanded Comprehensive Agrarian Reform Law Magna Carta for Public Health Workers The Philippine Labor Code, and Other Laws Labor-related provisions in Other Laws Civil Code a. Art. 1700. The relation between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective

bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects. b. Art. 1701. Neither capital nor labor shall act oppressively against the other, or impair the interest or convenience of the public. c. Art. 1702. In case of doubt, all labor legislations and all labor contracts shall be construed in favor of the safety and decent living for the laborer. d. Art. 1703. No contract which practically amounts to involuntary servitude, under any guise whatsoever, shall be valid. The Philippine Labor Code, and Other Laws Labor-related provisions in Other Laws Revised Penal Code a. Art. 289. Formation, maintenance and prohibition of combination of capital or labor through violence or threats. The penalty of arresto mayor and a fine not exceeding 300 pesos shall be imposed upon any person who, for the purpose of organizing, maintaining or preventing coalitions of capital or labor, strike of laborers or lock-out of employees, shall employ violence or threats in such a degree as to compel or force the laborers or employers in the free and legal exercise of their industry or work, if the act shall not constitute a more serious offense in accordance with the provisions of this Code. The Aim and Basis of Labor Laws Attainment of Social Justice Balance the interest of labor and capital (eliminate oppression) Labor is afforded a greater measure of protection There is greater supply of labor than demand for their services; Those who have less in life should have more in law; The need for employment by labor comes from vital, and even desperate necessity (survival); Social Justice Social justice is the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the PROMOTION OF THE WELFARE of all people, the adoption by the government of measures calculated to ensure economic stability of all the component elements of the society through the maintenance of proper economic and social equilibrium in the interrelations of- the members of the community, constitutionally, through the adoption of measures, legally justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of all governments, on the time-honored principle of salus populi est suprema lex. (Calalang v. Williams, No. 47800, December 2, 1940). Basic Principles Preliminary Discussions on the Labor Code What are the basic principles in the constitution and labor-related laws on protection to labor? The state shall afford full protection to labor, promote full employment, equal work opportunities without bias or discrimination, regulate the relations of employers and employees, and assure workers rights (refer to protection to labor clause Art. XIII, Sec. 3, 1987 Const. & Art. 3, Labor Code); The relation of capital and labor are impressed with public interest, hence employment contracts are not ordinary contracts (Art. 1700, NCC); What are the basic principles in the constitution and labor-related laws on protection to labor? In case of doubt or ambiguity, labor laws and rules are to be construed in favor of labor (Art. 4, Labor Code, Art. 1702, Civil Code) IF THERE IS DOUBT as to the meaning of the legal and contractual provision, the above-mentioned applies.

IF THE PROVISION IS CLEAR AND UNAMBIGUOUS, it must be applied in accordance with its express terms. (Meralco v. NLRC, GR No. 78763, July 12, 1989). The law also recognizes that management has rights which are also entitled to respect and enforcement in the interest of fair play (St. Luke's Medical Center Employee's Assoc, v. NLRC, GR No. 162053, March 7, 2007). Why the preference for labor over capital? Comes from acknowledgement that capital wields more power than labor; (Sanchez v. Harry Lyons Construction Inc., GR No. L-2779, October 18, 1950). There is greater supply than demand for labor; Those who have less in life should have more in law; and The need for employment by labor comes from vital, and even desperate necessity (survival) To whom does the Labor Code apply? General Rule: The Code applies to all workers, whether agricultural or nonagricultural, including employees in a government corporation incorporated under the corporation code; Exceptions: 1. Government employees; 2. Employees of government Corporations created by special or original charter; 3. Foreign governments; 4. International Agencies, employees of intergovernmental or international organizations; 5. Corporate officers/Intra-corporate disputes which fall under PD 902-A and now fall under the jurisdiction of, the Regular Courts pursuant to the Securities Regulation Code; and 6. Local water districts except where NLRC jurisdiction is invoked. Cases Government employees; Employees of government Corporations created by special or original charter (Juco v. NLRC, GR No. 98107, August 18, 1997); Foreign governments (JUSMAG-Philippines v. NLRC, GR No. 108813, December 15, 1994); International Agencies (Lasco v. UNRFNRE, GR Nos. 109095109107, February 23, 1995), employees of intergovernmental or international organizations (SEAFDEC-AQD v. NLRC, GR No. 86773, February 14, 1992); Corporate officers / Intra-corporate disputes which fall under PD 902-A and now fall under the jurisdiction of, the Regular Courts pursuant to the Securities Regulation Code (Nacpil v. IBC, GR No. 144767, March 21, 2002); and Local water districts (Tanjay Water District v. Gabaton, GR Nos. 63742 and 84300, 17 April 1989) except where NLRC jurisdiction is invoked (Zamboanga City Water District v. Buat, GR No. 104389, May 27, 1994). Who is a worker/employee? Article 13 A worker is any member of the labor force, whether employed or unemployed. A person who works for an employer for a fee; a person working for salary or wages. Note the term employee under Article 218 of the Labor Code: Not limited to the employees of a particular employer, it shall include any individual whose work has ceased as a result of or in connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other substantially equivalent or regular employment. Protection to labor should not come at the expense of oppressing capital! Law recognizes management rights. The employer has the right to Conduct business; Prescribe rules; Select and hire employees; Transfer or discharge employees; Discipline of employees, and

Return of investment and expansion of business. Management Prerogatives Rural Bank of Cantilan . v. Julve, GR No. 169750, February 27, 2007. Under the doctrine of management prerogative, every employer has the inherent right to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work" assignments, working methods, the time, place and manner of work, work supervision, transfer of employees, lay-off of workers, and discipline, dismissal, and recall of employees Mendoza v. Rural Bank of Lucban, GR No. 155421, July 7, 2004. Management prerogatives, however, are subject to limitations provided by law, contract or collective bargaining agreements and general principles of fair play and justice Viewpoints on Labor Relations The Whys and Hows State Policy on Labor Relations Article 217, Labor Code Promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration, mediation and conciliation, as modes of settling labor or industrial disputes; Promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and development; Foster the free and voluntary organization of a strong and united labor movement; Promote the enlightenment of workers concerning their rights and obligations as union members and as employees; State Policy on Labor Relations Article 217, Labor Code Provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes; Ensure a stable but dynamic and just industrial peace; and Ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare. Prohibit courts or administrative agencies or officials from setting or fixing wages, rates of pay, hours of work or other terms and conditions of employment, except as otherwise provided under the Labor Code. Social Justice Self Organization Workers organize as a union or some other form of association (registered or unregistered) Effect of registration with the State: Acquisition of legally demandable rights, e.g. right to demand collective bargaining Organization must have rules and mechanisms that respect member rights No employer influence or interference (See Article 261, Labor Code) Why Workers Organize Self Advancement Job Security Upholding the rule of law over arbitrary exercise of power by capital Provide employees a sense of participation in the enterprise Self Organization There can be many labor organizations in the workplace, but Only one recognized representative for workers in Collective Bargaining Selected by the workers themselves by way of election (with or without intervention of the government) Who may exercise right to self-organization

All persons employed in commercial, industrial and in religious, charitable, medical or educational institutions (profit or nonprofit) Includes the right to Form Join Assist Labor organizations of their own choosing Collective Bargaining Presentation of proposals and counter-proposals by the parties If capital and labor agree on substantially all points, a labor contract is forged (Collective Bargaining Agreement) If both parties do not agree on material points, this results in a deadlock Parties are obliged to avoid or break the impasse Failure to resolve a deadlock may result in work stoppage Strike Lockout Collective Bargaining While a legal right, strike or lockout is not an ideal solution to compel a party to agree to a proposal Considered as measures of last resort Strikes and lockouts are heavily regulated Purpose Manner of implementation Violation of established rules will merit sanctions (admin, civil and criminal) Parties are allowed to introduce means and methods that will expedite bargaining Subject to compliance to legal standards Collective Bargaining Parties are primarily responsible for dealing with problems arising out of their relations (Inter-party relationship) Voluntary modes of settling disputes are preferred over compulsory processes Grievance machinery: In-house problem solving structure State steps in only when Parties fail to agree Rights are violated States Intervention SSS Employees Association vs. CA, 175 SCRA 686: The principle behind labor unionism in private industry is that industrial peace cannot be secured through compulsion by law. Relations between private employers and their employees rest on an essentially voluntary basis. the terms and conditions of employment in the unionized private sector are settled through the process of collective bargaining Definitions Definitions Categories of employees Managerial employees Supervisory employees Rank-and-file employees Existence of Er-Ee Relationship is Vital in Labor Relations If there is no such relationship, there is no basis for exercising the right of self-organization for purposes of collective bargaining. Note also that Labor Arbiters cannot exercise jurisdiction where Er-Ee Relationship does not exist. (subj. to exception) Employer-Employee Relationship Four-Fold Test the selection and engagement of the employee; the payment of wages; the power of dismissal; and the power to control the employees conduct, or the so-called control test. Two-tiered test of employment relation ship Control test the employers power to direct the employee (the manner, means and methods) by which work is accomplished;

Economic reality test economic reality of the relationship; the question of economic dependency of the worker on his employer. (Read Orozco vs. CA, GR 155207, April 29, 2005) Existence of Er-Ee Relationship in the following instances: A stipulation stating expressly that there is no Er-Ee relationship is not controlling (Chavez vs. NLRC, GR No. 146530, Jan. 2005) Jeepney and taxi drivers (Paguio Transport Corp. vs. NLRC GR No. 119500, August 1998) Bus, auto-calesa drivers (R. Transport Corp. vs. Ejandra, GR No. 148508, May 2004) Fishermen (Ruga vs. NLRC, Jan. 1990) Stevedores Lawyers, doctors, nurses, dentists, public relations practioners, other professionals Employees of cooperatives Insurance agents (salaried) No Er-Ee Relationship in the following instances: Commission salesmen Agents of prinicipal (who are not employees in other respects) Working scholars (See Section 14, Rule X, Book III, IRR, Labor Code) Consultants Visiting Physicians Independent contractors Definitions Labor disputes: Includes any controversy or matter concerning terms or conditions of employment or the association or representation of persons in negotiating, fixing, maintaining changing or arranging the terms and conditions of employment, regardless of whether the disputants stand in the proximate relation of employer and employee. Labor Disputes Nature: arises from Er-Ee relationship, regardless of whether the disputants stand in the proximate relation of employer and employee; SMCEU-PTGWO vs. Bersamira & SMC, GR No. 87700, June 1990) Involves issue of SMCs exclusion of temporary, probationary & contractual employees in scope of CBA with union Subject Matter Terms and conditions of employment Association or Representation of persons Labor Disputes, Kinds Standards-related Compensation Benefits Working Conditions Relations Disputes Organizational rights/ULP Representation Bargaining Contract administration Personnel policy Employment tenure disputes Resolving Labor Disputes Grievance procedure CBA-prescribed, in-house mechanism for addressing complaints. Conciliation involves third person who meets with both parties and, by assuaging hurt feelings and cooling tempers, aids in reaching agreement. Mediation third person offers suggested solutions to dispute. Arbitration dispute is submitted to impartial third person who renders decision based on evidence, law and jurisprudence. Decision is enforceable. Voluntary by agreement of parties Compulsory directed by law. Primarily done by labor arbiters of the NLRC Resolving Labor Disputes Enforcement/Compliance Order dispute arises from concern uncovered by the exercise of enforcement/visitorial power of

SOLE, or adjudicatory powers of the DOLE Regional Directors (Articles 128, 129, Labor Code) In case of labor disputes that may affect an industry indispensable to the national interest, the following apply: Assumption of jurisdiction by DOLE Certification to the NLRC for compulsory arbitration The National Labor Relations Commission Jurisdiction, Case Flow, Appeals, Cases The National Labor Relations Commission Precursor: Court of Industrial Relations NLRC was created by the Labor Code attached to the DOLE Under EO 204, s. 2005, DOLE exercises administrative supervision over the commission Under RA 9347, several changes to the composition of the divisions, rank equivalence, and reverted to the old version of NLRCs attachment to DOLE (program and policy coordination) Equal representation from workers, employers & public sector Jurisdiction of Labor Arbiters Original and exclusive jurisdiction to hear and decide the following cases involving all workers, whether agricultural or nonagricultural (Art. 223, LC, Rule V Section 1, 2011 NLRC Rules): Unfair labor practice cases; ULP Means "Unfair labor practice" means any unfair labor practice as expressly defined by the Code (Art. 218(K), Art. 254, Art. 255). Termination disputes; If accompanied with a claim for Reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; The National Labor Relations Commission NLRC exercises adjudicatory powers and other functions through its divisions (not the individual commissioners); En banc decisions pertain only to Promulgation of rules governing hearing and disposition of cases in the divisions (e.g., 2011 NLRC Rules); Recommending Labor Arbiters to the President Allowing a division to hear and decide a case under the jurisdiction of another division Jurisdiction of Labor Arbiters 4. Claims for actual, moral, exemplary and other forms of Damages arising from the employer-employee relations; 5. Cases arising from any Violation of Article 270 of this Code, including questions involving the legality of strikes and lockouts; and 6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other Claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement (Article 223, Labor Code, as amended). Jurisdiction of Labor Arbiters 7. Original and exclusive jurisdiction over money claims arising out of employer-employee relationship or by virtue of any law or contract, involving Filipino workers for Overseas deployment, including claims for actual, moral, exemplary and other forms of damages (Section 10, Republic Act No. 8042, as amended by Republic Act No. 10022). 8. Wage distortion disputes in unorganized establishments not voluntarily settled by the parties pursuant to Republic Act No. 6727. 9. Enforcement of compromise agreements when there is noncompliance by any of the parties or if there is prima facie evidence that the settlement was obtained through fraud, misrepresentation or coercion (Article 233, Labor Code, as amended). 10. Other cases as may be provided by law. Cases

The jurisdiction of labor arbiters, as well as of the NLRC, is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statutes, or their collective bargaining agreement. U-Bix's complaint was one to collect sum of money based on civil laws on obligations and contract, not to enforce rights under the Labor Code, other labor statutes, or the collective bargaining agreement. (U-Bix Corporation, et al. vs. Valerie Anne H. Hollero, G.R. No. 177647, October 31, 2008) The jurisdiction of labor courts extends only to cases where an employer-employee relationship exists. (Jaguar Security & Investigation Agency vs. Rodolfo Sales, et. al., G.R. No. 162420, April 22, 2008) Cases Exception to the rule that Er-Ee relationship is necessary for Labor Arbiters to acquire jurisdiction: The jurisdiction of Labor Arbiters is not limited to claims arising from Employer-Employee relationships under Sec. 10 of RA 8042, which cover money claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment, including claims fordamages. Santiago vs. CF Sharp Crew Management, Inc. (GR No. 162419, July 2007) Cases Corporate Officers Nacpil vs. IBC (GR No. 144767, March 21, 2002) Officers designated by the board are corporate officers Prudential Bank and Trust Company (GR No. 141093, Feb. 20, 2001) - One rising from the ranks is not a mere corporate officer Rural Bank of Coron vs. Cortes, (GR No. 164888, Dec. 6, 2006) A corporate officer who is also an employee may file an illegal dismissal case with the labor arbiter. Cases See also Okol vs. Slimmers World International (GR No. 160146, December 11, 2009) Gomez vs. PNOC Development and Management Corporation (GR No. 174044, November 27, 2009) Atty. Virgilio R. Garcia vs. Eastern Telecommunications Philippines (GR No. 173115, April 16, 2009) Renato Real vs. Sangu Philippines, Inc. et al., G.R. No. 168757, 1/19/2011 Venue Case may be filed in the RAB having jurisdiction over the workplace of complainant or petitioner Where two or more RABs have jurisdiction, venue resides in the RAB which first acquired it No objection to venue before the filing of position papers, issue is deemed waived May be by written agreement, or by motion for meritorious cases Option of the worker Case Flow, RAB 2011 NLRC Rules of Procedure Significant changes from 2005 Rules (as discussed by Atty. Ruben Del Rosario) 1. Service of Notices, Resolutions, Orders and Decisions by Private Courier (Section 4, Rule III). Under the 2005 Rules, service of notices such as summons, notice of conference, resolutions, orders and decisions is made through the NLRCs messenger or sent by registered mail only. In the 2011 Rules, service can be done by private courier also. 2. Authority of the Labor Arbitration Associate to Conduct Conciliation and Mediation Conference (Section 8a, Rule V). The 2005 Rules state that the Labor Arbiter shall personally preside over and take full control of the proceedings. The 2011 Rules state that the Labor Arbiter may be assisted by the Labor Arbitration Associate in the conduct of the proceedings. 2011 NLRC Rules of Procedure 3. Re-filing of a Dismissed Complaint Due to Non-Appearance of Complainant (Seafarer) (Section 10, Rule V). Under both the 2005 and 2011 NLRC Rules, the Labor Arbiter can dismiss the complaint if the seafarer fails to appear,

despite due notice, during the two (2) settings for mandatory conciliation and mediation conference. The dismissal however is without prejudice which means that the seafarer can re-file his complaint. However, under the 2005 NLRC Rules, the seafarer cannot re-file the case after it has been dismissed for the 2nd time on the ground of nonappearance during the mandatory conferences. This limitation of 2nd time is not present under the 2011 NLRC Rules. It would appear that the seafarer can keep filing a new case despite dismissals of his previous cases due to non-appearance at the mandatory conferences. 4. Failure to Attend Mandatory Conferences by Respondents (Manning Agents) In case of non-appearance by the respondent (manning agent) during the first scheduled conference, the second conference as scheduled in the summons shall proceed. However, if the respondent (manning agent) still fails to appear at the second conference despite being duly served with summons, he/she shall be considered to have waived his/her right to file position paper. The above was not in the 2005 NLRC Rules and is new in the 2011 NLRC Rules. It is thus important to ensure attendance at the mandatory conferences. 2011 NLRC Rules of Procedure 5. Remedy of the Respondents (Manning Agents) When Declared To Have Waived Their Right to File Position Paper (Section 20, Rule V) In instances where a party is declared to have waived his/her right to file position paper, the 2011 NLRC Rules have provided a remedy. The 2011 NLRC Rules states: A party declared to have waived his/her right to file position paper may, at any time after notice thereof and before a case is submitted for decision, file a motion under oath to set aside the order of waiver upon proper showing that failure to appear during the hearings was due to justifiable and meritorious grounds. If said motion is granted, the manning agents can now file the necessary Position Paper. 6. Limited Period to Conduct Hearing or Clarificatory Conference (Section 14a, Rule V) The concept of hearing or clarificatory conference referred to in this rule is independent of and different from the mediation or conciliation hearing wherein the seafarer and the manning agents are encouraged to enter into an amicable settlement. The clarificatory hearing is conducted after the submission of the position papers Briefly stated, a clarificatory hearing is rarely held and it is discretionary on the part of the Labor Arbiter. As the term connotes, its purpose is to ask the parties clarificatory questions to further elicit facts or information which will include obtaining relevant documentary evidence from any party or witness. . The hearing or clarificatory conference shall be terminated within thirty (30) calendar days from the date of the initial clarificatory conference. The period now is shorter as it was ninety (90) calendar days under the 2005 NLRC Rules. In any event, under both the 2005 and 2011 Rules, cases involving overseas Filipino workers (including seafarers) the mandatory conciliation and mediation conferences and clarificatory conferences must be terminated within sixty (60) days from the acquisition of jurisdiction by the Labor Arbiter over the person of the respondents. 2011 NLRC Rules of Procedure 7. Procedure for Recovery of Amount Paid to the Seafarer During Execution Proceedings (Section 14, Rule XI) By way of brief background, if the case is lost in the Labor Arbiter level, the manning agents/principals can file an appeal before the Commission level to assail the Labor Arbiters decision. If the appeal is dismissed, the remedy of the manning agents is to file a Motion for Reconsideration. The denial of the motion will render the Labor Arbiters decision final and executory.

Consequently, at this stage, manning agents and their principals are required to pay the seafarer based on said final award. In the meantime, the case can still continue because the manning agents has the remedy of elevating the matter to the Court of Appeals and eventually, to the Supreme Court. In some cases, the Court of Appeals and/or the Supreme Court would either reverse (the seafarer is not entitled at all to his claim) or modify (the judgment award is reduced) the decision of the NLRC. In case of reversal or modification by the Court of Appeals or Supreme Court of the Labor Arbiters decision, the next recourse of the manning agents is to recover the amount it has previously paid to the seafarer. The present 2011 NLRC Rules of Procedure explicitly provides for the steps on how to recover the said amount from the seafarer. Under the 2011 NLRC Rules the Labor Arbiters of the NLRC can issue orders of restitution to enable the manning agents to recover the amount they previously paid to the claimants as a result of the reversed or modified decisions of the NLRC. This provision was not present under the 2005 NLRC Rules. 2011 NLRC Rules of Procedure 8. Extraordinary Remedy Available to the Manning Agents/Principals Other Than Appeal (Rule XII) One of, if not, the most critical stage in NLRC proceedings is during execution of the judgment award. It is at this point that the seafarer can now collect from the manning agents or the bonding company the amount mentioned in the Labor Arbiters decision. The writ of execution is the basic document which would empower the NLRC Sheriff to collect the judgment award from manning agent which is the losing party. Under the 2005 NLRC Rules of Procedure, once the writ is issued, the manning agents are already helpless to stop the NLRC Sheriff from enforcing the judgment award unless of course, and this is very rare, the Court of Appeals issues a Temporary Restraining Order and/or Writ of Injunction. The 2011 NLRC Rules of Procedure provides for a specific remedy. It is not in the form of an appeal but a verified petition with the NLRC Commission the purpose of which is to annul or modify the order of the Labor Arbiter issuing the writ of execution. The immediate effect of the filing of the said verified Petition is that the NLRC Sheriff cannot, in the meantime, enforce the writ of execution or the NLRC Sheriff, in laymans term, cannot collect the amount stated in the decision from the manning agents or from the bonding company. Please note that the mere filing of the verified Petition will prevent the bank of either the manning agents or the bonding company from releasing the garnished amount to the seafarer within fifteen (15) calendar days from the filing of the Petition. Of course, the period can be longer if the NLRC issues a Temporary Restraining Order or Writ of Preliminary Injunction which has a lifetime of twenty (20) or sixty (60) days, respectively. It can also go beyond said period if the NLRC issues a final injunction. However, the Temporary Restraining Order or the Writ of Preliminary Injunction only becomes effective upon posting by the manning agents of a cash bond, not surety bond, amounting to Php50,000.00 or a higher amount as may be required by the NLRC. Important Note: While the extraordinary remedy described above can be availed of during execution proceedings, Rule XII of the 2011 NLRC Rules can be availed of by any party aggrieved by an order or resolution of the Labor Arbiter. It is thus not confined to just execution proceedings but on all orders or resolutions of the Labor Arbiter. For example, if the manning agent files a Motion to Dismiss on the ground that the seafarer has already been paid his disability benefits and it is denied by the Labor Arbiter, the manning agent can avail of the extraordinary remedy under Rule XII of the 2011 NLRC Rules. The above are the currently perceived significant changes but we are

continually reviewing the 2011 NLRC Rules and will report on any other significant developments in subsequent updates. 2011 NLRC Rules, amendments En Banc Resolution 11-12 amended the 2011 NLRC Rules of Procedure. Venue: When venue is not objected to before the first scheduled mandatory conference, such issue or objection will be deemed waived. (Rule IV, Section 1, par. c) Confidentiality of Commission Records: access to pleadings and other documents filed by parties to a case are restricted. Reports, drafts of decisions, records of deliberations, and other documents involving private rights are made confidential. Nevertheless, decisions, resolutions and orders of the NLRC are open to the parties and their counsel or authorized representative during office hours. (Rule XIII, Section 8) 2011 NLRC Rules, amendments RULE V, SECTION 11. AMENDMENT OF COMPLAINT/PETITION. An amended complaint or petition may be filed before the Labor Arbiter at any time before the filing of position paper, with proof of service of a copy thereof to the opposing party/ies. If the amendment of the complaint or petition involves impleading additional respondent/s, service of another summons in accordance with Section 3 hereof is necessary to acquire jurisdiction over the person of the said respondent/s. RULE V, SECTION 20. DEATH OF PARTIES. In case a complainant dies during the pendency of the proceedings, he/she may be substituted by his/her heirs. If it is the individual respondent, the provision of Section 20, Rule 3 of the Rules of Court shall apply. RULE XI, SECTION 5. EFFECT OF A MOTION TO LIFT ENTRY OF JUDGMENT. In case a motion to lift Entry of Judgment is filed, the execution proceedings shall not be suspended and the records of the case shall not be elevated to the Commission unless ordered otherwise. RULE XI, SECTION 11 EXECUTION IN CASE OF DEATH OF PARTY. Where a party dies after the entry of judgment or issuance of certificate of finality, execution thereon may issue or one already issued may be enforced in accordance with the applicable provisions of the Rules of Court. The sheriff shall submit to the Commission or Labor Arbiter a report before and after the sale. Proceeds of the sale should be deposited with the Cashier for proper disposition by the Commission or Labor Arbiter. The foregoing provisions provide mechanisms to: a) amend complaints b) substitute heirs in case of death of a party and c) execute judgments. The amendments also clarify certain ambiguities in the rules. For instance, the amended rules specify the reckoning point of the five (5) year effectivity of the writ of execution, which is the date of entry of judgment or issuance of certificate of finality. (Rule XI, Section 7) In respect of execution of monetary judgments, the amended rules state the manner by which a losing party may voluntarily tender payment. The amended rules also enumerate the order of funds and properties against which the judgment may be enforced in the event the losing party refuses or fails to pay. Notably, the prevailing party may even file a motion for the issuance of a break open order with the Commission or the Labor Arbiter if the losing party prevents the sheriff from entering the place where the property subject of execution is kept. (Rule XI, Section 9 and 10) The amended rules introduced a new provision, which would have a significant effect during execution proceedings. It contemplates a situation where a case is elevated to the Court of Appeals and subsequently to the Supreme Court. The new provision states that a total or partial reversal of judgment by the Court of Appeals has the effect of suspending the execution insofar as the reversal is concerned even during the pendency of a motion for reconsideration on such judgment. Where the judgment of the Court of Appeals is reversed by the Supreme Court, execution proceedings shall commence upon presentation of a certified true copy of the decision and entry of judgment. (Section 17, Rule XI) Doctrine of Forum Non Conveniens Manila Hotel Corporation vs. NLRC (GR No. 120077, October 13, 2000) The NLRC has no jurisdiction when the main aspects of

the case transpired in foreign jurisdictions and the only link that the Philippines has with the case is that the employee is a Filipino citizen. PNB vs. Cabansag (GR No. 157010, June 21, 2005) when the employee is directly hired in a foreign country but nonetheless secures a (POEA) employment certificate, she is an OFW and thus the case falls under the jurisdiction of the labor arbiter. Counter claims of employers Banez vs. Valdevilla (GR No. 128024, May 9, 2000) Art. 217 (now 223) is comprehensive enough to include claims for all forms of damages arising from Er-Ee relations, including Ers claims for actual damages against a dismissed Ee. Domondon vs. NLRC (GR No. 154376, Sept. 30, 2005) NLRC, Jurisdiction Two kinds Original Jurisdiction Injunction in ordinary labor disputes Injunction in strikes and lockouts under Article 270, LC Certified labor disputes in industries indispensable to the national interest, where work stoppage is likely or has already occured Exclusive Appellate Jurisdiction Cases decided by the labor arbiters Cases decided by DOLE regional directors under Article 129 Labor Arbiters & NLRC, distinction of jurisdictions NLRC has exclusive appellate jurisdiction on all cases decided by the labor arbiters. NLRC does not have original jurisdiction on the cases over which labor arbiters have original and exclusive jurisdiction. If the labor arbiter does not exercise original and exclusive jurisdiction over a case, the NLRC has no appellate jurisdiction over it. Appeals Labor Arbiters decisions ordinary appeal to the NLRC, w/in 10 calendar days from receipt. NLRCs decision on appeal is elevated to the CA by way of special civil action (Rule 65), and then under ordinary appeal (Rule 45) to the SC Grounds of Appeal Prima facie evidence of abuse of discretion on the part of the labor arbiter Decision, order or award was secured through fraud or coercion, including graft and corruption Purely on questions of law Serious errors in the findings of facts which would cause grave or irreparable damage or injury to appellant Perfection of Appeal, requisites Filed within reglementary period (ten days from receipt of decision by party seeking appeal) Under oath Appeal fee Posting of cash or surety bond (where judgment involves monetary award) Proof of service to adverse party Appeal Note the following: Labor arbiter loses jurisdiction upon perfection of appeal Lack of verification is not fatal nor jurisdictional Appeal is still valid despite failure to pay docket fee, but refusal to pay despite directive is fatal Raising new issues or changing theory on appeal is not allowed. Reinstatement Order Reinstatement is immediately executory even pending appeal Pioneer Texturizing Corporation vs. NLRC employer is dutybound to inform employee of reinstatement An employer may not stay execution of reinstatement, even when he has posted a bond Roquero vs. PAL (GR No. 152329, April 2003) - Labor arbiter has ministerial duty to implement reinstatement order

Reinstatement by Employer Actual reinstatement of the employee to his work under the same terms and conditions prior to dismissal or separation, or Reinstatement in the payroll of the company, without requiring actual return to work Bureau of Labor Relations FUNCTIONS OF THE BUREAU OF LABOR RELATIONS ABSORBED BY NCMB Pursuant to E.O. 126, the National Conciliation and Mediation Board (NCMB) has absorbed the conciliation, mediation and voluntary arbitration functions of the BLR. The BLR functions, as it now stands are confined largely to union matters, collective bargaining and labor education. Jurisdiction over labor-management problems or disputes is also exercised by other offices such as the DOLE regional offices, the Office of the Secretary of Labor, NLRC, POEA, OWWA, SSS-ECC, the regional wage and productivity boards, NWPC, and even the regular courts over intra-corporate disputes. Exclusive and Original Jurisdiction of the BLR To act on its own initiative or upon the request of either or both parties on all: INTRA-union conflicts; INTER-union conflicts; and OTHER RELATED Labor Relations Disputes Other Related Labor Relations Disputes (Sec. 2, Rule XI D.O. 40-03) Shall include any conflict between a labor organization and the employer or any individual, entity, or group that is NOT a labor organization or workers association. This includes: Cancellation of registration of unions and workers associations; and A petition for interpleader. EO 251, S. 1987 removed from the jurisdiction of the BLR all labor-management disputes. The effect of E.O. 251 is to transfer to the NCMB the mediation, conciliation, and arbitration functions of the BLR. The parties may, by agreement, settle their differences by submitting their case to a voluntary arbitrator rather than taking the case to the BLR. EO 251, S. 1987 This category of labor relations disputes as the name suggests is related to inter/intra union disputes to differentiate it from other labor-management disputes, such as those under Article 128: Visitorial and enforcement power Article 129: recovery of wages, simple money claims and other benefits Article 223: Jurisdiction of the LA and NLRC Article 267: Jurisdiction of VA Article 270(g): Secretary of Labor, on possibility of strikes and lockouts Functions and Authority of BLR under the 1987 Administrative Code Sec. 16. Bureau of Labor Relations The BLR shall: Set policies, standards, and procedures on the registration and supervision of legitimate labor union activities including denial, cancellation, and revocation of labor union permits; Set policies, standards and procedures relating to collective bargaining agreements, and the examination of financial records of accounts of labor organization to determine compliance with relevant laws; Provide proper orientation to workers on their schemes and projects for improvement of the standards of living of workers and their families. Union Disputes Intra-Union Disputes refer to any conflict between and among union members, including grievances arising from any violation of the rights and conditions of membership, violation of or disagreement over any provision of the unions constitution and by-laws, or disputes arising from chartering or affiliation. Inter-Union Disputes refer to any conflict between and among legitimate labor organizations involving representation questions for purposes of collective bargaining or to any other conflict or

dispute between legitimate labor organizations based on any violations of their rights as labor organizations. Coverage of Inter/Intra-Union Disputes (Sec. 1 Rule XI, D.O. 40-03) Cancellation of registration of a labor organization filed by its members or by any other labor organization; Conduct of election of union and workers association officers/nullification of election of union and workers association officers; Audit/accounts examination of union or workers association funds; De-registration of CBA; Validity/invalidity of union affiliation or disaffiliation; Validity/invalidity of acceptance/non-acceptance for union membership; Coverage of Inter/Intra-Union Disputes (Sec. 1 Rule XI, D.O. 40-03) Validity/invalidity of impeachment/expulsion of union and workers association officers; Validity/invalidity of voluntary recognition; Opposition to application for union and CBA registration; Violations of or disagreements over any provision in a union or workers association constitution and by-laws; Coverage of Inter/Intra-Union Disputes (Sec. 1 Rule XI, D.O. 40-03) Disagreements over chartering or registration of labor organizations and CBAs; Violations of the rights and conditions of union or workers association membership; Violations of the rights of legitimate labor organizations, except interpretation of CBAs; and Such other disputes or conflicts involving the rights to selforganization, union membership, and collective bargaining Between and among legitimate labor organizations; and Between and among members of a union or workers association. Special Requirements as to the Filing of Cases Involving Entire Membership The complaint must be signed by at least 30% of the entire membership of the union; and It must also show exhaustion of administrative remedies. Special Requirements as to the Filing of Cases Involving a Member Only In such case, only the affected member may file the complaint. Redress must first be sough within the union itself in accordance with its constitution and bylaws EXCEPT under any of the following circumstances: Futility of intra-union remedies; Improper expulsion procedure; Undue delay in appeal as to constitute substantial injustice; The action is for damages; Special Requirements as to the Filing of Cases Involving a Member Only In such case, only the affected member may file the complaint. Redress must first be sough within the union itself in accordance with its constitution and bylaws EXCEPT under any of the following circumstances: Lack of jurisdiction of the investigating body; Action of the administrative agency is patently illegal, arbitrary, and oppressive; Issue is purely a question of law; Where the administrative agency had already prejudged the case; and Where the administrative agency was practically given the opportunity to act on the case but did not. Effects of Filing or Pendency of Inter/Intra-Union Dispute and other Labor Relations Disputes (Sec. 3, Rule XI, D.O. 40-03)

Who: Where

The rights, relationships and obligations of the part-litigants against each other and other parties-in-interest prior to the institution of the petition shall continue to remain during the pendency of the petition and until the date of finality of the decision rendered therein. Thereafter, the rights, relationships and obligations of the party litigants against each other and other parties-in-interest shall be governed by the decision so ordered. Modes of Appeal in Intra/Inter-Union Disputes (Rule XI, D.O. 4003 Summary of Rules on Inter/Intra Union Disputes For grounds under Section 1: any LLO members thereof specially concerned For grounds under Section 2: any party-in-interest

RO that issued its certificate of registration or certificate of creation of chartered local if it involves labor unions with independent registration, chartered locals, workers association, its officers or members. Directly with the BLR if it involves a federation/national union/industry union, its officers or members Effects of Filing or Pendency of Inter/Intra-Union Dispute and other Labor Relations Disputes (Sec. 3, Rule XI, D.O. 40-03) The filing or pendency of any inter/intra-union disputes is not a prejudicial question to any petition for certification election and shall not be a ground for the dismissal of a petition for certification election or suspension of proceedings for certification election. Summary of Rules on Inter/Intra Union Disputes Formal requirements In writing Verified under oath Contains: Name, address and other personal circumstances of the complainant or petitioner Name, address and other personal circumstances of the respondent or person charged Nature of complaint or petition Facts and circumstances surrounding complaint or petition Causes of action Statement on exhaustion of Administrative Remedies Reliefs prayed for Certification of non-forum shopping Other relevant matters Administrative functions of BLR Regulation and registration of labor unions Keeping of registry of labor unions Maintenance of a file of CBAs Maintenance of a file of all settlements or final decisions of the SC, CA, NLRC and other agencies on labor disputes BLR has no jurisdiction over implementation or interpretation of CBAs, which shall be subject of grievance procedure and/or Voluntary arbitration. Compromise Agreements Purpose: Parties agree to Avoid litigation, or Put an end to one already in place How: making reciprocal concessions Win-win Substantial requirements Voluntary, devoid of coercion Not contrary to law, morals, public policy Reasonable Formal requirements In writing Signed in the presence of person before whom case is filed Compromise Agreements When effected: At any stage of the proceedings, even when there is already a final & executory judgment

EXCEPT when judgment is in process of execution Validity: Valid and binding on both parties, with or without DOLE assistance Repudiation: If done without DOLE assistance In case of non-compliance with agreement Prima facie evidence of fraud, misrepresentation, coercion Compromise Agreements Options when agreement is violated: Enforce compliance Regard as rescinded, revert to original demand Quitclaim: A formal renunciation or relinquishing of a claim Usually integral in compromise agreements Compromise Agreements Cases: Mindoro Lumber vs. Baay,, GR No. 158753, June 2005 Veloso and Liguaton vs. DOLE, Noahs Ark Sugar Carriers, GR No. 87297, Aug. 1991 JAG & Haggar Jeans vs. NLRC, GR No. 105710, Feb. 1995 Magbanua vs. Uy, GR No.161003, May 2005 Registration and Cancellation Labor Organizations Definitions (Article 218) "Labor organization" means any union or association of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and conditions of employment. "Legitimate labor organization" means any labor organization duly registered with the Department of Labor and Employment, and includes any branch or local thereof. "Bargaining representative" means a legitimate labor organization whether or not employed by the employer. Definitions (DO 40-03) "Chartered Local" refers to a labor organization in the private sector operating at the enterprise level that acquired legal personality through the issuance of a charter certificate by a duly registered federation or national union, and reported to the Regional Office in accordance with Rule III, Section 2-E of these Rules. "Exclusive Bargaining Representative" refers to a legitimate labor union duly recognized or certified as the sole and exclusive bargaining representative or agent of all the employees in a bargaining unit. "Independent Union" refers to a labor organization operating at the enterprise level that acquired legal personality through independent registration under Article 234 of the Labor Code and Rule III, Section 2-A of these Rules. Definitions (DO 40-03) "Labor Organization" refers to any union or association of employees in the private sector which exists in whole or in part for the purpose of collective bargaining, mutual aid, interest, cooperation, protection, or other lawful purposes. "Labor Relations Division" refers to the (1) Labor Organization and CBA Registration Unit and (2) Med-Arbitration Unit in the Regional Office. The Labor Organization and CBA Registration Unit is in charge of processing the applications for registration of independent unions, chartered locals, workers associations and collective bargaining agreements, maintaining said records and all other reports and incidents pertaining to labor organizations and workers' associations. Definitions (DO 40-03) "Legitimate Labor Organization" refers to any labor organization in the private sector registered or reported with the DOLE in accordance with Rules III and IV of these Rules. "Legitimate Workers' Association" refers to an association of workers organized for mutual aid and protection of its members or for any legitimate purpose other than collective bargaining

registered with the DOLE in accordance with Rule III, Sections 2-C and 2-D of these Rules. Two-Fold Purpose of Labor Organizations Dealing with the Employer interaction between employers and employees concerning Grievances Wages Hours Other terms and conditions of employment Applies even without registration Two-Fold Purpose of Labor Organizations Collective Bargaining is a right acquired through registration, and recognition or certification as the exclusive bargaining representative Classifications of LOs At the National Level National Union/Federation Industry Union Trade Union Center Alliance Company Union Enterprise Level Independent Labor Union Chapter RA 9481 AN ACT STRENGTHENING THE WORKERS' CONSTITUTIONAL RIGHT TO SELF-ORGANIZATION, AMENDING FOR THE PURPOSE PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS THE LABOR CODE OF THE PHILIPPINES Amended Articles 240, 244, 245, 261, 262 & 263 Changes to Labor Code Re: Registration of Labor Organizations 20% membership of employees in bargaining unit required only for independent unions Chapters acquire legal personality (for purposes of certification election) upon receiving their charter certificate Grounds of cancellation revised. Some grounds were removed as they were not promotive of self organization rights Petition for Certification Election will continue to be heard despite petition to cancel registration Changes to Labor Code Re: Registration of Labor Organizations Cancellation may be effected by vote of two-thirds of membership, with application to cancel submitted to DOLE by the organizations board Reportorial requirements Supervisors Union and Rank and File Unions may join same Federation Commingling of supervisors and rank & file employees no longer a ground for cancellation Changes to Labor Code Re: Registration of Labor Organizations PCEs filed by a federation on behalf of its chapter need not identify the chapters officers and members Employer cannot oppose a petition for certification election; he is considered a bystander Registration of Labor Organizations Legal personality Enjoy the rights given to legitimate labor organization. Petition for certification election Bargaining rights Right to strike Non-registered unions are not illegitimate or illegal Registration of Labor Organization Union registration refers to the process of determining whether the application for registration of a labor union organized for collective bargaining complies with the documentary requirements prescribed under Rule 3 and 4 of DOLE Department Order No. 4003and the rules implementing Book V of the Labor Code, as amended. Registration of Labor Organization All labor unions whose members are employed in commercial, industrial and agricultural enterprises, and employees of government-owned and controlled corporations without original charters established under the Corporation Code, including religious, charitable, medical or educational institutions whether

operating for profit or not which exist in whole and in part for collective bargaining. Alien employees with valid working permits issued by DOLE may exercise their right to self-organization and join or assist labor unions for purposes of collective bargaining if they are nationals of a country which grants the same or similar rights to Filipino workers, as certified by the Department of Foreign Affairs. Requirements, Local or Chapter Duly accomplished and notarized Application Form; Charter certificate issued by the federation or national union indicating the creation or establishment of the local/chapter; The names of the local/chapters officers, their addresses and principal office of the local/chapter; and, The local/chapters constitution and by-laws, provided that where the local/chapters constitution and by-laws is the same as that of the federation or national union, this fact shall be indicated accordingly. Requirements, Independent LO Duly accomplished and notarized Application Form; Minutes of Organizational Meeting and Attendance Sheet List of Members Financial Report if in existence for at least one (1) year Requirements, Independent LO If less than 1 year, and has not collected any amount, a certification to this effect. Constitution and by-laws accompanied by the names and signatures of ratifying members. Minutes of adoption or ratification of the constitution and bylaws, date/s when ratification was made and list of ratifying members. Requirements, Independent LO Minutes of adoption or ratification is not required if it is done simultaneously with the organizational meeting including the date/s when ratification was made and list of ratifying members. Statement that it is not reported as a chartered local or any federation. List of members comprising at least 20% of the employees of the bargaining unit. Affiliation/Disaffiliation The independent unions act of entering into an agreement of affiliation with a federation or national union, or A chartered locals act of maintaining its ties to a federation or national union despite its subsequent independent registration Requirements of Affiliation Report of affiliation of independently registered labor union; Resolution of LU board approving affiliation Total number of members, and names of those approving affiliation Certificate of affiliation Written notice to the employer concerned if the affiliating union is the bargaining agent Chartering vs. Independent Registration Revocation of Charter May only occur on the grounds of disloyalty or such grounds specified in the constitution & by-laws; Effected by serving a verified notice to the local/chapter, copy the BLR Effect revocation of legal personality, except if local chapter has acquired independent registration. If covered by CBA, local chapter may be given opportunity to register independently BLR Action Act on all applications within 30 days from filing, provided all documents and papers required have been submitted; When DOLE refuses to register a labor organization which has complied with the requirements, mandamus is the proper remedy Approval Order and Certificate of Registration Disapproval Decision which states clearly reasons for denial Cancellation of Registration BLR has jurisdiction Only for grounds in Article 245 Petition for cancellation will not suspend PCE proceedings

Union may still seek just and equitable remedies in appropriate courts Grounds for Cancellation Misrepresentation, false statements or fraud in connection with the adoption or ratification of the constitution and by-laws or amendments thereto, minutes of ratification and list of members who took part Misrepresentation, false statements or fraud in connection with the election of officers, minutes of the election of officers and list of voters Voluntary dissolution by members Grounds for Cancellation Ten grounds in Article 245 prior to RA 9481 have been reduced to three Examples of removed grounds Failure to submit reportorial requirements Illegal strike Engaging in cabo system Voluntary Dissolution May be done by members themselves 2/3 of general membership votes during a meeting called for the purpose of dissolving organization Application to cancel registration submitted by the board, attested by the president Rights & Conditions of Membership, LO Article 247 Arbitrary or excessive initiation fees Full and detailed reports Direct election of officers Determination of major policy affecting entire membership of organization Exclusion of subversive persons from membership Exclusion of convicted member as union officer Collection or disbursement only by authorized officers Receipts for all payments Rights & Conditions of Membership, LO Article 247 Funds for authorized use only Ban on unauthorized compensation on officers True and correct accounting of funds Inspection of records of organization No unauthorized special levy or assessment of fees Check off Information on the Constitution and by-laws Rights & Conditions of Membership, LO Article 247can be best grouped into four basic classifications Political rights right to vote and be voted for Deliberation and decision-making. Right to participate in deliberations on major policy questions and decide by secret ballot Money matters Information 1. Constitution and By-laws 2. Collective Bargaining Agreement 3. Labor Laws Violation of Rights of Union Members, Consequences Cancellation of union registration, OR Expulsion from office of a union officer. 30% of all members (if affecting entire membership) must concur re filing of complaint with the BLR Only affected member/members may file a complaint pertaining to a violation of which they are affected Relationship of the Union and its Members Ang Malayang Manggagawa ng Ang Tibay Enterprises, et al. vs. Ang Tibay, et al., G.R. No. L-8259, December 1957: The relationship of the union and the members is governed by their mutual agreement, the terms and conditions of which are set forth in the union constitution and by laws and binding on the members as well as the organization itself Prohibited as members Non-employees (247(c))

Subversives (247(e)) What about persons convicted of crimes involving moral turpitude? Allowed as members, not eligible for election as officer (247(f)) Limitations The labor organization cannot compel employees to become members of their labor organization if they are already members of a RIVAL UNION The persons mentioned in Art 247[e] (SUBVERSIVES) of the Labor Code are prohibited from becoming a member of a labor organization The members of RELIGIOUS ORGANIZATION whose religion forbids membership in labor organization could not be compelled into union membership (Victoriano v. Elizalde Rope Workers Union, L-25246 September 1974) Who are entitled to vote? Tancino vs. Pura Ferrer-Calleja, G.R. 78131, Jan. 1988 Only members of the union have the eligibility to take part in the election of union officers. Eligibility to vote may be determined through the use of the applicable payroll period and the status of the employees during the applicable period. This pertains to the payroll of the month next preceding the labor dispute, in case of regular employees and the payroll period at or near the peak of operation, in case of employees in seasonal industries. Requirements for Levy of Special Assessments or Extraordinary Fees Written resolution; Approved by a majority of all members; and Approval obtained at a general membership meeting duly called for that purpose. Secretary of the organization shall record the minutes of the meeting, which shall be attested to by the President. list of all members present votes cast; and purpose of the assessment or fees Strict Compliance Enjoined (Palacol et aa. v Ferrer-Galleja, et al, GR No. 85222, February 6, 1990) - Substantial compliance with the aforementioned procedure is not enough the requirements must be strictly complied with Check-off A method of deducting from an employees pay at prescribed period, the amounts due to the union for fees, fines or assessments Nature and Purpose of Check-off Union dues are the lifeblood of the union. All unions are authorized to collect reasonable membership fees, union dues, assessments and fines and other contributions for labor education and research, mutual death and hospitalization benefits, welfare fund, strike fund and credit and cooperative undertakings (Art. 283 [a]) Requirements With Regard to Check-offs (Art 241 [O]) General Rule: NO special assessment, attorneys fees, registration fees or any other extraordinary fees may be checked off from any amount due an employee without an individual written authorization duly signed by the employee The Authorization should specifically state the: Amount; and Purpose and the beneficiary of the deduction Exceptions For mandatory activities provided under the Code; and When non-members of the union avail of the benefits of the CBA: Said non-members may be assessed union dues equivalent to that paid by members; Only by a board resolution approved by majority of the members in a general meeting called for the purpose Check Off Eduardo J. Marino, Jr. et al. vs. Gil Y. Gamilla, et al., G.R. No. 149763, July 7, 2009: The individual written authorization duly


2. 3. 4.

signed by the employee is an additional requirement in order that a special assessment may be validly checked-off. In case of checkoff another requisite is necessary in addition to the requirements for special assessment, enumerated above and this is, individual written authorization for check-off duly signed by the employee concerned. Jurisdiction over Check-Off Disputes Being an intra-union conflict, the Regional Director of DOLE has jurisdiction over check off disputes. Union Dues Regular monthly contributions paid by the members to the union in exchange for the benefits given to them by the CBA and to finance the activities of the union in representing them. Agency Fees Dues equivalent to union dues charged from the non-union members who were benefited by the CBA provisions. The relationship between the non-union employees and the Union that is the bargaining representative is that of principal agent Since the union was able to secure better terms and conditions of employment for all employees, it is proper that they be compensated for their representation Requisites for Assessing Agency Fees The employee is part of the bargaining unit, He is not a member of the union; and He partook of the benefits of the CBA Written authorization is not necessary for collection Union Dues vs. Agency Fees Agency Fees not Imposable NAIBAILU v. San Miguel Brewery Inc., GR No. 18170, August 31, 1963 Agency Fee cannot be imposed on employees already in the service and are members of another union. If a closed shop agreement cannot be applied to them, neither may an agency fee, as a lesser form of union security, be imposed to them. Payment by non-union members of agency fees does not amount to an unjust enrichment basically because the purpose of such dues is to avoid discrimination between union and non-union members. Coverage of CBA to Include Employee-Members of Another Union Members of a rival union are NOT Considered Free Riders When the union bids to be the bargaining agent, it voluntarily assumes the responsibility of representing all employees in the appropriate bargaining unit. CHAPTER III. RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS ART.248 RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS Rights of A Legitimate Labor Organization Undertake activities for benefit of members; Sue and be sued; Exclusive representative of all employees; Represent union members; Be furnished audited financial statements by employers; Own properties; and Be exempted from taxes. ART.248-A: REPORTORIAL REQUIREMENTS Constitution and by-laws, or amendments thereto, minutes of ratification, and the list of members who took part in the ratification of the constitution and by-laws or amendments thereto; List of officers, minutes of the election of officers and list of voters within 30 days from election; ART.248-A: REPORTORIAL REQUIREMENTS Annual financial report within 30 days after the close of every fiscal year; and List of members at least once a year or whenever required by the Bureau Failure to comply with the above-mentioned requirements shall not be a ground for cancellation of union registration Erring officers or members to be suspended, expelled from membership, or otherwise sanctioned. Title Five:Coverage Art. 249: Coverage and Employees Right to Self-Organization

Constitutional Basis of the Right to Self-Organization Art. III, Sec. 8. The right of the people, including those employed in the public or private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged. Art. XIII, Sec. 3. The State shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities including the right to strike in accordance with law. Right to Self-Organization, Extent To form, join and assist labor organizations for the purpose of collective bargaining through representatives of their own choosing; and To engage in lawful concerted activities for the same purpose or for their mutual aid and protection (Art. 252) Right to Self-Organization,Coverage All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable, medical, or educational institutions Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without definite Employers may form labor organizations for their mutual aid and protection. Right to Self-Organization,Coverage Art. 250 : Rights of Employees in the public service Employees of government corporations established under the Corporation Code shall have the right to organize and bargain collectively with their respective ERs. All other EEs in the civil service shall have the right to form associations for the purposes not contrary to law. Right to Self-Organization,Coverage Art. 251 : Managerial employees are not eligible to join, assist, or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank-andfile EEs but may join, assist or form separate labor organizations of their own. Examples 1. Reys Hair Salon refused to bargain with the union of the barbershop composed of eight barbers on the ground that the shop was a service establishment and the number of the barbers was less than ten. Is the contention tenable? No. The law does not fix the minimum number of employees for the exercise of the right to self-organization and the right extends to all types of establishments. Examples 2. Faculty members of a non-profit school converted their club into a labor union. Is this allowed? Yes. Even employees in non-profit or religious organizations are entitled to exercise this right. Examples 3. Is a religious sects directive to its congregation not to join a labor union a bar for members to form their own union? The right of the members of a sect not to join a labor union for being contrary to their religious beliefs does not bar the members of that sect from forming their own union. (Kapatiran vs. Calleja) Supervisory Employees Those, who, in the interest of the ER, effectively recommend such managerial actions if in the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. (Art. 218) The criterion which determines whether a particular employee is within the definition of a statute is the character of the work performed rather than the title or nomenclature of position held. (NSRC vs. NLRC) Supervisory Employees If the recommendation of the teacher area supervisor is subject to evaluation, review and final approval of the principal, is the teacher a supervisory employee? No. This is merely ineffective or clerical recommendation. ( Laguna Colleges vs. CIR ) Supervisors were given the job of either to assist the foreman if the effective dispatch of manpower and equipment or execute and coordinate work plans emanating from his supervisors. Are

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these supervisors supervisory personnel? No. They only execute approved and established policies leaving little or no discretion at all whether to implement the said policies or not. (Southern Philippines Federation vs. Calleja) Non-Abridgement of the Right to Organize Art. 252 speaks of the illegality of the following acts with respect to the exercise to the right of self-organization Restraint Coercion Discrimination Undue interfere with employees and the workers in their exercise of self-organization right Non-Abridgement of the Right to Organize Alexander Reyes vs. Cresenciano Trejano , GR No. 84433, June 1992. The right to self-organization includes the right not to form or join a union Airtime Specialists vs. Ferrer- Calleja, (180 SCRA 179). The intendment of the law is to grant to bona-fide employees of a bargaining unit, whether members of a labor organization or not, the right to vote in certification elections However, by virtue of the operation or enforcement of a closed shop clause in a CBA, an employee may be compelled under pain of dismissal, to become a member of a labor union. Non-Abridgement of the Right to Organize May an ER impose as condition for employment that the applicant shall not join a labor organization or shall withdraw from the one he belongs to? No. Such a condition partakes of the nature of a yellow dog contract and constitutes an unfair labor practice. It is interference with the individuals right to self-organization. Non-Abridgement of the Right to Organize SPFL v. Calleja, 179 SCRA 127, GR No. 80882, April 1989. The right to self-organization must be upheld in the absence of express provision of law to the contrary. It cannot be curtailed by a Collective Bargaining Agreement Labor Code Provisions on Unfair Labor Practices Art. 253 concept of ULP and procedure for prosecution Art. 254 ULP by employers Art. 255 ULP by labor organizations Art. 267 CBA violations which are gross in character Art. 270(c) union busting involving dismissal of union officers which threatens existence of union Elements of Unfair Labor Practice Concurrence of BOTH There should exist an employer-employee relationship between the offended party and offender Act complained of must be EXPRESSLY mentioned and defined in the Labor Code ULP of Employers Interference, restraint, coercion of employees in the exercise of their right to self organization; Yellow dog contract Contracting out services or functions performed by union members, that interfere, restrain or coerce employees in the exercise of their right Company union Company Union Initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization Includes giving of financial or other support to it or its organizers or supporters ULP of Employers Discrimination Wages, hours of work, terms and conditions of employment Except with respect to Union Security Clauses Dismissal or prejudice or discrimination by reason of testimony Violation of duty to bargain Payment of Negotiation or Attorneys Fees to the Union, its officers or agents Violate CBA Yellow dog contract

Known previously as infamous document or iron-clad document From the United Mine Workers Journal (1921) This agreement has been well named. It is yellow dog for sure. It reduces to the level of a yellow dog any man that signs it, for he signs away every right he possesses under the Constitution and by-laws of the land and makes himself the truckling, helpless slave of the employer. ULPs of Labor Organizations Restraint or coercion of employees in the exercise of their right Causing or attempting to cause employer to discriminate against an employee Violate duty, or refuse to bargain collectively with employer Causing or attempting to cause employer to pay or deliver any money or other things of value for services which are not performed, including demand for union negotiation fees (Featherbedding) ULPs of Labor Organizations Ask for or accept negotiation or attorneys fees from employers as part of settlement of any issue in collective bargaining or any other dispute Violation of a CBA Criminal Liability for ULPs Only officers or agents of corporations, associations or partnerships who actually participated in, authorized or ratified ULPs to be held criminally liable On the part of the Union, its officers, members of governing boards, representatives or agents Totality of Conduct Doctrine Expressions of opinion by an employer, though innocent in themselves, may be constitutive of ULP because of the circumstances under which they are uttered, the history of the employers labor relations or anti-union bias or because of their connection with an established collateral plan of coercion or interference. Union Security Clause Stipulation in the CBA where management recognizes membership of employees in the union which negotiated said agreement should be maintained or continued as a condition of employment or retention of employment Purpose is to safeguard and ensure continued existence of the union Union Security Clause, Types Closed shop Maintenance of membership agreement Union shop agreement Modified union shop Exclusive Bargaining Agreement Bargaining for members only agreement Agency shop agreement Preferential hiring agreement Legal Principles Pertinent to Union Security Clause Employer must still afford employee due process Collective bargaining and administration of agreement Collective Bargaining A democratic framework to stabilize Er-Ee relations, to create a climate of sound and stable industrial peace A mutual responsibility & legal obligation of the employer and the union Collective bargaining denotes negotiations looking forward to a collective agreement, however, it is a continuous process. Collective Bargaining, Process Negotiation of wages, hours & terms, conditions of employment Execution of written contract embodying terms Negotiation of issues arising out of interpretation or application of agreement Negotiation of terms of new contract, or proposed modifications. Collective Bargaining, Process System of collective bargaining consists of: Negotiation of contracts (legislative phase) Administration of contract (executive phase) Interpretation or application (judicial phase) Collective Bargaining, Process (Article 256, 257, Labor Code) Party seeking negotiation serves written notice & statement of proposals

Collective Bargaining Agreement A contract executed upon request of either the employer or the exclusive bargaining representatives Incorporating all agreements reached during negotiations With respect to wages, hours of work and other terms and conditions of employment Including proposals for adjusting any grievance or questions under such agreement Collective Bargaining Agreement Azucena: It is more than a contract; it is a generalized code to govern a myriad cases which the draftsmen cannot wholly anticipate. It covers the whole employment relationship and prescribes the rights and duties of the parties. It is a system of industrial self-government with the grievance machinery at the very heart of the system. Collective Bargaining, Parties Collective Bargaining, Parties Bargaining Representative Refers to the Legitimate Labor Organization selected or designated by the employes. Does not refer to its officers. How selected is discussed under Articles 261-265 of Labor Code Selection or Designation of Exclusive Bargaining Agent Manifestation of workers participatory right PAL vs. NLRC (GR No. 85985, Aug. 1993) The CBA may not be interpreted as cession of employees right to participate in the deliberation of matters which may affect their rights and the formulation of policies relative thereto. May be exercised by a Labor-Management Council, aside from or instead of a union (dealing with the employer vs. collective bargaining) Does not preclude the exercise of an individual employees right to raise his own grievance. Collective Bargaining Unit That group of jobs and jobholders represented by the recognized or certified union when it bargains with the employer. May comprise all of the supervisors or, separately, all the rankand-file population of the company. The law favors having only one grouping per category (following the united-we-stand, divided we fall logic), but does not prohibit sub-groups that are appropriate. CBU, Under DO 40-03 Refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit. What is Appropriateness? BLRs primary function, considering all legally relevant factors. Bargaining Unit may be determined following the four recognized modes: Substantial Mutual Interests principle or community or mutuality of interests rule Will of the Employees (Globe Doctrine) Collective Bargaining History Employment Status Substantial Mutual Interests Rule Employees sought to be represented must have substantial mutual interests in terms of employment and working conditions Characterized by similarity of employment status, same duties and responsibilities and substantially similar compensation and working conditions. Substantial Mutual Interests Rule There must be a logical basis for the formation of a bargaining unit. Adherence to the adage Strength in Numbers Geographical location can be completely disregarded if communal or mutual interests of the employees are not sacrificed. However, if employers in two plants are clearly distinct, each group of employees in the plants are treated as separate units (Diatagon vs. Ople)

Cases, Substantial Mutual Interests SMC Employees Union vs. Confesor, (GR No. 111262, Sep. 1996) Philtranco Service Enterprises vs. BLR, (GR No. 85343, Jun. 1989) SMC vs. Laguesma (GR No. 100485, Sep. 1994) SMC Supervisors and Exempt Employees Union vs. Laguesma (GR No. 110399, Aug. 1997) Cases, Substantial Mutual Interests St. James School of Quezon City vs. Samahang Manggagawa sa St. James School of Quezon City (GR No. 151326, Nov. 23, 2005) Globe Doctrine Globe Machine and Stamping Co., 3 N.L.R.B. 294 (1937), A petitioning union claimed that there were three separate bargaining units in the plant, whereas an intervening union argued for treating the plant as one overall unit. The US NLR Board found that either arrangement would result in appropriate bargaining units, and concluded that the question was so evenly balanced that the determining factor should be the desire of the employees themselves. Globe Doctrine Globe Machine and Stamping Co., 3 N.L.R.B. 294 (1937), Each of the three separate units was given the opportunity to vote for the petitioning union (and representation as a separate unit), the intervening union (and representation as an overall unit), or no union. The Globe procedure thereby allows employees "to determine the scope of a unit by allowing them to cast a vote for each of several potential units which the Board has determined are appropriate." Globe Doctrine US Case: Globe Machine & Stamping Co. (3 NLRB 294, 1937) In defining the appropriate bargaining unit, the determining factor is the desire of the workers themselves. Consequently, a certification election should be held separately to choose which representative union will be chosen by the workers. Collective Bargaining History Prior collective bargaining history and affinity of employees should be considered in determining the appropriate bargaining unit. The existence of a prior collective bargaining history is neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit (see SMC vs. Laguesma, NAFTU vs. Mainit Lumber Devt. Company Workers Union) CB History vs. Mutuality of Interest NAFTU vs. Mainit SC applied mutuality of interest among workers in sawmill division and logging division, despite the history of divisions being treated as separate units and geographical distance (see also SMC vs. Laguesma) Employment Status Casual employees and those employed on day-to-day basis must be considered separate because there is no mutuality of interest (Philippine Land-Air-Sea Labor Union vs. CIR, GR No. L-14656, Nov. 1960) Confidential employees cannot be allowed to be included in rankand-file bargaining units Belyca Corporation vs. Ferrer-Calleja (GR No. 77395, Nov. 1988) Selection of Bargaining Representative Certification Election Consent Election Voluntary Recognition Certification Election Process of determining by secret ballot the sole and exclusive bargaining agent of the employees in an appropriate bargaining unit, for purposes of collective bargaining. Certification Election No longer necessary under the following circumstances Voluntary recognition of the employer Employees designate the union as the bargaining representative Certification Election, Requisites Organized establishments Petition questioning the majority status of the incumbent bargaining agent is filed with the DOLE during the 60-day freedom period Verification of Petition necessary

Support of at least 25% of all employees in bargaining unit In unorganized establishments, certification election shall be automatically conducted upon the filing of a petition by a legitimate labor organization Party Filing Certification Election Legitimate labor organization, or Employer, when requested by a labor organization to bargain and status of organization is in doubt. Note: Art. 264-A Employer is a bystander in petitions of certification election. Employers participation limited to: Being notified or informed of petitions of such nature Submitting list of employees to Med-Arbiter during pre-election conference Petition for Certification Election May be filed at any time in the absence of a CBA, except: Certification year-bar rule Bargaining deadlock bar rule Contract bar rule Petition for Certification Election Certification year-bar rule A certification election may not be filed within one year from the date of a valid certification, consent or run-off election, or one year from the date of voluntary recognition. Petition for Certification Election Bargaining deadlock-bar rule. Before the filing of a petition for certification election, the duly recognized or certified union has commenced negotiations with the employer within the one-year period from the date of a valid certification, consent or run-off election or voluntary recognition. A bargaining deadlock to which an incumbent or certified bargaining agent is a party had been submitted to conciliation or arbitration or become the subject of a valid notice of strike or lockout. Cases, Bargaining Deadlock Rule Kaisahan ng Manggagawang Pilipino (Kampil-Katipunan) vs. Trajano (GR No. 75810, Sept. 1991) Capitol Medical Center Alliance of Concerned Employees-USFW vs. Laguesma (GR No. 118915, Feb. 1997) Contract Bar Rule The BLR shall not entertain any petition for certification election or any other action which may disturb the administration of duly registered existing collective bargaining agreements affecting the parties. Exceptions 60-day Freedom Period CBA is not registered with the BLR CBA contains provisions lower than statutory standards Falsified, fraudulent or misrepresented documents Incomplete CBA Collective bargaining and negotiations entered into prior to the 60-day freedom period Internal strife in the union resulting in an industrial dispute which does not foster industrial peace. Petition for Certification Election, Other Grounds for Dismissal Petitioner is not listed in DOLEs registry of legitimate labor organizations, or whose registration is revoke or cancelled with finality Petition filed outside of freedom period, provided that the 60 day period based on the original CBA shall not be affected by any amendment, extension or renewal of the CBA Failure to submit 25% support requirement for filing of petition Consent Election Voluntarily agreed upon by the parties with or without the intervention of the DOLE Distinction, Certification Election vs. Consent Election Certification Election to determine the sole and exclusive bargaining agent of all the employees in an appropriate bargaining unit for the purpose of collective bargaining; Consent Election to determine the issue of majority representation of all workers in the appropriate collective bargaining unit mainly for the purpose of determining the

administrator of the CBA; not for the purpose of determining the bargaining agent for purposes of collective bargaining. Voluntary Recognition Process whereby the employer recognizes a labor organization as the exclusive bargaining representative of the employees in the appropriate bargaining unit after a showing that the labor organization is supported by at least a majority of the employees in the bargaining unit. Available only in unorganized establishments. FAQs What is Certification Election? Certification election is a process of determining through secret ballot the sole and exclusive bargaining agent (SEBA) of all the employees in an appropriate bargaining unit for the purpose of collective bargaining. 2. Where does a union file a petition for certification election (PCE)? A PCE is filed at the Regional Office which issued the certificate of petitioning unions certificate of registration/certificate of creation of chartered local. 3. What are the requirements in filing a PCE? Among the important requirements are the following: a) A statement indicating any of the following: That the bargaining unit is unorganized or that there is no registered CBA covering the employees in the bargaining unit; If there exists a duly registered CBA, that the petition is filed within the sixty-day freedom period of such agreement; If another union had been previously recognized voluntarily or certified in a valid certification, consent or run-off election, that the petition is filed outside the one-year period from entry of voluntary recognition or conduct of certification or run-off election and no appeal is pending thereon. b) In an organized establishment, the signature of at least twenty-five (25%) percent of all employees in the appropriate bargaining unit shall be attached to the petition at the time of its filing (Section 4, Rule VIII, of the Department Order No. 40-03). 4. What happens after receipt of the PCE? The petition will be raffled to the Med-Arbiter for preliminary conference to determine, among others, the bargaining unit to be represented, the contending unions, and the possibility of consent election. 5. What happens upon approval of the conduct of certification election by the Mediator-Arbiter? The PCE will be endorsed to an election officer for the conduct of pre-election conference wherein the date, time and place of election will be identified, the list of challenged and eligible voters will be made, as well as the number and location of polling places. FAQs 6. May a PCE be denied? Yes, a PCE may be denied if: a) it was filed before or after the freedom period of a registered CBA; b) the petitioner union is not listed in the DOLE Registry of legitimate labor organization; or c) the legal personality of the petitioner-union has been revoked or cancelled with finality. 7. Who will conduct the CE? The DOLE Regional Office through the election officer conducts the certification election. 8. How is the SEBA determined? The union that garners majority of the valid votes cast in a valid certification election shall be certified as the SEBA. 9. May election protest be entertained? Yes, but protest should have been first recorded in the minutes of the election proceedings. 10. What happens if the petitioner union fails to garner the majority of the valid votes cast? There will be no SEBA, but another PCE may be filed one year thereafter. FAQs 10. What happens if the petitioner union fails to garner the majority of the valid votes cast?

There will be no SEBA, but another PCE may be filed one year thereafter. 11. What are the requisites for certification election in organized establishments? Certification election in organized establishments requires that: a) a petition questioning the majority status of the incumbent bargaining agent is filed before the DOLE within the 60-day freedom period; b) such petition is verified; and c) the petition is supported by the written consent of at least twenty-five percent (25%) of all employees in the bargaining unit. 12. What is the requirement for certification election in unorganized establishments? Certification election in unorganized establishments shall automatically be conducted upon the filing of a petition for certification election by an independent union or a federation in behalf of the chartered local or the local/chapter itself. 13. May an employer file a PCE? Yes, the employer may file a PCE if it is requested to bargain collectively. 14. May an employer extend voluntary recognition to a legitimate labor organization without filing a PCE? Yes, management may voluntarily recognize a union if there is no other union in the company and if other requirements are complied with (Sec. 2, Rule 7 of D.O. 40-03). 15. What is the role of employer in certification election? The employer shall not be considered a party to a petition for certification election, whether it is filed by an employer or a legitimate labor organization, and shall have no right to oppose it. Its participation shall be limited only to being notified or informed of petition for certification election and submitting the certified list of employees or where necessary, the payrolls (Employer as Bystander Rule). Collective Bargaining Agreement A negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit Deemed as the law between the parties during its lifetime Provisions are construed liberally Legal Principles Applicable to CBA A proposal not embodied in the CBA is not part thereof Minutes of CBA negotiation have no effect if not incorporated in the CBA Making a promise during the CBA negotiation is not considered bad faith Adamant stance resulting in impasse is not bad faith No terms and conditions may be imposed by the DOLE or any other agency which the law and the parties did not intend to reflect in the CBA Signing bonus is not demandable under the law Allegations of bad faith are erased with the signing of the CBA Collective Bargaining, Kinds Single Enterprise Between on certified labor union and one employer Multi-Employer Bargaining Between and among several certified labor unions and employers Conditions Only LLOs that are the SEBA may participate and negotiate Only employers with counterpart LLOs which are incumbent bargaining agents may participate Employers must consent to multi-enterprise bargaining may participate Duty to Bargain Collectively Where there is yet no CBA: Compliance to Article 256, LC Er and union must MEET, CONVENE and CONFER for collective bargaining purposes Requisites of collective bargaining must be complied with Er-Ee relationship

Majority status of bargaining union Demand to negotiate Advantage where the negotiations have no precedent CBA: Clean slate, unencumbered by previous agreements Duty to Bargain Collectively Where there exists a CBA Neither party shall terminate nor modify such agreement during its lifetime. Parties may serve notice to terminate or modify agreement during freedom period Parties to keep the status quo during freedom period until new agreement is reached. Requisites in Relation to CBA Posting of CBA Posted in two conspicuous places in the work premises, at least five days prior to ratification Mandatory requirement; non-compliance will result in ineffectiveness of CBA (ATU vs. Trajano, 1988) Employer responsible for posting (ALU vs. FerrerCalleja, May 1989) Ratification by Majority of Employees in Bargaining Unit Registration of CBA Refusal to Negotiate Ignoring all notices for negotiation and requests for counterproposals Refusing to bargain anew on economic terms of the CBA, using flimsy excuses such as questioning union Not serving an answer All the above are indications of bad faith Refusal to Negotiate Employer who violates the duty to bargain collectively loses its statutory right to negotiate or renegotiate terms and conditions of the draft CBA; and may impose the adoption of the proposals of the union as the CBA Cases General Milling Corporation vs. CA, Kiok Loy vs. NLRC Divine Word University of Tacloban vs. SOLE Lifetime of a CBA Representation aspect 5 years, meaning no petition questioning the majority status of the incumbent agent shall be entertained by DOLE Economic and non-economic provisions except representation renegotiated not later than three years after its execution Retroactivity of CBA New CBA concluded by negotiation The CBA or other provisions of such agreement entered into within 6 months from expiration of term shall retroact to the day immediately following date of expiration If entered into beyond 6 months, parties shall agree on effectivity CBA concluded through arbitral award LMG Chemicals Corporation vs. Secretary of DOLE, (GR No. 127422, April 2001) Breaking the Deadlock Conciliation and Mediation with NCMB, DOLE Declaration of Strike or Lockout Referral to conciliation or voluntary arbitration Grievance and Voluntary Arbitration Grievance Any question by Er or union regarding interpretation or application of the CBA, or company personnel policies, or Any claim by either party that the other party is violating the CBA or company personnel policies. Complaint or dissatisfaction arising from the interpretation or implementation of CBA and those arising from interpretation or enforcement of personnel policies. Grievance Machinery Refers to mechanism for the adjustment and resolution of grievances arising from the interpretation or implementation of a

CBA and those arising from the interpretation and enforcement of company personnel policies. Grievance Procedure Internal rules of procedure established by the parties in their CBA with voluntary arbitration as the terminal step. Refers to the system of grievance settlement at the plant level as provided in the CBA. Consists of successive steps starting at complainant and his immediate supervisor, up to the level of top union and company officials Grievance Procedure All grievances submitted to the grievance machinery that are not settled in seven calendar days from submission shall be referred to Voluntary Arbitration prescribed in the CBA Voluntary Arbitrators shall be named and designated in advance, or include a procedure for selection of VAs. In case parties fail to select VA, NCMB shall designate Voluntary Arbitration Mode of settling labor-management disputes Parties select a competent, trained and impartial third person Decision based on merits of the case Decision is final and executory Voluntary Arbitration vs. Court Arbitrable Disputes Contract-negotiation disputes Terms and conditions of contracts Collective bargaining issues Known as arbitration of interest Contract interpretation disputes Arises out of existing CBAs Known as arbitration of grievance or rights Interplay of Jurisdiction, Labor Arbiters vs. Voluntary Arbitrators Jurisdiction of LA Article 223 Jurisdiction of VA- Article 267, 268 Interpretation or implementation of CBA are disposed of by LAs by referring the matter to the grievance machinery, of which the terminal step is voluntary arbitration Under Article 268, VAs may, upon voluntary agreement of the parties hear and decide ALL other labor disputes including ULP and bargaining deadlocks Interplay of Jurisdiction, Labor Arbiters vs. Voluntary Arbitrators Termination disputes may fall within the jurisdiction of VAs, provided that the parties had agreed in unequivocal language that the termination dispute would be referred to the grievance machinery and voluntary arbitration. Cases San Jose vs. NLRC & Ocean Terminal Services (GR 121227, Aug. 1998) San Miguel Corporation vs. NLRC Sanyo Philippines Workers Union vs. Canizares, GR No. 101619, July 1992 Voluntary Arbitrator Any person accredited by NCMB as such, or Any person named or designated in the CBA as such, or One appointed by the NCMB in case either party refuses to submit to voluntary arbitration Note that VAs are not part of DOLE or any government agency. His authority to render arbitral awards are vested by law. Enforcement of VAs Decision Article 268-A: Upon motion of any interested party, the VA may issue a writ of execution requiring the sheriff of the NLRC or regular courts or public officials whom the parties may designate in the submission agreement Strikes, Lockouts and Picketing Concerted Activities People planning and acting together One undertaken by two or more employees, or by one on behalf of others. Strikes Temporary stoppage of work by the concerted action of the employees as a result of an industrial or labor dispute.

Consists not only of concerted work stoppages but also sitdowns, mass leaves, slowdowns, attempts to damage, destroy or sabotage plant equipment or facilities and similar activities. Strikes Cessation of work by employee in an effort to get more favorable terms for employment Concerted refusal by employees to do any work for their employer, or work at their customary rate of speed until the object of strike is attained by employers concession Characteristics of Strikes Established relationship between strikers and persons against whom the strike is called Relationship must be of employer-employe Existence of dispute between the parties and the utilization by labor of the weapon of concerted refusal to work as a means of persuading or coercing compliance to demands Characteristics of Strikes Even though work cessation is by belligerent suspension, Employment relation still continues Work stoppage is temporary Concerted action by employees Striking group is a LLO, and in the case of bargaining deadlock, the sole bargaining representative Lockout Temporary stoppage of work by reason of refusal of an employer to furnish work as a result of an industrial or labor dispute Lockout An employers means of protecting his bargaining position Employer must show that his act is primarily defensive, and not an act of hostility to collective bargaining or of discriminaiton. Valid Lockouts To forestall threatened acts of sabotage (Rizal Cement Workers Union vs. Madrigal Co.) In anticipation of a threatened strike where motivated by economic considerations In response to unprotected strike or walkout In response to a whipsaw strike Picketing A right given to workers to peacefully march to and from before an establishment involved in a labor dispute accompanied by the carrying and display of signs, placards and banners intended to inform the public about the dispute. Picketing Allowed by Law Included in the constitutional guarantee to engage in concerted activities for purposes of collective bargaining for their mutual benefit and protection Freedom of speech principle Can be performed by persons even in the absence of Er-Ee relationship Limitations Right to peaceful picketing should be exercised with due respect to the right of others; coercion, intimidation or acts of violence are strictly prohibited Picketers cannot rightfully prevent employees of another company which is not their employer from entering or leaving their rented premises (innocent bystander) Kinds of Strikes Extent General occur over a whole community, province, state or country. An extended form of sympathetic strike; many workers stop working to put pressure on government or paralyze economic & social systems Local or Particular applies only in a particular enterprise or locality Kinds of Strikes Nature of the Act Sitdown Strike Possession, trespass and prevention of access and operation Slowdown reduction of production output

Partial or quickie strike intermittent, unannounced work stoppage; used interchangeably with wildcat strike Kinds of Strikes Employee Interest Primary Strike declared by employees who have a direct and immediate interest in the subject of the dispute between them and the Er Secondary Strike Coercive measure adopted by workers against an employer connected by product or employment with alleged unfair labor conditions or practices Sympathetic Strike striking employees have no demands or grievances of their own, but strike to directly or indirectly aid others without direct relation to the advancement of the interest of the strikers. Kinds of Strikes Economic Strike one intended to force wage and other concessions from the employer, which he is not required by law to grant. Unfair Labor Practice Strike called against the ULP of the employer, usually for the purpose of making him desist from further committing such practices. Called for mutual protection, and for the discontinuance of employer abuses. Avoidance of Strikes Parties must first exhaust measures or remedies that will avoid the strike, akin to the doctrine of Exhaustion of Administrative Remedies. Only when non-disruptive alternatives have proved unsuccessful may strikes be deemed justified. Jumping the gun on the grievance procedure/voluntary arbitration of a dispute will mean that the strike is PREMATURE, thus illegal Premature Strikes Insurefco Paper Pulp Project Workers Union vs. Insular Sugar Refinery Corporation, 95 Phil. 161 Almeda vs. CIR, 97 Phil. 306 National Labor Union vs. Phimco., 70 Phil 300 Until all the remedies and negotiations looking toward the adjustment or settlement of labor disputes have been exhausted, the law does not look with favor upon resort to radical measures, the pernicious consequences of which transcend the rights of the immediate parties. (Union of the Philippine Education Employees (NLU) vs. PECO, L-4423, March 31, 1952) Avoidance of Strikes Once an issue has been submitted for conciliation, mediation or compromise, the employees cannot resort to a strike. Discussions during conciliation proceedings are confidential and treated as privileged information Parties can enter into compromise agreements to avoid a strike, which compromise shall be immediately final and executory. Labor Code Provisions Protecting the Right to Strike Art. 260 Not subject to labor injunction or restraining order Art. 254 No discrimination against striker in the exercise of the right Art. 270(a) Preservation of employment relationship Art. 270(c) Prohibition on Strike-breakers Strike-Breakers Persons who obstruct, impede or interfere with any peaceful picketing by employees during any labor controversy affecting wages, conditions of work or in the exercise of their rights Through force, violence, coercion, threats or intimidation Strikes, Mandatory Requisites First requisite: Valid and factual ground (1) CBA Deadlock; and (2) Unfair labor practice (ULP). Second Requisite: Notice (of Strike or Lockout) (1) CBA Deadlock - 30 days from intended date of strike (2) Unfair labor practice (ULP) 15 days. Strikes, Mandatory Requisites

Third requisite: Notice to NCMB-DOLE at least 24 hours priot to the taking of the strike or lockout vote (secret ballot) Decision to conduct vote Date, time and place Fourth Requisite: Strike or Lockout Vote Majority approval required Must be implemented even in cases of union-busting Strikes, Mandatory Requisites Fifth requisite: Strike/Lockout Vote Report Submitted at least seven days prior to strike/lockout If report submitted during cooling off period, seven day waiting period begins on the day following the cooling off period If for union busting, cooling period may be dispensed with Sixth Requisite: Cooling Off Period Reckoned from filing of notice of strike/lockout 30 days for deadlock, 15 for ULP If strike is for union-busting, period is dispensed with Strikes, Mandatory Requisites Seventh requisite: Waiting period Seven days from submission of strike vote report Nota Bene: Strike Rules 1. Failure to comply with requisites will render the strike or lockout illegal. 2. A strike or lockout based on non-strikeable issues is illegal 3. A strike or lockout is illegal if the issues involved are already subject of compulsory or voluntary arbitration or conciliation or the steps in grievance machinery are not exhausted. 4. A strike or lockout is illegal if unlawful means were employed or prohibited acts or practices were committed (e.g., Use of force, violence, threats, coercion, etc.; Barricades, blockades and obstructions of ingress to [entrance] or egress from [exit] the company premises). 5. A strike or lockout is illegal if the notice of strike or notice of lockout is already converted into a preventive mediation case. Nota Bene: Strike Rules 6. A strike or lockout is illegal if staged in violation of the No-Strike, No-Lockout clause in the collective bargaining agreement. 7. A strike or lockout is illegal if staged in violation of a temporary restraining order or an injunction or assumption or certification order. 8. A strike is illegal if staged by a minority union. 9. A strike or lockout is illegal if conducted for unlawful purpose/s (e.g.: Strike to compel dismissal of employee or to compel the employer to recognize the union or the so-called UnionRecognition Strike) 10. The local union and not the federation is liable to pay damages in case of illegal strike. Preventive Mediation The NCMB has the authority to convert a notice of strike filed by the union into a preventive mediation case if it finds that the real issues raised therein are non-strikeable in character. NCMB has duty to exert all efforts at mediation and conciliation to enable parties to settle the dispute amicably and in line with the state policy of favoring voluntary modes of settling labor disputes. Once a notice of strike/lockout is converted into a preventive mediation case, it will be dropped from the docket of notices of strikes/lockouts. Once dropped therefrom, a strike/lockout can no longer be legally staged based on the same notice. The conversion has the effect of dismissing the notice. Invalid Grounds for Strike 1. Violation of collective bargaining agreements, except those which are gross in character. 2. Inter-union or intra-union disputes. A strike declared more on the ground of inter-union and intra-union conflict which is a nonstrikeable issue is patently illegal pursuant to the provision of paragraph [b] of Article 263 (now 269) of the Labor Code. (Filcon Manufacturing Corporation vs. Lakas Manggagawa sa Filcon-Lakas Manggagawa Labor Center [LMF-LMLC], G. R. No. 150166, July 26, 2004). Invalid Grounds for Strike 3. Issues already assumed by the DOLE Secretary or certified by him to the NLRC for compulsory arbitration. Once the Secretary

of Labor and Employment assumes jurisdiction over a labor dispute affecting national interest or certifies the same to the NLRC for compulsory arbitration, the issues involved in said labor dispute can no longer be invoked by the union in staging a strike or by management in conducting a lockout. 4. Issues already brought before grievance machinery or voluntary arbitration. In a plethora of case, it was held that a strike is illegal because of the failure to exhaust all the steps in the grievance machinery/voluntary arbitration provided for in the CBA. (Union of Filipro Employees, vs. Nestle Philippines, Inc., G. R. No. 8871013, Dec. 19, 1990). Illegal Strikes 1. Those that are expressly prohibited by law 2. Does not comply with statutory requirements 3. Declared for an unlawful purpose 4. Employs unlawful means 5. In violation of an existing injunction 6. In violation of assumption or certification order 7. Violation of no-strike, no-lockout clause 8. Minority union calls strike 9. Strike by a non-registered union 10. Premature strike Assumption of Jurisdiction Occurs when labor dispute that caused or may cause strike is in an industry indispensable to the national interest DOLE Secretary assumes jurisdiction and May decide the case, or Certify the same to the NLRC for compulsory arbitration The power of assumption of jurisdiction over labor disputes in these industries is in the nature of the POLICE POWER measure Effects of Assumption Automatically enjoins intended or impending strike or lockout All striking or locked out employees shall return to work immediately Note that striking employees are not considered to have abandoned their employment, but only ceased from their labor Employer shall resume operations and admit all workers under same conditions pre-strike No Motion for Reconsideration will stay the assumption order Wages to be paid during strike No work, no pay rule applied Exceptions ULP strike Unconditional and voluntary offer to return to work is refused by employer Employees are discriminated against despite a RTWO Non-participating employees were locked out by employer Reinstatement no longer possible Prohibited Activities Article 270 - Note prohibitions on: Labor Organizations Third Persons Employers Public Officials or Employees Picketers Return to Work Order Enjoins striking workers to RETURN TO WORK Defiance of RTWO is considered an illegal act Strike becomes illegal Defiant strikers may be sanctioned with disciplinary measures, e.g. dismissal or loss of employment status or criminal prosecution Improved Offer Balloting NCMB shall conduct a referendum by secret ballot on or before 30th day of the strike; If majority of union members accept offer Striking workers shall return to work immediately Employer readmits striking workers upon signing of agreement

Initiated when EMPLOYER makes an offer that is, in his opinion, better than his previous stance in the labor dispute Reduced Offer Balloting NCMB shall conduct a referendum by secret ballot on or before 30th day of the lockout; If majority of board members, trustees or directors accept offer Locked out workers shall return to work immediately Employer readmits workers upon signing of agreement Initiated when STRIKERS make an offer that is, in their opinion, more acceptable than their previous stance in the labor dispute Post Employment Security of Tenure Termination of Employment Security of Tenure Defined: The constitutional right granted the employee that the employer shall not terminate the services of an employee except for JUST CAUSE, or when AUTHORIZED BY LAW. It extends to regular (rank and file, managerial) as well as nonregular employment (probationary, seasonal, project) Applies as protection from unwarranted and unconsented demotion and transfer Kinds and Forms of Employment Article 286 Regular Casual Project Seasonal Other forms Fixed Period Probationary Regular Employment Employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer One year of service has been rendered, whether continuous or broken, with respect to the activity in which he is employed Determining Regular Status Nature of Work Test Whether or not there is reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer Period of Service Test Employees length of service is at least one year, whether continuous or broken Probationary Employee Test Whether or not the employee is allowed to work after the lapse of the probationary period. Casual Employment Employee has been engaged to perform activities which are not necessary or desirable in the usual trade or business of the employer Once a casual employee has rendered at least one year of service, his status becomes REGULAR The purpose of this rule is to honor the constitutional guarantee of security of tenure and right to self-organization Project Employment Employee has been engaged for a SPECIFIC project or undertaking the completion or termination of the project has been determined at the time of engagement of the employee REGULAR STATUS vested when Continuous re-hiring of project employees even after the cessation of a project for the same tasks or nature of tasks Tasks performed by project employee are vital, necessary and indispensable to the usual business or trade of the employer Project Employees Exodus International Construction Corporation, et al. v. Guillermo Biscocho, et al., G.R. No. 166109, Feb. 2011: Two types of employees in the construction industry: Project employees or those employed in connection with a particular construction project or phase thereof and such employment is coterminous with each

project or phase of the project to which they are assigned. Non-project employees or those employed without reference to any particular construction project or phase of a project; when one project is completed, employees are automatically transferred to the next project awarded to employer. There was no employment agreement given employees which clearly spelled out the duration of their employment and the specific work to be performed and there is no proof that they were made aware of these terms and conditions of their employment at the time of hiring. Fixed Period Employment Employment is for a pre-determined period established at the time of engagement Validity of Fixed Period Employment: fixed period of employment was knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent; or It satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter. (Lynvil Fishing Enterprises, Inc. vs. Andres G. Ariola, et al., G.R. No. 181974, Feb. 2012) Probationary Employment Section 6 of the Implementing Rules of Book VI, Rule VIII-A of the Code specifically requires the employer to inform the probationary employee of such reasonable standards at the time of his engagement, not at any time later; else, the latter shall be considered a regular employee. The essence of a probationary period of employment fundamentally lies in the purpose or objective of both the employer and the employee during the period. While the employer observes the fitness, propriety and efficiency of a probationer to ascertain whether he is qualified for permanent employment, the latter seeks to prove to the former that he has the qualifications to meet the reasonable standards for permanent employment. The trial period or the length of time the probationary employee remains on probation depends on the parties agreement, but it shall not exceed six (6) months under Article 281 of the Labor Code. Probationary Employment Cases Canadian Opportunities Unlimited, Inc. vs. Bart Q. Dalangin, Jr., G.R. No. 172223, February 6, 2012. Armando Ailing vs. Jose B. Feliciano, Manuel F. San Mateo III, et al., G.R. No. 185829. April 25, 2012. Management Prerogatives Our laws recognize and respect the exercise by management of certain rights and prerogatives. For this reason, courts often decline to interfere in legitimate business decisions of employers. In fact, labor laws discourage interference in employers judgment concerning the conduct of their business. (Philippine Industrial Security Agency Corporation vs. Aguinaldo, G. R. No. 149974, June 15, 2005; Mendoza vs. Rural Bank of Lucban, G.R. No. 155421, July 7, 2004). An employer can regulate, generally without restraint, according to its own discretion and judgment, every aspect of its business. (Deles, Jr. vs. NLRC, G. R. No. 121348, March 9, 2000). This privilege is inherent in the right of employers to control and manage their enterprise effectively. (Mendoza vs. Rural Bank of Lucban, G.R. No. 155421, 07 July 2004). Extent of management prerogatives regulate and control all aspects of employment in their business organizations. Such aspects of employment include hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work

supervision, lay-off of workers and the discipline, dismissal and recall of workers. (Philippine Airlines, Inc. vs. NLRC, G. R. No. 115785, Aug. 4, 2000). Management retains the prerogative to change the working hours of its employees. (Sime Darby Pilipinas, Inc. vs. NLRC, G.R. No. 119205, 15 April 1998, 289 SCRA 86). Extent of Management Prerogatives Extent of management prerogatives A transfer means a movement (1) from one position to another of equivalent rank, level or salary, without a break in the service; or (2) from one office to another within the same business establishment. (Sentinel Security Agency, Inc. vs. NLRC, G. R. No. 122468, Sept. 3, 1998). Prerogative of management to transfer an employee from one office to another within the business establishment upheld, provided There is no demotion in rank or diminution of salary, benefits, and other privileges, and; Action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. (Mendoza vs. Rural Bank of Lucban, G. R. No. 155421, July 7, 2004; Benguet Electric Cooperative vs. Fianza, G. R. No. 158606, March 9, 2004). Transfer, tests Must be exercised without grave abuse of discretion Basic elements of justice and fair play adhered to. Employer must be able to show that the transfer is not unreasonable, inconvenient or prejudicial to the employee, otherwise, the employees transfer is tantamount to constructive dismissal. (The Philippine American Life and General Insurance Co. vs. Gramaje, G. R. No. 156963, Nov. 11, 2004; Globe Telecom, Inc. vs. Florendo-Flores, G. R. No. 150092, Sept. 27, 2002). Transfer William Endeliseo Barroga vs. Data Center College of the Philippines, et al., G.R. No. 174158, June 2011 Constructive dismissal is quitting because continued employment is rendered impossible, unreasonable or unlikely, or because of a demotion in rank or a diminution of pay. It exists when there is a clear act of discrimination, insensibility or disdain by an employer which becomes unbearable for the employee to continue his employment. It is management prerogative for employers to transfer employees on just and valid grounds such as genuine business necessity, e.g. financial constraints No vested right in position An employee has a right to security of tenure, but this does not give her such a vested right in a position as would deprive the employer of its prerogative to change employee assignments or transfers where the employees service will be most beneficial to the employers client. No vested right in position Cases OSS Security & Allied Services, Inc., vs. NLRC, G. R. No. 112752, Feb. 9, 2000 Tan vs. NLRC, 299 SCRA 169, 180 [1998] Chu vs. NLRC, G. R. No. 106107, June 2, 1994