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Labor Law
Bar 2011 Notes
Roland Glenn T. Tuazon
Ateneo de Manila University
Table of contents:
1. FUNDAMENTAL PRINCIPLES AND POLICIES
2. RECRUITMENT AND PLACEMENT
3. LABOR STANDARDS
4. TERMINATION
5. SOCIAL LEGISLATION
6. SELF-ORGANIZATION
7. COLLECTIVE BARGAINING
8. CONCERTED ACTS
9. PROCEDURE
FUNDAMENTAL PRINCIPLES AND POLICIES

What is labor law?
o A regulatory devise, which regulates the relationship between
the employer and the worker the two factors of production
What is labor standards law?
o Establishes the minimum terms and conditions of employment
o Rationale: these are necessary for the worker and his family to
survive
o These are beyond then negotiation of the parties; they cannot
agree to terms less than those provided in the law. If they do,
these are void.
What is labor relations law?
o It is concerned with institutional relationships and does not look
as the laborer as an individual, but as a group of workers
(union)
o Two aspects of labor relations law:
1. Union and State relationship
2. Union as an organization and its relationship to the
members
What is social or welfare legislation?
o It solves the problem of avoiding making the worker a charge
on society and solves the problem of continuity of income
either in whole or in part if and when some contingencies
occur, such as sickness, injuries, premature death, and final
death
o What are the laws covered by social legislation?
1. Employees compensation and State Insurance
Fund (ECSIF)
2. SSS Law
3. GSIS Law
4. Limited portability law
o Which are applicable to what workers?
SSS, to private sector employees
GSIS, to government employees and those in GOCCs
Both, to those employed in both fields
Limited portability provides a tacking provision for
those who have partially fulfilled GSIS and SSS
requirements
SSS and GSIS for non-work-connected injuries and
ECSIF for work-connected injuries
What is the basis for enacting labor law?
o Constitutional provisions mandating the State to protect
laborers
o Police power of the State
What are the sources of labor law?
o 1. Contract law gives rise to rights and obligations
A. Civil code provisions on contracts
B. Collective Bargaining Agreements
o 2. Past practices, which are:
Those given voluntarily by the employer without
compulsion by law for a sufficient duration
What is sufficient period or duration?
Case by case
o 3. Company policies
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Those unilaterally designed and implemented by the
employer, stating rules and regulations of the
company. These can be the source of rights and
obligations.
N.B. these are unilaterally imposed by the employer;
otherwise, it would fall under contract law.
What is a labor case?
o 1. Involves employer and employee
o 2. Subject of controversy and laws of resolution fall under labor
law
Thus, if the area of resolution is civil law and not labor
law, such as replevin, then it is not a labor dispute
What is management function?
o These are rules based on the right of ownership, designed for
efficient and economical management of the enterprise. It
permeates the entire labor code, regardless of field.
o What is the limit to management function?
The law reserves the right to inquire as to the manner
of exercise of such right.
How does the law look upon waivers and compromises?
o It looks upon it with disfavor, although not all waivers and
compromises are void under law.
o What are the tests of validity of waivers and
compromises?
1. Arithmetic measure is what was received for
settlement unconscionable?
2. Relative positions of the employer and employee
what is the educational attainment of each? Was the
employee in dire need?
3. Freedom on the part of the worker was there
absence of coercion?
What are the guaranteed rights of laborers under Art XIII, Sec. 3?
o 1. Self-organization
o 2. Collective bargaining and negotiations
o 3. Peaceful concerted activities, including right to strike
o 4. Security of tenure
o 5. Humane conditions of work
o 6. Living wage
o 7. Participation in policy and decision-making processes
How does LC Art. 255 operationalize this?
Workers can participate in policy and
decision-making processes of the
establishment where they are employed as
far as it would directly affect their rights,
benefits, and welfare
What are the other goals set by this provision?
o Full protection to labor
o Full employment and equality of opportunities
o Shared responsibility between ER and EEs
o Preferential use of voluntary dispute settlement
o Two fold rights:
Right of labor to just share in fruits of production
Right of enterprises to reasonable returns to
investments
What does the NCC say?
o Art 1700 relations between labor and capital are not just
contractual, but impressed with public interest must yield to
common good
What factors does labor law consider as to contracts?
o 1. Due process clause
Labor is considered property
Due process and EPC can protect the employer too,
not just the employee
o 2. Liberty of contract and laissez faire
N.B. but the State still retains an interest on the
worker as part of society no matter how reckless he
may be; thus, the State continues to interfere in
contract. Laissez faire is not totally adopted.
When does the Labor code apply?
o 1. There must be an employer-employee relationship
o 2. Generally applies to all kinds of employment
N.B. but for GOCCs created and governed by special
charter, apply the Civil Service Law instead
o What is the rule on international organizations?
Beyond the coverage of the Labor Code, but the
international agreement must contain provisions on
method of dispute settlement.
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N.B. if not provided, the worker can ask for withdrawal
of immunity of suit so that Philippine legal processes
can apply.
o What about school teachers?
Public school teachers are covered by the Civil
Service Law.
Private school teachers are covered by the Dep. Ed.
Manual
But for all matters not covered by these, the Labor
Code applies. The most important is probationary
employment.
o Does the Labor Code apply to religious corporations?
If the nature of the controversy is not religious, then
the Labor Code applies.
o Does the Labor Code apply to managerial employees?
Yes, although certain aspects like Hours of Work do
not apply.
RECRUITMENT AND PLACEMENT

RECRUITMENT OF LOCAL AND MIGRANT WORKERS
What is recruitment and placement?
o Any act of:
Canvassing, enlisting, contracting,
Transporting, utilizing, hiring, procuring workers
Includes referrals, contact services, promising or
advertising employment for profit or not, here or
abroad
o When is there a presumption of R&P?
When a person or entity offers or promises for a fee
employment to two or more persons
o How do you harmonize the definition and the
presumption?
Any one act under the definition is sufficient to
establish R&P, regardless of number of persons. The
presumption is only a rule of evidence which operates
when there are two persons to whom employment is
promised for a fee and the acts defined above cannot
clearly be established.
o Who are workers?
All members of the labor force, whether employed or
unemployed
What is the State policy under MWA?
o Promotion of overseas recruitment is not State policy, because
it seeks to create local opportunities. But while there are
workers deployed abroad, there must be protections for them.
o Does the POEA have jurisdiction over ER-EE relations
cases for OFWs?
Not anymore. Its been retransferred to NLRC. The
POEA only handles administrative cases.
o What is the nature of employment of seafarers?
They are contractual employees
Differentiate license from authority:
o License is authorization to operate a private employment
agency. A Private Employment Agency is an entity engaged in
R&P for a fee (charged from employer, worker, or both)
o Authority is authorization to operate a private recruitment
entity. A Private Recruitment Entity is an entity engaged in
R&P without charging any fee
Illegal recruitment
o What is the definition of illegal recruitment under the LC?
Any recruitment activities (Art. 13) or prohibitions (Art.
34) undertaken by non-licensees or non-holders of
authority
o What is the definition of illegal recruitment under the MWA
(RA 8042)?
Any recruitment activities (Art. 13) undertaken by non-
licensees or non-holders of authority
Any prohibited acts (Art. 34), whether licensed or non-
licensed
o What are the prohibited acts (Art. 34)?
1. Overcharging (whether vis--vis schedule of fees or
what has been loaned/advanced)
2. Public false information re: recruitment
3. Misrepresentation to secure license or authority
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4. Induce or attempt to induce employed worker to
leave job to offer him to another
Except to save him from oppressive
employment
5. Influence employer not to hire worker unless
coursed through his agency
6. Engage in R&P for harmful or anti-public policy
work
7. Obstruct or attempt to obstruct inspection by Sec of
Labor or representatives
8. Fail to file reports required by Sec of Labor
9. Substitution or alteration of approved contracts
without approval of Sec of Labor
10. Becoming officer or being involved in
management of travel agency
11. Withhold or deny travel documents from workers
before departure due to financial considerations
Unless authorized by LC
o What are the additional grounds added by MWA, apart
from these?
12. Failure to deploy the worker without valid reason
13. Failure to reimburse worker when deployment
does not happen without his fault
Differentiate simple illegal recruitment, illegal recruitment in large
scale, illegal recruitment as syndicate:
o Large scale if committed against 3 or more persons
individually or as a group
o By a syndicate carried out by a group of 3 or more persons
conspiring or confederating with each other
o What are these two types of illegal recruitment called?
Illegal recruitment as economic sabotage
Can illegal recruitment and estafa coincide?
o If there are pecuniary damages due to previous or
simultaneous false pretense resorted to by the entity, then the
latter can be sued for estafa under Art. 315
o This suit may prosper aside from illegal recruitment
What are the liabilities of the local employment agency and the
employer?
o The agency is solidarily liable for the unpaid salaries of the
worker, along with the principal/employer. This holds true even
if the agency agreement has been severed, if no notice was
given to the employee.
o What is the theory of imputed knowledge?
The presumption that knowledge of he agent can be
ascribed to the principal as well.
o When is an employee of the entity liable as a principal?
When he had knowledge of the offense and had
active and conscious participation. NOT liable as
principal when merely carrying out orders of superior.
What is the rule on pre-termination of contract of a MW?
o If there was pre-termination without just cause, the employer
will be ordered to pay the workers:
o 1. Full placement fee with 12% interest AND
o 2. Salary for unexpired portion of the contract OR for 3 months
for every year of the unexpired term, whichever is lesser
o Isnt this unconstitutional?
Yes, according to Serrano v. Gallant, but R.A. 10022
passed 1 year after reinstated the provision
Is direct hiring allowed for overseas employment?
o As a general rule, no, direct hiring is not allowed. It must be
through boards and authorized entities.
o What are the exceptions?
1. Diplomatic corps
2. IOs
3. Other employers allowed by the DOLE
What is the rule on employment of Non-Resident Aliens?
o Either the alien or the employer must obtain an employment
permit from the DOLE
o When is the permit issued?
Upon determination of non-availability or a person in
the Philippines who is competent, able, and willing at
the time of application to perform the services for
which the alien is desired
o What is the special rule for those preferred areas of
investment?
Permit issued upon recommendation of the
government agency in charge of that enterprise
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Upon issuance of the employment permit to the NRA, what are the
regulations?
o Cannot transfer employment without prior approval from DOLE
Secretary
o Else, punished under the LC and/or deported
REGULATION AND ENFORCEMENT
What is the rule on remittance of foreign exchange earnings?
o Employment contracts must contain a proviso that makes
remittance of the following rates mandatory
1. Seamen 70% of basic salary
2. Workers of Filipino contractors or construction firms
70%
3. Doctors, nurses, engineers, teachers, other
professionals whose contract gives free board and
lodging 70%
4. Professionals without free board and lodging 50%
5. Domestic and service workers 50%
6. All others 50%
What are regulations?
o 1. Travel agents and sales agencies of airline companies
cannot engage in R&P for overseas employment, w/n for profit
o 2. Citizenship requirement for recruitment entities:
Filipino
OR 75% Filipino ownership (authorized and voting
stock)
o 3. Minimum capitalization as required by Sec. of Labor
o 4. Non-transferability of authority or license
Cannot transfer to another person or use in another
place
What if you want to transfer offices?
Get prior approval of Sec. of Labor, as with
appointing an agent or getting additional
offices
What are the prohibited activities?
o See above enumeration (Art. 34)
What is the nature of the regulatory and visitorial powers of the
Labor Secretary?
o The Secretary can restrict and regulate R&P activities of all
agencies covered
o Can issue orders and R&Rs
o Visitorial Powers Sec of Labor or representatives may
inspect premises, inspect books/records of entities, require
submission of reports, etc.
What must be given by those applying for license or authority?
o 1. Prescribed registration fees
o 2. Cash/surety bonds to guarantee compliance with provisions
What is the nature of the license?
o It is beyond the commerce of man, and subject to prior
approval
What are the penalties for illegal recruitment?
o 1. Simple illegal recruitment 12 y 1 d to 20 y imprisonment
And fine of P1M to 2M
o 2. Economic sabotage life imprisonment
And fine of P2M to 5M
Maximum if the one recruited is less than 18 years, or
committed by a non-licensee or holder of
authorization
o 3. Prohibited acts 6 y 1 d to 12 y
And fine of P500K to P1M
If alien, deported without further proceedings
o 4. In all cases:
Revoke license or authorization
LABOR STANDARDS

Where do benefits come from?
o 1. Law (Labor standards law)
o 2. Contact (ex. CBA)
o 3. Vested benefits
HOURS OF WORK
What is the rationale for the hours of work provisions?
o 1. To safeguard health and welfare of the laborer
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o 2. Prevent unemployment (companies that operate more than
8 hours have to hire more workers or pay more)
o 3. The employee usually just accepts what the employer says,
so this will prevent begrudging acceptance of long work days
Who are covered by the provisions on hours of work?
o By default, employees in all establishments and undertakings,
whether for profit or not
Who are excluded by the provisions?
o 1. Government employees
Covered by Civil Service Law
Exception?
Employees of GOCCs incorporated under
the Corporation Code
N.B. even GSIS-covered employees are not excluded
from the employees compensation program under
the Labor Code
o 2. Managerial employees
What are managerial employees?
1. Primary duty is management of the
establishment, department, or subdivision
2. Customarily or regularly directs work of
two or more employees
3. Has authority to hire/fire employees of
lower rank, or at least their suggestions are
given particular weight
N.B. this is not the same definition for
manager in labor relations. This is broader
in scope and covers even supervisory
employees, while the labor relations
definition does not.
Ratio: they are not hired for quantity of hours of work
put in but the special training, knowledge, or
experience that requires discretion and independent
judgment
o 3. Field personnel
Who are these?
Non-agricultural employees regularly
performing their duties away from the
principal place of business
What is essential?
Actual hours of work cannot be determined
with reasonable certainty
Test: whether the employee is supervised on
the field
What about bus conductors and drivers?
NOT field personnel because inspectors
check their hours of work.
o 4. Members of the family of the employer who are dependent
on him for support
o 5. Domestic helpers
o 6. Persons in the personal service of another
o 7. Workers paid by results
Is this determinative of employer-employee
relationship?
No. Always follow the four-fold test. This is
just a method to compute compensation.
Ratio: they are paid based on work output, regardless
of time employed
What are the normal hours of work?
o Not exceeding 8 hours a day
Can normal hours of work be less than 8?
Yes. It says not exceeding
Can an employer and employee contractually
agree that work must be 12 hours a day, or any
number above 8?
Yes, its a contractual commitment but the
extra 4 hours are covered by OT pay.
What is the day here?
Work day (24 hour period starting from the
time an employee regularly starts to work)
NOT calendar day
o What are the exceptions?
1. Health workers
In cities and municipalities with population at
least 1 million
Or in hospitals/clinics with bed capacity at
least 100
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What are their hours?
o 8 hours a day, 5 days a week
(N.B., its doesnt say not
exceeding this time, so
they really must work 8
hours)
Excluding meal times
o Except when exigencies require
work for 6 days (48 hours)
What is the implication on their salary?
o 130% of normal salary on the sixth
day
2. Compressed Work Week
What is this?
o When the employer and employee
agree that the employee works one
day less (ex. from 6 to 5 days) and
the hours of the skipped day will be
added to the other days
What is the maximum time allowed for
CWW?
o 12 hours. Anything in excess will
garner OT pay
Otherwise, what is the general?
o The work beyond 8 hours but under
12 is not given OT pay
What are covered by the counting on hours worked?
o 1. All time where an employee is required to be on duty or to
be at a prescribed workplace
o 2. All time when the employee is suffered or permitted to work
o 3. Rest periods of short duration during work hours
Does the employee actually need to leave the
premises of the workplace?
No. He can stay or go.
o What about waiting time?
Check the circumstances of the job, if waiting is an
integral part of his work
o X has to drive to a place outside Metro Manila to do an
installation job. Is this part of hours of work?
Yes, it is when the travel time cuts across or coincides
with regular work hours.
o X is a delivery truck driver. Is time spent driving the
vehicle to and fro the bodega time worked?
Yes.
How does the law treat work interruption due to brownouts?
o It is considered working time, because the time during which
an employee is inactive by reasons beyond his control is
considered working time if
Resumption of work is imminent and it requires his
presence at the place of work
Or the interval is too brief to be utilized effectively and
gainfully in the employees interest
Meal period:
At least 60 minutes Default meal period
Less than 60 minutes but at least
20 minutes
Valid shortened meal time; becomes
compensable
Less than 20 minutes Compensable rest period. NOT a
valid meal period.
Less than 20 minutes, but valid
compensable meal period:
1. Non-manual work; does not
involve strenuous physical
exertion
2. Establishment regularly
operates at least 16 hours a day
3. Actual or impending
emergencies or urgent work on
machineries to avoid serious
loss
4. Necessary to avoid serious loss
of perishable goods

Other types of time spent at work:
Type of work Counted as working time?
Idle time Yes, if the employee was engaged to
wait or he waited to be engaged.

The controlling factor: whether the
waiting time was for the employers
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benefit or the employees benefit
Waiting time Yes, if waiting is integral part of the
work, or if the ER engaged him to
wait.
On call working Yes. It is when an EE is required to
remain on call that he cannot
gainfully and effectively use his time
for his own purposes.
Travel from home to work No.

Except, when:
1. EE made to work on
emergency call and travel is
necessary to get to work
2. Travel through conveyance
provided by ER
3. Travel under supervision
and control of ER
4. Travel under vexing and
dangerous circumstances

X was a company driver and was
engaged to pick up and drop off
other employees to and fro work.
Is this working time?
Yes, because it is done for the
employers benefit
Travel incidental in days work Yes, if part of EEs regular activity
Travel away from home Yes, if it keeps an EE away from
home overnight and it cuts across an
EEs workday. It substitutes for
normal working time.
Semestral break, for teachers Yes. It is an interruption beyond
their control. N.B. this only applies
to regular full-time teachers
Attendance in lectures, meetings,
trainings, or programs
Yes.

Except if the ff requisites concur:
1. Attendance is outside
regular working hours
2. Attendance is voluntary
3. There is no productive work
done during attendance

Nightshift differential
What is the nightshift differential?
o 10% of regular wage, for each hour of work between 10 pm
and 6 am
Who are not covered by nightshift differential?
o 1. In government or GOCCs
o 2. Managerial employees
o 3. Field personnel or other employees whose
time/performance is unsupervised
o 4. Domestic helpers
o 5. Those in personal service
o 6. Working on contract basis, purely commission basis, or paid
fixed amount irrespective of time worked
o 7. In retail or service establishments regularly hiring only up to
five workers
o N.B. So this is just like the hours of work enumeration, but
including retail and service establishments hiring only up to 5
workers.
o Reason?
Its onerous for the small business to pay NSD, but in
also, it will be harsh if they dont have to comply with
hours of work just because they have few employees.
What is the rationale for the NSD?
o 1. Social disarrangement
o 2. Lower efficiency and output
o 3. Higher risk going to and fro work in darknesss
What if it is also overtime work?
o The 10% is calculated against OT pay as base
Overtime Work
What is OT work?
o Work performed beyond 8 hours a day
What is the rate for each hour of work done beyond 8 hours?
o Regular wage + 25%
N.B. Base excludes fringe benefits/bonuses just
regular pay
o What if the OT work was done during a holiday?
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The +25% becomes +30%
o What if the OT work was done during a rest day?
The +25% becomes +30%
What are conditions to be entitled to OT pay?
o 1. Actual rendition of OT work
o 2. Submission of sufficient proof that work was actually
performed
o 3. With knowledge and consent of employer
Is it legal for the employment contract that the monthly salary
would be treated as covering even pay for rest days and holidays?
o Yes, as long as the wage is still equal to or above the minimum
wage
What is the anti-offset rule?
o Under-time work on one day cannot be offset by overtime work
on another day
o Neither does permission given to the employee to go on leave
some other day of the week exempt the employer from paying
additional compensation
Can OT pay be waived?
o No.
o Unless the waiver was in consideration of other benefits or
salary that equals or exceeds the OT pay.
What are the emergency situations when OT work can be made
mandatory by the ER?
o 1. RP is at war, or national/local emergency declared by
Congress or President
o 2. Necessary to prevent loss of life/property or imminent
danger due to disaster or calamity
o 3. Urgent work on machines, installations, equipment to avoid
serious loss or damage to the employer
o 4. Necessary to prevent loss or damage to perishable goods
o 5. Completion or continuation of work started before the 8
th

hour must be completed to avoid serious obstruction or
prejudice to the business
o 6. Necessary to avail of favorable weather or environmental
conditions
o When OT is required under these 6 circumstances, must
there be extra compensation nonetheless?
Yes. It just becomes mandatory, rather than optional.
What prevails, CBA provision or OT work rate?
o CBA may stipulate higher OT pay rate. The court cannot
impose upon the parties anything beyond what they agreed
upon. If there is none, impose regular OT rate.
WAGES
What is the no work no pay principle?
o If there is no work performed by the employee, there can be no
wage or pay.
o Exceptions to no work no pay:
1. The laborer was willing, able, and ready to work but
was prevented by management
2. Illegally locked out, suspended, or dismissed.
o What if the failure to work was the employees fault?
He doesnt get paid
o What is the principle established under ISA v.
Quisumbing?
Equal work for equal pay; no distinction can be made
based on nationality
Facilities and supplements:
Facilities Supplements
Included in wages Not included in wages
Can be credited as wages or
deducted from wages
Over and above wages
Articles or services like
board/lodging which benefit the EE
and his family

Requisites:
1. Customarily furnished in
trade
2. EE voluntarily accepted it in
writing
3. Charged at reasonable
value
Extra remuneration or special
privileges received over and above
the EEs ordinary wages

N.B. For facilities and supplements,
the nature of the benefit or item is
not a controlling criterion. It is the
purpose that controls. Check if its
meant to be part of his wages or
over and above them.
Generally for the benefit of the
employee. So its usually at the
initiative of the EE.
Usually on the initiative of the ER.

Tools of trade or other articles for the
benefit of the ER or the business
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Who are excluded from the rules on wages?
o 1. Farm tenancy/leasehold
o 2. Cottage industries and other small businesses that probably
cannot afford to pay the wage rates set by law.
N.B. Consult wage orders established by regional
wage boards
o 3. Domestic service
o 4. Barangay Micro Business Enterprises (BMBE) under R.A.
9178
Business entities engaged in producing or processing
of products (including agro-processing), whose total
assets do not exceed 3M pesos
What does the term assets cover?
Includes loans
Excludes land where the office, plant, or
equipment are situated
Differentiate wages and salaries:
o Wages
Manual labor, skilled or unskilled
Paid at stated times
Measured by day, week, month, or season
Usually for lower and less responsible character of
employment
o Salaries
Higher degree of employment, superior grade of
services, and implies position/office
Larger and more permanent/fixed compensation
What is the non-diminution rule?
o The benefits being given to employees cannot be taken back
or reduced unilaterally by the employer, because the benefit
has become part of the employment contract (whether written
or unwritten)
o When does a benefit set-in and cannot be diminished?
1. When the benefit is based on express policy or has
ripened into practice for a long period of time
2. AND that it is consistent and deliberate
o What can be diminished?
1. Conditional or contingent benefits (ex. bonuses)
2. Those granted due to error or doubtful application
or law
What is the exception to this?
o When the error has stood so long
and has been left uncorrected that it
has ripened into company policy
What is the rule on those paid by results?
o If paid according to piece rates in DOLE Pierce Rate Orders:
Wages = number of pieces * Piece Rate
No overtime pay
o If paid according to output rates prescribed by the employer
and not yet approved by DOLE:
If number of pieces * Rate is >= to legal daily wage,
they receive the former
If formula is < than the legal daily wage, they receive
the latter
What are piece-rate employees entitled to?
o 1. Applicable minimum daily rate
o 2. SIL
o 3. Night shift differential
Huh? I thought those paid by results are excluded
by NSD?
Yes but that covers those paid by
commission, contract basis, or by end-result.
That doesnt include piece-rate workers who
are just like normal workers in every respect
except they are paid by pieces made.
o 4. Holiday pay
How calculated?
Not less than his average daily earnings for
the last seven actual working days
It must not be less than the minimum wage
o 5. Meal and rest periods
o 6. OT pay
Conditional
o 7. Premium pay
Conditional
o 8. 13
th
month pay
o 9. Other benefits granted by law or by agreement
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o N.B. So the rule is that piece-work EEs are entitled to the
normal benefits because the difference between them and the
usual employees is just manner of payment and nothing else
What are the legal forms of payment?
o Must be legal tender
o Cannot be in PNs, vouchers, coupons, tokens, tickets, etc.
o What if the employee requested for PNs, vouchers, etc?
Even so. Its not allowed.
o When is payment by check allowed?
1. Customary manner of wage payment in that place
2. Stipulated in CBA
3. Or where all of the following requisites are met:
A. Bank or encashment facility within 1 km
radius from workplace
B. the ER or his agents do not receive
pecuniary benefit from the arrangement
C. EEs given reasonable time during
banking hours to withdraw wages from bank
o This is compensable working time
D. Written consent of employee if there is no
CBA provision
4. Special circumstances provided in labor regulations
o Is payment by ATM allowed?
Yes, under 25 Nov 1996 labor advisory
Requisites for payment through ATM:
1. Written permission of majority of EEs
2. 25 or more EEs in the establishment
3. Establishment is within 1 km from bank
What is the time of payment?
o At least once every 2 weeks or twice a month at intervals not
exceeding 16 days
o What if there is force majeure preventing payment?
Payment made as soon as force majeure disappears
o In all cases, what is prohibited?
Payment with less frequency than once a month
o What is the rule for employees made to perform tasks
which cannot be completed in 2 weeks?
1. Payments at intervals not exceeding 16 days, in
proportion to amount of work completed
2. Pay balance upon completion of work
o What is required by the IRRs?
1. Individual time record of employees
2. Payroll
Where and how must wages be paid?
o At or near the place of undertaking
N.B. Remember the ATM exception
o When can there be payment in any other place?
1. Impossible to pay in place of work due to
emergency or calamity
2. ER provides free transportation back and forth
3. Analogous circumstances
N.B. For all: time spent is compensable work time
o What are prohibited places of payment?
Bar, night/day club, drinking place, massage clinic,
similar places
Except if the people are employed there
o Who must receive the payment?
The worker himself
o Exceptions to this rule?
1. Force majeure can be paid to another person
with written authority given by EE
2. Decease of EE
Can pay wages to heirs directly without need
of intestate proceedings
What is the procedure?
o The heirs submit an affidavit stating
relationship to deceased
o ER pays through Sec. of Labor or
his representatives
o Sec. of Labor acts as referee to
divide the amount
3. Workers family member authorized in writing
What is the rule on workers preference under Art. 110?
o In case of bankruptcy or judicial liquidation, the workers
unpaid wages are preferred.
12

o It is not a lien, but a reordering of credits (see Concurrence
and Preference of Credits in Civil Law)
What is the rule on attorneys fees?
o In case of unlawful withholding of wages culpable party may
be assessed attorneys fees equal to 10% of wages recovered
o In any proceeding, cannot recover attorneys fees exceeding
10% of the wages recovered
What is non-interference in disposal of wages?
o No employer can limit or interfere with the employees disposal
of his wages.
o Can an employer compel his employees to purchase any
merchandise or commodity?
No, whether it be from himself or another person
Can an employer deduct his employees wages?
o In general, no.
o What are the exceptions under the Labor Code?
1. To pay for insurance premiums that employee
consented to
2. Union dues, where right to check-off is authorized
in writing by the employee or recognized by the
employer
3. Authorization by the Sec. of Labor
o What are the exceptions under other laws?
1. Employee is indebted to the employer, and it is due
and demandable
2. Court ordered attachment of wages for debts
incurred for food, shelter, clothing, or medical
attendance only
3. Withholding tax
4. Salary deductions for coop members
5. Payment to third persons, upon written
authorization by employee
And agreement by the employer, who is not
obliged to do so
6. Agency fee
7. Facilities
8. Loss or damage under Art. 114 (see below)
9. SSS, Medicare, Pag-ibig premiums
Can the employer require the employees to make deposits to cover
for deductions for loss/damage to tools or equipment?
o In general, no.
o What is the exception?
When it is shown that such practice is long-
established and recognized in the trade
o If allowed, when can deductions be made (requisites)?
1. Employee is responsible for the loss/damage
2. Employee given chance to show cause against
deduction
3. Amount is fair and reasonable, and not exceeding
the loss/damage
4. Deduction does not exceed 20% of employees
wages in a week
Can wages be withheld by the employer, if the employee violated
company rules, failed to perform tasks, or for any other reason?
o No. It can be dealt with in some way but not by withholding
wages.
o Other express prohibitions?
Deduction to ensure employment
Retaliatory deductions
False reporting
Which body has the power to prescribe rules and guidelines for
determination of wages in the country?
o National Wages and Productivity Commission (NWPC)
o What is the status of guidelines issued by Regional
Tripartite Wages and Productivity Boards?
These are void, if without the approval of or contrary
to NWPC guidelines
o What is the status of a wage order without required public
consultation and publication in newspapers?
Void as well
Who sets the minimum wage?
o Regional Tripartite Wages and Productivity Boards
o Is poor financial condition of the company an exemption
to payment of minimum wage?
No.
o What does minimum wage relate to?
A days work which comprises 8 hours at most
13

o When is a worker daily paid?
Paid only for days he actually worked
o When is a worker monthly paid?
When the monthly rate covers all the days of the
month.
Calculated through the following formula:
Monthly wage x 12 / 365 = daily rate
Must exceed the following formula:
Minimum wage x 365 / 12
Distinguish agricultural from industrial rates:
o Agricultural rates farming in all its branches
o Industrial manufacturing and processing
o What determines which rate applies?
Nature of the work. It is permissible for one company
to pay agricultural rate to some, and industrial rate to
others.
What is wage distortion?
o When the pay advantage of a position over another is removed
or significantly reduced due adjustment required by a wage
order
o The advantage must thereafter be restored
o Must there be full elimination of salary differences?
No. A severe contraction is enough.
o Are efforts to rectify mandatory?
Yes, whether the establishment is organized or
unorganized
What if its an organized establishment? (Neg-GM-
VA)
1. Employer and union must negotiate
2. Any dispute must be resolved through
grievance machinery in CBA
3. If unsolved, through voluntary arbitration
What if its an unorganized establishment? (Neg-
Labor-NLRC)
1. Employer and union must endeavor to
correct it
2. Any dispute must be resolved through
Labor Arbiter (R.A. 6727 says NCMB)
3. In unsolved after 10 days of conciliation,
refer to NLRC
o Must the new difference be the same as before?
No, not to the last peso. Restoration of appreciable
differential is sufficient.
o Is any issue involving wage distortion a valid ground for
strike or lockout?
No. Check the enumeration its not there.
o What is the just and equitable formula forwarded by the
SC in Metrobank?
(minimum wage / actual salary) * (prescribed
increase) = distortion adjustment
o Is there inter-region wage distortion?
No. Just intra-region. The wage-fixing rates are fixed
per region, and comparison must be within these
regions and not across regions.
o What if the salary distortion was created due to employer-
initiated salary restructuring?
There is no legal duty to rectify the distortion because
the legal duty only arises from distortions brought
about government wage orders.
o What are the prohibitions pertinent to wage orders?
1. No TROs or injunctions are allowed for
proceedings before the NWPC or RTWPBs.
2. Wage orders must respect the statutory minimum
wage set by Congress.
o Who are not covered by wage orders?
1. Household/domestic workers, and those in
personal service
2. Workers in retail/service establishments employing
not more than 10 workers, when exempted from
compliance for a certain period fixed by
commission/boards
3. Workers in new business enterprises, within 2-3
years from start of operations, when exempted and:
Outside NCR
Or in EPZs
o How often can there be a wage order?
Once every 12 months
14

Except when there is a Congressional law
o What are factors considered in wage orders? (dont
memorize but understand and familiarize)
1. Standards of living
2. Needs of workers/families
3. Wage adjustment vis--vis consumer price index
4. Prevailing wage levels
5. Effects on employment family income
6. Cost of living and changes
7. Fair return of capital investment and employers
capacity
8. Need to induce investment in rural areas
9. Equitable distribution of income
10. Demand for living wages
REST DAY
When does the right to rest day accrue?
o For every six consecutive normal work days
When is the rest day set?
o Depending on the CBA or subject to RRs
o What if the employee has preference based on religion?
It is respected, but he must inform the employer at
least 1 week before the day preferred
What if it might cause prejudice to business?
Resort to other remedial measures. If there
are none, must schedule the preferred rest
day on that chosen day at least twice a
month.
When may an employee be required to work on a rest day?
o 1. Actual or impending emergencies caused by disaster or
calamity, to prevent loss of life/property
o 2. Urgent work on machinery, equipment, or installation to
avoid serious loss
o 3. Abnormal pressure of work due to special circumstances
And there are no other measures
o 4. Prevent loss or damage to perishables
o 5. Nature of work requires continuous operations and stoppage
of work may result in irreparable injury or loess to employer
o 6. Analogous circumstances
o 7. Favorable weather or environmental conditions, when
performance is dependent on such
o (N.B. If you notice, this is the same as the Mandatory OT
enumeration, except for abnormal pressure of work due to
special circumstances)
What is the rate of rest-day compensation?
o Regular wage plus 30% (premium pay)
o What if because of the nature of the employees job, there
are no regular workdays and no regular rest days can be
scheduled?
The extra 30% applies to Sunday work
What is the rate for work on a special holiday?
o Regular wage plus 30%
o What if it is also his scheduled rest day?
Regular wage plus 50%
N.B. if he works OT, then its plus 30% of 150%
What are the special holidays?
o 1. All Saints Day (Nov 1)
o 2. Last day of the year (Dec 31)
o 3. Ninoy Aquino day (Aug 21)
What if the employee does not work on a special holiday?
o No pay
What is the implication when a day is declared as a special
working holiday?
o Then no premium pay is given. An employee just earns 100%
if he works.
HOLIDAYS
Which employers are not required to pay this holiday pay?
o 1. Government and GOCC employees
o 2. Domestic helpers
o 3. Those in personal service of another
o 4. Managerial employees
o 5. Field personnel
o 6. Those paid based on contract, commission, or for end-result
regardless of time spent working
15

o 7. Those in retail and service establishments employing less
than 10 workers
o (N.B. This is the same as NSD enumeration, and the same as
hours of work exemption + 10 workers-rule)
Are monthly-paid employees excluded from holiday pay?
o No. They are included. The IRR provision establishing this is
void.
For hourly-paid teachers, will the calling off of class or declaration
of special public holiday deprive them of income?
o No. They should receive what they would have been paid.
o What about when extensions are given?
Then they are paid their hourly rates.
Are private school teachers entitled to holiday pay?
o Yes if the holiday falls during Christmas vacation
o No if the holiday falls during semestral breaks
What about employees paid by results?
o Paid average daily earnings for 7 days preceding holiday
o But must not be less than minimum wage
What about seasonal workers?
o Not paid holiday pay during off-season
Compensation:
Holiday and EE does not work 100% pay
Holiday and EE works 200% pay
Double-holiday (ex. Maundy
Thursday and Araw ng Kagitingan)
200% if EE rests; 300% if EE works
Holiday falls on Sunday 100% if EE rests; 200% if EE works
(no special rule)
Holiday falls on rest day 100% if EE rests; 230% if EE works;

N.B. +30% of 230% if EE works OT

What is the rule in case of absences?
o Employee on LOA with pay
entitled to benefit
o Employee on LOA without pay on the day immediately
preceding a regular holiday
not entitled to holiday pay unless he works on such
regular holiday
o If immediately preceding day to a holiday is a non-working day
or is the scheduled rest day
entitled to benefit only if he worked on the day
immediately preceding the rest day or non-working
day
What if there are successive regular holidays, like Maundy
Thursday and Good Friday?
o To be entitled to two successive holidays, employee must:
1. Be present on the day immediately preceding the
first holiday
2. Or be on paid leave
o If he absents himself on the day immediately preceding
the first holiday, what is the consequence?
He may not be paid for the two holidays
What is the remedy?
He can go to work on the first holiday.
What is the rule if there is temporary shutdown or cessation of
work?
o If regular holiday falls in period of temporary shutdown (ex.
inventory, repair, etc.)
Entitled to benefit
o If it falls in period where operations cease due to business
reverses, as authorize by Sec. of Labor
No holiday pay
What is an ECOLA? Is the employee entitled to it during a legal
holiday?
o Emergency Cost of Living Allowance, which is not part of the
regular wage
o Yes, whether or not the employee works on a legal holiday, he
is entitled to ECOLA
What are the legal holidays?
o New Year
o Maundy Thursday
o Good Friday
o Araw ng Kagitingan (April 9)
o Labor Day (May 1)
o Independence Day (June 12)
o National Heroes Day (Last Sunday of August)
o Bonifacio day (November 30)
16

o Eidul Fitr
o Eidul Adha
o Christmas Day
o Rizal Day (December 30)
What is the holiday economics rule?
o For the following seven holidays, the holiday is moved to the
nearest Monday
Araw ng Kagitingan
Labor Day
Independence Day
National Heroes Day (becomes Last Monday of
August)
Bonifacio Day
Rizal Day
Ninoy Aquino Day Special holiday
LEAVES
What is the right of Service Incentive Leave?
o Every employee who has rendered 1 year of service is entitled
to SIL of 5 days
o To whom will SIL not apply?
0. USUAL (Government/GOCCs, domestic workers,
those in personal service of another, managerial,
field, contractual/commission/end-result)
1. Those already enjoying this benefit
2. Those with Vacation Leave (VL) with pay of at least
5 days
3. Those in establishments with less than 10
employees
4. Establishments exempt by the Sec. of Labor, after
considering viability or financial condition of the
establishment
o (N.B. There are actually just three categories: a) those who
already grant it, and b) those who cant grant it, c) usual)
What is the prohibition as to benefits granted in excess of what is
provided herein?
o It cannot be the subject of arbitration or any court/admin action
Is VL or Sick Leave required to be given?
o No, it is not required by law. It is dependent on employer
policy and CBAs.
o These are voluntary benefits.
What are required by law (mandatory benefits)?
o 1. SIL
o 2. Paternity Leave (RA 8187)
o 3. Maternity Leave (SSS Law)
o 4. Solo Parent Leave (RA 8972)
o 5. Battered Woman Leave (RA 9262)
o Does the less than ten employees rule apply to Paternity
or Maternity Leave?
No. It only applies to SIL.
Why?
Kawawa naman sila, nanganak na nga,
papapasukin mo pa. It doesnt matter how
many employees are there.
What happens to unused SIL?
o Converted to cash.
Maternity Leave:
o Who is covered?
Female who has paid at least 3 monthly contributions
in the 12-month period immediately preceding the
semester of her childbirth or miscarriage
o What does she receive?
100% of average daily salary for 60 days
100% of average daily salary for 78 days, if caesarian
o What are the conditions?
The employee must notify the employer of her
pregnancy and this information is transmitted to the
SSS
Full payment is advanced by the employer within 30
days from filing the maternity leave application
o Can the woman recover sickness benefits concurrent with
maternity leave?
No.
o When does the SSS reimburse the employer?
Upon satisfactory proof that the employer has
advanced to the employee the benefits required
17

o How many times can maternity leave benefits be availed
of?
First four deliveries or miscarriages
o What is the consequence if the employer fails to turnover
to the SSS the employees contributions, or fails to inform
the SSS of her pregnancy?
Employer pays damages to the SSS equal to what the
employee would have been entitled to
o Is the identity of the father material?
No, it doesnt matter who the father is
Paternity Leave:
o What is given?
Seven days of paternity leave with full pay to married
male employees in the private/public sectors
Are these 7 working days or 7 calendar days?
No. 7 calendar days.
o What are the conditions to entitlement?
1. Married male employee and is employed when the
child is born
2. Cohabiting with his legitimate spouse when she
gives birth or suffers miscarriage
3. Applied for paternity leave according to rules
4. Wife gave birth or suffered miscarriage
Is abortion included?
o No, not anymore.
o For how many deliveries is paternity leave valid?
First 4 deliveries
What is Solo Parent Leave?
o A solo parent employee who has rendered service for at least
one year shall be given parental leave of not more than 7
working days
o What does a solo parent cover?
Women who gave birth as a result of rape
Widow or widower
Spouse separated legally or de facto for at least one
year
o What must the solo parent prove?
He or she is left alone with responsibility of
parenthood
o What must he or she show?
Solo parent identification card issued by a
representative of the DSWD
What is the Battered Woman Leave (BWL) under RA 9262?
o A victim of physical, sexual, or psychological violence can
apply for the issuance of a protection order. In addition to
other reliefs, if she is an employee, she is entitled to a paid
leave of up to 10 days in addition to other leaves.
o Is it extendible?
Yes, when necessity arises as specified in the
protection order.
o What is a pre-requisite?
Must submit certification from punong brgy, kagawad,
prosecutor, or clerk of court that an action under RA
9262 has been filed and is pending
o Is use of the 10 day leave mandatory?
No. Its up to the woman employee.
It can be used for days where she attends to medical
and legal concerns.
Are unused leave days convertible to cash or
cumulative?
No.
o What if the employer refuses to implement BWL?
Liable under RA 9262.
o How is recovery of BWL benefits enforceable?
Under Art. 129, with the Regional Director (same
provision as simple money claims)
SERVICE CHARGES
What is the rate of distribution for service charges collected by
establishments?
o 85% to all covered employees distributed equally among
employees, regardless of position or rank
How often is distribution?
Once or twice a month
o 15% to management
What is the integration rule?
18

o If service charge is abolished, the share of covered employees
is considered integrated in their wages
What is covered by the 15% management share?
o To answer for losses and breakages, or it can be distribution to
managers at managements prerogative
13
TH
MONTH PAY
What is the rule on 13
th
month pay?
o It is required by law. It is not part of the basic wage, but it is
based on that wage.
What is the value of the 13
th
month pay?
o It is 1/12 of total salary earned within a calendar year.
Are other bonuses included in the base rate?
No. Just the regular wage.
When is it paid?
Not later than December 24
What is not part of the basic salary base?
1. Cost of living allowances
2. Profit-shares
3. All allowances and monetary benefits not
integrated in the basic salary
Who is entitled to 13
th
month pay?
o All rank and file employees regardless of designation and
status as long as they worked at least one month in that year
o And irrespective of method of payment (even piece-rate
employees)
o What about managerial employees?
Excluded by law, but can be included by stipulation
What if an employee is terminated or has resigned before payment
of 13
th
month pay?
o Entitled to 1/12 of what he has earned anyway
Which employers are exempted?
o 1. Government/GOCCs (usual)
o 2. Employers of household helpers
o 3. Employers of those under the personal service of another
o 4. Employers of those paid on commission, boundary, or end-
result basis
Except: piece-rate workers, who are covered
What is the rule on commissions?
If the commissions may properly be
considered as part of the basic salary, then
its covered by 13
th
month pay
If its not part of the basic salary, its
excluded
o 5. Those already paying 13
th
month pay or its equivalent
Check intent of the bonus to see if it is credited as in
lieu of the 13
th
month pay or if its additional
o N.B. This is almost the usual enumeration + those who already
get an equivalent. Managers may or may not be given (see
above).
o EXCEPT field workers are supposed to be given 13
th
month
pay, because this provision is not re: hours of work.
What if someone has multiple employers?
o Can get 13
th
month pay from all private employers, regardless
of total earnings
Summary of exemptions:
Hours of
work
NSD Wages Holiday
pay
SIL 13
th
MP
Govt,
GOCCs
Govt,
GOCCs
Farm
tenancy/
leasehold
Govt,
GOCCs
Govt,
GOCCs
Govt,
GOCCs
Managers Managers Cottage
industries
Managers Managers Managers
(may still
be given)
Field
personnel
Field
personnel
BMBE Field
personnel
Field
personnel

DH DH DH DH DH DH
Supported
family
members
Supported
family
members
Supported
family
members
Supported
family
members
Supported
family
members
Personal
service
Personal
service
Personal
service
Personal
service
Personal
service
Paid by
results
Paid by
results
Paid by
results
Paid by
results
Paid by
results
Only up to
5 EEs
Only up to
10 EEs
Only up to
10 EEs

Exempted
19

by Labor
Sec
Already
have SIL
Already
have 13
th

MP
With paid
VL of at
least 5
days


Compulsory OT work Compulsory rest day work
War or emergency War or emergency
Prevent loss or imminent danger Prevent loss or imminent danger
Urgent work on equipment Urgent work on equipment
Prevent loss or damage to
perishables
Prevent loss or damage to
perishables
Completion of work to avoid
prejudice
Completion of work to avoid
prejudice
Favorable weather conditions Favorable weather conditions
Abnormal pressure to work due to
special circumstances

WOMEN WORKERS
What is the non-discrimination rule?
o Cannot discriminate against a woman as to terms and
conditions of employment solely due to her sex
o What are the reliefs available?
Criminal action
Civil action for money claims, with damages, and
other affirmative reliefs
Are these mutually exclusive?
No. They proceed independently of each
other.
Are stipulations against marriage allowed?
o No. An employee cannot be hired with the condition that she
does not get married, or be terminated due to marriage
What are the prohibited acts?
o 1. Deny a woman employee benefits here or discharge her to
prevent her from enjoying the benefits
o 2. Discharge a woman due to pregnancy, or while on maternity
leave
o 3. Discharge or refuse to re-admit a woman after leave
What is the special rule on classification?
o Woman who is permitted or suffered to work, with or without
compensation in night clubs, massage clinics, bars (and similar
establishments), if under effective control/supervision of the
employer considered an employee of such establishment
o For what purposes?
Labor and social legislation
Who may be a victim of sexual harassment?
o Either a male or female
When is sexual harassment committed?
o When a person demands, requests, or requires sexual favor
from another
Must it be put in an oral or written statement?
No, it can be by inference
o Who may commit sexual harassment?
Anyone with authority, influence, or moral ascendancy
over the person harassed
o Where may it happen?
In work,
training,
or education environment
o What if the person harassed refused the demand, request,
or requirement?
It does not matter. Its still sexual harassment.
MINOR WORKERS
Where can minors from 15 to below 18 be hired?
o For any employment, as long as it is non hazardous. A person
has to be at least 18 years old to perform hazardous work
o Give examples of hazardous workplaces:
Exposed to contaminants
Construction, logging, fire-fighting, mining,
mechanized farming, deep sea fishing, etc.
20

Handling explosives or pyrotechnics
Using heavy equipment or machinery
Using power tools
o What are the allowed working hours?
Not more than 40 hours a week, no more than 8
hours a day
No work from 10 pm 6 am
N.B. in other words, no OT, no night shift
Can children below 15 be employed?
o No, except under very strict conditions
o What are these exceptions?
1. The child works directly under the sole
responsibility of his/her parents/guardian and where
only members of the family are employed, and as
long as:
The childs safety, life, health, or morals are
not endangered
Does not impair childs normal development
Parent or guardian gives primary/secondary
education to the child
2. Child actors or talents, as long as:
Employment contract is concluded by
parents or guardian with express agreement
of child, and if possible, DOLE approval
The childs safety, morals, health are not
endangered
Employer takes measures to prevent child
exploitation or discrimination taking into
account remuneration, duration, and working
time
Implement continuing skills and training
acquisition program for the child
o What is required for these two situations?
The employer must secure a work permit from DOLE
o What are the allowed working hours?
No more than 20 hours a week, no more than 4 hours
a day
No work from 8 pm 6 am
What does RA 7323 provide?
o Employers can hire at least 50 students during vacation period
and pay those students only 60% of their wages, and 40%
through education vouchers to be paid by government
o But the wages must meet the legal minimum
What are the prohibitions on employment of children in certain
advertisements?
o Cannot be employed as model in advertisements for alcoholic
beverages, tobacco, gambling, violence, or pornography
What are the worst forms of child labor?
o 1. Slavery
o 2. Prostitution
o 3. Production and trafficking of dangerous drugs and prohibited
substances
o 4. Work which by its nature or circumstances in which it is
carried is hazardous or harmful to health, safety, morals of
children
EMPLOYMENT OF HOUSE HELPERS
What are house helpers?
o Those providing services in the employers home which is
usually necessary and desirable for the maintenance and
enjoyment thereof
Includes ministering personal comfort and
convenience of the members of the household
Including family drivers
o Is a driver, laundrywoman, houseboy, etc. who works in
company staff-houses a house helper?
No. He or she is an industrial worker and must be
paid the industrial rate
o What is the criterion?
Personal comfort and enjoyment of the family of the
employer in the home of said employer
What benefits are accorded house helpers?
o 1. Minimum wage
o 2. Cannot be assigned to work in commercial, industrial, or
agricultural enterprise at a wage lower than what is prescribed
o 3. What if the house helper is less than 18 years old?
21

If the house helper is less than 18 years old, the
employer must afford opportunity for at least
elementary education
Cost of education is part of the helpers compensation
o 4. Must be treated in just and humane manner. No physical
violence must be used.
o 5. Free lodging, board, and medical attendance
o 6. Upon termination, given a written statement of the nature
and duration of the service and his/her efficiency as house
helper (employment certification)
o 7. Contract does not exceed 2 years (renewable)
o 8. Funeral expenses paid by employer if house helper has no
relatives with sufficient means in the place
What are the hours of work allowed?
o Not to work for more than 10 hours a day
If the house helper agrees to work OT and there is
additional compensation, it is permissible
What is the vacation privilege?
o Right to 4 days vacation each month with pay. Failure to use
this does not allow accumulation the helper can just get
monetary value.
What if the period of household service is fixed?
o Cannot be terminated before end of the period without just
cause
o What if a house helper is unjustly dismissed?
Paid compensation already earned plus that of 15
days indemnity
o What if a house helper leaves without justifiable reason?
Forfeits unpaid salary not exceeding 15 days
What if the period of household service is not fixed?
o He must give 5 days notice before intended date of termination
EMPLOYMENT OF HOME WORKERS
What is a homeworker?
o Any person who performs industrial homework for an
employer, contractor, or sub-contractor
Under what circumstances are persons considered employers of
homeworkers?
o 1. Delivers or causes to be delivered any goods to be
processed or fabricated in or about a home and then returned
or disposed of or distributed according to his directions
o 2. Sells goods to be processed or fabricated in or about a
home and then re-buys them after such processing
Who can be deemed an employer of homeworkers?
o Any person, natural or artificial
o For his account or benefit, or on behalf of a non-resident
o Directly or indirectly
Can industrial home workers form a labor organization?
o Yes.
What are the conditions before there can be deductions from a
homeworkers income, due to loss, damage, or destruction to
materials?
o 1. Homeworker is clearly shown to be responsible for the loss
o 2. Employee is given reasonable opportunity to explain
o 3. Amount of deduction is fair and reasonable and not exceed
loss/damage
o 4. Deduction is made such that it does not exceed 20% of the
earnings in a week
o N.B. this is the same rule for breakages for regular employees
What is the nature of the liability of the employer vis--vis the
contractor and the latters homeworkers?
o Same as in an independent contracting arrangement. The
provisions for homeworkers must be inserted in the contract.
o The employer is held liable when there is failure to pay wages
by the contractor.
Prohibitions for homework:
o 1. Explosives, fireworks, similar articles
o 2. Drugs and poisons
o 3. Articles where processing involves exposure to toxic
substances
APPRENTICES AND LEARNERS
What is an apprenticeable occupation?
o Any trade, form of employment, or occupation which requires
more than 3 months of practical training on the job
supplemented by theoretical instruction
22

o Involving a contract between the apprentice and employer, on
an approved apprenticeable occupation by the TESDA
Who may employ apprentices?
o Only employers in highly technical industries AND approved by
the DOLE
Who can qualify as an apprentice?
o 1. At least 14 years of age
o 2. With vocational aptitude and capacity for appropriate tests
o 3. And possesses the ability to comprehend and follow
written/oral instructions
What is the maximum period of apprenticeship?
o 6 months
Can there be payment of less than the minimum wage?
o Yes, but not below 75% and it must be pursuant to an
approved apprenticeship program approved by the DOLE
What if there is no prior approval of the DOLE?
o The apprentice is in fact a regular employee.
What are the possible venues of the program?
o 1. Entirely within the sponsoring firm
o 2. In a DOLE training facility
o 3. In a training facility, and then in the sponsoring firm
What is the remedy for violation of apprenticeship agreement?
o Complaint filed with DOLE
o Appeal within 5 days from receipt of decision to Sec. of Labor
What the conditions for tax deductibility of training costs?
o 1. The program must be approved by the DOLE
o 2. The deduction must not exceed 10% of direct labor wage
o 3. The apprentices are paid at least the minimum wage
o How much can be deducted?
of value of labor training expenses
When can apprentices be hired without compensation?
o When training on the job is required by the school or
curriculum, or as a requisite for graduation/board examination
Are students who work for the school for free education deemed
employees?
o No, as long as they are given real opportunities to finish their
chosen courses
o What if the student causes damage to a third person in the
course of these duties?
The school will be deemed an employer.
The school is only not deemed an employer as
regards labor regulations, rest periods, etc.
What are learners?
o Persons hired as trainees in semi-skilled and other industrial
occupations which are non-apprenticeable
o And which may be learned through practical training on the job
in a relatively short period of time, not exceeding 3 months
When can learners be hired?
o 1. When no experienced workers are available
o 2. Necessary to prevent curtailment of employment
opportunities
o 3. Does not create unfair competition in terms of labor costs or
standards
Contents of learnership agreement?
o 1. Names and addresses of learners
o 2. Duration of learnership period (at most, 3 months)
o 3. Wages and salaries of learners, which must be at least 75%
of minimum wage
What if the learners are in piecework?
Must be paid in full for the work done
o 4. Commitment to employ the learners if they want as regular
employees after the period
o When are learners automatically deemed regular
employees?
When they have worked for at least 2 months and
then training is terminated by the employer before the
end of the stipulated period, through no fault of the
learner
Contrast:
Apprenticeship Learnership
Highly skilled or technical jobs Semi-skilled job or industry
Not learnable in less than 3 months Learnable in less than 3 months
Approved by DOLE No such requirement
No commitment to hire after
termination of period (no certainty it
Commitment to hire after termination
of period
23

will be learned)

HANDICAPPED WORKERS
Who are handicapped workers under the LC?
o Those whose earning capacity is impaired by age or
physical/mental deficiency or injury, disease, or illness
o What if the disability is not related to the work performed?
Then the employee will not be considered a
handicapped worker
Who are handicapped persons under RA 7277 (Magna Carta for
Disabled Persons)?
o Those suffering from restriction or different abilities as a result
of mental, physical, or sensory impairment, to perform an
activity in the manner or within the range considered normal for
a human being
What is the rule on non-discrimination?
o No disabled person can be denied access to opportunities for
employment
o If qualified, must be hired under same terms, privileges,
benefits, etc.
What are the reserved positions for handicapped workers?
o 5% of all casual, emergency, and contractual positions in
DSWD, DOH, Dep Ed, and other government agencies
engaged in social development
o What if suitable employment for handicapped persons
cannot be found through open employment?
State endeavors to provide sheltered employment
o Can handicapped workers be hired as learners or
apprentices?
Yes, if their handicap is not such as to effectively
impede performance in the job for which they are
hired
What are the incentives given to employers of handicapped
persons?
o 1. Tax deduction from employers gross income of up to 25%
of amount paid as salaries to handicapped workers
Must present proof of employment
And DOLE certification of workers disability
o 2.Tax deduction from employers gross income of up to 50% of
direct costs for improvement of facilities for handicapped
workers
But does not include improvements under BP 344
(Accessibility Law)
TERMINATION OF EMPLOYMENT

EMPLOYER-EMPLOYEE RELATIONSHIP
Why is it important to determine EER?
o It determines the legal relationship between the parties, and
their rights and obligations.
How do you determine whether there is an EER?
o Four-fold test
1. Selection and hiring
2. Payment of wages
3. Power to dismiss the employee
4. Control over how the employee performs his
functions
o Does it matter what kind of system for payment of wages
is present (e.g. by compensation)?
No. EER is not determined by basis of employees
compensation, because wage is paid no matter how
designated.
o What is the most important?
Control (#4)
o How do you determine when there is control?
Determine how the employee performs the functions
(manner and means used), not just the end product
There is no control under the EER if the employer just
says the end product or goal
o What about employees working outside the facilities, are
they still under control of the employer?
They still can be under the control of the employer.
Ex. taxi cab drivers.
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Distinguish giving details on the work, supervision on the manner
of doing the work:
o Instructions, no matter how detailed, may not actually indicate
control. If the details pertain to the product itself, then you are
not controlling the work. (Ex. you say that you want a barong
that has gold buttons, long sleeves, made of a certain tela,
etc.)
o If the details pertain to the work itself, there is control.
o N.B. So reporting about collections, or progress of the chair
being constructed these reports are really just about the end
product, and do not indicate control. So even reports do not
always indicate control.
o What if the alleged employee works more or less at his
own pleasure and is not subject to definite
hours/conditions of work, and is compensated for the end
result only?
No EER.
o X was an insurance agent required to solicit business
exclusively for Company Y. Is this control?
It may seem like it, but its not. In this case, the
exclusivity clause stems from an Insurance Memo
Circular, to protect the public. There was no intention
by Corp Y to exercise control over the method and
manner by which X sells insurance.
Should the power be exercised?
o No, need not be. Just as long as its available.
o How can you prove it if its not exercised?
If there is a written agreement, you can point to
certain provisions.
o What if there is no written contract or any proof of the
instructions given?
Usually you can prove it by the fact that he is within
the company premises. That his presence is required
by the company, and he is given an ID, are strong
indicators. Working in a place controlled by the
employer is a good indicator.
In the above examples, there are only two parties. But if there are
multiple parties involved and there are multiple suspected
employers, how do you determine who the employer is?
o Control is the strongest factor. For instance, A hires, B fires, C
pays, and D controls. D is the employer.
What is the subordinate test?
o Economic Relations Test existing economic conditions
between the parties are used to determine whether EER
exists:
1. Payment of pag-ibig contributions
2. Payment or remittance of contributions to the State
Insurance Fund
3. Deduction of withholding tax
4. Deduction or remittance of SSS contributions
o W/N the employee is dependent on the alleged employer for
his continued employment in that line of business
What is the value of ID cards?
o Its not just a security measure but it usually mainly identifies
the holder as a bona fide employee of the corporation.
What are the special cases?
o 1. No EER between students and their school if there is written
agreement that the student works in exchange for free
education and the student is given real opportunity to finish the
course
o 2. There is EER between resident physicians and training
hospital UNLESS there is training agreement between them
and it is duly accredited by the government
PROBATIONARY EMPLOYMENT
Do all regular employees have to start as probationary employees?
o No. There is only probationary employment when there is an
agreement for probationary employment.
o But for probationary employees, after the lapse of the period,
he/she becomes a regular employee.
What should the agreement contain?
o 1. Apprise employee of the nature of employment
o 2. Inform employee of standards to be met to become regular
How long should the probationary period be?
o Six months. It cannot go beyond the six month period. It is
non-extendible.
o What are the exceptions?
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1. Covered by an apprenticeship program stipulating
longer period
2. Voluntary agreement of parties (esp. when the
nature of work requires longer period) (Mariwasa v.
Leogardo)
3. Employer gives employee a second chance to pass
the standards test
What will make the probationary employment invalid?
o If the employer did not give reasonable standards for the
employee to meet within that period.
o The standards have to be given at the start of the employment.
o What is the legal effect of this?
The employee becomes regular.
Before you reach the end of the probationary period, can you still
terminate the employee on the grounds for which a regular
employee may be terminated?
o Yes.
When will the employee become regular?
o Evaluate within the period.
o If there is no evaluation and he is hired beyond the period, then
he becomes a regular employee.
You start a probationary work agreement, and the six month period
ended. The employee continues working. There is no evaluation
yet. What is the legal implication?
o He becomes a regular employee.
o At what point?
As soon as you go beyond the six month period.
How do you count six months?
o There are conflicting decisions, but Atty. MM prefers the same
day from the sixth month from when you started employment
(Jan. 3 July 3)
o Although there is another case that says 180 days.
Can a person who has been promoted be probationary again?
o No. Only probationary as to the position, but you can never be
probationary as to employment in general again.
What are the requirements for private school teachers to acquire
permanent employment?
o 1. The teacher is full-time
o 2. Must have rendered three consecutive years of service
o 3. The service must be satisfactory
KINDS OF EMPLOYMENT
Regular employees
When is an employee regular?
o When he performs tasks that are usually necessary and
desirable to the business.
How does usually necessary and desirable here compare to
directly related in contracting arrangements?
o Necessary and desirable here applies to class of
employment, and directly related in contracting only relates to
whether there is an employer-employee relationship.
A worker who performs work usually necessary and desirable to
the company becomes an employee of the company. T/F?
o False. The conclusion is off-tangent.
o You use the necessity and desirability test to determine what
class of employee he is, and not whether or not he is an
employee.
o To determine employer-employee relationship, you apply the
four-fold test.
There is a company with security guard A, and security guard B.
Can it be that A is a regular employee, and B is not because he
was hired by a contractor?
o Yes, this is legally possible.
o But isnt the nature of the work of the employee the
determinant?
Yes. But you determine the nature of his work in
relation to the contractor.
How do you determine if a particular work is usually necessary and
desirable, hence leading to regular employment?
o Look at the nature of the business of the employer
o What if an employee is tasked to perform a job for at least
one year already?
Performance of a job for at least a year evidence
that the job is necessity and indispensable for
business
How can a regular employee be terminated?
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o For just or authorized causes only
Casual employee
Who is a casual employee?
o One doing work not usually necessary or desirable to the
employer, and is not project nor seasonal
When do they become regular employees?
o After one year of service, continuous or broken.
o He becomes regular as to the activity for which he is employed
and is regular as long as the activity exists
o When does one year period vest?
NOT your one year anniversary.
It must be cumulative period of service of one year.
Fixed term employment
What are the requisites?
o 1. They should have agreed upon a time frame for when work
must be done
How is this different from project?
Fixed term is time bound, project is task
bound. Fixed term does not care if the
project or job is done.
o 2. The agreement was voluntarily entered into by parties
Consider level of parity
o 3. Employment scheme is not designed to circumvent the
law/Labor Code
What if the job is usually necessary and desirable to the business
of the employer?
o The employee is deemed regular
If all the employees are fixed-term, it is proof of illegality, because the
employer is seemingly circumventing the law.
Is there a conversion?
o If you work beyond this period, you become regular
Remember the general rule: you are regular if you are not covered by a
special agreement. If you are hired but not placed under a special
category, you are regular.
Seasonal employees
When will seasonal employees become regular?
o After repeated rehiring.
What if after harvesting season, they still work FOR the employer
but doing other seasonal tasks (ex. harvesting then the next
season, drying)?
o They become regular.
o If you are employed throughout the year, doing different tasks,
although all are seasonal, you are regular.
What is the status of seasonal workers who are called to work from
time to time and are not made to work during off-season?
o They are not separated from service. They are considered on
leave until re-employed. They are seasonal workers.
o But if they have repeatedly done that job for years, they
become regular.
Project employees
What are project employees?
o They are hired for a specific undertaking or project.
o His employment ends after the project ends.
o They cannot be terminated without just cause before the
project ends.
o What is the day certain rule?
It ends on a certain date, but not an exact date just
upon completion of project
If there is a construction project ongoing, can we assume the
construction workers are project employees?
o No, it doesnt follow.
What is an example of a project within a company that is different
from its main line of business?
o Mango Orchard owner hiring workers to build a water pipeline
for irrigation.
When can project employees become regular employees?
o Working beyond the project
o Repeated rehiring, for the same task or tasks that are
necessary for the business
o Is a second project a repeated rehiring?
27

No, its the first rehiring. A third project will be the first
instance of repeated rehiring.
Is the date material?
o Not always, because it can also be another determinant, such
as the completion of the project, even if the date is not
determinable.
o What if there is no such given standard?
Considered a regular employee.
Is a long gap between projects material to determine whether you
can be converted to a regular employee?
o No, lapse of time is immaterial. As long as there is repeated
rehiring.
o What if the period is more than one year?
Again, time is immaterial.
CONTRACTING ARRANGEMENT
Whats a contracting arrangement?
o There are three parties: the principal, the contractor, and the
employee
o There are two contracts between the principal and
contractor, and the contractor and the employee
What is the relationship between the principal and the worker?
o The principal is the indirect employer.
o Principle why this is so: the work is always for the principal. It
redounds to his benefit.
N.B. This does not refer to all situations where there
is a complicated process/production line, where
ultimately, what is produced by employer goes to the
principal. For instance, some outsourcing
transactions are not contracting arrangements. Just
take note of this.
The principal has no liability to the employee if you have a
legitimate contracting arrangement. T/F?
o False. The principal is solidarily liable for failure to pay wages.
What are the rights of the parties in a legitimate contracting
arrangement?
o The principal is the indirect employer.
o Contractor is the direct employer.
o Employee is, well, the employee.
In an illegitimate contracting relationship?
o Principal is the direct employer
o Contractor is the agent of the principal
o Employee is still the employee
How different are the responsibilities of the principal is the two
relationships?
o Legitimate principal is solidarily responsible if the employer-
contractor cannot pay the wages due
o Illegitimate principal is principally liable for the wages
When is there solidary liability?
o In EITHER contractual arrangement.
o But in the illegitimate contractual arrangement, the solidary
liability is not as important, because they are targeting the
principal usually. But it is wrong to say that the contractor is
not solidarily liable. It is solidarily liable; otherwise it will be in a
better position than the legitimate contractor. But for all intents
and purposes they just go to the principal anyway.
What is the difference though?
o In legitimate labor contracting, the principal is only liable if the
contractor fails to pay wages.
NOTE: Under Art. 106, the principal is ONLY liable for
failure to pay wages by the contractor for work
performed, but the principal is NOT their employer for
any other purpose. Nothing else. Not even back-
wages stemming from illegal termination.
Note: Under Art. 109, solidary liability is established
between principal and contractor. In 109, there is no
difference between legitimate and illegitimate
contractors, as to solidary liability.
o In illegitimate labor contracting, the principal is employer even
beyond this single circumstance. It is, for all intents and
purposes, just like any other employer. It is liable not just for
payment but for responsibilities of the employer.
o If the illegitimate contractor already paid the wages, is the
principal still liable?
Not anymore, because the principal/employers agent
has paid.
What if there a violation of the Labor Code?
28

o For legitimate contracting arrangement, the principal is
generally not liable, unless it has participated or connived in
the violation. Remember, the principal is just liable under one
circumstance: payment of wages for work performed. Nothing
else.
o Take note of Rosewood case, which laid down that there must
be finding of fault in the principal to hold it liable for violation of
Labor Code.
What is a legitimate contracting arrangement?
o 1. The contractor has sufficient capital
o 2. Employees do not perform work directly related to the
business of the principal
o 3. Contractor has control
When does it become a labor-only contracting arrangement? Does
it have to violate all three grounds or just one?
o Do not be confused by the structure of the definition in Dept.
Order 18-02. You go back to Art. 100. One disqualification
out of three is the more reasonable interpretation.
o For legitimate contractor you have to meet ALL
requirements.
o For illegitimate you miss just one, you are illegitimate.
o N.B. In the old rules, there was a definition of an independent
contractor. We only have the definition of a labor-only
contractor.
When will you consider the principal the direct employer of the
employee?
o 1. Labor-only contracting arrangement
1. Principal actually controls the employees
2. Contractor does not have sufficient capital
3. Employees perform work directly related to the
principals business
o 2. Commission of a prohibited activity
What are these prohibited activities?
Those mentioned under DO 18
What in particular?
1. Contracting out a job when not done in
good faith resulting in termination of
regular employees and reduction of work
hours or affects bargaining unit
2. Contracting out a work with a cabo a
person or group which is disguised as a
labor organization but supplies workers to an
employer (with or without consideration)
3. Exploitative acts:
o Requiring contractual employees to
perform tasks of regular employees
o Requiring signing of antedated
resignation, blank payroll, waiver of
labor standards, or quitclaim
o Requiring signing of contract fixing
employment period to term shorter
than the principal-contractor
contract (unless the contract is in
phases)
4. Contracting out a job through in-house
agency which refers to a contractor owned,
managed, or controlled by the principal and
operates solely for the principal
5. Contracting out a job directly related to
principals business due to strike/lockout,
actual or imminent
6. Contracting out a job to interfere with right
to self-organization of employees
Summarize!
1. Labor-only
2. Contracting in bad-faith
3. Contracting with a cabo
4. Contracting with an in-house agency
5. Contracting due to strike or lockout
6. Contracting that constitutes ULP
So a contracting arrangement may be legitimate, but
if there is the commission of any of these prohibited
activities, the principal becomes the direct employer.
Do you need proof that the principal connived
with the contractor in doing any of the prohibited
activities?
29

NO. Not under DO 18. So the principal has
to ensure that the contractor is a good
employer to its employees, otherwise you
become liable as a principal.
What is the rule regarding lack of registration?
o It only creates a presumption that the contractor is a labor-only
contractor
What is the rule on posting bonds?
o The principal may require the contractor to furnish a bond
equal to the cost of labor under contract, on condition that the
bond will answer for the wages due the employees if the
contractor fails to pay them
Can an individual be an independent contractor for himself?
o Yes. (Remember the Jay Sonza case)
TERMINATION OF EMPLOYMENT
Security of tenure of the following EEs:
Employee type Security of tenure duration
Regular Duration of employment
Project Duration of the project
Seasonal Duration of the season
Fixed term Duration of the term
Probationary During probationary period, because
they can only be terminated if they
do not meet the standard, or for
just/authorized causes
Casual None, because their work is not
usually necessary nor desirable

For what can you be terminated?
o For just and authorized causes
What are the differences?
Just cause Authorized cause
Due to EEs actions Due to independent reasons (e.g.
business reasons)
No separation pay unless based on
compassion
Separation pay required by law,
except for closure due to serious
business losses
Due process requires notice (two-
notice requirement) and hearing
No hearing; just notice given to EE
and DOLE 30 days before
separation
Dismissals effectivity determined by
the ER
Dismissal effective 30 days after
notice

What are just causes?
o 1a. Gross misconduct
What is gross misconduct?
It must be serious in nature
Give an example?
Employee attacks another employee
Causing serious disruption in the workplace
during business hours
Sexual harassment (Libres)
Falsification of time card (Felix)
What if it happens outside company premises?
It can be (examine the circumstances)
Must it be habitual?
No need.
o 1b. Willful disobedience
A single act can fall under both willful disobedience
and neglect of duties (ex. failure to deposit money
that employee needs to deposit)
Willful disobedience a single act is
enough
There is willful intent to not follow authority.
It is a defiance of authority.
What is the more accurate term for willful
disobedience?
Insubordination. Thats why it is called
willful.
Must the disobedience be gross?
No, as long as its willful. Look not at the
effect, but at the act of disobedience. (ex. it
doesnt matter how much is involved)
Must it be habitual?
30

No. Even a single act of disobedience is
enough.
What is the difference between disobedience and
neglect?
Disobedience is an act contravening the
employers orders
Negligence is an omission, failure to
exercise diligence
What must be the character of the order or
instruction of the employer?
1. Reasonable and lawful
2. Sufficiently known to the EE
3. In connection with the EEs duties
What if an employee refuses to follow order for
transfer of assignment or location?
Its willful disobedience, unless the EE
proves that it was motivated by
discrimination or bad faith, or it is actually a
demotion
o 2. Gross and habitual neglect
Obviously there are past infractions.
What is gross neglect?
Absence of diligence that an ordinary
prudent man would use in his own affairs
Give an example.
The rule is to make a deposit of the
collection everyday and the employee here
did not make such deposits consistently
Failure to fulfill reasonable work standards or
reasonable work assignments
Abandonment of job:
1. Failure to report for work without just
reason, and
2. Clear intention to sever ER-EE
relationship
There has to be habitualness here. It also has to be
gross (so look at the effect).
What must be the nature of these past
infractions?
Obviously the employee was not terminated
for these causes (because they are not
enough to terminate him, but the
cumulativeness of such will)
Must he have been punished for these?
No need. But its better for employer to
penalize the employee for these past
infractions because this is proof that there is
habitualness involved, for evidentiary
purposes.
o 3. Fraud or willful breach of trust
To whom is this applicable?
Only to those holding positions of trust and
confidence
Ex. managerial employees or non-
managerial but those holding funds (like
cashiers)
o 4. Commission of a crime or offense against the employer, his
representatives, or immediate family
Up to fourth civil degree
o 5. Analogous causes
Can an employee be terminated from being found
positive in random drug testing?
Yes.
What about if he is found to be HIV positive?
No.
How do you terminate an employee for just cause?
o There is a 2-notice requirement:
1) notice charging employee of particular
acts/omissions that may cause dismissal
2) subsequent notice of the employers decision
What does the first notice contain?
o First notice (1) apprises the employee of the ground for
termination and that there is intent to terminate, and that (2)
the employee is given opportunity to submit written explanation
within a reasonable period.
o What must be included?
31

1. Facts constituting the offense
2. The Offense charged
3. The possible termination
o How much time is given to the employee?
Reasonable time
As long as the employee has enough time to get
evidence and present his defenses.
What happens after?
o The employee presents his defenses and rebuts the
allegations against him
o There will be a meeting or conference, or at least the chance
the present his evidence and rebut the employers allegations
o Must there be a meeting or conference at all times?
No.
The law says ample opportunity to be heard must be
given. There is no reference to face-to-face
confrontation. But the rules require a meeting or
conference.
The SC said the law only requires ample opportunity
to be heard, and this can be had even without face-to-
face meeting.
o When must it be required?
1. When the employee requested for it in his
explanation
2. When company policy requires it
3. There is an issue that requires face-to-face
confrontation depending on the issue involved
Ex. habitual tardiness is the issue no need
for hearing or conference, because you just
check the records (unless of course the
employee requests for it)
After this?
o If there is ground to terminate, give SECOND notice
o What are contents?
1. Circumstances are considered
2. There is sufficient ground to establish the offense
o Is there a waiting period for termination?
No, it is immediate.
When is preventive suspension allowed?
o Allowed if the employees continued employment poses a
threat to the life or property of the ER or co-workers. Note that
it is an incident of the investigation and is not the penalty per
se.
o What is the maximum period?
30 days
o What if the preventive suspension exceeds 30 days?
It is deemed as constructive dismissal
Or the ER will be required to pay the EE for the days
beyond 30
What are authorized causes?
o 1. Redundancy
o 2. Retrenchment
o 3. Closure of business
What is the redundancy?
o Superfluity of the need to have that employee perform such
duty
o What are labor saving devices?
Installation of automated means or the like that would
render the employee superfluous
o Who do you terminate?
Use standards like seniority, efficiency, or nature of
contract
o Can redundancy be prompted by the contracting out of
services?
Yes, unless the CBA provides otherwise (Serrano)
o Do you need to have losses for redundancy?
No.
What is retrenchment?
o Termination due to losses, reversals, economic downturns, etc.
o What are the requirements?
1. Undertaken to prevent losses
2. Losses are proven by sufficient and convincing
evidence
3. Losses are actual and imminent
4. It is reasonably necessary and is likely to prevent
expected losses
32

Evidence must not only be about the past
but ALSO about the future, to prove that you
would not be able to recover
o Do you need actual losses to retrench?
Even if you have not incurred actual losses, but
losses are certain and imminent unless you retrench,
you can do so. Not just a projection, but one
supported by evidence.
o It must be a last resort.
o How do you choose whom to terminate?
You need to have a set of reasonable criteria or
standards as re: who can be terminated.
Many retrenchment programs have been invalidated
due to the company not having set criteria.
What is closure?
o When the business closes, obviously, the employees can be
terminated
o It must be done in good faith. As long as not done to just
circumvent the law (fake closure just to hire new guys).
o What is the obligation of a purchaser of a business in a GF
sale?
No obligation to absorb the employees.
o What about in mergers?
There is succession to the employment contract,
unlike in sale to another new entity, so the employees
are absorbed. (Of course there can be declaration of
redundancy, etc.)
What is the procedure for authorized causes?
o 1. Give notice to the DOLE and employees at least 30 days
before intended termination
Is this the same notice as for just causes?
No.
What is the role of the DOLE?
To determine if it is justified.
Do you have to wait for DOLE determination?
No.
After 30 days you can terminate
If you have 100 employees, how many notices are
needed?
101 100 for employees, 1 for DOLE with
the list of employees
o 2. Give separation pay:
Ground Separation pay given
Redundancy or labor-saving devices 1 month salary for each year of
service, or 1 month salary
(whichever is higher)

N.B. for this ground and all the
others, at least 6 months is
equivalent to 1 year
Retrenchment month salary for each year of
service, or 1 month salary
(whichever is higher)

N.B. there is always separation pay
in retrenchment, even due to serious
losses
Closure not due to serious losses month salary for each year of
service, or 1 month salary
(whichever is higher)
Closure due to serious losses No separation pay

What is a constructive dismissal?
o Unwarranted transfer or demotion, or unjustified action that
results into involuntary resignation by the employee
o Includes imposing floating status on employee beyond 6
months
What if the employee is found to be suffering from disease and his
continued employment will prejudice his health or that of his co-
employees?
o He can be terminated.
o What is his separation pay?
1 month salary or month salary for each year of
service, whichever is higher
o What does the IRR provide?
There must be certification from competent public
health authority that the disease is incurable within a
period of 6 months even with proper treatment
33

What are the types of dismissal?
o 1. Valid dismissal
o 2. Illegal dismissal no valid ground
o 3. Valid ground, but improper dismissal
What is an ineffectual dismissal?
o No longer applicable now. There is no such thing.
If there is a valid dismissal, will the employee get anything?
o Separation pay, if terminated for authorized causes
o What if its for a just cause?
You dont get anything, in general.
o Exception?
But you can get financial assistance if justice and
equity require this. This is for those who are not
morally depraved (perverse mental attitude). Ex.
terminated for repeated absences or laziness.
What are the consequences of illegal dismissal?
o 1. Reinstatement to former position without loss of seniority
rights
When is there no reinstatement?
1. If the position is not anymore available,
2. Strained relations between the ER and
EE. Strained relations usually apply when
the EE is holding a position of confidence.
What is thus the alternative?
Instead you get separation pay equal to 1
month for every year of service.
o 2. Backwages
Represents wages he should have earned
How is it computed?
From actual termination until the case for
illegal termination is finally resolved
Employee is hired on year 1 and is fired year 5. The case was
resolved after 7 years, which is year 12. His salary was P10,000.
How do you count?
o (P10,000 x 13 x 7) = P910,000
o You calculate it against 13 months because you factor in the
thirteenth month
What about separation pay?
o 1 month for every year of service: P120,000
o He rendered service for 12 years, not 5, because he does not
lose seniority rights during the 7 years when the case was
pending.
o If you are entitled to other benefits, you also calculate it against
the 12 years, not 5.
o (But if wages increased to P12,000 in the middle of the period
and there is proof, it becomes P12,000 x 12 = P144,000)
Will the P10,000 monthly salary remain constant regardless of
increases in salary of other employees or other factors that would
increase salary?
o In practice, if you are a minimum wage worker during
termination and the MW is adjusted, your salary will also be
adjusted to reflect the increase.
o If you are not a minimum wage worker, its difficult because
there is no basis to assume you will get an increase. In that
case, your compensation is fixed at P10,000. But if there is
proof that your salary would have increased had you stayed,
then apply this (ex. there is a CBA that should have included
the employee, increasing the salary).
What is the difference in calculation for backwages and separation
pay, if there is an intermediate increase?
o Separation pay use the latest amount to multiply against
years of service, blanketly
o Backwages for the years with lower salary, use that; for the
years with higher salary, use the higher amount (e.g. P10,000
x 2 years; P12,000 x 5 years, etc.)
What are the consequences of dismissal where there is valid
ground, but defective procedure?
o No reinstatement.
o What else do you get?
Nominal damages.
P50,000 authorized cause
P30,000 just cause
o Backwages?
No
o Separation pay?
No, if just cause.
34

Yes, if authorized cause but its not because of the
defective procedure, but it will arise from the
authorized cause itself (which requires separation
pay).
o Employees that are illegally dismissed (second category)
can get damages. T/F?
Yes, you can get moral damages. This, however, is
not a standard of the package, you have to prove it,
and the courts have discretion.
When are moral damages awarded?
Where there is BF or fraud in the dismissal,
or acts contrary to morals, good customs,
public policy
When are exemplary damages awarded?
Dismissal was done in wanton, oppressive,
or malevolent manner
o Are there actual damages in an illegal dismissal case?
Before, the SC said full backwages is more exemplary
than compensatory. But this is now inconsistent with
the formula for dismissal with defective procedure.
What is reinstatement pending appeal?
o The L.A. will provide that there is reinstatement pending appeal
upon finding in favor of the employee.
Employer has two options:
o 1. Actual reinstatement (without loss of seniority rights)
o 2. Payroll reinstatement
Reinstated in payroll but not required to report
The Labor Arbiter decides that it was an illegal dismissal. It was
appealed to the NLRC, and the NLRC said the dismissal was valid.
What will happen to the reinstatement?
o The employer can have the employee stop reporting to work.
It is not a new termination because the NLRC simply effected
the original dismissal. There must be notice.
o What if the CA reversed the NLRC? Does the employee go
back?
There is NO reinstatement pending appeal.
Reinstatement pending appeal only applies to Labor
Arbiter.
Since you go up to the SC through rule 45, its an
appeal (unlike 65 which is a SCA), so the CA decision
is not executory.
o The SC finally reversed the CA, and said the dismissal was
valid. What happens to the salaries/wages received
pending appeal?
No need to return them, whether actual or payroll
reinstatement.
1. If its actual reinstatement, no need to return the
wages because he actually rendered service
2. If its payroll reinstatement, theres still no
reimbursement because it was the employers choice
that led to payroll reimbursement
DIFFERENT SITUATION: What if the LA upheld the dismissal at
first and the NLRC reversed? Is it reinstatement pending appeal?
o No. It is a reversal of the Labor Arbiters case, but not a
reinstatement pending appeal. There is reinstatement unless
there is a TRO.
o The employee can ask for a writ of execution from the NLRC
that he be ordered back to work. There can be no payroll
reinstatement because its not a reinstatement pending appeal.
o What if the CA reversed, upholding the dismissal, and the
SC upheld the dismissal too?
The employee is not obliged to reimburse the salaries
received in between LAs reversal by the NLRC and
the NLRCs reversal by the CA.
o What if the employer did not reinstate the employee
between the NLRC and CA stages, even if there is a valid
order? Can the employee recover backwages?
Yes. Because even if he is ultimately dismissed, he
still should have been reinstated in this period.
This is a case where an employee who was validly
dismissed can still recover backwages.
o Can the NLRC issue a writ of execution after reversing the
LA?
Yes, because the nature of the decision of the NLRC
attains finality after the MR fails.
[Note that LA NLRC is appeal. Then it becomes
final. The Rule 65 to the CA is an SCA, an is thus an
35

original action. The appeal to SC is Rule 45 and is
thus an appeal.]
o But SHOULD the NLRC issue a writ of execution?
The SC advises against it, because it might violate
judicial courtesy.
Relate this with the calculation of backwages and separation pay
above (in the year 5, year 12 example):
o If there was reinstatement pending appeal somewhere there,
the backwages period will take out whatever period was
covered by the reinstatement pending appeal (because the
employee was paid during that period).
Bago v. NLRC: EE won an illegal dismissal case with a favorable
decision with the LA. The LA ordered immediate reinstatement. The
ER opted payroll reinstatement pending appeal. The NLRC reversed
the decision of the LA and ruled that the dismissal was valid. The ER
stopped payroll reinstatement. The EE elevated the case to the CA,
and eventually the SC. The SC upheld the dismissal. Is the EE entitled
to continued payroll reinstatement after the NLRC decision?
o No. The EE is not entitled to continued payroll reinstatement.
The decision of the NLRC on appeals from decisions of the LA
is final and executory after 10 calendar days from the receipt
thereof by the parties. (Note: the CA is operating under Rule
65 its an SCA, not an appeal)
Salas v. Aboitiz: Can the award of backwages in illegal dismissal be
limited even if there is a finding there is no just cause for dismissal?
o Yes. AN exception to the general rule is where the EE is not
entirely faultless, but the fault is not sufficient to justify
termination. In such case, the EEs fault cannot be condoned,
much less tolerated. The award of backwages in favor of the
EE can be limited and the period for such award shall start
from the date of the NLRCs promulgation of its decision,
instead of the termination.
Moreno v. San Sebastian College: A case where all the backwages
were removed, and the EE was just reinstated because the EE was also
at fault. (Same principle)
Lansangan v. Amkor: In an illegal dismissal case, the LA dismissed
the complaint for illegal dismissal as he found the dismissed employee
guilty of dishonesty as a form of serious misconduct and fraud. The
Arbiter, however, ordered the reinstatement of the EE without
backwages as a measure of equitable and compassionate relief. The
ER appealed the decision to the NLRC. The EE claims that he is
entitled to reinstatement pending appeal. Is he?
o No. The provision in Article 223 says that the provisional
remedy is given to an EE who secures an illegal dismissal
declaration. The reinstatement aspect in 223 is for a decision
that states the dismissal is illegal. In this case, the Arbiter did
not find the dismissal illegal but merely ordered reinstatement
for compassionate relief.
Resignation, temporary lay-off, retirement
What is the general rule for voluntary resignation?
o EE can terminate ER-EE relationship without just cause by
service 1 month notice
o What if there is no notice given?
EE can be liable for damages
o When is notice not required?
1. Serious insult by ER/representative on honor or
person of employee
2. Inhuman and unbearable treatment
3. Commission of crime or offense by
ER/representative to EE or family members
4. Analogous causes
o The EE submitted an irrevocable resignation. Can it still
be withdrawn?
Yes, notwithstanding the appellation.
o What if the ER already accepted the resignation?
The withdrawal needs the ERs consent.
What is the rule on floating status?
o If the employer temporarily suspends business or the
employee is in military service, or analogous causes
o How long can it last?
Up to 6 months
o After which?
ER must either reinstate the EE or retrench. If
floating status lasts beyond 6 months, it can be
deemed constructive dismissal.
o How does an EE return to work?
36

Give notice to ER within 1 month from resumption of
business or cessation of military service
What is the rule on mandatory retirement?
o Follow any provision in the CBA or retirement plan. The
benefits must not be below those in the LC.
What if there is no CBA provision or retirement plan?
o An employee who has reached at least 60 years of age and
has served at least 5 years may retire.
o What is the mandatory retirement age?
65 years old.
o What does the employee receive?
month salary for every year of service (6 months
fraction is one year)
o What is 1/2 month salary?
15 days salary +
1/12 of 13
th
month pay +
Cash equivalent of not more than 5 days of SIL
What is the change in age for mining workers?
o Retirement is at least 50 years
o Mandatory retirement age is 60 years
Who are exempted from complying with retirement pay
provisions?
o Establishments employing not more than 10 employees or
workers
SOCIAL LEGISLATION

SSS GSIS
Coverage, in
general
1. Employer any natural or
juridical person with any
business that hires services
of another person

2. Employee person who
performs services for an
employer, receives
compensation, and theres an
ER-EE relationship
1. Employer the national
government, subdivisions,
including GOCCs and
financial institutions with
original charters

2. Employee whether
elected or appointed

3. Self-employed
considered ER and EE
Compulsory
coverage
1. All employees not over 60
years old and their employers

2. self-employed persons

3. domestic helpers not over
60 years old with monthly
income of at least P1000

4. individual farmers and
fishermen
All employees irrespective
of employment status
Voluntary
coverage
1. Filipinos recruited by
foreign-based employers for
employment abroad

2. Employee separated from
employment, to maintain right
to full benefits

3. self-employed, who
realized no income for a
certain month

4. spouses who devote full
time to managing household
and family

5. foreign governments or
institutions hiring Filipinos
abroad may enter into an
agreement with the
Philippines to include their
workers in SSS EXCEPT if
they are already covered by
the civil service retirement
system there

Not covered 1. employment is purely
casual, and not for purpose of
occupation or business of
employer (ex. hiring a tubero)

1. AFP members

2. PNP members

3. contractual employees
37

2. service in an alien vessel,
when the vessel is outside
the Philippines

3. covered by GSIS

4. services by temporary
employees and others
excluded by SSS regulation

5. See #5 above: default rule
is exclusion
with no ER-EE relationship
with agency

4. members of judiciary
and constitutional
commissions (just
covered by life insurance)
Beneficiaries 1. Primary: a) dependent
spouse until remarriage AND
b) dependent children
(regardless of status)

2. Secondary: a) dependent
parents, b) in default of
others, any other person
designated as beneficiary

3. As to death benefits, if
there are none qualified
under the act, follow intestate
succession rules
1. Primary: a) dependent
spouse until remarriage
AND b) dependent
children

2. Secondary: a)
dependent parents AND b)
legitimate descendants
(subject to limitations and
qualifications on
dependent children)
Who is a
dependent
child
1. unmarried

2. Not gainfully employed

3. not reached 21 years of
age

4. or incapable of supporting
self physically or mentally
1. unmarried

2. not gainfully employed

3. not reached 18 years of
age

4. or incapable of
supporting self physically
or mentally
Benefits 1. Monthly pension

2. Dependents pension

3. Retirement

4. Death

ALL MEMBERS

1. Life insurance

2. Retirement

3. Disability

5. Permanent disability

6. Funeral

7. Sickness

8. Maternity (first four
deliveries see maternity
leave)

9. Loan grant

N.B. See bolded items for
unusual/unique enumerations
4. Survivorship

5. Separation

6. Unemployment

JUDICIARY

1. Life insurance (only)
Base
compensation
which is basis
of
contributions
All actual remuneration,
including COLA, cash value
of remuneration not paid in
cash except remuneration in
excess of maximum salary
credit
Basic pay or salary
excluding per diems,
bonuses, OT pay,
honoraria, allowances, all
received in addition to
basic pay
When can
there be a
valid claim
Non-work connected
disability, sickness, maternity,
death, old age, and other
contingencies
Disability must not be due
to own grave misconduct,
habitual intoxication, or
willful intention to kill self
or another person
Effects of
separation
from
employment
1. contribution to account
ceases

2. obligation to contribute also
ceases at the end of the
month of separation

3. credited with all
contributions paid on his
behalf and entitled to benefits
under the SSS law

4. may continue to pay
contributions to maintain right
to full benefits
Separated member
continues to be a member
and shall be entitled to
benefits he is qualified to
in the event of any
contingency
Dispute
settlement
Where disputes arise from:
1. coverage
2. benefits
3. contributions
Any dispute arising from
this Act and other laws
administered by GSIS

38

4. penalties
5. any related matters

1. SS Commission decides
within 20 days of receipt of
evidence
2. Rule 43 to CA
3. Rule 45 to SC
1. GSIS decides within 30
days from receipt of
evidence and findings of
hearing officer
2. Rule 43 to CA
3. Rule 45 to SC
Prescriptive
period for
claims for
dispute
settlement
20 years from delinquency 4 years from date of
contingency
EXCEPT: life and
retirement benefits
Funding 1. Employers contributions

2. Employees/members contributions
Exemption
from tax,
legal process,
lien
All property of SSS and GSIS are exempt from taxes, all
benefits paid by SSS or GSIS are exempt from taxes, fees,
charges, duties, etc.

SSS LAW
Does the existence of a welfare plan funded solely by the employer
exempt its employees from compulsory SSS coverage?
o No, even if the benefits are better than those under the SSS
Law.
o Remedy: integrate private plan with the SSS so that the
employer only pays to the SSS what is required of his, and
then continue contributing to the private plan the excess.
Does employer cover even religious organizations not for profit?
o Yes. It is comprehensive enough to cover them.
A factory hires 10 carpenters to repair the roof of its factory which
was destroyed by a typhoon. Are the carpenters subject to
compulsory coverage under SSS Law?
o No. The employment was purely casual (#1 in the excluded
group)
When does compulsory coverage of an employer, employee, and
self-employed person take effect?
o 1. Employer: first day of operation
o 2. Employee: day of employment
o 3. Self-employed: upon registration with SSS
What is the effect of an employees separation of employment
upon his membership in the SSS?
o His employers contribution and that employees obligation to
pay contribution shall cease at the end of that month, but he
will be credited with all contributions already paid and entitled
to benefits under the law.
o But he may continue paying the total contributions to maintain
his right to full benefit. N.B. this is the once a member, always
a member rule.
What if X was fired without just cause, and his dismissal affected
him so much that after 2 months, he suffered a stroke that led to
paralysis. Can he get disability benefits?
o Yes. Once a member, always a member even if he has
stopped paying contributions and has stopped working.
What if a self-employed member realizes no income in a given
month?
o Not required to pay contributions that month but he can still
continue paying, just like a separated member could.
What is the employers duty?
o Give contributions as well, and may not deduct from the
compensation of the employee such employers contribution.
X, a sash factory worker, got stabbed in a movie house. Can he
recover benefits under SSS?
o Yes. The injury need not be work-connected.
What is the sickness benefit?
o Daily allowance of 90% of daily salary given to covered
employee who becomes sick
o What are the prerequisites?
1. Payment of at least 3 monthly contributions in the
12 month period immediately preceding the semester
of sickness
2. Sickness or injury and confinement for more than 3
days in a hospital or elsewhere with the
Commissioners approval
3. Notice of fact of sickness by the employee to the
employer (or SSS if unemployed) within 5 calendar
days of start of confinement, except:
39

If confined in a hospital
Or injured in the work premises
4. Exhaustion of sick leaves of absence with pay to
the credit of the employee
o Limits?
No more than 120 days in one calendar year
No more than 240 days for the same confinement
No carry-over of unused days
o How does it work?
ER pays the allowance every regular payday or on
the 15
th
-30
th
of each month
Subject to 100% reimbursement by SSS upon receipt
of proof of payment, provided the ER informed the
SSS within 5 days after receipt of notification from the
EE
Failure to notify within this period: ER
reimbursed only for each day of confinement
starting from the 10
th
calendar day
immediately preceding the date of
notification to the SSS
When will there be no reimbursement?
If clam is made after 1 year from date of
confinement
What disabilities are permanent total?
o 1. Complete loss of sight in both eyes
o 2. Loss of two limbs at or above the ankle or wrists
o 3. Permanent complete paralysis of two limbs
o 4. Brain injury resulting to incurable imbecility or insanity
o 5. Cases determined and approved by the SSS
What are the permanent disability benefits?
o Permanent total disability of member who has paid at least 36
monthly contributions prior to the semester of disability
entitled to monthly pension
o What if he has not paid the 36 monthly contributions?
Entitled to lump sum benefit equal to the monthly
pension times number of monthly contributions paid
or times 12, whichever is higher
o What is the rule if one has received a lump sum benefit
and is re-employed or resumes self-employment not
earlier than 1 year from the date of disability?
Again subject to compulsory coverage and is
considered a new member
What are the retirement benefits?
o 1. One who has paid at least 20 monthly contributions prior to
the semester of retirement and has 1) reached 60 years and is
separated from employment/no longer self-employed, or 2)
reached 65 years old entitled to monthly pension as long as
he lives
Can receive first 18 monthly pensions in lump sum
discounted at a preferential rate
Monthly pension suspended if a person is reemployed
before he turns 65
o 2. Covered member who is 60 years old and separated from
employment but not qualified above lump sum benefit to his
total contributions paid by him and on his behalf
As long as he does not choose to continue paying
contributions
What are the death benefits?
o Death of a member who has paid at least 36 monthly
contributions prior to semester of death: primary beneficiaries
entitled to monthly pension
If no primary beneficiaries secondary beneficiaries
entitled to lump sum benefit of 36 times the monthly
pension
If not yet paid the 36 month contributions lump sum
benefit to monthly pension times number of monthly
contributions or times 12, whichever is higher
o Who are the primary beneficiaries?
Dependent spouse until remarriage, dependent
legitimate and illegitimate children
What is a dependent spouse?
o Not just under a valid marriage but
also dependent for support from
him
o Who are the secondary beneficiaries?
40

Dependent parents or any other person designated by
the covered employee as beneficiary
o X, a bachelor, died after being an SSS member for 10
years. He designated his girlfriend Y as beneficiary. Z, his
brother, is claiming the monthly pension. B, C, D, his
children who are already married, also claimed it. Who
gets it?
Y. Z is not a primary beneficiary. B, C, and D are no
longer dependent children. So Y is a valid secondary
beneficiary.
o What if a permanently disabled pensioner or retiree
pensioner dies?
The beneficiaries receive monthly pension
But if he has no primary beneficiaries and he dies
within 60 months from start of monthly pension,
secondary beneficiaries receive balance of the 5-year
guaranteed period as lump sum benefit
o What if no beneficiary qualifies for entitled to the death
benefits under SSS Law?
Paid to the legal heirs of the deceased according to
law of succession
What are funeral benefits?
o Funeral grant equivalent to 12K paid in cash or in kind
Maternity leave see Labor Standards section
What are the loans that may be extended by the SSS to its
members?
o 1. Salary loan
o 2. Educational loan
o 3. Housing loan
o 4. Community hospital loan
Who are disqualified beneficiaries under the SSS Law?
o Foreign national of a country which does not extend benefits to
a Filipino beneficiary residing in the Philippines or not
recognized by the Philippines
o But in the best interest of the SSS, the Commission may direct
payments without regard to nationality or country of residence
What if the covered employee dies, or retires, becomes
permanently disabled or sick without the ER reporting about him
to the SSS or giving contributions on his behalf?
o 1. Pay to the SSS damages equivalent to the benefits which
the employee would have been entitled to
For pension equivalent to 5 years monthly pension
o 2. Pay corresponding unremitted contributions and penalties
o 3. Criminal liability for failure to comply with SSS Law
Who has jurisdiction over disputes arising under SSS Law as
regards benefits, contributions, penalties, etc.?
o The SSS Commission.
o Where to appeal?
Court of Appeals, Rule 43
If purely questions of law, SC Rule 45
Are SSS benefits transferable?
o No, except when physically unable to collect personally the
benefits
What is the prescriptive period against an ER?
o Within 20 years from the time the delinquency (ex. failure to
turn-over contributions) is known, or assessment made by the
SSS, or when the benefit accrues.
o It does not commence when the obligation to pay premiums
accrues.
GSIS LAW
What is the effect of separation of the EE from the ER?
o A member separated from service shall continue to be a
member and is entitled to whatever benefits he has qualified to
in the event of compensable contingencies under the GSIS
Law
Differentiate permanent total disability from permanent partial
disability:
o In the latter, the member can still pursue a gainful occupation
notwithstanding the permanent disability
What are the conditions for entitlement to permanent disability
benefits?
o Must not be due to grave misconduct, notorious negligence,
habitual intoxication, or willful intent to kill another or himself
When is retirement compulsory?
o At least 65 years old with at least 15 years service
41

o If he has less than 15 years of service, he shall be allowed to
continue until he completes the 15 years
What is the unemployment or involuntary separation benefit?
o Monthly cash payments of 50% of average monthly salary paid
to permanent employee who is involuntarily separated from
service due to abolition of office provided he has paid
contributions at least 1 year prior to separation
o How long will he receive these for?
Depending on how long he has made contributions,
maximum is 6 months (for 11-15 years)
Which body has original and exclusive jurisdiction to determine
whether a member is qualified or not to avail of old-age pension
benefit?
o The GSIS
What is the basis of computation of the retirement benefits of a
government employee?
o Based on highest salary rate actually received by the
employee (excluding OT pay, bonuses, per diems, etc.)
Who is entitled to survivorship benefits?
o Beneficiaries entitled to basic survivorship pension (50% of
basic monthly) and dependents pension (not exceeding 50%
of basic monthly)
o Who are the beneficiaries?
Primary legal dependent spouse until she remarries
and dependent children
Secondary dependent parents and legitimate
descendants
What are the classes of life insurance coverage under the GSIS
Law?
o 1. Compulsory all employees (except AFP, PNP)
compulsorily covered with life insurance which takes effect as
follows:
1. Upon date of employment for those who are hired
after effectivity of revised GSIS Law
2. Those whose insurance will mature after effectivity
of revised GSIS Law insurance deemed renewed on
the day following the maturity or expiration of their
insurance
3. Those without life insurance: take effect after
effectivity of revised GSIS Law
o 2. Optional member may apply for insurance or pre-need
coverage embracing life, health, hospitalization, education,
memorial plans, and other such plans as designed by the GSIS
for him or his dependents
Paid to the GSIS
GSIS can also formulate group insurance coverage
for its employees
Can a GSIS member enjoy the benefits provided for in the Revised
GSIS Act simultaneously with other benefits under other laws for
the same contingency?
o The member can choose either the GSIS plan or the other
plan. If the other plan provides benefits less than that of the
GSIS law, the GSIS will only pay the difference.
Which body has jurisdiction over disputes under the GSIS Act?
o GSIS has original and exclusive jurisdiction to settle the
disputes arising from this Act
What is the prescriptive period for claims?
o 4 years from date of contingency, except for life and retirement
benefits
How are decisions of the GSIS appealed?
o To the CA, under Rule 43
LIMITED PORTABILITY LAW (RA 7699)
To whom does LPL apply?
o For those who transfer employment from one sector (i.e.
private/public) into another
What situation is covered?
o When the person would not qualify for particular benefits
unless the contributions/services for both SSS and GSIS are
totalized, then it shall be done
o What if there are overlapping periods of membership?
Only credited once
EMPLOYEES COMPENSATION ACT
What is the coverage of ECA?
42

o 1. Every employer
o 2. Every employee not over 60 years old
o 3. Any employee over 60 years of age if he had been paying
contributions prior to age 60 and has not been compulsorily
retired
o 4. Employee coverable by both GSIS and SSS are covered by
both
Grounds for compensability?
o For injury and resulting disability or death: must be the result of
accident arising out of and in the course of employment
o For sickness and resulting disability or death: must be result of
occupational disease
Must be listed under Annex of the IR dealing with
occupational diseases
Must meet conditions stated therein
Otherwise, what is allowed?
Show proof that the risk of contracting the
disease was increased by the working
conditions
SOCIAL LEGISLATION JURISPRUDENCE
SOCIAL SECURITY LAW
Coverage
Coverage is not based on a bilateral, consensual agreement between
employer and employee. R.A. 1161 (SSS) requires COMPULSORY
COVERAGE of employers and employees. It is a legal imposition, pursuant
to police power of the State. (Philippine Blooming Mills v. SSS)
Reporting
It is the duty of the employer to report immediately to SSS the name, age,
civil status, occupation, salary, and dependents of a deceased worker. This
duty to report is not affected if the employee did not want to make
contributions. If the employer failed to report death, sickness, or disability,
the employer is liable to the amount equivalent of what the employee should
have received. (Poblete Construction v. Asiain)
Funding
Contributions are not in the nature of taxes, but are intended to protect the
employees in case of disability, sickness, old age, and death. The funds
belong to the members, and not to the State, which just hold the money in
trust. (CMS Estate v. SSS)
Effect of non-remittance
If the employer fails to pay the contributions, the State may collect them in
the same manner as unpaid taxes. Non remittance by employers should not
prejudice covered employees. (Santiago v. CA)
Benefits
The benefits under the SSS are not part of the estate of the covered
members. It is non transferable, and exempted from tax, legal processes,
and lien. (SSS v. Davao)
Dispute settlement
Any dispute as to coverage, benefits, contributions, and penalties are
cognizable by the SSS. But the SSS cannot adjudicate criminal complaints
the regular courts should. (De Jesus v. CA)
ECSIF (EMPLOYEES COMPENSATION AND STATE INSURANCE FUND)
Concept
A compensable sickness means: a) any illness accepted as an occupational
disease by the Employees Compensation Commission, or b) any illness
caused by employment, with proof that the working conditions increased the
risk.
Before, there was presumption of compensability. Now, under the Labor
Code, the law has abandoned this, and to recover compensation for
sickness/disability/death, one must prove either one of the two requisites
above. (Sulit v. Employees Compensation Commission)
Interpretation of the Law
43

Under social justice policy, there must be liberal and sympathetic approach
to legitimate appeals of disabled public servants. (Diopenes v. GSIS)
Even if the presumption of compensability was abandoned, still interpret the
law in favor of the working man, especially if there is some basis in the facts
for inferring a work connection to the cause of death. (Santos v.
Employees Compensation Commission)
Compensability formula
Grounds for compensability:
Injury, disability, or death:
Employee must have been injured at place where work requires him to
be
Employee must have been performing official functions
If injury is sustained elsewhere, it must be based on order of employer
Sickness and resulting disability or death:
Occupational disease listed in Annex A of rules
Or risk of contracting disease increased by working conditions
Use rules on proximate cause. All medical consequences and sequels that
flow from primary injury are compensable. (Belarmino v. ECC)
Need not actually be in place of employment. If the worker was acting within
the purview of his employment, performing an act reasonably necessary or
incidental thereto, the injury sustained is compensable. (Ex. teacher tasked
to work at home) (Lopez v. ECC)
Disability
There must be loss or impairment of a physical or mental function, resulting
from injury arising out of, or in the course of employment, a disease listed as
occupational by the Commission, or working conditions increasing risk of
disease. (Hatta Halale v. ECC)
Sickness
See above must either prove it is in the list of occupational diseases, or
from work-related conditions increasing risk of disease
Official functions
Place hardly matters, when the task the worker was doing was work-
connected. (Enao v. ECC)
On vacation
While days when an employee is on vacation is part of his employment
period, not everything which transpires during vacation are work-connected
and compensable. (De la Rea v. ECC)
Military personnel
A soldier on active duty status is really on 24 hours a day official duty, and is
subject to military discipline and military law 24 hours a day. He is subject to
the call and orders of his superiors at all times, 7 days a week, except when
on vacation leave. Thus, a soldier going to another soldiers house is still
doing official functions. (Hinoguin v. ECC)
Coming and going rule
Injury sustained by the employee while on his way to or from his place of
work, and which is otherwise compensable, is deemed to have arisen out of
and in the course of his employment. The death or injury is compensable
whether is arose from accident or from an intentional assault. (Lentejas v.
ECC)
LABOR RELATIONS
RIGHT TO SELF-ORGANIZATION

Who can join a union?
o Anyone, whether for profit or not, and regardless of nature
(commercial, industrial, charitable, educational, etc.)
o Exceptions:
44

1. managerial employees
Those with power to lay down management
policies and execute them; have power to
hire, suspend, transfer, layoff, etc.
employees
2. supervisory only by themselves
3. Confidential employees
Assist or act in confidential capacity with
regard to persons who formulate, determine,
effectuate management policies, esp. those
connected to LR
Meaning, they are privy to sensitive and
highly confidential records
o Who are excluded by EO 180 (guidelines for exercise of
right to organize for government employees)?
1. AFP members
2. Police officers, policemen
3. Firemen
4. Jail guards
o What about ambulant, intermittent, itinerant, rural, of self-
employed workers, who do not have definite employers?
They may still form labor organizations for the
purpose of mutual aid and protection (but obviously,
they cannot CB and perform concerted activities)
What is a union?
o An organization that exists in whole or in part for collective
bargaining or for dealing with the employer concerning terms
and conditions of employment
How do you form a union?
o 1. Identify the bargaining unit
What is a bargaining unit?
A group of employees sharing mutual
interests within a given ER unit
Less/all of entire body of employees in the
ER unit, or according occupational or
geographical grouping within the unit
How many bargaining units can there be?
The law fixes no minimum or maximum.
There can be several unions coming from
one CBU. The union is the representative,
and the represented group is the CBU.
What is the Globe doctrine?
If units in one industry cannot be determined,
the employees can decide how to organize
themselves into units.
Best way is referendum/plebiscite
What is the community of interests rule?
Employees in a BU must have commonality
of CB interests as evidenced by work they
perform
o 2. Register the union
20% of members of bargaining unit
Constitution and by-laws
If you do not have 20% of the membership of the bargaining unit,
you cannot organize. T or F?
o False. You can still have a union, although not a legitimate
labor organization.
o You can still receive a charter from a federal union you do
not need to meet the 20% requirement to become a chartered
local.
o What is the significance of removing the 20% requirement
for chartered locals?
Consistent with policy that makes it easier to self-
organize.
o But why is an independent union still required to have the
20%? Why only make it easier for chartered locals?
You privilege chartered locals. You want unions that
are attached to parent federations, which already
have systems and support in place.
What is a federation?
o An umbrella organization a group of local unions forming the
national level (there are industry unions, ex. Banking unions;
while there are national federation from different industries)
An independent union is not part of a federation. T or F?
o False. An independent union can join a federation, after
independently organizing itself.
A chartered local is not an affiliate. T or F?
45

o True, because it has to be created by the federation. See
below for the types of affiliates.
Can a chartered local register as an independent union while
within the federation?
o Yes. It becomes an affiliate.
o There are two types of affiliates:
1. Independent first, then joined federation.
2. Part of federation, then became independent but
did not leave the union.
What can a federation do versus other types?
o ONLY a federation can create another labor organization.
o An independent union cannot create another union. A
chartered local cannot, as well.
o N.B. A Trade union is not a legitimate labor organization.
Whats the difference between procedure for acquisition of legal
personality of an independent union and a chartered local?
o Independent union:
Obtain a certificate of registration
What do you have to submit?
1. P50 fee
2. Names of officers, addresses, LO
address, minutes of organizational meetings,
list of workers who participated in those
meetings
3. Names of members comprising at least
20% of bargaining unit
4. If existing for at least one year, annual
financial reports
5. Four copies of constitution and by-laws,
minutes of adoption/ratification, members
who participated in it
o Chartered local:
Issuance of charter certificate has limited legal
personality (to apply for certification election)
Do you need submission, or does legal
personality vest upon issuance of the certificate?
Just upon the moment of issuance of charter
certificate. No need for submission or filing.
Why is the personality limited?
Personality is only to apply for certification
election.
What documents must be submitted?
1. Chapters officers, addresses, principal
office of the chapter
2. Constitution, by-laws
Upon submission, what happens?
You obtain all rights and privileges of a
legitimate labor organization.
Whats the reason behind the difference in requirements?
o Note that you need to wait for the certificate for independent
union; while for a chartered local, you just need to submit.
(IMPT!)
o Because you are not encountering an entirely new
organization; the chartered local is merely the creature of an
existing union.
How do you illustrate limited legal personality of a chartered
local?
o They do not possess all the rights of legitimate labor
organizations (which a chartered local becomes after
submission of documents):
Ex. Cannot conduct a strike
All chartered locals, upon filing for petition for certification
election have limited legal personality. T or F?
o False. Limited legal personality is an option that can be
exercised by a chartered local. Meaning, you can either
acquire full legal personality first before filing for certification
election (by submitting the documents: a) list of officers, b)
constitution and by-laws); or you can do it the normal way
and obtain limited legal personality first.
In the amendment introduced by RA 9481, R&F and supervisors
can be part of the same union. T or F?
o False. Only same federation, not same union.
o RA 9481 removed the prohibition against the joining together
of supervisory and R&F unions in a federation. It overturned
Atlas. This is not in Art. 245, but merely a jurisprudential
prohibition. So they can now mix in the same federation.
46

N.B. De La Salle qualified the Atlas doctrine by
providing qualifications (direct professional
relationship between supervisors and R&F, etc.).
So when Atlas was killed, the De La Salle
qualifications also died.
Did RA 9481 allow comingling between R&F and supervisors?
o Yes. Allow within the same federation, without the
qualifications set in law before.
o But no comingling within union or chartered local, because this
is prohibited by the Labor Code.
o What is the effect of this comingling?
Those not supposed to be part of the union are
deemed to be not included or part of the union.
BUT it is not a ground for cancellation of the
registration of the union. The Labor Code only
provides three grounds for cancellation of a unions
registration comingling is not one of these.
N.B. Art 245 speaks of eligibility of employees to
become union members. Even before RA 9481, the
SC clarified that because the LC speaks of eligibility
of employees and not legitimacy of unions. So it
should not adversely impact the union, just the
employees.
o What are these three grounds?
1. Misrepresentation, false statement, or fraud in
adoption/ratification of constitution or by-laws or
amendments to such; minutes of ratification, or list of
members taking part in the ratification
2. Misrepresentation, false statement, or fraud in
election of officers, minutes of election, and list of
voters
3. Voluntary cancellation
2/3 of general membership
In a meeting duly called for that purpose
Submitted by labor organizations board,
attested by president of org
Can an opposition be filed by another union or party, alleging any
of the grounds for cancellation against another union during the
filing for certification election?
o No. You cannot attack the validity of an organization
collaterally in a procedure for certification election. You have
to directly attack it.
o Is this an absolute rule?
No. Wait for this in the part on certification elections.
What is the nature of the right to disaffiliate?
o It is part of the constitutional guarantee of freedom of
association. To disaffiliate is a right, but to observe terms of
affiliation is an obligation.
o When can a labor union disaffiliate from the mother union
to form a local/independent union?
Only during 60 day freedom period
o What is the exception?
Shift of allegiance of majority
But the existing CBA is still valid until it expires
o What is the substitutionary doctrine?
Precisely this. Even with a shift in representation, the
CBA still exists and binds. But the new agent and the
ER can negotiate to shorten the CBAs term.
What is a trade union?
o It is the third level. It is a group of federations. This is why is
it not a legitimate labor organization. Its just a grouping of
different federations.
If a chartered local disaffiliates, does it lose its legal personality?
o Yes. Because its existence is dependent on the federation.
The legal personality is tacked on the point of creation, which
is the federation issuing a charter certificate. (Consistent with
policy of RA 9481 on encouraging membership in federations)
What if a petition for cancellation is filed against the federation and
the federations personality is indeed cancelled?
o It also erases the legal personality of all the chartered locals.
o OLD EXCEPTION (does not apply anymore this is missing in
the new DO): if there is an existing CBA and the chartered
local is the administrator of the CBA, the chartered local will
not exist only until after the CBA expires.
How long does the BLR have to act on an application for
registration?
o 10 days.
Employer level, company
level,
47

o Upon receipt of denial of registration, how long and to
whom must appeal be made?
Within 10 days of receipt of notice of denial of
registration by the regional director, to the BLR
director, and then to the CA
o What if it is a federation that is registering?
Since it operates in more than one region, it receives
its denial from the BLR director, so it appeals to the
DOLE secretary, and then to the CA.
What are the additional requirements for registration of
federations/national unions?
o Proof of affiliation of at least 10 locals/chapters, which must all
be EBRs there
o Names and addresses of the companies where the
locals/chapters operate, and list of members
BARGAINING AGENT AND CERTIFICATION ELECTION
How do you start a certification election?
o For an organized establishment, where there is an incumbent
EBR
File verified petition questioning majority status of
incumbent with the Regional Office, within 60 day
freedom period before the expiration of the CBA
Must be supported by signatures of 25% of the
employees in the bargaining unit
o For unorganized establishment
No 25% signature requirement
Petition need not be verified
When can a certification election be held?
o Unorganized establishment anytime, except within 12
months of previous CE
o Organized only within 60 day freedom period before the end
of the 5
th
year of the current CBA
What are confidential employees?
o Those who 1) assist or act in a confidential capacity, 2) to
persons who formulate, determine, and effectuate
management policies in labor relations
o Both requisites must concur
What is a bargaining unit?
o Determined by the applicant bargaining agent.
o A group of employees sharing mutual interests within a given
employer unit.
o Organized by either geographical grouping, specific
occupational grouping, or by manner of payment
At what point should you determine the bargaining unit?
o Early stage of organization phase because even the name of
the LO matters to determine the BU
o Petition for certification elections (PCE) only those part of the
BU will vote
o CBA negotiations only those covered by the BU benefit from
the provisions of the CBA, even those not members of the
union
How do you appeal from the decision of the med-arbiter?
o Appeal to the DOLE secretary
o Then to the CA, under rule 65
o Then to the SC, under rule 45
What is a forced intervenor?
o In a petition for certification election, where an LLO is
contesting the incumbent, the incumbent becomes a forced
intervenor to the elections.
What are the three types of certification?
o 1. Voluntary recognition
o 2. Certification election
o 3. Consent election
Voluntary recognition
What is voluntary recognition?
o In an enterprise being unionized for the first time, and where
there is only one LLO, the employer may voluntarily recognize
the EBR status of that LLO.
o Within 30 days of recognition, submit notice of voluntary
recognition to the Regional Office
What are the contents of the notice?
o 1. The fact of voluntary recognition (joint statement)
o 2. Certificate of posting of joint statement for 15 consecutive
dates in two conspicuous places in the establishment
48

o 3. Approximate number of employees in the BU
Majority must support the voluntary recognition
o 4. Statement that it is the only LLO in the BU
What if the notice is insufficient?
o Notify the union of it and advise compliance with what is
needed
What if the requirements are incomplete?
o Return notice, without prejudice to re-submission
What are the effects of voluntary recognition?
o 1 year certification bar
o LLO becomes EBR
Certification election
What is the role of the employer?
o It is a mere bystander. It is just notified or informed of
petitions. It just submits list of EEs during pre-election
conference should the Med-Arbiter have the petition prosper.
Preliminary conference
o When is the preliminary conference held?
Within 10 days from receipt of petition
o What does the MA determine?
1. Bargaining unit
2. Contending unions
3. Possibility of consent elections
4. Existence of bars
5. Other relevant matters
o What action can the MA take?
Within 10 days of last hearing, MA issues formal order
granting or denying petition
N.B. no decision can come out during freedom period
(obviously, you have to wait for the others to file too, if
there are)
The order directs the ER and unions to submit within
10 days the certified list of EEs in the BU
o When can a petition for CE be denied?
1. Petitioner union does not appear in two successive
conferences called by MA (and it was notified)
2. Petitioner not listed in the DOLEs registry of LLOs
or its legal personality has been revoked with finality
3. Failure of chapter or national union to submit a duly
issued charter prior to filing petition of CE
4. Absence of ER-EE relationship between the
members of the union and the establishment
5. Contract bar
6. Certification year bar
7. Negotiation/Deadlock bar
8. For organized establishment, failure to submit 25%
support requirement
o What are not grounds to deny the petition?
1. Validity of petitioning unions certificate of
registration
2. Legal personality as LO
3. Validity of registration
4. Execution of CBA
N.B. these must be heard and resolved by the
Regional Director in an independent petition
N.B. the difference between these grounds and the
one above (#2) is that there, the LLO is not listed in
the DOLE registry, so its just a matter of checking the
list. Here, there must be hearing.
o When is appeal allowed?
NOT allowed to appeal order granting CE in
unorganized establishments
For others appealable to DOLE Secretary within 10
days from receipt
Pre-election Conference (PEC)
o What are the matters set in PEC?
1. Date, time, place of election
Not later than 45 days from first PEC
Regular working day
In work premises
2. List of eligible voters
3. Mechanics of election
o What is the effect of failure to appear in PEC?
Waiver of objections or questions as to agreements
reached there.
49

N.B. this is unlike Preliminary Conference,
where two absences kills the petition
Still given notice of subsequent PECs and can attend
o Includes matters such as exclusion and inclusion of voters
Ex. when there is no employer-employee relationship;
when he is not a member of the bargaining unit
o How do you do undergo inclusion/exclusion?
Report to Med-Arbiter, who will note it in the minutes.
Undergo with normal conduct of elections. But actual
exclusion/inclusion only happens after the elections.
But what if they agree? Can there be removal
during pre-election?
Yes.
Who can challenge?
Authorized representative of any of the
contending unions
Employer
When?
Before deposited in ballot box
What grounds?
1. No ER-EE relationship
2. Not member of the BU
Normally, whats the status of the challenged
names?
They can vote. But the Med-Arbiter decides
after certification election.
But how can you exclude them?
o You segregate their votes, in
separate envelopes, because their
votes are otherwise anonymous.
Election proceedings
o If there are 500 voters, how many must vote for there to be
valid elections?
At least 251.
o What if there is a failure of election?
This happens when there is 50% or less valid votes
from the voters in the bargaining unit.
You DONT have to file another petition. You can just
request through a motion to repeat the conduct of a
certification election (6 months, according to the DO)
o What are you voting on?
Either you vote for a union (Union A or Union B), or
vote for no union.
If there is just one union, its yes or no in favor of
Union X.
o How do you determine the winner?
Get the majority of those who actually voted with valid
votes.
What do you mean valid votes?
Those which are not spoiled ballots.
For instance, of the 500 voters, 400 voted. 390 are valid votes.
o Union A 150
o Union B 200
o No Union 40
o Spoiled 10
o Is there a winning Union?
Yes. Union B got majority of 390 votes (at least 196
votes).
For instance, of the 500 voters, 400 voted. 390 are valid votes.
o Union A 150
o Union B 150
o No Union 90
o Spoiled 10
o Is there a winning Union?
No. There will be a run-off election.
o What is your basis for determining whether there should
be a union, even if there is no majority?
At least 50% of ALL votes, including spoiled ballots,
voted for unions,
For instance, of the 500 voters, 400 voted. 390 are valid votes.
o Union A 90
o Union B 100
o No Union 200
o Spoiled 10
o Is there a winner?
Yes. No Union won.
50

For instance, of the 500 voters, 400 voted. 390 are valid votes.
o Union A 100
o Union B 100
o No Union 190
o Spoiled 10
o Is there a winner?
No, no choice got the magic number of 196.
o Will there be a run-off?
Yes, because the two unions got 50% of ALL the
votes (200 out of 400). (You count the spoiled ballots
in the total, but you dont care about what their
contents are [Gs question])
o What happens?
No union choice will be removed.
o N.B. In this situation, even if no union got most of the votes,
ONLY unions can participate in run off elections.
For instance, of the 500 voters, 400 voted. 390 are valid votes.
o Union A 100
o Union B 95
o No Union 195
o Spoiled 10
o Is there a winner?
No. Nobody got a majority.
o Is there a run-off election?
No, because the two unions did not get at least 50%
of ALL the votes (200 out of 400).
o Is there a valid election?
Yes.
o What is the effect of this particular certification election?
The one-year bar applies. The certification election
has ended. It is as if no union won.
NOTE: Different base figures based on example:
o 500 (for total amount of voters need 251 for valid elections)
o 390 (for majority need 196 which is 50%+1)
o 400 (whether there will be a run-off elections just 50%, not
50%+1)
For instance, of the 500 voters, 400 voted.
o Union A 100
o Union B 95
o No Union 195
o CHALLENGED (not spoiled) 10
o what happens here?
You put Challenged persons X in one envelope and
put his/her name. You put Challenged persons Y in
another SEPARATE envelope and put the name.
o Do you open the segregated envelopes immediately after
elections?
Only if it will materially affect the result of the
elections.
o In this case, does it apply?
Yes, because there is no winner and any of those
challenged votes could lead to a winner (no union in
particular).
Also, if none of the 10 votes is for no union it can
also help the two unions reach 200 votes to enable
run-off elections.
N.B. When they are qualified as valid votes, 196 will
not be the majority number, because the base
number will increase.
o What is the reason why challenged ballots are treated this
way?
So you dont unduly expose their votes to scrutiny if
there is no need to do so.
Aside from the one-year bar from certification election, is there any
other bar for certification election?
o 1. Certification election bar <this>
- one year bar
N.B. if there is failure of election because
less than majority of CBU voted, there can
be another petition for CE within 6 months
(D.O. 40-03)
Bar applies too when no union wins
o 2. Contract bar
Wait for the 60-day freedom period before the 5 year
period expires
o 3. Deadlock bar
No CE may be held if there is a pending bargaining
deadlock which has been submitted to conciliation or
51

arbitration, or has become the subject of a valid notice
of strike or lockout
o 4. Negotiation bar
Once negotiations are started within the 1
st
year, even
if there is no CBA at the end of the 1-year period, it
bars a subsequent CE
There is no incumbent EBR. So there was a certification election
(or consent election).
o From the CE, you have 1 year bar. This protects the union that
won the CE, through a one-year protection to give it a chance
to negotiate with the employer as regards a CBA.
o After 1 year, the ideal situation is that there is CBA. This
extends the 1 year period to a 5-year period.
There is a short window period (60 day freedom
period before the expiration of the 5 year term of the
CBA)
o N.B. (very important) If you dont have a CBA and you are
nearing the end of the first year, in the past, you need a
deadlock to bar subsequent CE. NOW, there is no more need
for a CBA or a deadlock, because as long as you have started
negotiations and you have sustained negotiations beyond the
first year, you are still protected.
Consent Election
What is a consent election?
o One where the contending unions voluntarily agree upon
elections, with or without the intervention of the DOLE.
o The result binds the parties.
What are the two kinds of consent elections?
o If Union A and B decide to have elections without participation
of DOLE, it has no effect of a valid CE. It only determines the
majority.
o But if Union A and B agree to have elections, but involve the
Med-Arbiter and the DOLE, then it has effect of valid CE.
What is the effect of consent election?
o Will have the same effect as the conduct of a certification
election if done under the supervision of DOLE (selecting an
EBR).
o Before DO 40, it is an internal contest which will not have the
effect of choosing an EBR.
What if there is no DOLE supervision:
o Valid election
o But will not gave effect of a CE
o Unofficial election (thus, not a bar to CE)
What is the difference between consent and certification election?
o Consent election dispenses with the need for an order from the
Med-Arbiter
o Med-Arbiter will just note the fact in the minutes that the
contending unions agreed to hold the consent elections.

Union Dues and Agency fees

How does the check-off system operate?
o The employees pay is deducted at prescribed periods to pay
for union fees, fines, or assessments
o Must there be individual authorizations?
No. Deductions for union service fees are authorized
by law.
What are agency fees?
o Equivalent to union dues, but paid by non-members, because
the union represents him too as part of the BU and accords
benefits
What are requisites for valid Special Assessments?
o 1. Authorization by written resolution of majority of members at
a general meeting for this purpose
o 2. Secretary records minutes
Members present and votes cast
Purpose of special assessment and recipient thereof
o 3. Individual written authorization for check-off, signed by the
EE
COLLECTIVE BARGAINING

What is collective bargaining?
o Agreement between employer and employee as to terms of
employment (benefits, conditions of work), and dispute
settlement (ex. grievance machinery).
What are the jurisdictional requirements for CB-ing?
o 1. Status of majority representation of EEs representative
o 2. Proof of majority representation
52

o 3. Demand to bargain given to ER
How do you start collective bargaining?
o Submission of the EBR to the employer of notice to collectively
bargain, along with proposal
o Then the employer will submit a counterproposal within 10
days
o What if there is a pending petition for cancellation of union
registration?
It does not prevent the filing of petition for CB-ing.
o When is it commenced?
During the certification period (12 months)
What next?
o They will negotiate (do not proceed to the NCMB immediately,
contrary to what the provision of law suggests!). You can meet
several times, over a period, until you have discussed each
provision.
o If you have exhausted all efforts, you will reach a point where
there can be no agreement or movement in the positions of the
parties as to particular provisions.
o What is the procedure for CB under the code?
1. Serve proposal to other party
2. Reply by other party within 10 calendar days
3. Conference between parties
4. If not settled, NCMB intervenes upon request of
parties or motu propio conciliation meetings
Can issue subpoenas to parties
What if the employer refuses to respond to the EBRs proposal?
o There is Unfair Labor Practice violation of the duty to bargain
collectively:
1. It can be submitted to the Labor Arbiter.
2. Or alternatively, you can use it as a ground to file
notice of strike
N.B. 1 and 2 are mutually exclusive
o What is the penalty for management for refusing to
bargain?
The proposal becomes the new CBA (Kiok Loy
doctrine)
o What are the four forms of violation of duty to bargain?
1. Failure or refusal to meet and convene
2. Evading mandatory subjects of bargaining
3. Bad faith in bargaining
4. Gross violation of CBA
o As a corollary, this duty also means respecting an existing
CBA, with exception to the 60 day freedom period
What is the term of the CBA?
o It can be fixed by the parties. It can be 20 years, whatever, but
subject to the five-year period.
o What happens after five years?
There is a freedom period (60-days before the end of
the five years) to possibly hold another CE.
When does contract bar rule not apply?
1. CBA not registered
2. CBA de-registered
3. CBA incomplete it itself
4. CBA does not foster industrial peace
5. CBA concluded in violation of order
enjoining the parties from entering into CBA
until representation conflict is settled
o What happens before the end of the third year?
N.B. Use the term underlined to be precise.
You can renegotiate the economic provisions of the
CBA.
How do you do the renegotiation?
The terms of the CBA will be reexamined.
Who will start it?
o The union. You will not expect the
employer to start it.
o The union submits a proposal for
modification. The same
principle/penalty for management
refusing to bargain will apply the
proposal becomes the new CBA if
management refuses to respond.
What if the union does not submit a
proposal?
o Then the existing CBA will persist.
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o Can the parties renegotiate on the first year? The second
year?
Yes, but only if the parties both agree.
But on the third year, the law mandates bargaining.
o When is registration done?
Within 30 days from execution of the CBA, with the
Regional Office which issued the certificate of
registration (if single ER) or the BLR (if multiple
employers in the CBA)
Where is appeal done?
Regional office BLR
BLR (multiple ERs) Sec. of Labor
Both within 10 days of denial
This is valid:
o There is a CBA that covers five years, giving wage increases
for the first, second, and third years, leaving the fourth and fifth
years open.
o Or it can provide for wage increases in years four and five, but
subject to renegotiation.
What is the period before the expiration of the CBA?
o The 60 day period is for either party to notify to the other that it
seeks to terminate or modify the current CBA.
A CBA expires after five years. You commence negotiations for a
new CBA. (Alternatively, renegotiations, if the CBA is not yet
expiring, but after 3 years.) What is the relevance of the six month
period?
o Agreement between the parties on the new CBA will retroact to
the beginning of the first date after expiration, if they agree
within 6 months from expiration.
Here, the law mandates retroactivity.
o If they agree after six months post expiration of the CBA, the
parties will determine when the CBA is deemed to have
commenced.
There can still be retroactivity, but optional.
Does the six month period apply to mid-term renegotiation period?
o No. The six month period only applies to a new CBA. The
provision only speaks of expiration so it must involve a new
CBA.
If there is no agreement on retroactivity, what must the Secretary
of Labor do after he assumes jurisdiction?
o There is an SC case that says the CBA must retroact to the
first day after the end of the six month period. BUT there is no
basis for this. This seems like an invention of the SC.
In case you have a situation when there is a new CBA entered into
after the six month period and there is no retroactivity. So there is
a gap (ex. 10 months). What happens?
o There is a hold-over principle where the first CBA will be
deemed to exist in the meantime.
o What if there is a four month interim instead?
In the interim, the first CBA will hold-over for the
meantime.
But since there is an agreement within six months, the
new CBA retroacts to replace the effects of the first
CBA. (Ex. Back pay of wage differentials)
What is the difference in impasse rules between mandatory and
non-mandatory CBA provisions?
o If mandatory, either party may bargain to an impasse as long
as he is in GF
o If non-mandatory, a party may not bargain to the point of
impasse; it may be construed as evasion of duty to bargain
Union of Filipro Employees v. Nestle: ERs insistence to exclude a
particular provision in the negotiations is not a refusal to bargain.
Obligation to bargain does not include the commitment to precipitately
accept the proposals of the other party.
What are the mandatory provisions of the CBA?
o 1. Grievance Machinery (GM)
For the interpretation or implementation of the CBA
provisions and personnel policies
Established within 10 days from signing CBA
Composition: Includes at least 2 representatives
from the members of the BU, designated by union
and the employer, unless otherwise agreed upon
o 2. Voluntary Arbitration (VA)
All grievances submitted to GM which are not settled
within 7 calendar days are automatically referred to
VA prescribed in CBA
How selected?
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Selected through CBA provision or
procedure, or if there is no agreement, by
NCMB according to selection procedure in
CBA
What is the VAs jurisdiction?
1. Grievances from implementation or
interpretation of CBAs
2. Arising from interpretation or enforcement
of company personnel policies
3. Wage distortion issues from application of
wage orders, in organized establishments
4. Arising from interpretation and
implementation of productivity incentive
programs under RA 6971
What else, optionally?
o Other labor disputes like ULP and
CB deadlocks, if agreed upon by
parties
o A dispute before or at the stage of
compulsory arbitration
Powers of VA?
1. Hold hearings
2. Receive evidence
3. Take necessary action to resolve dispute
Issue decision within 20 calendar days (or ground to
discipline the VA)
What if the VA decides de-listing as sanction?
Must turn over records of the case within 10
calendar days to the NCMB for further
disposition
When is a decision final and executory?
After 10 calendar days from receipt by
parties
No MR is allowed
Establish Grievance Machinery 10 days from signing CBA
GM elevate to VA Grievances not settled within 7
calendar days
VA decision Within 20 calendar days
VA decides de-listing as sanction Turn over records of case to NCBM
within 10 calendar days
Decision of VA final and executory Within 10 calendar days from receipt
MR of VA decision Not allowed

o 3. No Strike-No Lockout Clause
It is a valid stipulation, although it may only be
invoked by an ER when the strike is economic in
nature or one which is conducted to force wage/other
concessions not mandated by law to be granted.
What if the strike is based on ULP?
NSNL cannot be invoked
o 4. Labor-Management Council
Purpose: enable workers to participate in policy
making and decision processes
What are not covered by LMC?
1. Covered by CBAs
2. Traditional areas of bargaining
EE Representative Nominations made by:
EBR if organized
Employees at large if unorganized
What are the ULPs in CB?
o 1. Bargaining in BF
It must be raised while bargaining is in progress
Based on facts
o 2. Refusal to bargain
Refusal to reply to proposal
See Kiok Loy implication
o 3. Individual bargaining
Can only bargain with the EBR
o 4. Blue sky bargaining
Making of exaggerated or unreasonable proposals in
CB
o 5. Surface bargaining
Mere cosmetic pretense of bargaining
What are the elements of ULP?
o 1. ER-EE relationship between offender and offended
o 2. Defined in the LC as ULP
55

Not an exhaustive listing, because it is impossible to
cover all acts that are infirm to self-organization
(HSBC employees v. NLRC)
Who are liable for ULP committed by a juridical person?
o If by corporation, partnership, etc. the penalty is imposed on
the guilty officers of that entity
o If by a LO, the officers and members who have actually
participated in, authorized, or ratified such
What is the prescriptive period?
o 1 year
When is there no ER ULP?
o When there is valid exercise of management rights. The only
condition is that it must not violate the act and its prohibitions.
o As a rule the management can promote, transfer, or demote its
EEs when the interests of the company need it. There is only
ULP when instances directly point to interference by the
company with the EEs right to SO.
o The ER can treat union and non-union employees differently;
discrimination per se is not unlawful. It is only unlawful when it
is done against the right to SO. Thus, granting benefits to non-
union EEs outside the BU because the union members already
derive benefits from the CBA is valid.
o What is the determining factor for validity of exercise of
management rights?
The ERs motives
Generally, no need for the ER to explain motives
behind exercise of management acts, but if there is
history of enmity between the ER and EE then there
is greater suspicion for ERs acts.
What are the ULPs of ERs?
o 1. Interference
Interfering with formation of union, such as
threatening pay cuts for EEs who join the union
Dismissal of union members upon refusal to give up
membership
Refusal to give salary adjustments according to CBA
scale for years
What is the totality of conduct doctrine?
Culpability of ER is evaluated on the basis of
implication, against background of and in
conjunction with collateral circumstances
So the statement by one ER may become
ULP if uttered by another, hostile ER
Lockout or closure amounting to ULP
Sale of the enterprise in bad faith
What is the implication?
o The general rule that labor
contracts are in personam and non-
binding to the transferee changes.
It can be enforced even against the
transferee in bad faith.
What is the doctrine of successor-
employer?
o A new company that engaged in the
same business as the closed
company and is owned by the same
people is treated as a continuation
of the one that closed, so the ER
cannot avoid liability.
o 2. Yellow dog contract
A promise exacted from the EE that as condition for
employment, they must not join or form a union
o 3. Contracting out as ULP
This involves contracting out services performed by
union members as to interfere with right to self-org.
When is it not ULP?
When it is done for business reasons (to
save on costs, decline in business,
inadequate equipment, etc.)
What is a runaway shop?
Transfer of business to discriminate against
union members in old plant. This is ULP.
o 4. Company domination of union
A. Initiation of company union idea
Outright formation by the ER
EE formation out of ER demand
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Managerially motivated formation by EEs
B. Financial support to union
C. ER encouragement and assistance
Ex. giving exclusive recognition as EBR
without determining if it represents majority
of EEs
D. Supervisory assistance
o 5. Discrimination
Must be in the terms of employment or treatment of
the union members vis--vis the non-members
Or in bonus allocation
Or in layoff even if there is valid basis for
layoff, but all those laid off were union
members
Test of discrimination: underlying reason is union
activities
What is a union security clause?
It is a valid discrimination favoring unionism.
This is a clause where the union is assured
continued existence such as where new EEs
are compelled to join the union.
These are VALID.
So again, ER terminating those who refuse
to join the union is valid.
What are the kinds of union security clause?
Closed shop, union shop, maintenance of
membership, etc.
Who are not covered by closed shop provision?
EE who at the time of the closed-shop
agreement is a member of a religion that
prohibits members from joining unions
EEs already in service and members of labor
union other than the majority upon taking
effect of closed-shop agreement
Confidential EEs excluded from BU
EEs excluded from closed shop by
agreement
General rule: closed shop only applies to future EEs,
not current ones because theyd be force to jump
unions in violation of right to self-org
What is agency shop?
The EE is not required to join the union but
has to pay the union service fee.
o 6. Discrimination due to testimony
A retaliatory act by the ER regardless of the subject of
the complaint or testimony
o 7. Violation of duty to bargain
1. Failure or refusal to meet/convene
2. Evading mandatory subjects
3. BF bargaining, or failure to execute collective
agreement
4. Gross violation of CBA (must be economic
provision)
o 8. Paid negotiation
This is corrupt and ethically reprehensible
Neither may the ER pay on its own volition nor can
the EE ask or accept payments
o 9. GROSS violation of the CBA
Youre not being paid OT pay. Is this ULP?
o No, not in itself. It must be done in order to discourage
membership in a labor organization.
o TEST: It must be related to the exercise of an employees
right to self-organize.
Can ULP cases be compromised?
o No. Labor contracts are impressed with public interest, so
labor contracts must yield to the common good.
What is the single charge rule?
o Claim of ULP must include all acts within a given period.
Cannot split cause of action and file subsequent and
continuous charges.
What are the reliefs against ULP?
o 1. Cease and desist order
o 2. Affirmative order
o 3. Order to bargain or imposition of CBA
o 4. Strike by union
What are the ULPs of unions?
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o 1. Restraint or coercion by LOs
What about interference by EEs?
Its not ULP unless it amounts to coercion or
restraint
Union cannot coerce EEs to join a strike. This is done
through assault, threats, blockages, etc.
o 2. Union-induced discrimination
When is a union security clause ULP?
When it is arbitrarily used
Union security clauses must be governed by
justice, fair play, legality
o 3. Refusal to bargain
Ex. entering negotiations with fixed purpose of not
reaching an agreement
o 4. Featherbedding and Make-Work Arrangements
What is featherbedding?
EE practices which create or spread
employment by unnecessarily maintaining or
increasing the number of EEs used, amount
of time consumed, or work on a particular job
Make-work: minimum-crew regulations on railroads,
setting and prompt destruction of bogus type in
newspapers, stand-by pay for musicians when a radio
station broadcasts music from records, etc.
o 5. Ask or accept negotiation or attorneys fees from ER
o 6. Gross violation of CBA
Employer Employee
Inference Restraint or coercion by LO
Yellow dog Feather-bedding and make-work
arrangements
Contracting out as ULP
Company domination of union
Discrimination Union-induced discrimination
Discrimination due to testimony
Violation of duty to bargain Refusal to bargain
Paid negotiation Asking or accepting negotiating or
attorneys fees
Gross violation of CBA Gross violation of CBA

STRIKES
What is the definition of strike?
o Temporary stoppage of work by concerted action arising from
a labor dispute between employer and employee.
What is a strike?
o Temporary stoppage of work by concerted action of employees
as a result of industrial or labor dispute
o Characteristics:
1. There must be an ER-EE labor dispute
2. Employment relation is deemed to continue
although in a state of belligerent suspension
3. Temporary work stoppage through concerted
action
Can an employee on official LOA strike?
o No, because he cannot stop
working when hes not even
working
4. Striking group is LLO. If there is a deadlock, it
must be by the EBR.
What is a concerted action?
o An activity undertaken by two or more employees, by one on
behalf of others
What is a lockout?
o Temporary refusal of ER to furnish work as a result of industrial
or labor dispute
When can you strike?
o There are only two. No other:
o 1. ULP
o 2. Deadlock in collective bargaining
o What is the conversion doctrine?
The strike can start as economic and is converted to
ULP, or vice-versa
o T/F You cannot strike before negotiation.
False, you can strike on ULP.
Who can strike?
o 1. EBR, if there is one
o 2. Any LLO, if there is none
o T/F You cannot strike before certification election.
False. If there is no EBR, an LLO can strike on ULP.
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o T/F You cannot strike before you register in the DOLE.
True. Because an LLO has to be registered with
DOLE.
o T/F If you are not an independent union, hence a
chartered union, you cannot strike without having
registered with DOLE.
True. Because the charter certificate only gives your
personality to file for certification.
o T/F If you are a chartered local, and you submitted all
requirements, can you strike?
Yes. Upon submission, you have all the rights of an
LLO. (No need to wait for approval)
Can there be a strike when there is no union?
o No. There has to be a union.
o If not initiated by a labor union, is it still a strike?
Yes, but its not a valid strike.
Is a violation of a CBA an ULP?
o If it amounts to ULP (Economic provision + malice).
o All other violations are just grievances its still an actionable
wrong, but not ULP. You go to the grievance machinery.
o If you strike on the basis of a grievance, what happens?
It is not a valid strike.
o N.B. The distinction between gross and simple violations only
applies to violations of the CBA. Do not get confused.
T/F If there is no dispute with the employer, there can be no
strike.
o True.
o Is a welga ng bayan a strike?
No. There is no employer-employee dispute. It is a
mere sympathy strike. (BUT see Biflex case below)
Its a mass action that could lead to possible
dismissal.
o Is it proper to call it an illegal strike?
No. Because its not a strike in the first place, so you
dont even go into the inquiry whether its a legal or
illegal strike.
If its not an egg, do not call it a rotten egg. Its not
an egg. The SC is guilty of doing this a lot.
Although jurisprudence calls it a strike. Be careful.
But in the Bar exam, follow this classification.
Biflex v. Filflex: EEs who have no labor dispute their employer, but
who on a day they are scheduled to work, refuse to work and instead
join a welga ng bayan to protest the accelerating prices of oil commit an
illegal work stoppage.
o [Overturning the old doctrine that a welga ng bayan is not a
strike. Here it was deemed a strike, but an illegal one because
they didnt file notice to strike. Inevitably for this case its
deemed illegal because the LO didnt follow procedure
because how would it know that it should comply with the
requirements when it didnt think it was a strike in the first
place?]
The SC has upheld certain actions by employees, ex. wearing
armbands, having placards as valid expressions. But after the Dusit
case, it seems unclear if these will already be considered as work
stoppage or mass action. (NUWHRAIN Dusit Hotel Nikko Chapter v.
CA, November 11, 2008)
o NUWHRAIN-Dusit Hotel v. CA: Even without stoppage of
work, when the employees showed up to work bald and the
employer refused to let them enter the hotel and give them
work this was considered a strike.
o [This is weird because there is no work-stoppage, but its a
strike.]
There was a case where the employees did not apply for a permit to
strike, but just applied for a mayors permit to hold a rally, on the theory
that it is not a strike, but a mass action.
o But the SC held that it is a strike because there is work
stoppage; because they applied for work leaves, and there is a
dispute existing.
A. Soriano Aviation v. Employees Association of A. Soriano:
Employees refusal to work on three consecutive holidays, prompted by
their disagreement with management-imposed work schedule is
considered a strike that was grounded on a non-strikeable issue, and a
violation of the No-Strike Clause in the CBA.
o [This is weird, because the court is in effect requiring
employees to work on holiday.]
Is a prayer rally a strike?
59

o No, as long as it does not disrupt the work of those in duty. A
hot tip is to include as well non-members of the union. And it is
no question, valid, if done after work hours. If done during
work hours, do not disrupt.
T/F If there is no actual ground for a strike, there is no legal
strike.
o False. You can have a good faith strike, when the union in
good faith believed there is a ground to strike, even if it is
found not to have actually existed.
o There must be actions done by the employer that would justify
the belief that there was ULP committed.
What do you do?
o 1. File notice to strike stating that you intend to hold a strike on
the stated ground to the Regional Office of the DOLE
What is the cooling off period?
At least 30 days before intended date of
strike for CBA deadlock
At least 15 days for ULP
o Exception: No cooling-off period
for union-busting, such as dismissal
of union officers who are duly-
elected (take note: duty elected)
o Does termination of an appointed
officer fall within this exception?
No.
What is the reason for 30 and 15 days?
To give the parties chance to cool-off, in
order to reconcile.
What if you dont have an intended date?
Its not required in the IRR.
o 2. Inform the NCMB (DOLE) at least 24 hours before the strike
vote
This is the second notice. The purpose is to inform
the NCMB and give it a chance to supervise the strike
vote, and give it ample time to deploy personnel
When do you file this?
Anytime after notice to strike.
Should the union wait for a DOLE representative?
No, because it is not mandatory.
o 3. Hold strike vote
It has to be done after filing notice of strike. There is
no specific period.
Majority vote of whom?
Union members only
This is different from the eligible voters in a
certification election
Third notice: notice of result of strike vote
Can there be an illegal strike vote?
No such thing; there is no requirement that
should be complied with.
But what if there is absence of notice of
strike vote?
o There is defect in notice, but the
strike vote itself is not illegal.
o 4. 7 day strike ban
Count this 7-day ban from the time you submitted the
strike-vote results
Can it be counted within the cooling off period?
It can be wholly within, partly within, or
entirely outside the cooling off period.
Just use the submission of the results of the
strike-vote as the starting point.
What is the purpose of this?
Allow DOLE to confirm the results of the
vote, and allow any party to contest the
results.
Can they wait several weeks after to conduct the
actual strike?
Yes.
What if the strike ban is over but the cooling off
period is not?
You cannot strike yet. Wait for the cooling
off period to end.
What if the cooling off period is done, but the
strike ban is not?
Same. Wait for the strike ban to end.
How many notices all-in-all do you need for a valid strike?
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o Three notice of strike, notice of conduct of strike vote, notice
of strike vote results
[Class question] What if the employer commits ULP against the
minority union but the EBR doesnt strike on behalf of the minority
union. Can the minority strike?
o Jurisprudence No, they cannot.
o Sir. MM Yes they should be able to, based on ULP.
Especially when the EBR is in cahoots with the employer.
After complying with all the four steps, what else do you have to
comply with?
o Cannot perform acts that would render a strike illegal.
What are the prohibited acts during strikes?
o 1. Strike or lock-out after assumption of jurisdiction
o 2. Knowingly participating in illegal strike or participating in
commission of illegal acts during strike
Ground for termination of employment
o 3. Obstruct, impede, or interfere with through force, violence,
coercion, threats, or intimidation any peaceful picketing
o 4. Employment or strikebreaker or being employed as
strikebreaker
o 5. Bringing in, introducing, or escorting by public officer or
employee (including AFP/PNP) or armed persons any
individual who seeks to replace strikers in entering or leaving
premises
o 6. Commit any act of violence, coercion, intimidation while
engaging in picketing or obstruction of ingress or egress from
ERs premises for lawful purposes or obstruct thoroughfares
Should the employer wait for a case to be filed in order to fire an
employee who committed an illegal act? Should the employer wait
for a determination that the strike is illegal?
o No. The act is illegal, independent of whether the strike is
illegal or not. So the employer just has to follow the regular
procedure of terminating an employee, independent of any
holding in a case.
Recent case: statements or charges made by strikers against
management or company were considered illegal activities that would
convert an otherwise valid strike into an illegal strike.
o Ex. Libelous, statements against products or services
o Although general rule is that a strike is a conflict situation, so
the language used is expected to be strong.
So when does a strike change from valid to illegal due to the acts
of the strikers?
o It is a factual question. It is case-to-case basis.
o A single or isolated act of violence does not convert. Only if
the violence is pervasive.
What is improved offer balloting?
o 1. In case of strike
Regional branch of Board conducts referendum by
secret balloting on the ERs improved offer
On or before 30
th
day of strike
At its own initiative or upon any partys request
When at least majority of union members accept the
improved offer, the strikers must immediately return to
work
o 2. In case of lockout
Same, except the BOD is the one that votes on the
reduced offer (Reduced offer balloting)
What are the requisites of lawful picketing?
o 1. Aim is to inform public about dispute
o 2. Conducted peacefully
No threats, intimidation, coercion, force
No vandalism
No obstruction of ingress/egress
o What is the courts power to control picketing?
In general, it cannot restrict it because its exercise of
free speech.
But it can also localize the sphere of picketing to
establishments with related interest and insulate
those establishments with totally no interest. A third
party thus may have the right regulated when it would
appear that the labor dispute exists between the
union and the random third party.
o What if there is no EER?
Picketing is still valid, because its free speech.
What is assumption of jurisdiction?
o The Secretary will decide the conflict him or herself.
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o Without the assumption order, the dispute will not be decided
by government. Patagalan at patigasan. The parties have to
decide the conflict themselves.
When is it discretionary? When is it mandatory?
o Discretionary
For industries indispensable to national interest
Assume jurisdiction or certify to NLRC for compulsory
arbitration
results into RTWO (see below)
o Mandatory (within 24 hours)
Labor disputes affecting hospitals, clinics, medical
institutions
Assume jurisdiction or certify to NLRC for compulsory
arbitration
What is the duty of the striking union or locking-
out ER?
Must provide and maintain effective skeletal
workforce of medical and other health
personnel to handle emergency cases during
the strike/lock-out
Distinguish assumption of jurisdiction from court jurisdiction over
a case.
o In assumption, the parties do not initiate it; the Secretary steps
in.
o Is it still an assumption even if a petition is filed?
Yes.
o What happens in an assumption order?
Enjoin pending strike or ongoing strike. Workers have
to return to work or cannot pursue the strike.
How different is assumption from certification order?
o Assumption: Secretary will decide the case. Certification:
refers the matter to the NLRC. The NLRC will decide the case.
o Both are interventions of government that convert the issue
into a case to be decided upon by the Secretary or NLRC
respectively.
What are the implications/effects of assumption order?
o Immediately return to work.
o Secretary of Labor issues a Return to Work Order in addition to
the assumption order.
o Can you have an assumption order without a return to
work order? What if there is no return to work order?
The return to work order is automatic with the
assumption order. It is necessarily implied.
Otherwise, its a free vacation for the laborers! Steel
Corp. v. SMP
o Go back to status quo ante. The employer must accept the
employees under the same terms and conditions as before.
o What if there is defiance of the Sec. of Labors orders?
There can be disciplinary actions including dismissal,
loss of employment, payment of damages, etc.
To whom do you serve the assumption order?
o To the union, and to the employer.
o Serve to the president usually, as agent.
What is the effect of declaration of illegality of a strike? What if the
union officers did not participate in the strike and were reporting
for work, but then the rest of the union were striking?
o Union members will not be terminated, unless they performed
illegal acts during the strike.
o Union officers can be terminated. Even if they did not actually
physically participate in the strike.
o When can you terminate all strikers?
1. When there is a Return to Work Order and they
refused to comply with it.
And this RWO only happens when there is
an Assumption or Certification.
So mass termination cannot happen in
ordinary strikes there has to be defiance of
RWO, which can only be issued in an
Assumption or Certification Order.
2. If everyone committed illegal activities, everyone
will be terminated not because of the strike per se, but
because of individual actions, even if the strike per se
is legal.
Is there payment of wages during strikes?
o No, even if the strike is legal.
o Exceptions?
1. ULP strike, in the discretion of the authority
deciding the case
62

2. Strikers voluntarily and unconditionally offered to
return to work, but the ER refused to accept the offer
Back wages from when offer was made
3. When there is RTWO and the EEs are
discriminated against
When is there an award of back wages?
o There is no reward of backwages, even if the strikers win.
Can employers hire replacement workers?
o Yes, employers can.
What is the rule on injunctions?
o No court or entity can enjoin a strike, picket, or lockout
o What are the exceptions?
1. Prohibited or unlawful acts are being or about to be
committed that would cause grave or irreparable
damages
2. National interest
o What are the essential conditions to grant temporary
injunctive relief?
1. Complaint alleges facts which appear sufficient to
constitute proper basis for injunction
2. Injunction is reasonably necessary to protect legal
rights of the plaintiff pending litigation
o Who issues?
The NLRC
o Can an injunction be issued ex parte?
As a general rule, no. There must be testimony of
witnesses and cross-examination. And there must be
finding by the NLRC of the grounds above.
o When can it be issued ex parte and what are the
limitations?
Substantial and irreparable injury to complainants
property
There is testimony under oath sufficient to justify if
proved that a TRO must issue
What are the safeguards?
1. Filing of adequate security to cover for
damages if the TRO is granted erroneously
or improvidently
2. TRO is no longer than 20 days
What is the Innocent Bystander Rule?
o Peaceful concerted activities may be regulated at the instance
of innocent bystanders if it appears that the inevitable result of
its exercise is to create an impression that a labor dispute with
which they have no connection with involves them.
In sum, what are the four grounds to make a strike valid?
o 1. Grounds
o 2. Procedure
o 3. Conduct
o 4. Compliance with return to work
DISPUTE SETTLEMENT

Labor Arbiter
What is jurisdiction of LAs?
o [Labor disputes]
o 1. ULP
o 2. Termination disputes
What about termination of cooperative members?
Not covered by LA; no ER-EER
o 3. Cases from prohibited activities during strikes, including
questions on legality of strike/lock-out
o [Claims against ER]
o 4. Claims for wages, rates of pay, hours of work, and other
terms of employment
o 5. Claims for damages arising from ER-EE relationship
o 6. Money claims from ER-EE relationship in amount exceeding
P5000
o 7. All monetary claims of OFWs from ER-EER or by virtue of
law/contract, including damages (RA 8042)
o [Misc]
o 8. Wage distortion cases in unorganized establishments
o 9. Enforcement of compromise agreements when there is non-
compliance of parties
LA has no jurisdiction over:
o 1. Intra-corporate disputes
RTC
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o 2. Cases involving corporate officers (they are not EEs)
But an EE who rose from the ranks can be treated as
a regular EE
o 3. Cases involving GOCCs with original charters
CS Law
o 4. Cases involving entities immune from suit
o 5. Local water districts (quasi-public corporations)
o 6. Actions based on tort
Regular courts have J
Where do you appeal the LAs decision?
o Within 10 days, to NLRC
Whats the next step?
o Rule 65 to the CA
And then?
o Rule 45 to SC
What is the general rule?
o Period for appeals is 10 days to the NLRC from the LA.
o You cant file an MR in LA level.
How is appeal to the NLRC from the LA done?
o File a notice of appeal + memorandum of appeal (together)
within 10 days.
This is how it is different from ordinary appeal where
the notice of appeal and the memorandum are
separately filed.
o What is the rule on the bond filed?
In NLRC, amount of bond filed by losing ER is the
based on the amount in the judgment appealed from,
and not based on the amount you want to appeal.
So if the judgment is P500k, but youre only
appealing the P200k the bond is based on
the P500k. The rule is applied strictly.
The Bond has to be filed together with the appeal and
the memorandum, ALL within the 10 day period. Or
else appeal will be dismissed.
o Does petition to reduce the bond excuse the ER from filing
one?
No. Even with petition for reduction of bond, you still
have to file bond first in substance, and just attach
your petition for reduction of bond together with your
appeal.
Motion to reduce bond also does not toll the running
of the period to appeal.
o Who has no jurisdiction to accept a reduced bond?
SECRETARY OF LABOR: NO JURISDICTION TO
ACCEPT A REDUCED BOND.
Is an MR allowed in the NLRC?
o Yes, MR allowed in NLRC.
What is the next step?
o The next step is to file a special civil action under Rule 65 to
the Court of Appeals, within 60 days. After CA, you can file an
MR.
o Then you can file a Rule 45 appeal to the Supreme Court,
within 15 days, together with the filing fees; you can file motion
for extension for 30 days. Then MR. and MR. and MR.
See notes on termination for reinstatement pending appeal
NLRC
What is the original J of the NLRC?
o 1. Injunction in ordinary labor disputes
o 2. Injunction in strikes or lockouts
See the special requisites when this is allowed in the
strikes part
o 3. Certification case
Certified labor dispute causing/likely to cause
strike/lockout in an industry indispensable to national
interest as certified by the DOLE Secretary
What is the exclusive appellate J of the NLRC?
o 1. All cases decided by the LA, including contempt cases
o 2. Money claims decided by RDs (P5000 and below)
See notes in termination for effects of NLRC reversal of LA decision
allowing reinstatement
Bureau of Labor Relations (BLR)
Independent unions Federations and national unions
Regional Director BLR
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BLR Sec. of Labor
CA CA
SC SC

What is the BLRs jurisdiction?
o 1. Inter-union conflicts (includes registration, cancellation, etc.)
o 2. Intra-union conflicts (includes registration, cancellation, etc.)
o 3. All disputes, grievances, problems from labor-management
relations in workplaces except those falling under the GM and
VA (CBA provisions)
o 4. Complaint re: federations, national unions, industry
unions, their officers/member organizations
Does the BLR have jurisdiction for claim of damages arising from
intra- or inter-union conflicts?
o No, the BLR is not empowered to adjudicate claims for
damages.
When is jurisdiction original?
o If the case involves federations
o Appeal is to DOLE Sec (10 days), and then to CA, and then
SC
When is jurisdiction appellate?
o If the case involves independent unions (original J is with RD)
o Appeal is to BLR, and then to CA, and then SC
What if parties entered into a compromise agreement with the
assistance of BLR or Regional Office of DOLE?
o Binding upon parties
o The NLRC can only interfere when there is non-compliance or
prima facie evidence of fraud/misrepresentation/coercion
o What if the compromise agreement is already done and
then the parties just appear before the BLR or Regional
Office to file it?
NOT valid. Note that the provisions say the
compromise must be assisted by the BLR/Regional
Office.
Can the BLR issue a subpoena?
o Yes, when relevant to the labor dispute
What is the rule on privileged communication?
o Statements or information given in conciliation meetings
cannot be used as evidence in the NLRC. Even the
conciliators cannot be asked to testify on matters taken up in
the conciliation meetings.
National Conciliation and Mediation Board (NCMB)
What is the NCMBs jurisdiction?
o 1. Conciliation
o 2. Mediation
o 3. Voluntary arbitration cases
Recall provisions mentioning the NCMB:
o Failure to come to agreement in CBA negotiations
o For voluntary arbitration, when there is no agreement as to
who are the VAs, the NCMB does it
o Given the notice of strike vote in concerted acts
Regional Directors (RDs)
What is the jurisdiction of RDs?
o 1. Visitorial powers (actually exercised by Labor Secretary, but
usually delegated to RDs)
o 2. Small money claims (P5000 and below)
o 3. Violation of constitution, by-laws, rights and conditions of
members
o 4. Inter-union and intra-union disputes involving independent
unions and chartered locals (see above, BLR)
What are the visitorial powers of the Labor Secretary?
o Power of the Sec of Labor or authorized representative to
visit/check the premises of the employer to check compliance
with the law
o Ocular inspection, interviews, can require to produce
records/documents
What kind of rule should be violated?
o Ruling of Labor Arbiter or law on labor standards or other laws
identified by Congress
What can the Secretary do given those powers?
o Secretary will give compliance orders for the employer to follow
65

Is this retroactive? (i.e. can the compliance order,
say for back wages due to salary less than
minimum wage, retroact to the past months)
Yes.
o What if the employer admits to the adverse findings?
Compliance order must be complied with
and there can be writ of execution
What if the employer contests?
As a general rule the employer need not
explain because its a simple compliance
matter.
As an exception, sometimes, the employer is
given a chance to be heard
In this case, a writ of execution cannot issue
What is required for a contest?
There must be a contest and he must raise
issues that are supported by documentary
proofs not considered during course of
inspection.
o What if there is danger to the life/safety of the employees?
The Secretary of Labor can authorize closure or
stoppage of work
What if there is no danger to life or safety, can
there be closure or stoppage?
No.
What is the safeguard?
Within 24 hours, a hearing must be had to
determine w/n the stoppage must be lifted
Are the workers paid during stoppage?
Yes, if the violation is due to the fault of the
ER.
Why does 218(b) start with notwithstanding?
o Because 129 and 217 seem to be contrary to 218, but this
would have no effect
What if the employer denies the employer-employee relationship?
o Likewise, this is not a proper defense. There can still be
exercise of powers by the Secretary of Labor.
Peoples Broadcasting v. Secretary: Does the Secretary of Labor
have jurisdiction to determine the existence of ER-EE relationship
(when there is none) in the exercise of the visitorial and enforcement
powers under Art. 128?
o No. Art 128s grant of visitorial and enforcement power is for
the purpose of determining violations of and enforcing the
Labor Code and any labor law, wage order, or rules and
regulations. If there is no ER-EE relationship in the first place,
the duty of the ER to adhere to labor standards with respect to
the non-employees is questionable. The Secretarys power
under Art. 128 does not apply in two instances:
A. Where the ER-EE relationship has ceased
B. Where no such relationship ever existed
What is the power described in 129?
o Recovery of wages, simply money claims, and other benefits.
o Who has the right to exercise this power?
Regional director of the DOLE
o Whats the commonality with 128 and difference?
The Regional director can exercise 128 powers (as a
duly authorized officer) and 129 powers, by
provision.
o Differentiate this power from 128.
Here, the employee files a claim against the
employer. In 128, the Labor Secretary/officer acts
motu propio.
What is covered by 129?
o Money claims and benefits only. No reinstatement issues must
be included. It must not exceed P5000.
It must be the main action and not complicated by
other actions, thus simple.
Whats the significance of the amount?
It determines who has jurisdiction. If its
beyond 5000, it goes to the Labor Arbiter.
o Is ULP covered?
No.
o What about non-payment of CBA benefits?
No. Violation of CBA falls under Grievance
Machinery. (Or ULP, if it is a gross violation of
economic provision)
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o What if you have resigned and you still want to claim
unpaid wages accrued during employment? You do not
want reinstatement.
Covered by 129.
So why does 128 say notwithstanding 129?
o See below.
If the regional director receives a report from an employee, asking
for help due to non-payment of wages and benefits, and he, as
authorized, inspected the premises what power was exercised?
o 128 applies. Even if it was prompted by a letter complaint,
what were exercised were the visitorial and inspection powers.
o Even the compliance order will be based not on the letter
complaint, but on the findings.
From the regional office, where do you go? And how much time?
o If 128 go to Sec. of Labor
5 days
o If 129 go to NLRC
5 days
N.B. For labor, its always ten days for exercise of appellate powers.
These are the exceptions
DOLE Secretary
What is the scope of visitorial powers of the DOLE Secretary, as
discussed above?
o 1. Access to ERs records and premises at any time of day or
night when there is work
o 2. Copy records
o 3. Question any EE
o 4. Investigate matters to determine w/n there are violations of
Labor Code
o 5. Issue compliance orders
See discussion above
o 6. Issue writs of execution to appropriate authority for
enforcement of orders
Except when the ER contests findings of the officer
and raises issues supported by documentary proof
not considered during inspection raise this to the
LA
What cannot be done vis--vis the Sec. of Labors powers in 128?
o Cannot be subject of injunction
o Unlawful for any person/entity to obstruct or impede the orders
of the Sec. of Labor issued pursuant to 128
Voluntary arbitrator (VA)
What is the jurisdiction of VAs?
o 1. Grievances from interpretation of CBAs (from GM)
o 2. Arising from interpretation or enforcement of company
personnel policies (from GM)
o 3. Wage distortion issues from application of wage distortion
orders in organized establishments
If unorganized, go to LA
o 4. Arising from interpretation and implementation of
productivity incentive programs in RA 6971
o 5. Any other labor disputes upon agreement of the parties
o 6. Dispute before or during compulsory arbitration proceedings
Can be submitted to VA instead
How is the VAs decision appealed?
o Through Rule 43 to the CA
o And then, to the SC through Rule 65
In sum:
Labor
dispute
128 129 CBA
dispute
(orged)
Indep
unions
Feds,
nationa
l
unions
Cert.
elec.
LA RD (5
days
up)
RD (5
days
up)
GM RD BLR Med-
Arbiter
NLRC Labor
Sec
NLRC VA BLR Labor
Sec
Labor
Sec
CA (65) CA (65) CA (65) CA (43) CA (65) CA (65) CA (65)
SC (45) SC (45) SC (45) SC (65) SC (45) SC (45) SC (45)

Prescription of cases
Case Prescriptive period
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ULP 1 year from the act
Money claims arising from ER-EER 3 years from cause of action
Offenses penalized by the Labor
Code (except ULP)
3 years from cause of action
Illegal dismissal 4 years (based on injury to rights,
under NCC)
Simple illegal recruitment 5 years
Economic sabotage 20 years

Rules in Labor Cases
Rules of Evidence in ROC do not control
o Use reasonable means to ascertain facts
o Without regard to deep technicalities of law
Parties may be represented by legal counsel but the LA, commissioner,
or chairman has complete control of proceedings at all stages
How is jurisdiction acquired?
o 1. Service of summons general rule
o 2. Voluntary appearance
Failure to implead substitute party is not a fatal defect
When are docket fees not required?
o Labor standards claims
When are docket fees shared by the parties?
o Bargaining deadlock