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2016 LABOR LAW BAR REVIEW NOTES FOR PHILIPPINE ASSOCIATION OF LAW SCHOOLS (PALS)

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E. SPECIFIC ISSUES ON LABOR STANDARDS

1. WAGES; SOME GOVERNING RULES:

FAIR AND REASONABLE VALUE shall not include any profit to the employer, or to any person affiliated with the employer.

“NO WORK NO PAY” PRINCIPLE. -- If there is no work performed by the employee,
“NO WORK NO PAY” PRINCIPLE. -- If there is no work performed by the
employee, there can be no wage or pay unless the laborer was able, willing, and
ready to work but was prevented by management or was illegally locked out,
suspended or dismissed. But where the failure of employees to work was not due to
the employer’s fault, the burden of economic loss suffered by the employers should
not be shifted to the employer. Each party must bear his own loss.
EQUAL PAY FOR EQUAL WORK. -- Employees who work with substantially equal
qualifications, skill, effort and responsibility, under similar conditions should be paid
similar salaries (International School Alliance of Educators vs. Quisumbing, GR
No.128845, June 1, 2000).
CIVIL CODE PROVISIONS:
Art. 1705. The laborer’s wages shall be paid in legal currency.
Art. 1706. Withholding of the wages, except for a debt due, shall not be made by the
employer.
Art. 1707. The laborer’s wages shall be a lien
work done.
on the goods manufactured or the
Art. 1708. The laborer’s wages shall not be subject to execution or attachment
except for debts incurred for food, shelter, clothing, and medical attendance.
Art. 1709. The employer shall neither seize nor retain any tool or other articles
belonging to the laborer.
1.1 WAGE AND WAGE-RELATED BENEFITS
Minimum wages must always be complied with.
Wage Order No. NCR-20 eff. 02 June 2016
SECTOR/
BASIC
COLA
NEW BASIC
NEW COLA
NEW
INDUSTRY
WAGE
INTEGRATI
WAGE
MINIMUM
ON
WAGE
RATES
Non-agricultural (Incl
hospitals with 100
bed capacity or less)
P466.00
P15.00
P481.00
P10.00
P491.00
Agriculture
(plantation and non-
plantation
429.00
15.00
444.00
10.00
454.00
Retail/Service
establishmts
employing 15
persons or less
429.00
15.00
444.00
10.00
454.00
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2016 LABOR LAW BAR REVIEW NOTES FOR PHILIPPINE ASSOCIATION OF LAW SCHOOLS (PALS)

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Manufacturing establishments regularly employing less than 10 workers

429.00

15.00

444.00

10.00

454.00

EXCLUSIONS:

Kasambahay

Persons in the personal service of another, including family drivers

Workers registered in Barangay Micro-Business Enterprises (BMBE) with Certificates of Authority per R.A. 9178

Hours of work: Hours of worked shall include: (a) all time during which an employee is required to be on duty or to be at the prescribed workplace, and (b) all time during which an employee is suffered or permitted to work. The normal working hours shall be no more than eight (8) hours a day. Meal and rest period: meal break of less than one (1) hour and short rest periods shall be considered compensable working time

Premium pay for work within 8 hours on a: 1. Special or rest day: plus
Premium pay for work within 8 hours on a:
1. Special or rest day: plus 30% of basic daily rate (BDR)
2. Rest day falling on a special day: plus 50% of BDR
3. Rest day falling on a regular holiday: plus 30% of 200% of BDR
Overtime pay for work in excess of 8 hours on:
1.
Ordinary days: plus 25% of the basic hourly rate
2.
Service incentive leave: 5 days with pay per year of service
.
1.2 GENERAL RULE: WAGE DEDUCTIONS ARE NOT ALLOWED

Holiday pay. -- The employee is entitled to the payment of his regular daily basic wage (100%) during said holidays, even if the worker did not report for work on said days; PROVIDED THAT HE WAS PRESENT OR WAS ON LEAVE OF ABSENCE WITH PAY ON THE WORK DAY IMMEDIATELY PRECEDING THE HOLIDAY. If the employee was suffered to work during the said holidays, they will be entitled to payment of holiday premium of 200% of his basic wage (100% of basic wage PLUS 100%).

Special days, rest days and holidays: plus 30% of the regular hourly rate on said days

Nightshift differential pay: plus 10% of the basic/regular rate for work between 10PM 6AM

Service charges: 85% for distribution to rank-and-file employees; 15% for losses, breakages, or distribution to managerial employees (applicable only in establishments collecting service charges)

EXCEPTIONS:

in establishments collecting service charges) EXCEPTIONS : ALLOWABLE DEDUCTIONS WITHOUT EMPLOYEE ’ S CONSENT : a.

ALLOWABLE DEDUCTIONS WITHOUT EMPLOYEES CONSENT:

a. SSS, Philhealth and PAG-IBIG contributions;

b. Withholding taxes on income

c. Where the employer is authorized by law or regulations issued by the Secretary of Labor;

d. Agency fees, where the employee who is not a member of the exclusive bargaining agent but a member of the appropriate bargaining unit, may be assessed a reasonable fee for benefits received under a CBA.

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ALLOWABLE DEDUCTIONS WITH THE EMPLOYEE’S CONSENT:

a. Reasonable value of meals and other facilities;

b. Payment of union dues, which may or may not be under an automatic charging-off arrangement

c. Debt payments to the employer or third persons with employee’s explicit written consent

d. Worker’s insurance acquired by the employer with employee’s consent;

2015 CASE: Emer Milan, et al. vs. NLRC, et al., G.R. No. 202961, February 04, 2015. -- An employer can withhold terminal pay and benefits pending the employees’ return of its properties. An employer is allowed to withhold terminal pay and benefits pending the employees’ return of its properties. The return of the property’s possession became an obligation or liability on the part of the employees when the employer-employee relationship ceased. The NLRC has jurisdiction to determine, preliminarily, the parties’ right over a property, when it is necessary to determine an issue related to rights or claims arising from an employer-employee relationship.

1.3 NON-DIMINUTION OF BENEFITS, EXPLAINED: Art. 100, Labor Code. Prohibition against elimination or diminution of
1.3 NON-DIMINUTION OF BENEFITS, EXPLAINED:
Art. 100, Labor Code. Prohibition against elimination or diminution
of benefits. — Nothing in this Book shall be construed to eliminate or
in any way diminish supplements, or other employee benefits being
enjoyed at the time of promulgation of this Code.
General Rule: No diminution of salary or benefits
Exceptions:
(a) When employee consents to the deduction
Exception to the exception:
If the error is left uncorrected for a reasonable period of time, it ripens into a
company policy and employees can demand for it as a matter of right.
As to length of time required to ripen into a corporate policy:

(b) To correct an error (TSPIC vs. Tspic Employees Union, G.R. No. 163419, Feb2008; [VELASCO CASE]

Requisites for voluntary employer practice such that the same cannot be unilaterally withdrawn anymore: (a) It should have been practiced over a long period of time; and (b) It must be shown to have been consistent and deliberate.

(Sevilla Trading Company vs. Semana, 428 SCRA 239 [2004], citing Globe Mackay Cable and Radio Corp. vs. NLRC, 163 SCRA 71 [1988].

The Supreme Court has not laid down any specific rule requiring a specific minimum number of years. Rather, the test of long practice has been enunciated thus: where the company agreed to continue giving a benefit knowing fully well that said employees are not covered by the law requiring payment of said.

(Oceanic Pharmacal Employees Union (FFW) vs. Inciong, 94 SCRA 270 [1979]).

Employees Union (FFW) vs. Inciong, 94 SCRA 270 [1979]). Hence, the Supreme Court has ruled in

Hence, the Supreme Court has ruled in specific cases as follows:

a. Davao Fruits Corporation vs. Associated Labor Unions (225 SCRA 562 [1993]): six (6) years.

b. Davao Integrated Port Stevedoring Services vs. Abarquez (220 SCRA 197 [1983]): three (3) years and nine (9) months

c. Sevilla Trading Company vs. Semana, (428 SCRA 239 [2004]: two (2) years.

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Elements for diminution of benefits:

(1) the grant or benefit is founded on a policy or has ripened into a practice over a long period of time; (2) the practice is consistent and deliberate; (3) the practice is not due to error in the construction or application of a doubtful or difficult question of law; and (4) the diminution or discontinuance is done unilaterally by the employer. Vergara

vs. Coca Cola Bottlers, G.R. No. 176985, 01 April 2013

Question:

company practice?

When can a policy be considered to have ripened into a regular

Answer: The employee must prove by substantial evidence that the giving of the benefit is
Answer:
The employee must prove by substantial evidence that the giving of the
benefit is done over a long period of time, and that it has been made consistently
and deliberately. Jurisprudence has not laid down any hard-and-fast rule as to
the length of time that company practice should have been exercised in order to
constitute voluntary employer practice. The common denominator in previously
decided cases appears to be the regularity and deliberateness of the grant of
benefits over a significant period of time. It requires an indubitable showing that
the employer agreed to continue giving the benefit knowing well that the
employees are not covered by any provision of the law or agreement requiring
payment thereof. In sum, the benefit must be characterized by regularity,
voluntary and deliberate intent of the employer to grant the benefit over a
considerable period of time.
2.
THIRTEENTH MONTH PAY
2.1
How much: 1/12th of the basic salary of an employee within a calendar
year.
2.2
COVERAGE
All employers are required to pay all their rank-and-file employees a 13th month
pay not later than December 24 of every year.
Such employees are entitled to the benefit regardless of their designation or
employment status and irrespective of the method by which their wages are paid,
provided that they have worked for at least 1 month during a calendar year;
2.3
EXCLUSIONS or EXEMPTIONS FROM COVERAGE
1.
Government and any of its political subdivisions, including GOCCs with original
charters. (If GOCC without original charter, then considered part of private
sector)
original charter, then considered part of private sector) 2. Employers already paying their employees 13 t

2. Employers already paying their employees 13 th month pay or more in a calendar year or its equivalent at the time of issuance of PD 851;

“Its equivalent” includes Christmas bonus, mid-year bonus, cash bonuses and other payments amounting to not less than 1/12 of the basic salary but shall not include cash and stock dividends, COLA and all other allowances regularly enjoyed by the employees as well as non-monetary benefits.

3. Employers of household helpers and persons in the personal service of another in relation to such workers;

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2016 LABOR LAW BAR REVIEW NOTES FOR PHILIPPINE ASSOCIATION OF LAW SCHOOLS (PALS)

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4. Distressed employers:

a. currently incurring substantial losses or

b. in the case of non-profit institutions and organizations, where their income, whether from donations, contributions, grants and other earnings from any source, has consistently declined by more than forty (40%) percent of their normal income for the last two (2) years, subject to the provision of Section 7 of this issuance;

5. Employers of those who are paid on commission, boundary, or task basis, and those
5. Employers of those who are paid on commission, boundary, or task basis, and
those who are paid a fixed amount for performance of a specific work,
irrespective of the time consumed in the performance thereof.
Exception: Where the workers are paid on a piece-rate basis, in which case the
employer shall grant the required 13 th month pay to such workers.
Piece Rate – employees who are paid a standard amount for
every piece or unit of work produced that is more or less regularly
replicated, without regard to the time spent in producing the same.
3.
BONUS
3.1
Nature of a bonus: a prerogative, not an obligation. -- The matter of giving a bonus
over and above the worker’s lawful salaries and allowances is entirely dependent
on the financial capability of the employer to give it. (Traders Royal Bank vs.
NLRC, 189 SCRA 274 [1990]).
EXCEPTION: When demandable under a contract.
3.2
Are commissions included in computing 13th month pay?
a.
If the commission form part of the employees’ basic salary, then this will
likewise be included in the computation of 13th month pay. (Philippine
Duplicators, Inc. vs. NLRC, 241 SCRA 380 [1995]).
b)
If the commissions were in the nature of profit-sharing bonuses (productivity
bonuses), then these do not form part of the “basic salary” and should not
included in the computation of the 13th month pay. (Boie-Takeda Chemicals,
Inc. vs. Dela Serna 228 SCRA 329 [1993]).
4. HOURS OF WORK.
4.1
Hours of worked shall include: (a) all time during which an employee is required to
be on duty or to be at the prescribed workplace, and (b) all time during which an
employee is suffered or permitted to work. (Art. 84, Labor Code; See also Rada
vs. NLRC, 205 SCRA 69 [1992].)

4.2 Rest period of short duration during working hours shall be counted as hours worked. (Art. 84, Labor Code.) Example: coffee break of 15 minutes; meal period of less than one hour, e.g., 30 minutes.

4.3 Exemptions. (See Art. 82, Labor Code.) . -- The following employees are not covered by the Labor Code provisions on hours of work:

a) Government employees;

b) Managerial employees (International Pharmaceuticals, Inc. vs. NLRC, 287 SCRA 213 [1998].);

c) Field Personnel;

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d) Members of the employer who are dependent upon him for support;

e) Domestic helpers and persons in the personal service of another;

f) Workers who are paid by results, e.g., piece workers. (Red V Coconut

Products, Ltd. vs. CIR, 17 SCRA 553 [1966], citing Lara vs. del Rosario, 94 Phil. 780) (Note: Reason is that workers who are paid by the result are compensated on the basis of the work completed, and NOT in respect of the time spent working on it).

5. EMPLOYMENT OF HOUSEHELPERS VS. HOMEWORKERS

(See also KASAMBAHAY LAW)

5.1 Domestic helper or househelpers or domestic servant defined. -- shall refer to any person,
5.1
Domestic helper or househelpers or domestic servant defined. -- shall refer
to any person, whether male or female, who renders services in and about the
employer’s home and which services are usually necessary or desirable for the
maintenance and enjoyment thereof, and ministers exclusively to the personal
comfort and enjoyment of the employer’s family.”
Such definition covers family drivers, domestic servants, laundry women,
yayas, gardeners, houseboys and other similar househelps. (Apex Mining
Company, Inc. vs. NLRC, 196 SCRA 251 [1991]). – NOTE DISCREPANCY BETWEEN
LAW AND IMPLEMENTING RULES WHICH EXCLUDED THE DRIVERS FROM
COVERAGE.
If the househelp or laundrywomen is suffered to work in staffhouses of a
company to attend to the needs of the company’s guest and other persons
availing of said facilities, then they are NOT household helpers as defined by
law but employees of the company. (Apex Mining Company, Inc. vs. NLRC, ibid.)
BENEFITS ACCORDED TO
III, LC)
HOUSE-HELPERS (Book III, Title 3, Chapter
1.
Not to be assigned to non-household work;
2.
Reasonable compensation (minimum cash wage);
3.
4.
Lodging, food and medical attendance;
If under 18 years, an opportunity for elementary education (cost of which
shall be part of househelper’s compensation);
5.
Contract for household service shall not exceed 2 years (renewable from
year to year);
6.
Just and humane treatment;
7.
Right not to be required to work for more than 10 hrs. a day (if the
househelper agrees to work overtime and there is additional
compensation, the same is permissible);
8.
Right to 4 days vacation each month with pay (if the helper does not ask
for the vacation, the number of vacation days cannot be accumulated, he
is only entitled only to its monetary equivalent);
9.
Funeral expenses must be paid by the employer if the house-helper has
no relatives with sufficient means in the place where the head of the
family lives;
10. Termination only for just cause;

11. Indemnity for unjust termination of service; 12. Employment certification as to nature and duration of service and efficiency and conduct of the house-helper.

5.2 Homeworker, defined.-- one who performs in or about his home any processing of goods or materials, in whole or in part, which have been furnished directly or indirectly, by an employer and thereafter to be returned to the latter. (Book III, Rule XIV, Section 1 of the Omnibus Rules Implementing the Labor Code.)

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HOUSEHELPERS

 

HOME WORKERS

Minister

to

the

personal

needs

and

Performs in or about his own home any processing or fabrication of goods or materials, in whole or in part, which have been furnished directly or indirectly, by an employer and sold thereafter to the latter.

comfort of his employer in the latter’s home

RIGHTS and BENEFITS ACCORDED TO HOMEWORKERS (Department Order No. 5,

replacing Rule XIV of the Rules Implementing Book III of the Labor Code): 1) Formation
replacing Rule XIV of the Rules Implementing Book III of the Labor Code):
1) Formation and registration of labor organization of industrial homeworkers.
2) It also makes explicit the employer’s duty to pay and remit SSS, Philhealth and ECC
premiums.
3) Prohibitions for Homework
explosives, fireworks and articles of like character;
drugs and poisons;
other articles, the processing of which requires exposure to toxic substance.
6. EMPLOYMENT OF MINORS:
(Sec. 12, R.A. 7610, as amended by R.A.
9231).
Article 139. Minimum employable age. --
(a)
No child below fifteen (15) years of age shall be employed, except when
he works directly under the sole responsibility of his parents or guardian, and his
employment does not in any way interfere with his schooling.
(b)
Any person between fifteen (15) and eighteen (18) years of age may be
employed for such number of hours and such periods of the day as determined by the
Secretary of Labor in appropriate regulations.
(c)
The foregoing provisions shall in no case allow the employment of a
person below eighteen (18) years of age in an undertaking which is hazardous or
deleterious in nature as determined by the Secretary of Labor.
Article 140. Prohibition against child discrimination
--
No employer shall
discriminate against any person in respect to terms and conditions of employment on
account of his age.
6.1
GENERAL RULE: Employment of any child below fifteen (15) years of age is
prohibited
Note1:
Any person between 15 and 18 may be employed in any non-
hazardous work.

Note2: Any person above 18 NO PROHIBITION.

EXCEPT:

1. When he works directly under the sole responsibility of his parents or guardian, and his employment does not in any way interfere with his schooling. The following conditions must be met:

The employment does not endanger the child’s life, safety, health and morals;

• The employment does not impair the child’s normal development;

The employer parent or legal guardian provides the child with the primary

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and/or secondary education prescribed by the Department of Education

2. Where

the

child’s

employment

or

participation

in

public

entertainment

or

information through cinema, theater, radio or TV is essential provided that:

The employment does not involve ads or commercials promoting ALCOHOLIC BEVERAGES, INTOXICATING DRINKS, TOBACCO AND ITS BY-PRODUCTS OR EXHIBITING VIOLENCE; There is a written contract approved by the DOLE; and the following requirements are strictly complied with:

employer shall ensure protection, health, morals, and normal development of the child; employer shall institute measures to prevent child’s exploitation / discrimination taking into account the system and level of remuneration, duration, and arrangement of working time; employer shall formulate and implement a continuing program for training and skills acquisition of the child, subject to approval and supervision of competent authorities. (as amended by Rep. Act No.

9231) 6.2 NOTE: 6.3 Comparisons: (Rep. Act No. 9231) A child below 15 Allowed to
9231)
6.2 NOTE:
6.3 Comparisons: (Rep. Act No. 9231)
A child below 15
Allowed to work for not more than 20 hours a week.
Provided, the work shall not be more than 4 hours in a
day.
Shall not be allowed to work between 8pm and 6am of
the following day.
A
child
above
15
years
of
age
but
below 18
Shall not be allowed to work for more than 8 hours a
day, and in no case beyond 40 hours a week.
Shall not be allowed to work between 10 pm and 6am
the following day

In the above-exceptional cases where any such child may be employed, the

employer shall first secure, before engaging such child, a work permit from the

Department of Labor and Employment which shall ensure observance of the above requirements. (Rep. Act. No. 9231).

ON HAZARDOUS WORK. -- Any person between fifteen (15) and eighteen (18) years of age may be employed for NON-HAZARDOUS WORK for such number of hours and such periods of the day as determined by the Secretary of Labor in appropriate regulations. No such prohibition if eighteen (18) years old and above.

PROHIBITION AGAINST CHILD DISCRIMINATION. -- No employer shall discriminate against any person in respect to terms and conditions of employment on account of his age.

to terms and conditions of employment on account of his age. 7. APPRENTICESHIP AND LEARNER 7.1

7. APPRENTICESHIP AND LEARNER

7.1 Apprenticeship is the practical on-the-job training as supplemented by related theoretical instruction (Art. 58 (a), LC).

7.2 Learners are persons hired as trainees in semi-skilled and other industrial occupations which are non-apprenticeable and may be learned through practical training on the job in a relatively short period of time which shall not exceed three months.

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THE ABAD NOTES APPRENTICESHIP LEARNERSHIP NATURE • highly-technical semi-skill; non-apprenticeable PERIOD • SIX
THE ABAD NOTES
APPRENTICESHIP
LEARNERSHIP
NATURE
• highly-technical
semi-skill; non-apprenticeable
PERIOD
• SIX (6) months
THREE (3) months
COMITMT TO
At option of learner
HIRE
• At option of employer
WAGES
Must always be paid; 75% of
• May be paid or not; if
paid, 75% of minimum
minimum
DOLE
Approval
• Yes, DOLE approval is
essential
No, DOLE approval not required;
inspection only.
DEDUCTION for
None.
Expenses
• Yes, expenses for
training deductible
from income tax
8. DISABLED WORKERS
8.1
Equal opportunity for employment.
No disabled person shall be denied access to opportunities for suitable
employment. [R.A. 7277, Sec. 5: Magna Carta for Disabled Persons]
Qualified disabled employees shall be subject to the same terms and
conditions of employment and the same compensation, privileges, benefits,
fringe benefits, incentives or allowances as a qualified able-bodied person.
A worker is not necessarily considered as a handicapped worker if he is
capable, as an able-bodied worker, to function suitably in relation to the work
to which he was hired. (i.e. one-legged transcriptionist)
8.2
Incentives for employment of disabled workers (Sec. 2, RA 7277).
1. Private entities that employ disabled persons who meet the required skills or
qualifications either as regular employee, apprentice or learner, shall be
entitled to an additional deduction from their gross income, equivalent to 25%
of the total amount paid as salaries and wages to disabled persons; Provided,
that the following are complied with:
a.
b.
Presentation of proof certified by DOLE that disabled persons are under
their employ; and
Disabled employee is accredited with DOLE and DOH as to his
disability, skills and qualifications.

2. Private entities that improve or modify their physical facilities to provide reasonable accommodation for disabled persons shall also be entitled to an additional deduction from their taxable income, equivalent to 50% of the direct costs of the improvements or modifications. This does not apply to improvements required under B.P. Blg. 344.

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9. EMPLOYEE BENEFITS; RETIREMENT.

9.1 RETIREMENT AGE

GENERAL RULE: R.A. 7641

a. OPTIONAL at 60 years with minimum 5 years of service

b. MANDATORY at 65 years, no service requirement

EXCEPTION:

Where the company provides for a Retirement Plan with earlier retirement age, then the company’s Retirement Plan will apply

9.2 RETIREMENT BENEFITS GENERAL RULE: R.A. 7641 ½ month for every year of service (expanded
9.2 RETIREMENT BENEFITS
GENERAL RULE: R.A. 7641
½ month for every year of service (expanded concept per Sec 1, RA 7641)
Expanded concept: 22.5 days (basis: Capitol Wireless vs. Confesor)
15 days + 5 days service incentive leave + 2.5 days prorated 13 th month pay
EXCEPTION:
9.3 CASES:
Answer:
provision in the company rules prohibiting the availment of both .

Where the company provides for a Retirement Plan with better benefits, then the company’s Retirement Plan will apply

a) Question: Is an employee who was terminated for authorized causes (redundancy), also entitled to avail of early retirement benefits? Otherwise stated, may an employee be paid both retirement and separation pay benefits?

YES, as a general rule. Exception: When there is an explicit

Goodyear vs. Marina Angus, G.R. No. 185499, 14 November 2014. -- Employees are legally entitled to recover both separation pay and retirement benefits in the absence of a specific prohibition in the Retirement Plan or CBA. In such an instance where both the company rules or CBA and the retirement plan are silent, an employee is not barred from claiming his early retirement benefits, even if he/she had already received his retrenchment pay, and has executed a Quitclaim to that effect. This must be so because he is legally entitled thereto as a general rule.

See also: Difference between separation pay arising from termination of employment and retirement.

General Milling Corporation vs. Viajar, G.R. No. 181738, 30 January 2013, Citing Quevedo vs. Benguet Electric Cooperative, Inc., 599 SCRA 438 [2009]. -- While termination of employment and retirement from service are common modes of ending employment, they are mutually exclusive, with varying judicial bases and resulting benefits. Retirement from the service is contractual (i.e. based on the bilateral agreement of the employer and employee), while termination of employment is statutory (i.e. governed by the Labor Code and other related laws as to its grounds, benefits and procedure. The benefits resulting from termination vary, depending on the cause. For retirement, Article 287 of the Labor Code gives leeway to the parties to stipulate above a floor of benefits.

For retirement, Article 287 of the Labor Code gives leeway to the parties to stipulate above

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b. DIFFERENCE BETWEEN VOLUNTARY AND INVOLUNTARY RETIREMENT.

Voluntary retirement cuts employment ties leaving no residual employer liability; involuntary retirement amounts to a discharge, rendering the employer liable for termination without cause. The employee’s intent is the focal point of analysis. In determining such intent, the fairness of the process governing the retirement decision, the payment of stipulated benefits, and the absence of badges of intimidation or coercion are relevant parameters. (ibid.)

2015 CASE: Zenaida Paz vs. Northern Tobacco Redrying Co., Inc., et al., G.R. No. 199554,
2015 CASE:
Zenaida Paz vs. Northern Tobacco Redrying Co., Inc., et al.,
G.R.
No. 199554,
18 February 2015. -- If “optional retirement” is involuntary, the
employee shall be deemed to be illegally dismissed.
c.
RESIGNATIONS vs. TERMINATION vs STRAINED RELATIONS vs RETIREMENT
2013
CASE:
IN TERMINATION OF EMPLOYMENT BY THE EMPLOYEE
VIA RESIGNATION. -- The intent to relinquish must concur with the overt
act of relinquishment. (Mendoza vs. HMS Credit Corp., et. al., G.R. No. 187232,
17 April 2013; citing San Miguel Properties vs. Gucaban, 654 SCRA 18 [2011])
2013
CASE: DIFFERENCE BETWEEN TERMINATION OF EMPLOYMENT
AND RETIREMENT. -- While termination of employment and retirement from
service are common modes of ending employment, they are mutually
exclusive, with varying judicial bases and resulting benefits from the service
is contractual (i.e. based on the bilateral agreement of the employer and
employee), while termination of employment is statutory (i.e. governed by
the Labor Code and other related laws as to its grounds, benefits and
procedure). The benefits resulting from termination vary, depending on the
cause. For retirement, Article 287 of the Labor Code gives leeway to the
parties to stipulate above or floor benefits. (General Milling Corporation vs.
Viajar, G.R. No. 181783, 30 January 2013; Citing Quevedo vs. Benguet Electric
Cooperative, Inc., 599 SCRA 438 [2009])
RESIGNATION – It is the voluntary act of employees who are compelled by
reasons to disassociate themselves from their employment. It must be done
with intention of relinquishing the office, accompanied by the act of
abandonment. Where evidence reveals otherwise, then illegal dismissal.
STRAINED RELATIONS – Where reinstatement is no longer desirable or
viable in view of strained relations between the parties, then separation pay
is an acceptable alterative to reinstatement. Computation: one month for
every year of service, computed from date of hiring until finality of the
Decision finding for illegal termination.
d.
Early retirement is the option of the EMPLOYEE. Eastern Shipping Lines, Inc.
vs. Ferrer D. Antonio, G.R. No. 171587, 13 October 2009. –

The age of retirement is primarily determined by the existing agreement or employment contract. In the absence of such agreement, the retirement age shall be fixed by law. Under the aforecited law, the mandated compulsory retirement age is set at 65 years, while the minimum age for optional retirement is set at 60 years. Under Paragraph B of the retirement plan, a shipboard employee, upon his written request, may retire from service if he has reached the eligibility age of 60 years. In this case, the option to retire lies with the employee. Records show that respondent was only 41 years old when he applied for optional retirement, which was 19 years short of the required eligibility age. Thus, he cannot claim optional retirement benefits as a matter of right.

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2016 LABOR LAW BAR REVIEW NOTES FOR PHILIPPINE ASSOCIATION OF LAW SCHOOLS (PALS)

THE ABAD NOTES

e. IMPORTANT CASE: MAY THE EMPLOYER DEDUCT COST OF TRAINING FROM THE RETIREMENT BENEFITS OF THE EMPLOYEE? Bibiano C.

Elegir vs. Philippine Airlines, Inc.

ANSWER: YES! By carrying over the same stipulation in the present CBA, both PAL and ALPAP recognized that the company’s effort in sending pilots for training abroad is an investment which necessarily expects a reasonable return in the form of service for a period of at least three (3) years. This stipulation had been repeatedly adopted by the parties in the succeeding renewals of their CBA, thus validating the impression that it is a reasonable and acceptable term to both PAL and ALPAP. Consequently, the petitioner cannot conveniently disregard this stipulation by simply raising the absence of a contract expressly requiring the pilot to remain within PAL’s employ within a period of 3 years after he has been sent on training. The supposed absence of contract being raised by the petitioner cannot stand as the CBA clearly covered the petitioner’s obligation to render service to PAL within 3 years to enable it to recoup the costs of its investment. Further, to allow the petitioner to leave the company before it has fulfilled the reasonable expectation of service on his part will amount to unjust enrichment.

of service on his part will amount to unjust enrichment. FOR THE 2016 BAR EXAMINEES: GOOD

FOR THE 2016 BAR EXAMINEES:

GOOD LUCK AND GOD BLESS YOU ALL!!

ADA D. ABAD, 2016 Dean, Adamson University College of Law In behalf of Philippine Association of Law Schools (PALS)

ADA D. ABAD, 2016 Dean, Adamson University College of Law In behalf of Philippine Association of

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