----------------------- Page 1----------------------PRE-WEEK NOTES

ON THE 2013 BAR EXAMINATION IN LABOR LAW

By: Prof. Joselito Guianan
Chan
(These Notes, consisting of 8 parts, are supplementary to the authors
book entitled 2012 Bar Reviewer on Labor Law)
====================================================
====
PART THREE
LABOR STANDARDS
A. HOURS OF WORK.
1. Coverage. - All employees in all establishments, whether operated for
profit or not, are covered by the law on labor standards.
2. Excluded employees. - The following are excluded from the coverage of
the law on labor standards:
a. Government employees;
b. Managerial employees;
c. Other officers or members of a managerial staff;
d. Domestic servants and persons in the personal service of anothe
r;
e. Workers paid by results;
f. Non-agricultural field personnel; and
g. Members of the family of the employer.
3. Normal hours of work. - The total number of working hours of a worker
or employee shall not exceed eight (8) hours daily.
This eight (8) hour period is called the normal hours of work.
4. Overtime work; Overtime pay. - Any work in excess of eight (8) hours i
s considered overtime work. Overtime rate: 25% for overtime work on ordinary days; 30% - for overtime work on rest da
y.
5. Compressed work week - It is an alternative arrangement whereby the no
rmal workweek is reduced to less than six (6) days
but the total number of
shall remain at forty-eight (48)
thus

normal
hours.

work hours
The normal

per week
workday is

increased to more than eight (8) hours without corresponding overtime

premium. This concept can be adjusted accordingly in
cases where the normal workweek of the firm is five (5) days.
6. Meal break - Every employer is required to give his employees, regardl
ess of sex, not less than one (1) hour (or 60 minutes)
time-off for regular meals. Being time-off,
mpensable hours worked. In this case, the employee
do

it
is

is not co
free to

anything he wants, except to work. If he is required, however, to work

while eating, he should be compensated therefor.
7. Waiting time. Waiting time spent by an employee shall be considered as
working time if waiting is an integral part of his
work or the employee is required or engaged by the employer to wait.
8. Night work. SINCE THIS IS PROVIDED UNDER A NEW LAW, R.A. NO. 10151[1]
[JUNE 21, 2011], WE ARE
QUOTING THE ENTIRE CHAPTER INSERTED BY IT INTO THE LABOR CODE:
----------------------- Page 2----------------------Chapter V
Employment of Night Work
ers
Article 154.
Coverage. - This chapter shall apply to all persons,
who shall be employed or permitted or suffered to
work at
ishing,

night, except those employed in agriculture, stock

maritime transport and inland navigation,

raising, f

during a period of not less than seven (7) consecutive hours, including the inte
rval from midnight to five oclock in the
morning, to be determined by the Secretary of Labor and Employment, after consul
ting the workers representatives/labor
organizations and employers.
Night worker means any employed person whose work requires performance
of a substantial number of hours
of
be

night
fixed

work which exceeds a

by the Secretary

specified limit.
of Labor after

This limit shall

consulting the

workers representatives/labor organizations and employers.

Article 155.
Health Assessment, - At their request, workers shall
have the right to undergo a health assessment
without charge and to receive advice on how to reduce or avoid health problems a
ssociated with their work:

(a) Before taking up an assignment as a night worker;

(b) At regular intervals during such an assignment; and
(c) If they experience health problems during such an assignment whi
ch are not caused by factors other than the
performance of night work.
ight

With the exception

the findings of

work,

of a finding of unfitness for

such assessments shall not be

transmitted to others without the workers consent and shall not be used to their
detriment.
Article 156. Mandatory Facilities. - Suitable first-aid
be made available for workers performing

faci

lities shall

night work,
essary, can

including arrangements
be taken immediately

where such workers,

to a place for

where

nec

appropriate treatment. The employers are likewise required to provide safe and h
ealthful working conditions and adequate
or reasonable facilities such as sleeping or resting quarters in the establishme
nt andtransportation from the work premises
to the nearest point of their residence subject to exceptions and guidelines to
be provided by the DOLE.
Article 157. Transfer. - Night workers who are certified as unfit fo
r night work, due to health reasons, shall be
transferred, whenever practicable, to a similar job for which they are fit to wo
rk.
If such transfer to a similar job is not practicable, these
workers shall be granted the same benefits as other
workers who are unable to work, or to secure employment during such period.
A night worker certified as temporarily unfit for night work shall b
e given the sameprotection against dismissal
or notice of dismissal as other workers who are prevented from working for reaso
ns of health.
to

ensure

Article 158. WomenNight Workers. Measures

that an alternative to night work is

shall

be

taken

available to women workers who would otherwise be called upon to perform such wo
rk:
(a) Before and after childbirth, for a period of at least sixteen (1
6) weeks, which shall be divided between the
time before and after childbirth;
(b) For additional periods, in
certificate is produced stating that

respect of which
said additional

a medical

periods are necessary for the health of the mother or child:

(1) During pregnancy;
(2) During a specified time beyond the period, after childbirt
h is fixed pursuant to subparagraph (a) above,
the

DOLE

the length of which shall be determined

consulting the labor organizations and

after

by

employers.
During the periods referred to in this article:
----------------------- Page 3----------------------given

(i) A
woman
worker
shall not be dismissed
dismissal, except for just
or authorised

or

notice of

e not connected

with

causes provided
for in this Code
that
pregnancy,
childbirth and childcare

ar

responsibilities.
(ii) A woman worker shall not lose the benefits rega
rding her status, seniority, and access to promotion which
may attach to her regular night work position.
Pregnant women and nursing mothers may he allowed to work
at night only if a competent physician, other than
the company physician, shall certify their fitness to render night wo
rk, and specify, in the ease of pregnant employees, the
period of the pregnancy that they can safely work.
The measures referred to in this article may include trans
fer to day work where this is possible, the provision of
social security benefits or an extension of maternity leave.
The provisions of this article shall not have the
effect of reducing the protection and benefits connected with
maternity leave under existing laws.
Article 159. Compensation. The compensation for night worke
rs in the form of working time, pay or similar
benefits shall recognize the exceptional nature of night work.
rvices

shall

be

Article 160. Social

provided for night

Services.Appropriate social
workers and, where

se

necessary, for workers performing night work.

Article 161. Night Work Schedules. Before introducing work
schedules requiring the services of night workers,

the employer shall consult the workers representatives/labor organizat

ions concerned on the details of such schedules and
the forms of organization of night work that are best adapted to the
establishment and its personnel, as well as on the
ch

are

occupational
required.

health
measures
establishments

In

and
social services whi
employing
night

workers, consultation shall take place regularly.[2]

9. Night Shift Differential. - Every employee shall be paid a night shif
t differential of not less than ten percent (10%) of his
regular wage for each hour of work performed between ten oclock in the
evening and six oclock in the morning.
10. Part-time work. - On the issue of whether the employer should give th
e part-time employees concerned only fifty percent
(50%) of the wages and other benefits that the employer may pay the w
orkers who will work for four (4) hours a day, 6:00 to
10:00 in the evening, the compensation in proportion to the time they
actually rendered work or equivalent to only four (4)
hours a day must be given to part-time workers. This is, however, wit
hout prejudice to any individual or collective agreement
or company practice or policy that provides higher basis of computati
on of wages.
11. Contract for piece work (see Civil Code). Since the syllabus prescrib
es the definition to be in accordance with the Civil
Code, Article 1467 provides:
ART. 1467. A contract for the delivery at a certain price o
f an article which the vendor in the ordinary
course of his business manufactures or procures for the general marke
t, whether the same is on hand at the time or
not, is a contract of sale, but if the goods are to be manufactured s
pecially for the customer and upon his special
order, and not for the general market, it is a contract for a piece o
f work.
B. WAGES.
1.
erize

Wage
vs. Salary. - The
term wage is
the compensation
paid for manual
skilled

used
to charact
or unskilled

labor.Salary, on the other hand, is used to describe the compensation f

or higher or superior level of employment. In cases
of execution, attachment or garnishment of the compensation of an emp
loyee received from work issued by the court to

tinction
is

satisfy
should

a
be

judicially-determined
made
whether

obligation,
a
compensation

dis

such

----------------------- Page 4----------------------considered wageor salary.Under Article 1708 of the Civil Code, if considered
a wage,the employees compensation
shall not be subject to execution or attachment or garnishment, except for
debts incurred for food, shelter, clothing and medical
attendance. If deemed a salary,such compensation is not exempt from executi
on or attachment or garnishment. Thus, the
salary, commission and other remuneration received by a managerial employe
e (as distinguished from an ordinary worker or
laborer) cannot be considered wages. Salary is understood to
relate to a position or office, or the compensation given f
or
official or other service; while wage is the compensation for labor.
2.
Minimum wage, defined. It refers simply to the lowest basic wage rate fixe
d by law that an employer can pay his workers.
3.

Minimum wage setting. - With the advent of Republic Act No. 6727,
wage fixing and determination are no longer done

through Congress but through the various Regional Tripartite Wages and Pro
ductivity Boards (RTWPBs) constituted in every
region of the country, including autonomous regions as may be created by l
aw.
4.
Minimum
rkers
paid

by

wage
of workers
results, including

paid
those

by
who

results. - All wo
are paid on

piecework,takay,pakyaw or task basis, shall receive not less than the pres
cribed wage rates per eight (8) hours of work a day,
or a proportion thereof for working less than eight (8) hours.
5.
Minimum wage of apprentices and learners. It shall in no case be less than
seventy-five percent (75%) of the applicable
statutory minimum wage rates.
6.
Minimum wage of persons with disability (PWDs). It shall NOT be 75% but th
e full amount of the applicable minimum
wage rates.
7.
Commissions. - Commission is the recompense, compensation or reward of an
employee, agent, salesman, executor, trustee,
receiver, factor, broker or bailee, when the same is calculated as a perce
ntage on the amount of his transactions or on the profit

of the principal. Commission earned may or may not be considered part of a

wage or salary depending on the peculiar
he
es

circumstances of a case and on the

determination is being made. There is

purpose for which t

no law which requir

employers to pay commissions.[3]Once commission is granted,

is no law which prescribes amethod for computing

"there

commissions. The determination of the amount of commissions is the result

of collective bargaining negotiations, individual
employment contracts or established employer practice."[4]
8.

Deductions from wages. Permissible deductions may be divided into two:

a.

consent
the

Deductions allowed under Article 113.

(1) In
the

by

cases where the worker is

employer, and the deduction

insured
is to

with his
recompense

employer for the amount paid by him as premium on the insuranc

e;
(2)For union dues, in cases where the right of the worker or his un
ion to check-off has been recognized by the employer
or authorized in writing by the individual worker concerned; a
nd
(3) In cases where the employer is authorized by law or regulations
issued by the DOLE Secretary.
b.

Deductions allowed under other provisions of the Labor Code and other

laws.
1. Deductions for loss or damage under Article 114 of the Labor Cod
e;
2. Deductions made for agency fee from non-union members who accept
the benefits under the CBA negotiated by the
recognized or certified bargaining union. This form of deductio
n does not require the written authorization of the nonunion member concerned;
3. Union service fee;
----------------------- Page 5----------------------tion

of

4. When the
the employee

deductions are with the written

for payment to a third person

authoriza
and the

employer agrees to do so, provided that the latter does not rec
eive any pecuniary benefit, directly or indirectly, from

the transaction;
5. Deductions for value of meal and other facilities;
6. Deductions for premiums for SSS, PhilHealth, employees compensati
on and Pag-IBIG;
7. Withholding tax mandated under the National Internal Revenue Cod
e (NIRC);
8. Withholding of wages because of the employees debt to the employe
r which is already due;
9. Deductions made pursuant to a court judgment against the worker
under circumstances where the wages may be the
subject of attachment or execution but only for debts incurred
for food, clothing, shelter and medical attendance;
10. When deductions from wages are ordered by the court;
11. Salary deductions of a member of a legally established cooperat
ive.
9.

Non-diminution
of
D. Brion,
currently

benefits. According
to Justice Arturo
the Chairman
of the 2013
Bar

Examination Committee, Article 100 is not the proper basis

invocation of the non-diminution/non-elimination of

for

the
the

benefits
principle in his separate
concurring
opinion
in
case of Arco Metal
Products,
Inc. v. Samahang
ng mga
Manggagawa sa Arco Metal-NAFLU (SAMARM-NAFLU), [G.R.
May 14, 2008]. He emphasized therein that

No.

170734

Article 100 refers solely to the non-diminution of benefits enjoyed at the

time of the promulgation of the Labor Code. He thus
posited that the correct bases of this principle are the following:
a.

Express terms of an employment agreement;

b. Company practice which refers to the implied terms of an em

ployment agreement which the employer has freely,
voluntarily and consistently extended to its employees and
thus cannot be withdrawn except by mutual consent or
agreement of the contracting parties;
c. The Constitution (Section 18 of Article II and Section 3 of
Article XIII); and
d.

Article 4 of the Labor Code.

10. Facilities vs. Supplements. The term facilitiesincludes articles or service

s for the benefit of the employee or his family

but does not include tools of the trade or articles or services primarily
for the benefit of the employer or necessary to the
conduct of the employers business. They are items of expense nece
ssary for the laborers and his familys existence and
subsistence which form part of the wage and when furnished by the employer
, are deductible therefrom, since if they are not so
furnished, the laborer would spend and pay for them just the same.
l

privileges

The term supplementsmeans extra remuneration

or benefits given to or received by the

or

specia

laborers over and above their ordinary earnings or wages.

Facilities
rivilege given

and supplements, distinguished. - The

to the employee which constitutes an

benefit
extra

or

remuneration over and above his basic or ordinary earning or wage, is supp
lement; and when said benefit or privilege is part of
the laborers basic wage, it is afacility .As earlier pointed out, the crite
rion is not so much with the kind of the benefit or item
(food, lodging, bonus or sick leave) given but its purpose.Thus, free meal
s supplied by the ship operator to crew members, out
of necessity, cannot be considered as facilities but supplements which cou
ld not be reduced having been given not as part of
wages but as a necessary matter in the maintenance of the health and effic
iency of the crew personnel during the voyage.
Moreover, facilities are deductible from wage but not supplements.
11. Wage distortion. - As defined by law and implementing rules, wage distorti
oncontemplates a situation where an increase
in prescribed wage rates results in either of the following:
----------------------- Page 6----------------------1.Elimination of the quantitative differences in the rates of w
ages or salaries; or
2. Severe contraction of intentional quantitative differences i
n wage or salary rates between and among employee groups
in an establishment as to effectively obliterate the distin
ctions embodied in such wage structure based on the following
criteria:
a. skills;
b. length ofservice;or
c. other logical bases of differentiation.

4 elements of wage distortion. - The four (4) elements of wage

distortion are as follows:
(1) An existing hierarchy of positions with corresponding s
alary rates;
(2) A significant change in the salary rate of a lower pay
class without a concomitant increase in the salary rate of a
higher one;
(3) The elimination of the distinction between the two leve
ls; and
(4) The existence of the distortion in the same region of t
he country.
Formula to rectify wage distortion. In the case of Metropolitan
Bank and Trust Company Employees Union-ALU-TUCP
v. NLRC, [G.R. No. 102636, September 10, 1993], the Supreme Cou
rt has given its imprimatur to the following formula
for the correction of wage distortion in the pay scale structur
es:
Minimum Wage = % x Prescribed Increase = Disto
rtion Adjustment
Actual Salary
The above formula was held to be just and equitable.
12. Rectification of wage distortion. Wage distortion may be rectified as
follows:
1. In organized establishments. - The employer and the union sh
ould negotiate to correct the distortions. Any dispute
arising from wage distortions should be resolved through the
grievance procedure under their CBA and, if it remains
unresolved, through voluntary arbitration.
workers

2. In unorganized establishments. - The employers

should endeavour to correct such distortions. Any

and

dispute arising therefrom should be settled through the NCM

B and, if it remains unresolved after ten (10) days of
conciliation, should be referred to any of the Labor Arbite
rs of the appropriate branch of the NLRC.
13. Divisor to Determine Daily Rate. Given a fixed monthly rate, the d
aily rate is determined through the following formula:
Monthly Rate x 12
No. of Days Considered = Equivalent Daily Rate
(EDR)

Paid in a Year
Choice of factors/divisors is a prerogative of the employer.
- There is no law which requires employers to use specific
factors in the computation of employees benefits and wage deductions due to absen
ces. The choice of factors/divisors is a prerogative of
the employer, the exercise of which should not be contrary to law, public policy
or order. What wage legislations specifically require is
that the employees be paid on all their actual working days and on the twelve (1
2) regular holidays even if unworked. The principles
of no work, no payand equal pay for equal workare also generally accepted. It like
wise follows that an employer may deduct a
proportionate amount from the employees wages on account of their unworked hours/
days.
----------------------- Page 7----------------------C. REST PERIODS.
1.

Weekly
employees

his
24)

rest day. - Every employer is required to give

a rest period of not less than twenty-four (

consecutive hours
days. Where the

l work
es

after every
weekly rest

six (6) consecutive norma

is given to all employe

simultaneously, the employer should make known such rest period by me

ans of a written notice posted conspicuously in the
workplace
at least one (1) week
before it becomes
e
ffective. Where
the rest period is not granted to all employees
simultaneously and collectively, the employer shall make known to the
employees their respective schedules of weekly rest day
through written notices posted conspicuously in the workplace at leas
t one (1) week before they become effective.
Employees preference of rest day based on religious grounds. - The
employer is duty-bound to respect the preference
of the employee if based on religious grounds.
2. Emergency rest day work. The general rule is that no employee shall b
e required against his will to work on his scheduled
ticle

92

rest
of

day except under the circumstances

the Labor Code where work on

provided under
such day may

Ar
be

compelled. An employer may, however, require any of his employees to

work on his scheduled rest day for the duration of the

following emergency and exceptional conditions:

a. In case of actual or impending emergencies caused by serious a
ccident, fire, flood, typhoon, earthquake, epidemic
or other disaster or calamity, to prevent loss of life and pr
operty, or in case offorce majeure or imminent danger to
public safety;
b. In case of urgent work to be performed on machineries, equipme
nt, or installations, to avoid serious loss which the
employer would otherwise suffer;
c. In the event of abnormal pressure of work due to special circu
mstances, where the employer cannot ordinarily be
expected to resort to other measures;
d. To prevent serious loss of perishable goods;
e. Where the nature of the work is such that the employees have t
o work continuously for seven (7) days in a week or
more, as in the case of the crew members of a vessel to compl
ete a voyage and in other similar cases; and
f. When the work is necessary to avail of favorable weather or en
vironmental conditions where performance or quality
of work is dependent thereon.
D. HOLIDAY PAY/PREMIUM PAY.
a. Regular holiday. - Holiday pay refers to the payment of compensati
on to an employee during regular holidays as follows:
1. For unworked regular holiday 100% of an employees regular dail
y wage; and
2. For worked regular holiday 200% thereof.
b. Special holiday. - The rule for special holiday is as follows:
1. For unworked special holiday No Work, No Pay applies; and
2. For worked special holiday Additional compensation of 30% of
the daily rate on top of the basic pay or a total of one
hundred thirty per cent (130%).
c. Premium pay refers to the additional compensation required by law
to be paid for work performed within the regular eight
(8) hours on non-working days, such as rest days, regular and spe
cial holidays.
d. Coverage; exceptions. - Generally, all employees are entitled to c
overed by Article 94 of the Labor Code, as amended, and

its implementing rules, except:

----------------------- Page 8----------------------1. Those of the government and any of the political subdivisions
, including government-owned and controlled corporations;
2. Those of retail and service establishments regularly employing
less than ten (10) workers;
3. Domestic helpers;
4. Persons in the personal service of another;
5. Managerial employees as defined in Book III of the Labor Code
;
6. Field personnel and other employees whose time and performanc
e is unsupervised by the employer;
7. Those who are engaged on task or contract basis or purely comm
ission basis;
8. Those who are paid a fixed amount for performing work irrespe
ctive of the time consumed in the performance thereof;
9. Other officers and members of the managerial staff;
10. Members of the family of the employer who are dependent on h
im for support.
E. LEAVES.
1. Service incentive leave. - Every covered employee who has rendered at
least one (1) year of service is entitled to a yearly
service incentive leave of five (5) days with pay. The term at least
one year of serviceshould mean service within twelve
m

the

(12) months, whether continuous or broken, reckoned fro

date the employee started working, including authorized

absences and paid regular holidays, unless the number of working days
in the establishment as a matter of practice or policy,
or that provided in the employment contract, is less than twelve (12)
months, in which case, said period should be considered as
one (1) year for the purpose of determining entitlement to the servic
e incentive leave benefit.
2. Maternity leave. - It is the period of time which may be availed of b
y a woman employee, married or unmarried, to undergo
and recuperate from childbirth, miscarriage or complete abortion duri
ng which she is permitted to retain her rights and benefits
flowing from her employment. A female member who has paid at least th
ree (3) monthly contributions in the 12-month period

immediately preceding the semester of her childbirth or miscarriage s

hall be paid a daily maternity benefit equivalent to one
hundred percent (100%) of her average daily salary credit for:
(a) 60 days for normal delivery; or
(b) 78 days in case of caesarean delivery.
3. Paternity leave.[5] It covers a married male employee allowing him no
t to report for work for seven (7) calendar days but
continues to earn the compensation therefor, on the condition that hi
s spouse has delivered a child or suffered miscarriage for
purposes of enabling him to effectively lend support to his wife in h
er period of recovery and/or in the nursing of the newlyborn child.
4. Parental leave.[6] It is the leave benefit of not be
than seven (7) working days every year granted to a male

more
or

female solo parent to enable him/her to perform parental duties and r

esponsibilities where physical presence is required.
The term "solo parent"refers to any individual who falls under an
y of the following categories:
(1) A woman who gives birth as a result of rape and other crime
s against chastity even without a final conviction of the
offender: Provided, That the mother keeps and raises the
child;
(2) Parent left solo or alone with the responsibility of parent
hood due to death of spouse;
(3) Parent left solo or alone with the responsibility of parent
hood while the spouse is detained or is serving sentence for a
criminal conviction for at least one (1) year;
(4) Parent left solo or alone with the responsibility of parent
hood due to physical and/or mental incapacity of spouse as
certified by a public medical practitioner;
----------------------- Page 9----------------------bility of
ion from

(5) Parent left solo

parenthood due to legal

or alone
separation

with the responsi

or de facto separat

spouse for at least one (1) year, as long as he/she is

entrusted with the custody of the children;
(6) Parent left solo or alone with the responsibility of pare

nthood due to declaration of nullity or annulment of marriage as

decreed by a court or by a church as long as he/she is
entrusted with the custody of the children;
(7) Parent left solo or alone with the responsibility of pare
nthood due to abandonment of spouse for at least one (1) year;
(8) Unmarried mother/father who has preferred to keep and rea
r her/his child/children instead of having others care for
them or give them up to a welfare institution;
(9) Any other person who solely provides parental care and su
pport to a child or children;
lity
nt,

of

(10) Any family member who assumes the responsibi

of family as a result of the death, abandonme

head

disappearance or prolonged absence of the parents or so

lo parent.
5.
Leave for victims of violence against women and children.[7] - A vi
ctim is entitled to a total of ten (10) days of paid leave
of absence, in addition to other paid leaves under the Labor Code a
nd Civil Service Rules and Regulations. It is extendible
when the necessity arises as specified in the protection order. Thi
s is afforded to the woman employee to enable her to attend to
the medical and legal concerns relative to said law. This leave is
not convertible to cash.
6.
Special leave benefit for women. This is granted under R
.A. No. 9710 [August 14, 2009]. A woman employee having
rendered continuous aggregate employment service of at least six (6
) months for the last twelve (12) months shall be entitled to
a special leave benefit of two (2) months with full pay based on he
r gross monthly compensation following surgery caused by
gynaecological disorders.
F. SERVICE CHARGES.
The rules on service charges apply only to establishments
collecting service charges, such as hotels, restaurants, lodging
houses, night clubs, cocktail lounges, massage clinics, bars, casinos and gambli
ng houses, and similar enterprises, including those
entities operating primarily as private subsidiaries of the government. All empl
oyees of covered employers, regardless of their positions,
designations or employment status, and irrespective of the method by which their
wages are paid.

1.
Percentage of sharing. - All service charges collected by covered e
mployers are required to be distributed at the following
rates:
a. 85% to be distributed equally among the covered employees; a
nd
b. 15% to management to answer for losses and breakages and dis
tribution to employees receiving more than P2,000.00 a
month, at the discretion of the management.
2.
Frequency of distribution. - The share of the employees referred to
above should be distributed and paid to them not less
often than once every two (2) weeks or twice a month at intervals n
ot exceeding sixteen (16) days.
TH
G. 13

MONTH PAY.

Under the law, all rank-and-file employees

Managerial employees are not entitled thereto. However,

are entitled.
there is

th
nothing in the law which prohibits the grant of 13 month pay to managerial empl
oyees.
a. Exclusions/Exemptions from coverage. - The following employers a
re not covered by P.D. No. 851, as amended:
1. The government and any of its political subdivisions, inclu
ding government-owned and controlled corporations, except
those corporations operating essentially as private subsid
iaries of the government.
----------------------- Page 10----------------------2. Employers already paying their employees 13th-month pay or
more in a calendar year or its equivalent at the time of the
issuance of the Revised Guidelines.
3. Employers of household helpers and persons in the personal
service of another in relation to such workers.
4. Employers of those who are paid on purely commission, bound
ary, or task basis, and those who are paid a fixed amount
for performing a specific work, irrespective of the time
consumed in the performance thereof, except where the workers
are paid on piece-rate basis, in which case, the employer
shall be covered by the Revised Guidelines insofar as such
workers are concerned. Workers paid on piece-rate basis s
hall refer to those who are paid a standard amount for every

piece or unit of work produced that is more or less regula

rly replicated without regard to the time spent in producing the
same.
th
b. Amount of 13 month pay - Should not be less than one-twelfth (1
/12) of the total basic salary earned by an employee
within a calendar year. It is based on wage but not part of th
e wage.
th
c. Minimum period of service. To be entitled to 13 month pay, the e
mployee should have served at least 1 month in the
calendar year.
H. SEPARATION PAY.
Separation pay under the law and jurisprudence:
1. Separation pay in lieu of reinstatement (in case reinstatement i
s not possible or feasible);
labor-saving
losing

2. When termination is due to (a) installation of

devices, (b) redundancy, (c) retrenchment, or (d) c
or cessation of business operations under Article 283;

3. When termination is due to the disease of an employee and his co

ntinued employment is prejudicial to himself or his coemployees under Article 284;
mes

called

4. When resignation pay

financial assistance )

or
is

separation pay
required under

(or someti
a unilaterally

promulgated voluntary policy or practice of the employer or un

der an agreement such as a CBA;
5. When employment is deemed terminated after the lapse of six (6)
months in cases involving bona-fide suspension of the
operation of business or undertaking under Article 286;
I. RETIREMENT PAY.
1.

Eligibility. - Retirement applies to:

a. All employees in the private sector, regardless of their po

sition, designation or status and irrespective of the method by
which their wages are paid;
b. Part-time employees;

c. Employees of service and other job contractors;

d. Domestic workers or persons in the personal service of anot
her;
e. Underground mine workers;
f. Employees of government-owned and/or controlled corporation
s organized under the Corporation Code (without original
charters).
2.
age 65

Retirement age. - Optional retirement age 60; Compulsory retirement

3.
Amount. Should be equivalent to one-half () month salary for every y
ear of service, a fraction of at least six (6) months
being considered as one (1) whole year. One-half () month salary means
22.5 days comprised of the following:
(a) 15 days salary of the employee based on his latest salary
rate; PLUS
----------------------- Page 11----------------------(b) The cash equivalent of five (5) days of service incentive l
eave; PLUS
th
(c) One-twelfth (1/12) of the 13 month pay due the employee (o
r 2.5 days); PLUS
(d) All other benefits that the employer and employee may agree
upon that should be included in the computation of the
employees retirement pay.
4.
Retirement benefits of workers paid by results. The 15 days shall be
their average daily salary (ADS) for the last 12
months reckoned from the date of their retirement, divided by the nu
mber of actual working days in that particular period.
5.
Retirement benefits of part-time workers. Entitled to 1/2 month salar
y for every year of service, computed at least in
proportion to the salary and related benefits due them.
6.
Taxability. Retirement benefits are exempted from attachment, levy,
execution or any tax whatsoever. To be exempted from
withholding tax, the taxpayer should prove the following: (1) a reas
onable private benefit plan is maintained by the employer;
(2) the retiring official or employee has been in the service of the
same employer for at least ten [10] years; (3) the retiring
official or employee is not less than fifty [50] years of age at the
time of his retirement; and (4) the benefit has been availed of

only once.
J. WOMEN WORKERS.
1.

Acts of discrimination under the Labor Code. -

(a)Payment of a lesser compensation, including wage, salary or

other form of remuneration and fringe benefits, to a female
employee as against a male employee, for work of equal va
lue; and
ee

with

(b) Favoring a male employee over a female employ

respect to promotion, training opportunities, study and
scholarship grants solely on account of their sexes.

2.
Discrimination against women as defined under the Magna Carta of Women
[R.A. No. 9710 approved on August 14,
2009]. It refers to any of the following circumstances:
(a) Any gender-based distinction, exclusion, or restriction whi
ch has the effect or purpose of impairing or nullifying the
recognition, enjoyment, or exercise by women, irrespectiv
e of their marital status, on a basis of equality of men and
women, of human rights and fundamental freedoms in the po
litical, economic, social, cultural, civil, or any other field.
(b) Any act or omission, including by law, policy, administrati
ve measure, or practice, that directly or indirectly excludes or
restricts women in the recognition and promotion of their
rights and their access to and enjoyment of opportunities,
benefits, or privileges.
(c) A measure or practice of general application is discriminat
ion against women if it fails to provide for mechanisms to
offset or address sex or gender-based disadvantages or li
mitations of women, as a result of which women are denied or
of their rights
portunities,

restricted in
and in their

the recognition
access to and

and protection
enjoyment of op

benefits, or privileges; or women, more than men,

are shown to have suffered the greater adverse effects of those
measures or practices.
(d) Discrimination compounded by or intersecting with other gro
unds, status, or condition, such as ethnicity, age, poverty,
or religion.

3.
Stipulation
the employer to
of

against
require

marriage. It is an unlawful act o

as a condition for or continuation

employment that a woman employee shall not get married or to stipula

te expressly or tacitly that upon getting married, a
to

woman employee shall be deemed resigned or separated or

dismiss or discriminate or otherwise prejudice a woman
employee merely by reason of her marriage.

----------------------- Page 12----------------------4.

Prohibited acts. In addition to the stipulation against marriage (see
above), the following are prohibited:
a. To discharge any woman employed by him for the purpose of prev
enting such woman from enjoying maternity leave,
facilities and other benefits provided under the Labor Code;
b. To discharge such woman on account of her pregnancy, or while
on leave or in confinement due to her pregnancy;
c. To discharge or refuse the admission of such woman upon return
ing to her work for fear that she may again be pregnant;
d. To discharge any woman or any other employee for having filed
a complaint or having testified or being about to testify
under the Labor Code.
5.
exual

Anti-Sexual Harassment Act (R.A. No. 7877), - Penalizes

harassment only in three (3) situations, namely: (1)

employment (work-related); (2) education (education-related); and (3)

training (training-related).
In a work-related or employment environment, sexual harassment is
committed when:
a. The sexual favor is made a condition in the hiring or in the e
mployment, re-employment or continued employment of
said individual or in granting said individual favorable comp
ensation, terms, conditions, promotions, or privileges; or
the refusal to grant the sexual favor results in limiting, se
gregating or classifying the employee which in any way would
discriminate, deprive or diminish employment opportunities or
otherwise adversely affect said employee;
b. The above acts would impair the employees rights or privileges
under existing labor laws; or
c. The above acts would result in an intimidating, hostile, or of
fensive environment for the employee.

K. EMPLOYMENT OF MINORS (Labor Code and R.A. No. 7678, R.A. No. 9231).
1. Child, meaning. - For legal purposes, the term child refers to any pers
on less than eighteen (18) years of age.
2.
Working child, meaning. - A working child refers to any child engaged a
s follows:
i. when the child is below eighteen (18) years of age, in work or
economic activity that is not child labor;and
ii. when the child below fifteen (15) years of age:
responsibility
only

(a) in work where he/she is

of his/her parents or legal

directly
guardian

under the
and where

members of the childs family are employed; or

(b) in public entertainment or information which refers to arti
stic, literary, and cultural performances for television
show, radio program, cinema or film, theatre, commercia
l advertisement, public relations activities or campaigns,
print materials, internet, and other media.
3.
Prohibition of employing minors in certain undertakings and in certai
n advertisements. - No child below eighteen (18)
years of age is allowed to be employed as a model in any advertisemen
t directly or indirectly promoting alcoholic beverages,
intoxicating drinks, tobacco and its by-products, gambling or any for
m of violence or pornography.
L. EMPLOYMENT OF HOUSEHELPERS (NOW KNOWN AS DOMESTIC WORKERS OR KASAMBAHAY)[8]
1.
known

Prevailing
applicable
as Domestic
Workers

law. R.A.
No. 10361, otherwise
Act or Batas
Kasambahay

approved on January 18, 2013.

2.
Domestic worker or Kasambahay - refers to any person engaged in domestic
work within an employment relationship
such as, but not limited to, the following: general househelp, nursem
aid or yaya, cook, gardener, or laundry person, but
shall exclude any person who performs domestic work only occasionally
or sporadically and not on an occupational basis. This
term shall not include children who are under foster family arrangeme
nt, and are provided access to education and given an
allowance incidental to education, i.e., baon, transportation, school p
rojects and school activities.
----------------------- Page 13-----------------------

3.
Household - refers to the immediate members of the family or the occupants o
f the house that are directly provided services
by the domestic worker.
4.
Employer - refers to any person who engages and controls the services of a d
omestic worker and is party to the employment
contract.
5.

Important principles under R.A. No. 10361.

Standard of treatment - just and humane manner and in no case sh

all the former inflict physical violence upon the
kasambahay.

h such

Free board, lodging and medical attendance.

Privacy to all forms of communication and personal effects.

modern

Right to have access to the outside world throug

modes, equipment and devices as the internet,
cellphones, etc.

Right to education and training (without any age limitation of 1

8 years as provided previously).

Prohibition on disclosure by kasambahay of all privileged and co

nfidential communication or information pertaining
to employer.

There should be a written contract of employment between employe

r and kasambahay.

No more cap on duration of contract.

Kasambahay cannot acquire regularity of employment.

Employment of kasambahay is fixed-term in nature.

The kasambahay cannot be required to make deposits from which lo

ss or damage to tools, materials, furniture and
equipment may be deducted.

The kasambahay cannot be placed under debt bondage meaning the ren
dering of service by the domestic worker
as security or payment for a debt where the length and nature
of service is not clearly defined or when the value of the
service is not reasonably applied in the payment of the debt.

Children whose age is below 15 years are now absolutely prohibit

ed to work as kasambahay.

The employer is now required to report and register the kasambah

ay working for him/her in the Barangay where the

former resides.

Daily rest period - Aggregate daily rest period shall be 8 hours

Weekly rest period - At least 24 consecutive hours of rest in a

per day.
week.

It is prohibited to assign the kasambahay to non-household work

in a commercial, industrial or agricultural enterprise
on the basis of the wage rates for domestic workers.

Minimum wage on a monthly basis. Should not be less than:

(a) P2,500.00 a month for those employed in the National Capit

al Region (NCR);
(b) P2,000.00 a month for those employed in chartered cities a
nd first class municipalities; and
(c) P1,500.00 a month for those employed in other municipaliti
es.

All kasambahay are entitled to:

th
(a) 13 month pay.
(b) 5-day service incentive leave after 1 year of service.

rage

who

(c) SSS,
PhilHealth
and
have
rendered
at least
1

Pag-IBIG
month

cove
of

service. (NOTE: Premium payments or contributions shall be

shouldered by the employer. However, if the domestic
worker is receiving a wage of P5,000.00 and above per month
, the domestic worker shall pay the proportionate share
in the premium payments or contributions, as provided by la
w).
(d) The kasambahay shall be entitled to all other benefits
under existing laws.
----------------------- Page 14----------------------

Rules on termination of employment:

(1) If employment contract is fixed, it cannot be terminated before its ex

piration.
(i) If terminated by kasambahay without just
forfeits unpaid salary due not exceeding the
equivalent

15

days

work.

The

employer

cause,
may

he/she

recover

th

e deployment

expenses provided that

the

service

has

been terminated within 6 months from the domestic workers employment.

(ii)If terminated by employer without just cause, the domestic worker sh
all be paid the compensation already
earned plus the equivalent of 15 days work by way of indemnity.
(iii)The kasambahay and the employer may mutually agree upon written not
ice to pre-terminate the contract of
employment to end the employment relationship.
(2) If employment contract is not fixed, the employer
kasambahay may give notice to end the working

or

the

relationship 5 days before the intended termination of the service.

(3) Grounds to terminate employment contract by the kasambahay. - The domes
tic worker may terminate the
employment relationship at any time before the expiration of the contract
for any of the following causes:
a) Verbal or emotional abuse of the domestic worker by the employe
r or any member of the household;
b) Inhuman treatment including physical abuse of the domestic work
er by the employer or any member of the
household;
estic

c)
worker

Commission of a
by the employer

crime or offense against the

or any member of the

dom

household;
d) Violation by the employer of the terms and conditions of the em
ployment contract and other standards set
forth under this law;
e) Any disease prejudicial to the health of the domestic worker, t
he employer, or member/s of the household;
and
f)

Other causes analogous to the foregoing.

(NOTE: The grounds are a combination of both just and authorized causes).
(4) Grounds to terminate employment contract by the employer. -An employer ma
y terminate the services of the
domestic worker at any time before the expiration of the contract, for an
y of the following causes:

worker

(a) Misconduct or willful disobedience by the

of the lawful order of the employer in

domestic

connection with the formers work;

(b) Gross or habitual neglect or inefficiency by the domestic worker
in the performance of duties;
(c) Fraud or willful breach of the trust reposed by the employer on
the domestic worker;
worker

(d) Commission of a crime or offense by the

against the person of the employer or any

domestic

immediate member of the employers family;

(e) Violation
conditions of the

by the domestic worker of the

employment contract and other

terms

an

standards set forth under this law;

(f) Any disease prejudicial to the health of the domestic worker, th
e employer, or member/s of the household;
and
(g) Other causes analogous to the foregoing.
(NOTE: The grounds are a combination of both just and authorized causes).

Employment Certification. - It is the duty of the employer to issue

a certificate of employment to the domestic
worker within 5 days from the time it is requested.

----------------------- Page 15----------------------M. EMPLOYMENT OF HOMEWORKERS.

1.

Industrial homeworker is a worker who is engaged in industrial homework

.
2. Industrial homework is a system of production
work for an employer or contractor is carried out

under which
by a

homeworker at his/her home. Materials may or may not be furnished by

the employer or contractor. It differs from regular
factory production principally in that, it is a decentralized form of
production where there is ordinarily very little supervision or
regulation of methods of work.
3. Home means any nook, house, apartment or other premises used regularly,
in whole or in part, as a dwelling place, except
those situated within the premises or compound of an employer, contra
ctor/subcontractor and the work performed therein is

under the active or personal supervision by or for the latter.

4. Payment for homework. - Immediately upon receipt of the finished good
s or articles, the employer is required to pay the
homeworker
or the contractor
or subcontractor,
as th
case may
be, for the work
performed
less the corresponding

homeworkers share of SSS, PhilHealth

ontributions which should be remitted by the
rs

subcontractor or employer
share. However, where payment

to
is

the SSS
made to

and ECC premium

contractor or
with the employe
a contractor or

subcontractor, the homeworker should likewise be paid immediately aft

er the goods or articles have been collected from the
workers.
5. Prohibitions on certain kinds of homework. - No homework shall be per
formed on the following: (1) Explosives, fireworks
and articles of like character; (2) Drugs and poisons; and (3) Other
articles, the processing of which requires exposure to toxic
substances.
N. APPRENTICES AND LEARNERS.
Distinctions. - The following are the distinctions between apprentices and learn
ers:
1. Practical training. Both learnership and apprenticeship involve pract
ical training on-the-job.
2. Training
agreement. Learnership
is governed
by a
learnership
agreement;
while apprenticeship
is governed
by
an
apprenticeship agreement.
3. Occupation. Learnership involves learnable occupations consisting of
semi-skilled and other industrial occupationswhich are
nticeable
or

non-apprenticeable;
occupations or

while apprenticeship
concerns appre
any trade, form
of employment

occupation approved for apprenticeship by the DOLE Secretary.

not
e

4.
be

Theoretical
supplemented

instructions. Learnership
by related theoretical

may
or may
instructions;
whil

apprenticeship should always be supplemented by related theoretical i

nstructions.
5. Ratio of theoretical instructions and on-the-job training . For
both learnership and apprenticeship, the normal ratio is one

ry two
ing.

hundred (100) hours of theoretical instructions for eve

thousand (2,000) hours of practical or on-the-job train

Theoretical instruction time for occupations requiring less than two

thousand (2,000) hours for proficiency should be computed
on the basis of such ratio.
6. Competency-based system. Unlike in apprenticeship, it is required in
learnership that it be implemented based on the TESDAapproved competency-based system.
7. Duration of training. Learnership involves practical training on the
job for a period not exceeding three (3) months; while
apprenticeship requires for proficiency, more than three (3) months b
ut not over six (6) months of practical training on the
job.
8. Qualifications. The law does not expressly mention any
qualifications for learners; while the following qualifications ar
e
required to be met by apprentices under Article 59 of the Labor Code:
----------------------- Page 16----------------------(a) Be at least fourteen (14) years of age;
(b)Possess vocational aptitude and capacity for appropriate tests
; and
(c) Possess the ability to comprehend and follow oral and written
instructions.
9.
Circumstances justifying hiring of trainees. Unlike in apprenticeship
, in learnership, the law, Article 74 of the Labor Code,
expressly prescribes the pre-requisites before learners may be validl
y employed, to wit:
a. When no experienced workers are available;
b. The employment of learners is necessary to prevent curtailment
of employment opportunities; and
c. The employment does not create unfair competition in terms of
labor costs or impair or lower working standards.
10. Limitation on the number of trainees . In learnership, a participatin
g enterprise is allowed to take in learners only up to a
maximum of 20% of its total regular workforce. No similar cap is impo
sed in the case of apprenticeship.
11. Option to employ. In learnership, the enterprise is obliged to hire t

he learner after the lapse of the learnership period; while in

apprenticeship, the enterprise is given only an option to hire the appr
entice as an employee.
12. Wage rate. The wage rate of a learner or an apprentice is set at 75%
of the statutory minimum wage.
O. PERSONS WITH DISABILITY [PWDs] (R.A. No. 7277, as amended by R.A. No. 9442).
1.

Definitions of important terms. -

a. Persons with Disability are those suffering from restriction or

different abilities, as a result of a mental, physical or
the

manner

sensory impairment, to perform

within the range considered

or

an activity
normal for a

in
hum

an
being. [NOTE: It is not correct to refer to them as Disabled P
ersons].
b. Impairment refers to any loss, diminution or aberration of psyc
hological, physiological, or anatomical structure or
function.
c. Disability means (1) a physical or mental impairment that substa
ntially limits one or more psychological, physiological
or anatomical functions of an individual or activities of suc
h individual; (2) a record of such an impairment; or (3) being
regarded as having such an impairment.
d. Handicap refers to a disadvantage for a given individual, resul
ting from an impairment or a disability that limits or
prevents the function or activity that is considered normal g
iven the age and sex of the individual.
e. Reasonable Accommodations include: (1) improvement of existing
facilities used by employees in order to render
these readily accessible to and usable by persons with disabi
lity; and (2) modification of work schedules, reassignment
to a vacant position, acquisition or modification of equipmen
t or devices, appropriate adjustments or modifications of
examinations, training materials or company policies, rules a
nd regulations, the provision of auxiliary aids and services,
and other similar accommodations for persons with disability.
f. Marginalized Disabled Persons or more appropriately, Marginalized
Persons with Disability refer to persons with
disability who lack access to rehabilitative services and opp

ortunities to be able to participate fully in socio-economic

activities and who have no means of livelihood and whose inco
mes fall below the poverty threshold.
ividual

g. Qualified Individual with a Disability means

a disability who, with or without reasonable

with

an

ind

accommodations, can perform the essential functions of the em

ployment position that such individual holds or desires.
However, consideration shall be given to the employers judgmen
t as to what functions of a job are essential, and if an
employer has prepared a written description before advertisin
g or interviewing applicants for the job, this description
shall be considered evidence of the essential functions of th
e job.
h. Covered Entity means an employer, employment agency, labor organ
ization or joint-labor management committee.
2.

Rights of persons with disability.

----------------------- Page 17----------------------a. Equal opportunity for employment.

b. Wage rate. - 100% of the applicable minimum wage.
c. Sheltered employment for persons with disability. - Sheltered Employ
ment refers to the provision of productive
work
providing

s
r

for persons
with
disability through
workshop
special facilities, income-producing
projects o

homework schemes with a view to giving them the opportunity to ear

n a living thus enabling them to acquire a working
capacity required in open industry.
d. Vocational rehabilitation. - The State shall take approp
vocational rehabilitation measures that shall serve to

riate

disability

develop the skills and potentials of persons with

and enable them to compete favorably for available
productive and remunerative employment opportunities in the labor

market.
mplement

e. Vocational guidance and counselling. - The DSWD

measures providing and evaluating vocational

shall

guidance and counselling to enable persons with disability to secu

re, retain and advance in employment. It shall ensure
the availability and training of counsellors and other suitably qu
alified staff responsible for the vocational guidance and

counselling of persons with disability.

f. Persons with disability are eligible for apprenticeship and learner
ship.
3.

Prohibition on discrimination against PWDs.

4.
Discrimination on employment prohibited. - No entity, whether public or pr
ivate, shall discriminate against a qualified
person with disability by reason of disability in regard to job applicatio
n procedures, the hiring, promotion, or discharge of
employees, employee compensation, job training, and other terms, condition
s and privileges of employment. The following
constitute acts of discrimination:
(1) Limiting, segregating or classifying a job applicant with disabili
ty in such a manner that adversely affects his work
opportunities;
(2) Using qualification standards, employment tests or other selection
criteria that screen out or tend to screen out a person
with disability unless such standards, tests or other selection
criteria are shown to be job-related for the position in
question and are consistent with business necessity;
(4) Utilizing standards, criteria, or methods of administration that:
(a) have the effect of discrimination on the basis of disability
; or
(b) perpetuate the discrimination of others who are subject to c
ommon administrative control.
(5) Providing less compensation, such as salary, wage or other forms o
f remuneration and fringe benefits, to a qualified
employee with disability, by reason of his disability, than the
amount to which a non-disabled person performing the
same work is entitled;
ployee

(6) Favoring a
with disability

non-disabled employee over a qualified

with respect to promotion, training

em

opportunities, study and scholarship grants, solely on account o

f the latters disability;
bility
his

(7) Re-assigning
to a job or
disability;

or transferring an
position he cannot

employee with a disa

perform by reason of

(8) Dismissing or terminating the services of an employee with disabil

ity by reason of his disability unless the employer can
of
y;

the

prove that he impairs the satisfactory performance

involved to the prejudice of the business entit

work

provided, however, that the employer first sought to provide rea

sonable accommodations for persons with disability;
(9) Failing to select or administer in the most effective manner emplo
yment tests which accurately reflect the skills, aptitude
or other factor of the applicant or employee with disability tha
t such tests purports to measure, rather than the impaired
sensory, manual or speaking skills of such applicant or employee
, if any; and
(10) Excluding persons with disability from membership in labor unions
or similar organizations.
----------------------- Page 18----------------------5. Incentives for employers who employ persons with disability. - Private enti
ties that employ persons with disability who
lar

meet
the required
skills or qualifications, either
as a regu
employee,
apprentice
or learner, shall
be entitled to

anadditional deduction from their gross income equivalent to twenty-five p

ercent (25%) of the total amount paid as
salaries and wages to persons with disability; provided, however, that suc
h entities could present proof as certified by the
lity

Department of Labor and Employment that persons with disabi

are under their employ and provided further that the

employee with disability is accredited with the Department of Labor and Em

ployment and the Department of Health as to his
disability, skills and qualifications.[9]
ties

Private entities that improve or modify their physical

in order to provide reasonable accommodation for

facili

persons with disability shall also be entitled to an additional deduction f

rom their net taxable income equivalent tofifty
percent (50%) of the direct costs of the improvements or modifications.
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