just or authorized cause.

Hence she was illegally

dismissed; Moreover, her term employment contracts
were contracts of adhesion; hence they should be taken
against Hambergis Inc. because of its obvious intent to
use periods to bar her regularization.

KATO KLEIN ANSWERS THE BAR FOR YOU

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

3. Lolong Law Firm (LLF) which employs about 50

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

KATOS ANSWER: Linda is a regular employee. SUs

contention that Linda is a domestic helper is without
basis because the later did not minister to the personal
comfort of the members of any household. Although a
cook, hence listed, she cannot be classified as a
Kasambahay because she rendered services for resident
religious teachers in a university which was not a
household.

KATOS ANSWER: No, because it is a fringe benefit that

has already ripened into demandable right.
Remember: Not A, because the losses suffered did not
appear to be substantial.
Not B, since management prerogative
cannot be the SOURCE of a UNILATERAL BENEFIT at one
point and the very justification of its taking away at
another.

2. Lucy was one of approximately 500 call center

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

Not C since this is not a DIMUNITION OF

BENEFITS which is prohibited by the Labor Code, and
because Article 100 of the Labor Code refers only to
Benefits enjoyed before or at the time of the effectivity
of the Code (Waterfront Ruling 22 Sept. 2010, by Justice
Peralta)
4. Linis Manpower Inc. (LMI) had provided
janitorial services to the Philippines Overseas
Employment Administration (POEA) since
March 2009. Its Service contract was renewed
every three months. However, in the bidding
held in June 2012, LMI was disqualified and
excluded. In 2013, six janitors of the LMI
formerly assigned at POEA filed a complaint for
underpayment of wages. Both LMI and POEA
were impleaded as respondents. Should POEA,
a government agency subject to budgetary
appropriations from Congress be held liable
solidarily with LMI for the payment of Salary

KATOS ANSWER: I will advice Lucy to file a complaint

for constructive dismissal, with prayer for
reinstatement, because her floating status has
exceeded six (6) months.
By virtue of the nature of her job, Lucy attained tenure
on the first day of her employment. As a regular
employee, therefore, she could only be dismissed for a
1

differentials due the complainant? Cite the legal

basis of your answer.

segregated votes. Should Union A be certified

as the bargaining representative?

KATOS ANSWER: YES. The POEA, although a

government agency, is a statutory employer by
operation of Article 106 of the Labor Code, as
implemented by D.0 18-A. As such, it can be held
solidarily liable for salary differentials resulting from its
job contractors underpayment of salaries due its
workers. (Meralco Industrial Engg ruling 14 March
2008)

KATOS ANSWER:
A. Yes, the segregated votes should be counted as
valid votes. Probationary employees are not
among the employees who are ineligible to
vote. Likewise, the pendency of the appeal of
the sic dismissed employees indicates that they
contested their dismissal before a forum of
appropriate jurisdiction; hence they continue to
be employees for purposes of voting in a
certification election (D.0. 40-03)

Comment: Relative to the trilateral relationship

between a principal (P), a contractor (C) and worker
(W), we hardly read that P may be any person- private
or public. The Bar Question tells us that P may be POEA,
SSS, GSIS, or ADB. Article 106, LC, makes no distinction;
hence, any person can be a statutory employer. Indeed
only principals of service providers in IT-assisted
outsourcing, PCAB-registered contractors, and canteen
concessionaires are beyond the reach of D.O. 18-A

B. Yes, the certification election is valid because it

is not a barred election and majority of the
eligible voters cast their votes.
C. No. Union A should not be declared the winner
because it failed to garner majority of the valid
votes. The majority of the 500 votes,
representing valid votes, is 251 votes, Since
Union A received 200 votes only, it did not win
the election.

5. Liwayway Glass has 600 rank and file

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

D. None of the participating unions can represent

the rank and file employees for purposes of
collective bargaining because none of them
enjoys majority representative status.
E. If the 10 votes were segregated on the same
grounds, Union A cannot still be certified as the
bargaining representative because its vote of
250 is still short of the majority vote of 251.
However, if the 10 votes were validly
segregated, majority vote would be 246 votes.
Since Union A received more than majority
vote, then it won the election.

A. Should the votes of the probationary and the

dismissed employees be counted in the total
votes cast for the purpose of determining the
winning labor union?
B. Was there a valid election?
C. Should Union A be declared the winner?
D. Suppose the election is declared invalid, which
of the contending unions should represent the
rank-and-file employees?
E. Suppose that in the election, the unions
obtained the following votes: A-250; B-150. C50; 40 voted no union, and 10 were

6. Lina has been working as a steward with a

Miami; U.S.A based Loyal Cruise Lines for the
past 15 years. She was recruited by a local
manning agency, Macapagal Shipping, and was
made to sign a 10-month employment contract
2

every time she left for Miami. Macapagal

Shipping paid for Linas round trip travel
expenses from Manila to Miami. Because of a
food poisoning incident which happened during
her last cruise assignment, Lina was not rehired. Lina claims that she has been illegally
terminated and seeks separation pay. If you
were the Labor Arbiter handling the case, how
would decide?

Eventually, its members informed the company

of their intention to return to work.
A. Can Lazo Corporation refuse to admit the
strikers?
B. Assuming the company admits the strikers; can
it later on dismiss those employees who
committed illegal acts?
C. If due to prolonged strike, Lazo Corporation
hired replacements, can it refuse to admit the
replaced strikers?

KATOS ANSWER: I will dismiss the complaint for illegal

dismissal. Lina is a seafarer. As such, she is a contractual
employee who cannot require her employer to enter
into another contract of employment with her under
the Principle of Freedom of Contracts. In effect, Lina
cannot be awarded separation pay. As an alternative
relief, separation pay is proper only when there is a
finding of illegal dismissal.

KATOS ANSWER:
A. No. A Strike is a temporary stoppage of work
only. Therefore, strikers can go back to their
work in the event of a voluntary abandonment
of their strike.
B. After admission, the company can hold the
strikers behind the illegalities accountable for
their acts. If found to have committed acts
justifying a dismissal, said employees can be
terminated after due process.
C. No, the positions left behind by strikers are
deemed legally unoccupied. Moreover, the
hiring of replacement workers does not
terminate employer-employee relationship
because a strike is a temporary stoppage of
work only. Finally, replacement workers are
deemed to have accepted their engagement
subject to the outcome of the strike.

7. Non- lawyers can appear before the Labor

Arbiter if
A. They represent themselves
B. They are properly authorized to represent their
legitimate labor organization or member
thereof
C. They are duly accredited members of the legalaid office recognized by the DOJ or the IBO
D. They appear in cases involving an amount of
less than P5,000
KATOS ANSWER: A.

9. Luisa Court is a poplar chain of motels. It

employs over 30 chambermaids who, among
others, help clean and maintain the rooms.
These chambermaids are part of the union
rank-and-file employees which has an existing
collective bargaining agreement (CBA) with the
company. While the CBA was in force, Luisa
Court decided to abolish the position of
chambermaids and outsource the cleaning of
the rooms to Malinis Janitorial Services, a bona
fide independent contractor which has invested
in substantial equipment and sufficient
manpower. The chambermaids filed a case of

Note: Not B, because it restricts the terms

organizations to legitimate labor organizations
Not C, because the DOJ is not an accrediting agency
Not D, because the not exceeding P5000 is a
jurisdictional rule, not a rule on law practices.

8. As a result of a bargaining deadlock between

Lazo Corporation and Lazo Employees Union,
the latter staged a strike. During the strike,
several employees committed illegal acts.
3

illegal dismissal against Luisa Court. In response,

the company argued that the decision to
outsource resulted from the new
managements directive to streamline
operations and save on costs. If you were the
Labor Arbiter assigned to the case, how would
you decide?

However, she was not accorded statutory due

process. Therefore, I will award her nominal
damages of P30000.
11. Lionel, an American citizen whose parents
migrated to the U.S from the Philippines was
hired by JP Morgan in New York, as a call center
specialist. Hearing about the phenomenal
growth of the call center industry in his parents
native land, Lionel sought and was granted a
transfer as a call center manager for JP
Morgans operations in Taguig City. Lionels
employment contract did not specify a period
for his stay in the Philippines. After three years
of working in the Philippines, Lionel was advised
that he was being recalled to New York and
being promoted to the position of director of
international call center operations. However,
because of certain family reasons, Lionel
advised the company of his preference to stay
in the Philippines. He was dismissed by the
company. Lionel now seeks your legal advice
on:
A. Whether he has a cause of action
B. Whether he can file a case in the Philippines
C. What are his chances of winning

KATOS ANSWER: I would declare the

chambermaids to have been illegally dismissed.
The chambermaids are regular employees for
performing the work necessary or desirable to the
main trade of the Luisa Court. As such, they enjoy
security of tenure. The job contracting arrangement
between Luisa Court and Malinis Janitorial Services
is prohibited by D.O. 18-A because it has the effect
of introducing workers to displace Luisa Courts
regular workers.
10. Luisa was hired as a secretary by the Asian
Development bank (ADB) in Manila. Luisas first
boss was a Japanese national whom she got
along with. But after two years, the latter was
replaced by an arrogant Indian National who
did not believe her work output was in
accordance with international standards. One
day, Luisa submitted a draft report filled with
typographical errors to her boss. The latter
scolded her, but Luisa verbally fought back. The
Indian boss decided to terminate her services
right then and there. Luisa filed a case for illegal
dismissal with the Labor Arbiter claiming
arbitrariness and denial of due process. If you
were the Labor Arbiter, how would you decide
the case?

KATOS ANSWERS:
A. Lionel has a cause of action. He has a right to be
secure in his job; his employer has the
correlative obligation to respect that right; his
dismissal constitutes a violation of his tenurial
right; and said violation caused him legal injury
B. Lionel can file an illegal dismissal case in the
Philippines. Being a resident corporation, JP
Morgan is subject to Philippine Labor Laws.
And, although hired abroad, Lionels place of
work is Taguig. Hence, he can lodge his
complaint with the NLRC-NCR which has
territorial jurisdiction over his workplace. (Sec
1, Rule IV, NLRC RULES OF PROCEDURE, AS
AMENDED)

KATOS ANSWER:
I will dismiss the complaint of illegal dismissal.
Luisa committed serious misconduct. Her Indian
boss, regardless of his arrogant nature, had the
clear right to reprimand her for her poor
performance. Absent justification for verbally
fighting back, Luisas act amounted to serious
misconduct. Therefore, her dismissal was valid.
4

C. Lionel has reasonable chances of winning. His

recall to the USA was not a lawful lateral
transfer that he could not refuse. On the
contrary, it was a scalar transfer amounting to a
promotion which he could validly refuse.
Absent willful disobedience, therefore, his
termination is groundless.

B. Does Don Luis need to register Lando with the

SSS?
KATOS ANSWER:
A. There is employer employee relationship
between Don Luis and Lando. Firstly, Lando who
was looking for work finally rendered personal
services for Don Luis. Secondly, Lando could not
have been the master of his time, means and
methods under the circumstances. (SECTION 8,
R.A 8282)
B. Don Luis does not need to register Lando with
the SSS because he is a purely casual employee,
hence outside of SSS coverage (R.A 8282).
Neither should he report Lando for SSS
coverage under the Kasambahay Act, since he is
an occasional, if not sporadic employee.
Therefore, he is not a Kasambahay entitled to
SSS coverage. (R.A. 10361)

12. Which of the following groups does not enjoy

the right to self-organization?
A. Those who work in a non-profit charitable
institution
B. Those who are paid on a piece rate basis
C. Those who work in a corporation with less than
10 employees
D. Those who work as legal secretaries
KATOS ANSWER: D, because legal secretaries are
confidential employees

Note: THIS IS A TRICKY QUESTION. THE EXAMINER

WANTS TO LEAD THE EXAMINEES INTO
CONSIDERING LANDO AS A KASAMBAHAY
BECAUSE HE IS LISTED (GARDENER) AND GIVING
HIM SSS COVERAGE PURSUANT TO R.A. 10361.
HOWEVER, LANDO IS AN OCCASIONAL OR
SPORADIC GARDENER; HENCE HE IS NOT A
KASAMBAHAY.

Not A. because under Article 243 of the Labor Code,

employees of charitable, religious, educational and
medical institutions are covered employees.
Not B, because piece raters do not suffer any
disqualification
Not C, because the less than 10 rule in the Labor
Code affects right to labor standards benefits, in a
particular holiday pay and service incentive leave
(Articles 94 and 95) not right to self-organization.

14. Luisito has been working with Lima Land for 20

years. Wanting to work in the public sector,
Lusito applied with and was offered a job at
Livecor. Before accepting the offer, he wanted
to consult you whether the payments that he
and Lima Land had made to the SSS can be
transferred or credited to the GSIS. What would
you advice?

13. Don Luis, a widower, lived alone in a house with

a large garden. One day, he noticed that the
plants in his garden needed trimming. He
remembered that Lando. A 17 year old out of
school youth, had contacted him in Church the
other day looking for work. He contacted Lando
who immediately attended to Don Luiss garden
and finished the job in three days.
A. Is there an employer-employee relationship
between Don Luis and Lando?

KATOS ANSWER: I would tell Luisito under the

Limited Portability Law, he will carry with him his
creditable service and paid contributions as he
moves from one system to the other. Hence, he
may accept the job offer without fearing that he
would lose his years of service in the public sector in
the event that he would not be able to qualify for
5

benefits due solely to insufficiency of creditable

service.

employment of all the rank and file employees of

EGE. Consequently, EGE filed a petition for
certification election before the Bureau of Labor
Relations (BLR)

15. Our Lady of Peace Catholic Teachers and

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

During the proceedings, EGE insisted that it should

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

OLPCS-TELU subsequently filed a petition for

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

Is the contention of EGE proper? Explain.

KATOS ANSWER: EGE could file the petition for
certification because it was requested to collectively
bargain and it could not do so because SEGE was
not the EBR. After it filed the petition, however, it
reverted to its standby status. Therefore, it could
not interfere with the selection process which was
the exclusive prerogative of its workers. It could
only participate in the inclusion-exclusion
proceedings and nowhere else.

May OLPCS-TELU be considered a legitimate labor

organization?
KATOS ANSWER:
Yes, OLPCS-TELU is a legitimate labor organization.
Its mixed membership which included supervisors
and rank and filers does not affect its legitimacy.
The only effect of such membership is that the
supervisors in the persons of vice-principals and
department heads are deemed automatically
removed (R.A. 9481)

17. Philhealth is a government owned and

controlled corporation employing thousands of
Filipinos. Because of the desire of the
employees of Philhealth to obtain better terms
and conditions of employment from the
government, they formed the Philhealth
Employees Association (PEA) and demanded
Philhealth to enter into negotiations with PEA
regarding terms and conditions of employment
which are not fixed by law
A. Are the employees of Philhealth allowed to selforganize and form PEA and thereafter demand
Philhealth to enter into negotiations with PEA
for better terms and conditions of
employment?
B. In case of unresolved grievances, can PEA resort
to strikes, walkouts, and other temporary work
stoppages to pressure the government to
accede to their demands?

Comment:
ANOTHER TRICKY QUESTION. THE BODY OF THE
PROBLEM LEADS ONE TO APPROPRIATENESS OF A
CBU. HENCE, HE MIGHT APPLY THE SUBSTANTIAL
MUTUALITY OF INTEREST PRINCIPLE BASED ON HIS
OBSERVATION THAT THE EMPLOYEES PERFORM
SEPARATE BUT INTERDEPENDENT TASKS.
ACTUALLY, THE QUESTION IS LEGITIMACY OF
STATUS ONLY. SO THE FACT TO TACKLE IS MIXED
MEMBERSHIP.
16. SEGE is a labor organization composed of the
rank and file employees of EGE, the leading
manufacturer of gloves and aprons
EGE was later requested by SEGE to bargain
collectively for better terms and conditions of
6

cooling off period, strike vote and strike ban. It is in

the notice that ULP and deadlock in CB are included.

KATOS ANSWER:
A. Under E.O. 180, Philhealth employees can
organize. Thru their organization, they can
negotiate with Philhealth over terms and
conditions not fixed by its charter, Civil Service
Law, or applicable salary standardization law.
B. No. Although the right to organize implies the
right to strike, law may withhold said right. E.O.
180 is that law which withholds from
government employees the right to strike.
Hence, they cannot resort to strikers and similar
concerted activities to compel concessions from
the government.

19. Lincoln was in the business of trading broadcast

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

18. The procedural requirements of a valid strike

include:
A. a claim of either unfair labor practice or
deadlock in collective bargaining
B. notice of strike filed at least 15 days before a
ULP-grounded strike or at least 30 days prior to
the deadlock in a bargaining-grounded strike
C. majority of the union membership must have
voted to stage the striker with notice thereon
furnished to the National Conciliation and
Mediation Board (NCMB) at least 24 hours
before the strike vote is taken
D. strike vote results must be furnished to the
NCMB at least 7 days before the intended strike

IF you were the Labor Arbiter assigned to the case,

how would you rule on the companys motion to
dismiss?

KATOS ANSWER:
A.
EXPLANATION: Options B, C, and D refer to strike
procedures. B refers to the cooling-off period; C
to the strike vote; and D to the strike ban. What is
not expressly referred to in the options is the notice
of strike. It is this procedural requirement which
includes ULP or bargaining deadlock which are the
only valid strike grounds. Hence it is correct to say
that the procedural requirements of a valid striker
include A CLAIM FOR ULP OR DEADLOCK IN
COLLECTIVE BARGAINING (A). In other words, the
procedural requirements of a valid strike are notice,

KATOS ANSWER: I will deny the motion to dismiss

Lionel is not a corporate officer but a corporate
employee only because a. his office is not a creation
of the Corporation Code, b. it is not shown that his
office is a corporate position under Libertys Articles
of Incorporation; and c. it is not shown that there is
a board resolution investing his position with the
status of a corporate office

Absent corporate controversy, the Office, the Office

of the Labor Arbiter has jurisdiction to hear and
resolve Lionels complaint for illegal dismissal.

recall its old employees instead of replacing them

with new employees.
Withholding of work beyond six (6) months
amounts to constructive dismissal. Hence, I will
order JKL to pay the complainants full back wages,
separation pay because their positions are occupied
already, nominal damages for non observance by
JKL of prescribed pre-termination procedure, moral
and exemplary damages for its bad faith. (Lynvil
Fishing Enterprises, Inc., et. Al. G.R. No. 181974, 1
February 2012) and 10 percent attorneys fees for
compelling its employees to litigate against it. (Art
111, L.C)

20. Lito was anticipating the bonus he would

receive for 2013. Aside from ht 13th month pay,
the company has been awarding him and his
other co-employees a two to three months
bonus for the last 10 years. However, because
of poor over-all sales performance for the year,
the company unilaterally decided to pay only a
one month bonus in 2013. Is Litos employer
legally allowed to reduce the bonus?
KATOS ANSWER:

22. Despite a reinstatement order, an employer

may choose not to reinstate and employee if
A. there is a strained employer-employee
relationship
B. the position of the employee no longer exists
C. the employers business has been closed
D. the employee does not wish to be reinstated

Yes.
Bonuses enjoyed even for 10 years may be reduced
for economic reasons. Article 100 of the Labor Code
will not be violated because it only applies to
benefits enjoyed before or at the time of the
effectivity of the Labor Code (Waterfront ruling) As
to whether the Principle of Grants will be violated,
the reduction will not also amount to a violation
because benefits given to workers are not raw
materials but the product of business success. This
policy of balancing employer-employee interest is
one of the pillars of labor relations (Prof. Azucena)

KATOS ANSWER:
A.
NOTE:
Not B, because the stem implies that the employer
has a choice between reinstatement and non
reinstatement. Here, He has no option at all
because the position in question no longer exists.

21. An accidental fire gutted the JKL factory in

Caloocan. JKL decided to suspend operations
and requested its employees to stop reporting
for work. After six (6) months, JKL resumed
operations but hired a new set of employees.
The old set of employees filed a case for illegal
dismissal. IF you were the Labor Arbiter, how
would decide the case?

Not C because the employer has no option due to

the closure of his business
Not D because the employer cannot choose not to
reinstate die to his employees decision not to be
reinstated.

KATOS ANSWER:

Comment:

I will decide in favor of the employees. The fire has

not resulted in complete destruction of employeremployee relationship. Said relationship has
temporarily ceased only. When JKL resumed
operations, therefore it became its obligation to

This MCQ demonstrates the importance of

recognizing the implications of the stem. Since the
stem implies that the employer can choose one of
two options, none of the items that give him just
one choice can be the correct answer.
8

23. Luningning Foods engaged the services of

Lamitan Manpower a bona fide independent
contractor, to provide tasters that will check
on food quality. Subsequently, these tasters
joined the union of rank and file employees of
Luningning and demanded that they be made
regular employees of the latter as they are
performing functions necessary and desirable to
operate the companys business. Luningning
rejected the demand for regularization. On
behalf of the tasters, the union then filed a
notice of strike with the DOLE. In response,
Luningning sought a restraining order from the
RTC arguing that the DOLE does not have
jurisdiction over the case since it does not have
an employer-employee relationship with the
employees of an independent contractor.
Decide as if you were the RTC judge.

KATOS ANSWER:
As to the first ground, crime to be a just cause for
dismissal must be against the employer, members
of his immediate family or representative (Article
288 L.C as renumbered) Since the potential crime of
Lans is not against Lobinsons or its duly authorized
representatives, it cannot of itself justify his
termination.
As to the second ground, Lans dysfunctional
conduct has made the work environment at
Lobinsons hostile as to adversely affect other
employees, like Lee. Therefore, he can be dismissed
on the ground of serious misconduct and loss of
trust and confidence.

Comment:

KATOS ANSWER:

There are two separate grounds for dismissal. One

is a just cause, the other is not. To the question
Can Lans be legally terminated on these
grounds?One should not give an answer that treats
the two as though they were one and the same.
This is because based on the crafting of previous
questions; it should be obvious that the examiner
has a clinical mind.

I will not issue a TRO

The dispute brought to the RTC is a labor dispute
despite the fact that the disputants may not stand
in the proximate relation of employer and
employee (Article 212 of the Labor Code).
Moreover, the issue of regularization is resolvable
solely thru the application of labor laws. Under both
Reasonable Casual Connection Rule and Reference
to Labor Law Rule, the dispute is for labor tribunals
to resolve.

25. Lizzy Lu is a sales associate for Luna Properties.

The latter is looking to retrench Lizzy and five
other sales associates due to financial losses.
Aside from a basic monthly salary, Lizzy and her
colleagues receive commissions on the sales
they make as well as cost of living and
representation allowance. In computing Lizzys
separation pay, Luna Properties should consider
her:
A. monthly salary only
B. monthly salary plus sales commissions
C. MS plus SC plus Cost of Living allowance
D. MS plus SC plus COLA and representation
allowance

24. Lans was a strict and unpopular Vice President

for Sales of Lobinsons Land. One day Lans
shouted invectives against Lee, a poor
performing sales associate, calling him among
others a brown monkey. Hurt, Lee decided to
file a criminal complaint for grave defamation
against Lans. The prosecutor found probable
cause and filed an information in court.
Lobinsons decided to terminate Lans for
committing a potential crime and other illegal
acts prejudicial to the business. Can Lans be
legally terminated by the company on these
grounds?
9

complied with pre-strike procedure. As a

consequence, Liwanag Corporation may declare all
the strikers as having lost their employment as a
consequence of their intransigence (Sarmiento vs.
Tuico 27 June 1988)

KATOS ANSWER:
A
Note:
Not B because the basis of separation pay under
Art. 289 (renumbered) LC. is monthly salary only

B. The union may file a complaint for illegal

lockout with prayer for immediate
reinstatement. The refusal of Liwanag
Corporation to admit the strikers back is an
illegal lockout because it is not preceded by
compliance with prescribed pre-lockout
procedure. If the lockout is unreasonably
prolonged, the complaint may be amended to
charge constructive dismissal.

Not C because monthly salary means basis salary

which excluded commissions and allowances
Not D because monthly salary excludes
commissions and allowances
26. Liwanag Corporation is engaged in the power
generation business. A stalemate was reached
during the collective bargaining negotiations
between its management and the union. After
following all the requisites provided by law, the
union decided to stage a strike. The
management sought the assistance of the
Secretary of Labor and Employment, who
assumed jurisdiction over the strike and issued
a return to work order. The union defied the
latter and continued the strike. Without
providing any notice. Liwanag Corporation
declared everyone who participated in the
strike as having lost their employment.
A. Was Liwanag Corporations action valid?
B. If, before the DOLE Secretary assumed
jurisdiction, the striking union members
communicated in writing their desire to work,
which offer Liwanag Corporation refused to
accept, what remedy, if any does the union
have?

27. The jurisdiction of the NLRC does not include

A. Exclusive appellate jurisdiction over all cases
decided by the Labor Arbiter
B. Exclusive appellate jurisdiction over all cases
decided by Regional Directors or hearing
officers involving the recovery of wages and
other monetary claims and benefits arising from
employer-employee relations where the
aggregate money claim of each does not exceed
P5000
C. Original Jurisdiction to act as a compulsory
arbitration body over labor disputes certified to
it by the Regional Directors
D. Power to issue a labor injunction
C. REGIONAL DIRECTORS DO NOT HAVE ASSUMPTION
POWER; HENCE THEY CANNOT CERTIFY CASES TO
THE NLRC

Comment: the examiner shows contempt for the

human eye.

KATOS ANSWER:
A. Yes, the action of Liwanag Corporation is valid
The DOLE Secretary can assume jurisdiction in the
event of a labor dispute likely to result in a strike in
an industry involving national interest, like energy
production. (Art.263 (g); D.O. 40-H-13). His AJO,
once duly served on the union, will produce an
injunctive effect. Hence, if ignored, the unions
strike would be illegal even if it may have been
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