Prohibited Stipulations in Employment Contract

Labor Fundamentals 2010-02-11

Employment contract is not an ordinary contract, but a contract imbued with public interest. Unlike in
ordinary contracts, parties to labor contracts do not have complete freedom to stipulate the terms and
condition of their contractual relations.
Restraints on the parties right to freely enter into agreement pertaining to terms and condition of
employment are deemed valid, and not considered violative of the freedom or liberty of contract clause of
the Constitution.
In line with above, the Labor Code prohibits certains terms or conditions of employment to be stipulated
on employment contracts. Any such stipulation, even if freely and voluntarily agreed upon by the parties,
is void. For example, the prospective employer and employee may not validly agree that the latter shall be
paid a salary below the minimum wage prescribed by law, or that the employee shall be required to work
more than 8 hours per day without overtime pay. Such stipulation, even if mutually consented to by the
parties is null and without force and effect.
The underlying rationale for this prohibition is the protection of labor against discrimination, inhumane
condition of work, abuses, slavery, among others.
The following are some of the stipulations that are deemed void even if voluntarily agreed upon by
thecontracting parties in an employment contract.
Stipulation Against Marriage.
It shall be unlawful for an employer to require as a condition of employment or continuation of
employment that a woman employee shall not get married, or to stipulate expressly or tacitly that upon
getting married a woman employee shall be deemed resigned or separated. (Article 136, Labor Code.)
Stipulation Prohibiting Employee to Join Union.
A yellow dog contract is an employment contract which prohibits an employee from joing a labor
organization or which requires him to withdraw from one to which he belongs. Yellow dog contract is
prohibited under Article 248(b) of the Labor Code.
Stipulation Discriminating Employee on Account of Age.
No employer shall discriminate against any person in respect to terms and conditions of employment on
account of his age. (Article 140, Labor Code.)
Stipulation Discriminating Employee on Account of Gender.
It shall be unlawful for any employer to discriminate against any woman employee with respect to terms
and conditions of employment solely on account of her sex. (Article 135, Labor Code.)

Interpretation of Labor Laws
Labor laws are generally construed liberally in favor of labor. The Labor Code of the Philippines states: All
doubts in the implementation and interpretation of the provisions of the Labor Code, including its
implementing rules and regulations, shall be resolved in favor of labor.
[1]
Similar provision can be found
in the New Civil Code, viz. In case of doubt, all labor legislation and all labor contracts shall be construed
in favor of the safety and decent living for the laborer.
[2]

However, the above provisions do not mean that courts has to blindly rule in favor of labor. Capital and
management are entitled to no less protection under the law. The law, while protecting the rights of the
employees, authorizes neither the oppression nor destruction of the employer. When the law angles the
scale of justice in favor of labor, the scale should never be so tilted if the result is an injustice to the
employer.
[3]

Interpretation of Labor Contract
Labor contracts are not ordinary contract. The relation between capital and labor are not merely
contractual in that the parties do not have complete freedom as to the terms of their relationship. For
example, an employee cannot agree to a wage below the minimum wage set by law, or to waive his right
to overtime payfor overtime work rendered. This agreement or waiver, even if voluntarily entered into by
the parties, is void for being contrary to public policy. Labor contracts are so impressed with public
interest that labor contracts must yield to the common good. Hence, labor contracts must yield to laws on
CBA, strikes and lockouts, etc.
[4]

In the interpretation of labor contracts, the rule is, all doubts in the construction of labor contracts should
be resolved in favor of the working class. This is in accordance with Article 1702 of the NCC, which directs
that in case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety
and decent living for the laborer.

Art. 135. Discrimination prohibited. It shall be unlawful for any employer to discriminate against any woman employee
with respect to terms and conditions of employment solely on account of her sex.
The following are acts of discrimination:
1. Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe benefits, to a female
employees as against a male employee, for work of equal value; and

2. Favoring a male employee over a female employee with respect to promotion, training opportunities, study and scholarship
grants solely on account of their sexes.
Criminal liability for the willful commission of any unlawful act as provided in this Article or any violation of the rules
and regulations issued pursuant to Section 2 hereof shall be penalized as provided in Articles 288 and 289 of this
Code: Provided, That the institution of any criminal action under this provision shall not bar the aggrieved employee
from filing an entirely separate and distinct action for money claims, which may include claims for damages and other
affirmative reliefs. The actions hereby authorized shall proceed independently of each other. (As amended by Republic
Act No. 6725, May 12, 1989)
Art. 136. Stipulation against marriage. It shall be unlawful for an employer to require as a condition of employment or
continuation of employment that a woman employee shall not get married, or to stipulate expressly or tacitly that upon
getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss, discharge,
discriminate or otherwise prejudice a woman employee merely by reason of her marriage.
Art. 137. Prohibited acts.
1. It shall be unlawful for any employer:

1. To deny any woman employee the benefits provided for in this Chapter or to discharge any woman employed by him for the
purpose of preventing her from enjoying any of the benefits provided under this Code.

2. To discharge such woman on account of her pregnancy, or while on leave or in confinement due to her pregnancy;

3. To discharge or refuse the admission of such woman upon returning to her work for fear that she may again be pregnant.
Art. 138. Classification of certain women workers. Any woman who is permitted or suffered to work, with or without
compensation, in any night club, cocktail lounge, massage clinic, bar or similar establishments under the effective
control or supervision of the employer for a substantial period of time as determined by the Secretary of Labor and
Employment, shall be considered as an employee of such establishment for purposes of labor and social legislation.
Chapter II
EMPLOYMENT OF MINORS
Art. 139. Minimum employable age.
1. No child below fifteen (15) years of age shall be employed, except when he works directly under the sole responsibility of
his parents or guardian, and his employment does not in any way interfere with his schooling.

2. Any person between fifteen (15) and eighteen (18) years of age may be employed for such number of hours and such
periods of the day as determined by the Secretary of Labor and Employment in appropriate regulations.

3. The foregoing provisions shall in no case allow the employment of a person below eighteen (18) years of age in an
undertaking which is hazardous or deleterious in nature as determined by the Secretary of Labor and Employment.
Art. 140. Prohibition against child discrimination. No employer shall discriminate against any person in respect to
terms and conditions of employment on account of his age.

Art. 248. Unfair labor practices of employers. It shall be unlawful for an employer to commit any of the following unfair
labor practice:
1. To interfere with, restrain or coerce employees in the exercise of their right to self-organization;

2. To require as a condition of employment that a person or an employee shall not join a labor organization or shall withdraw
from one to which he belongs;

3. To contract out services or functions being performed by union members when such will interfere with, restrain or coerce
employees in the exercise of their rights to self-organization;

4. To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization, including
the giving of financial or other support to it or its organizers or supporters;

5. To discriminate in regard to wages, hours of work and other terms and conditions of employment in order to encourage or
discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties from
requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees
who are already members of another union at the time of the signing of the collective bargaining agreement. Employees of
an appropriate bargaining unit who are not members of the recognized collective bargaining agent may be assessed a
reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent, if such
non-union members accept the benefits under the collective bargaining agreement: Provided, that the individual
authorization required under Article 242, paragraph (o) of this Code shall not apply to the non-members of the recognized
collective bargaining agent;

6. To dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give
testimony under this Code;

7. To violate the duty to bargain collectively as prescribed by this Code;

8. To pay negotiation or attorneys fees to the union or its officers or agents as part of the settlement of any issue in collective
bargaining or any other dispute; or

9. To violate a collective bargaining agreement.
The provisions of the preceding paragraph notwithstanding, only the officers and agents of corporations, associations
or partnerships who have actually participated in, authorized or ratified unfair labor practices shall be held criminally
liable. (As amended by Batas Pambansa Bilang 130, August 21, 1981)

Republic Act No. 7610 June 17, 1992
AN ACT PROVIDING FOR STRONGER DETERRENCE AND SPECIAL PROTECTION AGAINST
CHILD ABUSE, EXPLOITATION AND DISCRIMINATION, AND FOR OTHER PURPOSES
Working Children
Section 12. Employment of Children. Children below fifteen (15) years of age may be employed
except:
(1) When a child works directly under the sole responsibility of his parents or legal guardian
and where only members of the employer's family are employed: Provided, however, That
his employment neither endangers his life, safety and health and morals, nor impairs his
normal development: Provided, further, That the parent or legal guardian shall provide the
said minor child with the prescribed primary and/or secondary education; or
(2) When a child's employment or participation in public & entertainment or information
through cinema, theater, radio or television is essential: Provided, The employment contract
concluded by the child's parent or guardian, with the express agreement of the child
concerned, if possible, and the approval of the Department of Labor and Employment:
Provided, That the following requirements in all instances are strictly complied with:
(a) The employer shall ensure the protection, health, safety and morals of the child;
(b) the employer shall institute measures to prevent the child's exploitation or discrimination
taking into account the system and level of remuneration, and the duration and arrangement
of working time; and;
(c) The employer shall formulate and implement, subject to the approval and supervision of
competent authorities, a continuing program for training and skill acquisition of the child.
In the above exceptional cases where any such child may be employed, the employer shall first
secure, before engaging such child, a work permit from the Department of Labor and Employment
which shall ensure observance of the above requirement.
The Department of Labor Employment shall promulgate rules and regulations necessary for the
effective implementation of this Section.
Section 14. Prohibition on the Employment of Children in Certain Advertisements. No
person shall employ child models in all commercials or advertisements promoting alcoholic
beverages, intoxicating drinks, tobacco and its byproducts and violence.
REPUBLIC ACT NO. 7658

AN ACT PROHIBITING THE EMPLOYMENT OF CHILDREN BELOW 15
YEARS OF AGE IN PUBLIC AND PRIVATE UNDERTAKINGS,
AMENDING FOR THIS PURPOSE SECTION 12, ARTICLE VIII OF R.A.
7610

Republic Act No. 9231 December 19, 2003
AN ACT PROVIDING FOR THE ELIMINATION OF THE WORST FORMS OF CHILD LABOR AND
AFFORDING STRONGER PROTECTION FOR THE WORKING CHILD, AMENDING FOR THIS
PURPOSE REPUBLIC ACTNO. 7610, AS AMENDED, OTHERWISE KNOWN AS THE "SPECIAL
PROTECTION OF CHILDREN AGAINST CHILD ABUSE, EXPLOITATION AND DISCRIMINATION
ACT"
DEPARTMENT ORDER NO. 65-04
.
Rules and Regulations Implementing
Republic Act No. 9231, Amending R.A. 7610, as Amended
.
Pursuant to Section 10 of Republic Act No. 9231 (An Act Providing for the Elimination of the Worst
Forms of Child Labor and
Affording Stronger Protection for the Working Child, Amending for this Purpose Republic Act No. 7610,
as amended, Otherwise
Known as the Special Protection of Children Against Child Abuse, Exploitation and Discrimination Act),
the following Implementing
Rules and Regulations are hereby promulgated:

Anti-Sexual Harassment Act of 1995 R.A. 7877
What is R.A 7877 ?
Also known as Anti-Sexual Harassment Act of 1995
This law declares as unlawful all forms of sexual harassment in school and in places of work.
It penalizes or punishes the offender after judgment by a court of Law and also allows the
punishment of any offender under the rules and regulations that a school or place of work may
adopt in accordance with the provisions of the law itself.
What is the purpose of the Law?
To guarantee that the learning and working environment is free from any sexual harassment
and is conducive for a harmonious and productive work and study.
In attaining this purpose the law seeks to value the dignity of individuals and protect the
human resources of the country by guaranteeing full respect for the human rights of the
people

Republic Act No. 8504 February 13, 1998
AN ACT PROMULGATING POLICIES AND PRESCRIBING MEASURES FOR THE PREVENTION
AND CONTROL OF HIV/AIDS IN THE PHILIPPINES, INSTITUTING A NATIONWIDE HIV/AIDS
INFORMATION AND EDUCATIONAL PROGRAM, ESTABLISHING A COMPREHENSIVE
HIV/AIDS MONITORING SYSTEM, STRENGTHENING THE PHILIPPINE NATIONAL AIDS
COUNCIL, AND FOR OTHER PURPOSES
ARTICLE VII
DISCRIMINATORY ACTS AND POLICIES
Sec. 35. Discrimination in the workplace. Discrimination in any form from pre-employment to
post-employment, including hiring, promotion or assignment, based on the actual, perceived or
suspected HIV status of an individual is prohibited. Termination from work on the sole basis of
actual, perceived or suspected HIV status is deemed unlawful.
DOLE: Department Order No. 102-10
Friday, 30 July 2010 05:27 | |
Guidelines for the Implementation
of HIV and AIDS Prevention and Control
in the Workplace Program

To strengthen response in the implementing the provisions of Republic Act
8504 otherwise known as The Philippine AIDS Prevention and Control Act of
1998 and its Implementing Rules and Regulations, and the DOLE National
Workplace Policy, in collaboration with the Inter-Agency Committee (IAC) on
STD, HIV and AIDS in the Workplace, the following guidelines are issued to
provide directions for employers, employees and program implementers in the
workplace.
Republic Act No. 9208 May 26, 2003
AN ACT TO INSTITUTE POLICIES TO ELIMINATE TRAFFICKING IN PERSONS ESPECIALLY
WOMEN AND CHILDREN, ESTABLISHING THE NECESSARY INSTITUTIONAL MECHANISMS
FOR THE PROTECTION AND SUPPORT OF TRAFFICKED PERSONS, PROVIDING PENALTIES
FOR ITS VIOLATIONS, AND FOR OTHER

Republic Act 7277
Republic of the Philippines
CONGRESS OF THE PHILIPPINES
Metro Manila
Fifth Regular Session
BEGUN AND HELD IN METRO MANILA, ON MONDAY, THE TWENTY SECOND DAY
OF JULY, NINETEEN HUNDRED AND NINETY-ONE.
Republic Act No. 7277
AN ACT PROVIDING FOR THE REHABILITATION, SELF-DEVELOPMENT AND
SELF-RELIANCE OF DISABLED PERSON AND THEIR INTEGRATION
INTO THE MAINSTREAM OF SOCIETY AND FOR OTHER PURPOSES.
- See more at: http://www.ncda.gov.ph/disability-laws/republic-acts/republic-act-
7277/#sthash.nXAlnSbT.dpuf
TITLE THREE PROHIBITION ON DISCRIMINATION AGAINST DISABLED PERSONS
CHAPTER 1 Discrimination on Employment SECTION 32. Discrimination on
Employment
TITLE THREE PROHIBITION ON DISCRIMINATION AGAINST DISABLED PERSONS
CHAPTER 1 Discrimination on Employment
SECTION 32. Discrimination on Employment No entity, whether public or private, shall
discriminate against a qualified disabled person by reason of disability in regard to job
application procedures, the hiring, promotion, or discharge of employees, employee
compensation, job training, and other terms, conditions, and privileges of employment. The
following constitute acts of discrimination:
(a). Limiting, segregating or classifying a disabled job applicant in such a manner that adversely
affects his work opportunities;
(b). Using qualification standards, employment tests or other selection criteria that screen out or
tend to screen out a disabled person unless such standards, tests or other selection criteria are
shown to be jobrelated for the position on question and are consistent with business necessity;
(c). Utilizing standards, criteria, or methods of administration that:
1). have the effect of discrimination on the basis of disability;
or 2). perpetuate the discrimination of others who are subject to common administrative control;
(d). Providing less compensation, such as salary, wage or other forms of remuneration and
fringe benefits, to a qualified disabled employee, by reason of his disability, than the amount to
which a non-disabled person performing the same work is entitled;
(e). Favoring a non-disabled employee over a qualified disabled employee with respect to
promotion, training opportunities, study and scholarship grants, solely on account of the latters
disability;
(f). Re-assigning or transferring a disabled employee to a job or position he cannot perform by
reason of his disability;
(g). Dismissing or terminating the services of a disabled employee by reason of his disability
unless the employer can prove that he impairs the satisfactory performance of the work involve
to the prejudice of the business entities; Provided, however, That the employer first sought
provide reasonable accommodations for disabled persons;
(h). Failing to select or administer in the effective manner employment tests which accurately
reflect the skills, aptitude or other factor of the disabled applicant or employee that such test
purports to measure, rather than the impaired sensory, manual or speaking skills of such
applicant or employee, if any; and
(i). Excluding disabled persons from membership in labor unions or similar organization

REPUBLIC ACT NO. 8791 - AN ACT PROVIDING FOR
THE REGULATION OF THE
ORGANIZATION AND OPERATIONS OF BANKS,
QUASI-
BANKS, TRUST ENTITIES AND FOR OTHER
PURPOSES
55.4. Consistent with the provisions of Republic Act No. 1405, otherwise known as
the Banks Secrecy Law, no bank shall employ casual or non regular personnel or
too lengthy probationary personnel in the conduct of its business involving bank
deposits.

Art. 1703. No contract which practically amounts to involuntary servitude, under any guise
whatsoever, shall be valid.
1. "Wage" paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in
terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the
same, which is payable by an employer to an employee under a written or unwritten contract of employment for work done
or to be done, or for services rendered or to be rendered and includes the fair and reasonable value, as determined by the
Secretary of Labor and Employment, of board, lodging, or other facilities customarily furnished by the employer to the
employee. "Fair and reasonable value" shall not include any profit to the employer, or to any person affiliated with the
employer.

salary is a form of periodic payment from an employer to an employee, which may be specified in
an employment contract. It is contrasted with piece wages, where each job, hour or other unit is paid
separately, rather than on a periodic basis.
A wage is monetary compensation (or remuneration) paid by an employer to an employee in
exchange for work done. Payment may be calculated as a fixed amount for each task completed
(a task wage or piece rate), or at an hourly or daily rate, or based on an easily measured quantity of
work done.