LABOR CODE

31. Relevant Civil Code, RPC provisions to Labor Code

Civil Code provisions related to Labor Code
Article 1700 in Civil Code provides that the relations between capital and labor are not
merely contractual. They are so impressed with public interest that labor contracts must yield to
the common good. Therefore, such contracts are subject to the special laws on labor unions,
collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor
and similar subjects. (Servidad v. NLRC, GR No. 128682, March 18, 1999)
Neither capital nor labor shall act oppressively against the other or impair the interest or
convenience of the public. (Art. 1701, NCC)
The concern of the law for the workers is further stressed in the provision in the Civil Code
which ordains that in case of doubt, all labor legislations and all labor contracts shall be construed
in favor of the safety and decent living for the laborers. (Art. 1702, NCC)
SC consistently ruled that both the provisions of Art. 1702 of the civil code and Art. 4 of
the labor code which mandate that all doubts shall be resolved in favor of labor, should be applied
in resolving any doubt or ambiguity in contracts between management and the union. (Plastic
town Center Corp. v. NLRC, GR No. 81176, April 19, 1989)
Civil Code Provisions relevant to Labor:

 Article 1700. The relations between capital and labor are not merely contractual. They
are so impressed with public interest that labor contracts must yield to the common good.
Therefore, such contracts are subject to the special laws on labor unions, collective
bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor
and similar subjects.
 Article 1701. Neither capital nor labor shall act oppressively against the other, or impair
the interest or convenience of the public.
 Article 1702. In case of doubt, all labor legislation and all labor contracts shall be
construed in favor of the safety and decent living for the laborer.
 Article 1703. No contract which practically amounts to involuntary servitude, under any
guise whatsoever, shall be valid.
 Article 1704. In collective bargaining, the labor union or members of the board or
committee signing the contract shall be liable for non-fulfillment thereof.
 Article 1705. The laborer's wages shall be paid in legal currency.
 Article 1706. Withholding of the wages, except for a debt due, shall not be made by the
employer.
 Article 1707. The laborer's wages shall be a lien on the goods manufactured or the work
done.
  Article 1708. The laborer's wages shall not be subject to execution or attachment, except
for debts incurred for food, shelter, clothing and medical attendance.
 Article 1709. The employer shall neither seize nor retain any tool or other articles
belonging to the laborer.
 Article 1710. Dismissal of laborers shall be subject to the supervision of the Government,
under special laws.
 Article 1711. Owners of enterprises and other employers are obliged to pay
compensation for the death of or injuries to their laborers, workmen, mechanics or other
employees, even though the event may have been purely accidental or entirely due to a
fortuitous cause, if the death or personal injury arose out of and in the course of the
employment. The employer is also liable for compensation if the employee contracts any
illness or disease caused by such employment or as the result of the nature of the
employment. If the mishap was due to the employee's own notorious negligence, or
voluntary act, or drunkenness, the employer shall not be liable for compensation. When
the employee's lack of due care contributed to his death or injury, the compensation shall
be equitably reduced.
 Article 1712. If the death or injury is due to the negligence of a fellow worker, the latter
and the employer shall be solidarily liable for compensation. If a fellow worker's
intentional or malicious act is the only cause of the death or injury, the employer shall not
be answerable, unless it should be shown that the latter did not exercise due diligence in
the selection or supervision of the plaintiff's fellow worker.
RPC provisions related to Labor Code
The Revised Penal Code contains provisions relevant to labor law. For instance, the
penalty of arresto mayor and a fine not exceeding 300 pesos shall be imposed upon any person
who, for the purpose of organizing, maintaining or preventing coalitions of capital or labor, strike
or laborers or lockout of employers, shall employ violence or threats in such a degree as to
compel or force the laborers or employers in the free and legal exercise of their industry or work,
if the act shall not constitute a more serious offense in accordance with the provisions of the
Revised Penal Code. (Article 289, RPC)
The Revised Penal Code also imposes the penalty of arresto mayor or a fine ranging from
200 to 500 pesos, or both, upon any person, agent, or officer of any association or corporation
who shall force or compel, directly or indirectly, or shall knowingly permit any laborer or
employee employed by him or by such firm or corporation, to be forced or compelled, to
purchase merchandise or commodities of any kind.
The same penalties are imposed upon any person who shall pay the wages due a laborer
or employee employed by him, by means of tokens or objects other than the legal tender
currency of the Philippines, unless expressly requested by the laborer or employee. (Art. 288,
RPC)
 Other Relevant Provisions of RPC:

 Article 272. Slavery. - The penalty of prision mayor and a fine of not exceeding 10,000
pesos shall be imposed upon anyone who shall purchase, sell, kidnap or detain a human
being for the purpose of enslaving him. If the crime be committed for the purpose of
assigning the offended party to some immoral traffic, the penalty shall be imposed in its
maximum period.
 Article 273. Exploitation of child labor. - The penalty of prision correccional in its minimum
and medium periods and a fine not exceeding 500 pesos shall be imposed upon anyone
who, under the pretext of reimbursing himself of a debt incurred by an ascendant,
guardian or person entrusted with the custody of a minor, shall, against the latter's will,
retain him in his service.
 Article 274. Services rendered under compulsion in payment of debt. - The penalty
of arresto mayor in its maximum period to prision correccional in its minimum period
shall be imposed upon any person who, in order to require or enforce the payment of a
debt, shall compel the debtor to work for him, against his will, as household servant or
farm laborer.
 Article 278. Exploitation of minors. - The penalty of prision correccional in its minimum
and medium periods and a fine not exceeding 500 pesos shall be imposed upon:
1. Any person who shall cause any boy or girl under sixteen years of age to perform any
dangerous feat of balancing, physical strength, or contortion.
2. Any person who, being an acrobat, gymnast, rope-walker, diver, wild-animal tamer or
circus manager or engaged in a similar calling, shall employ in exhibitions of these
kinds children under sixteen years of age who are not his children or descendants.
3. Any person engaged in any of the callings enumerated in the next paragraph
preceding who shall employ any descendant of his under twelve years of age in such
dangerous exhibitions.
4. Any ascendant, guardian, teacher or person entrusted in any capacity with the care of
a child under sixteen years of age, who shall deliver such child gratuitously to any
person following any of the callings enumerated in paragraph 2 hereof, or to any
habitual vagrant or beggar.
If the delivery shall have been made in consideration of any price, compensation, or
promise, the penalty shall in every case be imposed in its maximum period.
In either case, the guardian or curator convicted shall also be removed from office as
guardian or curator; and in the case of the parents of the child, they may be deprived,
temporarily or perpetually, in the discretion of the court, of their parental authority.
5. Any person who shall induce any child under sixteen years of age to abandon the
home of its ascendants, guardians, curators, or teachers to follow any person engaged
 in any of the callings mentioned in paragraph 2 hereof, or to accompany any habitual
vagrant or beggar.
 Article 291. Revealing secrets with abuse of office. - The penalty of arresto mayor and a
fine not exceeding 500 pesos shall be imposed upon any manager, employee, or servant
who, in such capacity, shall learn the secrets of his principal or master and shall reveal
such secrets.
 Article 292. Revelation of industrial secrets. - The penalty of prision correccional in its
minimum and medium periods and a fine not exceeding 500 pesos shall be imposed upon
the person in charge, employee or workman of any manufacturing or industrial
establishment who, to the prejudice of the owner thereof, shall reveal the secrets of the
industry of the latter.
 Article 310. Qualified theft. - The crime of theft shall be punished by the penalties next
higher by two degrees than those respectively specified in the next preceding article, if
committed by a domestic servant, or with grave abuse of confidence, or if the property
stolen is motor vehicle, mail matter or large cattle or consists of coconuts taken from the
premises of the plantation or fish taken from a fishpond or fishery, or if property is taken
on the occasion of fire, earthquake, typhoon, volcanic erruption, or any other calamity,
vehicular accident or civil disturbance. (As amended by R.A. 120 and B.P. Blg. 71. May 1,
1980).
 Article 316. Other forms of swindling. - The penalty of arresto mayor in its minimum and
medium period and a fine of not less than the value of the damage caused and not more
than three times such value, shall be imposed upon: xxx 5. Any person who shall accept
any compensation given him under the belief that it was in payment of services rendered
or labor performed by him, when in fact he did not actually perform such services or labor.
32. Relevant Constitutional provisions
Article 3 of the Labor Code reflects certain basic principles enshrined in the constitution
aimed at protecting the interest of labor, promoting full employment and equal work
opportunities irrespective of sex, race, or creed. Substantially, it was based on the provisions of
Section 9, Article II of the 1973 Constitution.
Section 3, Article XIII, 1987 Constitution:
“The State shall afford full protection to labor, local and overseas, organized and unorganized,
and promote full employment and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and
negotiations, and peaceful concerted activities, including the right to strike in accordance with
law. They shall be entitled to security of tenure, humane conditions of work, and a living wage.
They shall also participate in policy and decision-making processes affecting their rights and
benefits as may be provided by law.
The State shall promote the principle of shared responsibility between workers and employers
and the preferential use of voluntary modes in settling disputes, including conciliation, and shall
enforce their mutual compliance therewith to foster industrial peace.
The State shall regulate the relations between workers and employers, recognizing the right of
labor to its just share in the fruits of production and the right of enterprises to reasonable returns
to investments, and to expansion and growth.”
Other Constitutional Provisions related to Labor Law:
a. “ The State shall promote a just and dynamic social order that will ensure the prosperity
and independence of the nation and free the people from poverty through policies that
provide adequate social services, promote full employment, a rising standard of living,
and an improved quality of life for all.” (Section 9, Article II, 1987 Constitution)
b. “The State affirms labor as a primary social economic force. It shall protect the rights of
workers and promote their welfare.” (Section 18, Article II, 1987 Constitution)
c. “The right of the people, including those employed in the public and private sectors, to
form unions, associations, or societies for purposes not contrary to law shall not be
abridged.” (Section 8, Article III, 1987 Constitution)
d. “The State affirms labor as a primary social economic force. It shall protect the rights of
workers and promote their welfare.” (Section 18 [2], Article III [Bill of Rights], 1987
Constitution)
e. Section 5, Article VI [The Legislative Department] provides that along with other sectors,
labor is entitled to seats allotted to party-list representatives for three consecutive terms
after the ratification of the Constitution.
f. “No officer or employee of the civil service shall be removed or suspended except for
cause provided by law. (5) The right to self-organization shall not be denied to
government employees. (6) Temporary employees of the Government shall be given such
protection as may be provided by law.” (Section 2 [3], [5] and [6] of Article IX [B], 1987
Constitution).
g. “The Congress shall provide for the standardization of compensation of government
officials and employees, including those in government-owned or controlled corporations
with original charters, taking into account the nature of the responsibilities pertaining to,
and the qualifications required for, their positions.” (Section 5, Art. IX (B), 1987
Constitution)
h. “The goals of the national economy are a more equitable distribution of opportunities,
income, and wealth; a sustained increase in the amount of goods and services produced
by the nation for the benefit of the people; and an expanding productivity as the key to
raising the quality of life for all, especially the underprivileged.
“The State shall promote industrialization and full employment based on sound
agricultural development and agrarian reform, through industries that make full of
efficient use of human and natural resources, and which are competitive in both domestic
 and foreign markets. However, the State shall protect Filipino enterprises against unfair
foreign competition and trade practices.
“In the pursuit of these goals, all sectors of the economy and all region s of the country
shall be given optimum opportunity to develop. Private enterprises, including
corporations, cooperatives, and similar collective organizations, shall be encouraged to
broaden the base of their ownership.” (Section 1, Article XII, 1987 Constitution)
i. “The State shall promote the preferential use of Filipino labor, domestic materials and
locally produced goods, and adopt measures that help make them competitive.” (Section
12, Article XII, 1987 Constitution)
j. “The sustained development of a reservoir of national talents consisting of Filipino
scientists, entrepreneurs, professionals, managers, high-level technical manpower and
skilled workers and craftsmen in all fields shall be promoted by the State. The State shall
encourage appropriate technology and regulate its transfer for the national benefit. The
practice of all professions in the Philippines shall be limited to Filipino citizens, save in
cases prescribed by law.” (Section 14, Article XII, 1987 Constitution)
k. “The Congress shall give highest priority to the enactment of measures that protect and
enhance the right of all the people to human dignity, reduce social, economic, and
political inequalities, and remove cultural inequities by equitably diffusing wealth and
political power for the common good.” (Section 1, Article XIII, 1987 Constitution)
l. “The promotion of social justice shall include the commitment to create economic
opportunities based on freedom of initiative and self-reliance.”(Section 2, Article XIII,
1987 Constitution)
m. “Section 4. The State shall, by law, undertake an agrarian reform program founded on the
right of farmers and regular farmworkers who are landless, to own directly or collectively
the lands they till or, in the case of other farmworkers, to receive a just share of the fruits
thereof. To this end, the State shall encourage and undertake the just distribution of all
agricultural lands, subject to such priorities and reasonable retention limits as the
Congress may prescribe, taking into account ecological, developmental, or equity
considerations, and subject to the payment of just compensation.
“Section 5. The State shall recognize the right of farmers, farmworkers, and landowners,
as well as cooperatives, and other independent farmers' organizations to participate in
the planning, organization, and management of the program, and shall provide support
to agriculture through appropriate technology and research, and adequate financial,
production, marketing, and other support services.
“Section 6. The State shall apply the principles of agrarian reform or stewardship,
whenever applicable in accordance with law, in the disposition or utilization of other
natural resources, including lands of the public domain under lease or concession suitable
to agriculture, subject to prior rights, homestead rights of small settlers, and the rights of
indigenous communities to their ancestral lands. The State may resettle landless farmers
and farmworkers in its own agricultural estates which shall be distributed to them in the
manner provided by law.
 “Section 7. The State shall protect the rights of subsistence fishermen, especially of local
communities, to the preferential use of the communal marine and fishing resources, both
inland and offshore. It shall provide support to such fishermen through appropriate
technology and research, adequate financial, production, and marketing assistance, and
other services. The State shall also protect, develop, and conserve such resources. The
protection shall extend to offshore fishing grounds of subsistence fishermen against
foreign intrusion. Fishworkers shall receive a just share from their labor in the utilization
of marine and fishing resources.
“Section 8. The State shall provide incentives to landowners to invest the proceeds of the
agrarian reform program to promote industrialization, employment creation, and
privatization of public sector enterprises. Financial instruments used as payment for their
lands shall be honored as equity in enterprises of their choice.” (Sections 4, 5, 6, 7 & 8,
Article XIII, 1987 Constitution)
n. “The State shall, by law, and for the common good, undertake, in cooperation with the
private sector, a continuing program of urban land reform and housing which will make
available at affordable cost, decent housing and basic services to under-privileged and
homeless citizens in urban centers and resettlement areas. It shall also promote adequate
employment opportunities to such citizens. In the implementation of such program the
State shall respect the rights of small property owners.” (Section 9, Article XIII, 1987
Constitution)
o. “The State shall protect working women by providing safe and healthful working
conditions, taking into account their maternal functions, and such facilities and
opportunities that will enhance their welfare and enable them to realize their full
potential in the service of the nation.” (Section 14, Article XIII, 1987 Constitution)
p. “The State shall, provide adult citizens, the disabled, and out-of-school youth with training
in civics, vocational efficiency, and other skills.” (Section 2 [5], Article XIV, 1987
Constitution)
q. “The State shall, from time to time, review to increase the pensions and other benefits
due to retirees of both the government and the private sectors.” (Section 8, Article XVI,
1987 Constitution)
33. Rule of Interpretation of Labor Code
a. Doubts should be resolved in favor of labor.
Article 4 of the Labor Code enunciates the time-honored principle that all doubts in the
implementation and interpretation of its provisions should be resolved in favor of labor. (Asian
Transmission Corporation v. CA, GR No. 144664, March 15, 2004)
This rule applies not only in the interpretation of the provisions of the Labor Code but also
of its Implementing Rules. (Article 4, Labor Code; Section 3, Preliminary Provisions, Rules to
Implement the Labor Code)
 It is in keeping with the constitutional mandate of promoting social justice and affording
protection to labor. (Manila Electric Company v. NLRC, GR No. 78763)
Thus, when conflicting interests of labor and capital are to be weighed on the scales of
social justice, the heavier influence of the latter should be counter-balanced by sympathy and
compassion the law must accord the underprivileged worker. (Marcopper Mining Corporation v
NLRC, GR No. 103525)
b. Civil Code provisions related to Article 4 of the Labor Code.
Article 10 of the Civil Code states: “In case of doubt in the interpretation or application of
laws, it is presumed that the law-making body intended right and justice to prevail.”
More specifically, Article 1702 of the Civil Code directs that: “In case of doubt, all labor
legislation and all labor contracts shall be construed in favor of the safety and decent living of the
laborer.” (PNCC v. NLRC, GR No. 101535, Jan. 22, 1993, 217 SCRA 455)
Compared to the provision of Article 4 of the Labor of the Labor Code, it appears that
Article 1702 is broader in scope in that it pertains to “all labor legislation and all labor contracts”
and not merely to the “implementation and interpretation of the provisions of the Labor Code,
including its implementing rules and regulations,” as enunciated in Article 4. Moreover, the Civil
Code mentions a standard which would justify the invocation of the rule of interpretation in favor
of labor in that the same should be done “in favor of the safety and decent living for the laborer.”
Having made such observation, it may well be said that the provisions of the Civil Code
and the Labor Code do not really differ since the policy of the law is clear – any doubt should
always be interpreted or construed in favor of labor – which means, in more specific terms, the
safety and decent living for the laborer. (PNCC v NLRC, GR No. 101535)
c. Rule of interpretation embodied in the law itself
The Labor Code is one of the few laws which mandates the appropriate rule of
interpreting its provisions. This is one unique feature of the Labor Code. From the inception of a
legal controversy or case, labor has already an upper hand over the employer. Once the doubt is
not effectively overturned by clear and convincing evidence expected to be propounded by the
employer which, in most cases, has the burden of proof, the controversy should, by clear directive
of the law, be decided in favor of labor.
This is, of course, not a harsh rule. The framers of the law (Labor and the Civil Code) had
fully taken cognizance of the disparity in terms of resources and standing between labor and
capital. In any legal controversy between them, the former always suffers the most. Hence, the
common adage that those who have less in life should have more in law is best exemplified and
made real in Articles 4 and 1702 of the Labor Code and Civil Code, respectively. The worker must
look up to the law for his protection. The law regards him with tenderness and even favor and
always with faith and hope in his capacity to help in shaping the nation’s future. He must not be
taken for granted. (Cebu Royal Plant [San Miguel Corp] v Minister of Labor, GR No. 58639)
Certainly, this rule of interpretation and construction in favor of labor does not mean that
the capital or employer should, at all times, be at the losing end of a controversy. The law does
not say so. For while the Constitution and the law tend to favor the working man, protection to
the employer is assured. Protection of the rights of the laborer authorizes neither the oppression
nor self-destruction of the employer. While the Constitution is committed to the policy of social
justice and the protection of the working class, it should not be supposed that every labor dispute
will be automatically decided in favor of labor. Management also has its own rights, which, as
such, are entitled to respect and enforcement in the interest of simple fair play. Out of its concern
for those with less privilege in life, the Supreme Court has inclined more often than not towards
the worker and upheld his cause with his conflicts with the employer. Such favoritism, however,
has not blinded the court to rule that justice is, in every case, for the deserving, to be dispensed
in the light of the established facts and applicable law and doctrine. (Rolando Revidad v NLRC and
Atlantic, Gulf and Pacific Company of Manila, Inc., GR No. 111105)
The Supreme Court, in Philippine Long Distance Telephone Co. v NLRC, underscored that
although it is bound by the social justice mandate of the Constitution and the laws, however,
such policy of social justice is not intended to countenance wrongdoing.
Doubt or Ambiguity in Labor Contracts
In case of doubt or ambiguity, labor contracts should be interpreted liberally in favor of
the worker. (Ditan v POEA, GR 79560)
Doubt or Ambiguity in Evidence
The rule enunciated in Art 4 of the Labor Code likewise applies in the appreciation of
evidence in labor proceedings. Consequently, when there is a doubt between the evidence
presented by the employer and the employee, such doubt should be resolved in favor of the
latter. (Ph Employ Services and Resources, Inc. Paramio, GR No 144786)
When Rule in Article 4 does not apply
The provision that in case of doubt in the interpretation of the provisions of the Labor
Code, the doubt should be resolved in favor of the laborer does not apply where the pertinent
provisions of the Labor Code leave no room for doubt either in their interpretation or application.
(Bonifacio v GSIS, GR 62207)