1.

Understanding basic concepts/ terms and principles

Meaning of Social Legislation

 is a broad term and may include not only laws that give social security protection, but
also those that help the worker secure housing and basic necessities. The
Comprehensive Agrarian Reform Law could also be considered a social legislation. All
labor laws are social legislation, but not all social legislation is labor law.
 Social legislation – It includes laws that provide particular kinds of protection or benefits
to society or segments thereof in furtherance of social justice.    e.g. GSIS Law, SSS
Law, Philhealth benefits

Distinguish by labor law

 The law governing the rights and duties of the employer and employees with respect to:
1. The terms and conditions of employment; and  
2. Labor disputes arising from collective bargaining (CB) respecting such terms and
conditions.

Labor legislation is sometimes distinguished from social legislation by the former

referring to labor statutes, like Labor Relations Law and Labor Standards, and the latter
to Social Security Laws. Labor legislation focuses on the rights of the worker in the
workplace.

Legal Bases

Police Power

It has been defined as the "state authority to enact legislation that may interfere with
personal liberty or property in order to promote the general welfare." As defined, it
consists of (1) an imposition of restraint upon liberty or property, (2) in order to foster
the common good.

  People vs Pomar

Facts: Julio Pomar, the manager of a tobacco factory was charged of violating Section
13 in relation of Section 15 of Act No. 3071 considering that a woman by the name of
Macaria Fajardo, whom he granted vacation leave which began on the 16th day of July,
1923, by reason of her pregnancy, Pomar refused to pay to said woman the sum of
eighty pesos (P80), Philippine currency, to which she was entitled as her regular wages
corresponding to thirty days before and thirty days after her delivery and confinement
which took place on the 12th day of August, 1923.
 CFI found Pomar guilty of violating Section 13 1 in connection with section 15 2 of Act No.
3071 of the Philippine Legislature. 

Issue: WON the subject law promulgated under the police power of the state was
within a reasonable and lawful exercise of the said power

Ruling:

The provisions of said sections had not been adopted within the reasonable and lawful
exercise of the power of the state, and therefore unconstitutional and illegal.

It will also be noted from an examination of said section 13, that it takes no account of
contracts for the employment of women by the day nor by the piece. The law is equally
applicable to each case. It will hardly be contended that the person, firm or corporation
owning or managing a factory, shop or place of labor, who employs women by the day
or by the piece, could be compelled under the law to pay for sixty days during which no
services were rendered.

It has been decided in a long line of decisions of the Supreme Court of the United
States, that the right to contract about one's affairs is a part of the liberty of the
individual, protected by the "due process of law" clause of the constitution.

The rule in this jurisdiction is, that the contracting parties may establish any
agreements, terms, and conditions they may deem advisable, provided they are not
contrary to law, morals or public policy. (Art. 1255, Civil Code.)

Neither public sentiment, nor a desire to ameliorate the public morals of the people of
the state will justify the promulgation of a law which contravenes the express provisions
of the fundamental law of the people — the constitutional of the state.

Basaysay vs. WCC

Facts: Pedro Basaysay, the claimant, who, during the period of his employment in the
Elizalde Paint & Oil Factory, Inc, respondent company contracted tuberculosis for which
1
Article 13. Every person, firm or corporation owning or managing a factory, shop or place of labor of any description shall
be obliged to grant to any woman employed by it as laborer who may be pregnant, thirty days vacation with pay before and
another thirty days after confinement: Provided, That the employer shall not discharge such laborer without just cause, under the
penalty of being required to pay to her wages equivalent to the total of two months counted from the day of her discharge.
2
Any person, firm or corporation violating any of the provisions of this Act shall be punished by a fine of not less than fifty
pesos nor more than two hundred and fifty, or by imprisonment for not less than ten days nor more than six months, or both, in the
discretion of the court.
In the case of firms or corporations, the presidents, directors or managers thereof or, in their default, the persons acting in their
stead, shall be criminally responsible for each violation of the provisions of this Act.
he was hospitalized and treated. He was first taken to the Singian Clinic and when Dr.
Conrado Lorenzo, the company consultant, discovered that he was afflicted with active
minimal pulmonary tuberculosis, he had the claimant transferred to the Hospital de
Santiago. He was twice hospitalized in the said hospital for PTB and pleurisy with
effusion.

The respondent oil and paint factory not only defrayed all expenses for medical and
hospital services, but also paid the claimant his full wages during the two periods of
disability. He was discharged from the services on January 2, 1958.

WCC dismissed the petitioner’s claim

Issue:  WON claimant’s tuberculosis was already arrested on his last day of work,
because upon this point hinges the determination of whether claimant is entitled to
medical and hospital services after his discharge from employment on January 2, 1958

Ruling: The decision appealed from decided the issue in the affirmative, relying
principally upon the testimony of Dr. Conrado Lorenzo, to which, petitioner maintains,
the Workmen’s Compensation Commission should not have given "weight", because Dr.
Lorenzo is respondent’s consultant and witness in this case. Pursuant, however, to
section 46 of the Workmen’s Compensation Act (Act No. 3428, as amended), decisions
of the Workmen’s Compensations shall be "subject to appeal to the Supreme Court, in
the same manner . . . provided by law and by rules of court for appeal from the Court of
Industrial Relations . . .." Upon the other hand, an award, order or decision of the Court
of Industrial Relations may be appealed by certiorari, which appeal "shall be perfected
by filing with said court a notice of appeal and with the Supreme Court a petition
for certiorari" which may raise "only questions of law."

Philippine Association of Service Exporters, Inc. vs. DOLE Secretary Drilon

Facts: The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for
short), a firm "engaged principally in the recruitment of Filipino workers, male and
female, for overseas placement," 1 challenges the Constitutional validity of DOLE
Department Order No. 1, Series of 1988 entitled "GUIDELINES GOVERNING THE
TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD
WORKERS," in this petition for certiorari and prohibition. Specifically, the measure is
assailed for "discrimination against males or females;" 2 that it "does not apply to all
Filipino workers but only to domestic helpers and females with similar skills;" 3 and that
it is violative of the right to travel. The petitioner also asserts that it is an invalid
exercise of the lawmaking power, police power being legislative, and not executive, in
character.
It is claimed, finally, to be in violation of the Charter's non-impairment clause, in
addition to the "great and irreparable injury" that PASEI members face should the Order
be further enforced.

The OSG invoked the police power of the Philippine State.

Issue: WON the Department Order issued by DOLE is constitutional

Ruling:

As a general rule, official acts enjoy a presumed validity. In the absence of clear and
convincing evidence to the contrary, the presumption logically stands.

The petitioner has shown no satisfactory reason why the contested measure should be
nullified. There is no question that Department Order No. 1 applies only to "female
contract workers," but it does not thereby make an undue discrimination between the
sexes. It is well-settled that "equality before the law" under the Constitution does not
import a perfect Identity of rights among all men and women. It admits of
classifications, provided that:
(1) such classifications rest on substantial distinctions;
(2) they are germane to the purposes of the law;
(3) they are not confined to existing conditions; and
(4) they apply equally to all members of the same class. 

The Court is satisfied that the classification made-the preference for female workers —
rests on substantial distinctions. As a matter of judicial notice, the Court is well aware of
the unhappy plight that has befallen our female labor force abroad, especially domestic
servants, amid exploitative working conditions marked by, in not a few cases, physical
and personal abuse. Said reasons are the compelling motives for urgent Government
action.

The same, however, cannot be said of our male workers. In the first place, there is no
evidence that, except perhaps for isolated instances, our men abroad have been
afflicted with an Identical predicament. 

There is likewise no doubt that such a classification is germane to the purpose behind
the measure. The purpose of Department Order No. 1 is to "enhance the protection for
Filipino female overseas workers" this Court has no quarrel that in the midst of the
terrible mistreatment Filipina workers have suffered abroad, a ban on deployment will
be for their own good and welfare.
The Order does not narrowly apply to existing conditions. Rather, it is intended to apply
indefinitely so long as those conditions exist. This is clear from the Order itself, meaning to say
that should the authorities arrive at a means impressed with a greater degree of permanency,
the ban shall be lifted.

9. LIFTING OF SUSPENSION. — The Secretary of Labor and Employment (DOLE)

may, upon recommendation of the Philippine Overseas Employment
Administration (POEA), lift the suspension in countries where there are:

1. Bilateral agreements or understanding with the Philippines, and/or,

2. Existing mechanisms providing for sufficient safeguards to ensure the welfare

and protection of Filipino workers. 

The Court finds, finally, the impugned guidelines to be applicable to all female domestic
overseas workers. That it does not apply to "all Filipina workers" is not an argument for
unconstitutionality.

 What the Constitution prohibits is the singling out of a select person or group of persons within
an existing class, to the prejudice of such a person or group or resulting in an unfair advantage
to another person or group of persons.

CMS Estate vs. SSS

Facts: Petitioner is a domestic corporation organized primarily for the purpose of engaging in
the real estate business. It started doing business with only six (6) employees.  

In January 1957, the petitioner entered into a contract of management with one Eufracio D.
Rojas for the operation and exploitation of the forest concession.

The logging operation actually started on April 1, 1957 with four monthly salaried employees.

As of September 1, 1957, petitioner had 89 employees and laborers in the logging operation.
On December 26, 1957, petitioner revoked its contract of management with Mr. Rojas.

On August 1, 1958, petitioner became a member of the Social Security System with respect to
its real estate business. On September 6, 1958, petitioner remitted to the System the sum of
P203.13 representing the initial premium on the monthly salaries of the employees in its logging
business. However, on October 9, 1958, petitioner demanded the refund of the said amount,
claiming that it is not yet subject to compulsory coverage with respect to its logging business .
The request was denied by respondent System on the ground that the logging business was a
mere expansion of petitioner's activities and for purposes of the Social Security Act, petitioner
should be considered a member of the System since December 1, 1952 when it commenced its
real estate business.
The petitioner filed a petition with the Social Security Commission praying for the determination
of the effectivity date of the compulsory coverage of petitioner's logging business.

SSC decided that the petitioner should be subject to compulsory coverage as of Sept. 1, 1957
and the Social Security System is hereby directed to effect such coverage of petitioner's
employees in its logging and real estate business conformably to the provisions of Rep. Act No.
1161, as amended.

In its appeal, the petitioner asserts that CMS Estate is not yet subject to compulsory coverage
with respect to its logging business because it does not have the minimum required number of
employees. On the other hand, respondent claims that the logging business was a mere
expansion of petitioner’s activities and for purposes of the SSS Act, petitioner should be
considered a member of the System since December 1, 1952 when it commenced its real estate
business.

Issue: WON the contributions required of employers and employees under our SocSec Act are
obligatory because said Act was allegedly enacted by Congress in the exercise of its police
power of the State, not of its taxing power

Ruling: The Social Security Law was enacted pursuant to the policy of the government "to
develop, establish gradually and perfect a social security system which shall be suitable to the
needs of the people throughout the Philippines, and shall provide protection against the hazards
of disability, sickness, old age and death" (Sec. 2, RA 1161, as amended). It is thus clear that
said enactment implements the general welfare mandate of the Constitution and constitutes a
legitimate exercise of the police power of the State. As held in the case of Philippine Blooming
Mills Co., Inc., et al. vs. SSS  3 —

Membership in the SSS is not a result of bilateral, consensual agreement where

the rights and obligations of the parties are defined by and subject to their will,
RA 1161 requires compulsory coverage of employees and employers under the
System. It is actually a legal imposition on said employers and employees,
designed to provide social security to the workingmen. Membership in the SSS is
therefore, in compliance with the lawful exercise of the police power of the
State, to which the principle of non-impairment of the obligation of contract is
not a proper defense.

xxx xxx xxx

The taxing power of the State is exercised for the purpose of raising revenues. However, under
our Social Security Law, the emphasis is more on the promotion of the general welfare.

The funds contributed to the System belong to the members who will receive benefits, as a
matter of right, whenever the hazards provided by the law occur.
It is the intention of the law to cover as many persons as possible so as to promote the
constitutional objective of social justice.

Social Justice

Calalang vs. AD Williams

Facts: The National Traffic Commission, in its resolution of July 17, 1940, resolved to
recommend to the Director of the Public Works and to the Secretary of Public Works
and Communications that animal-drawn vehicles be prohibited from passing along the
following for a period of one year from the date of the opening of the Colgante Bridge to
traffic:

1) Rosario Street extending from Plaza Calderon de la Barca to Dasmariñas

2) Street from 7:30Am to 12:30 pm and from 1:30 pm to 530 pm; and

3) along Rizal Avenue extending from the railroad crossing at Antipolo Street to
Echague Street from 7 am to 11pm

The Chairman of the National Traffic Commission on July 18, 1940 recommended to the
Director of Public Works with the approval of the Secretary of Public Works the adoption of
themeasure proposed in the resolution aforementioned in pursuance of the provisions of theCo
mmonwealth Act No. 548 which authorizes said Director with the approval from the
Secretary of the Public Works and Communication to promulgate rules and regulations to
regulate and control the use of and traffic on national roads.

On August 2, 1940, the Director recommended to the Secretary the approval of the
recommendations made by the Chairman of the National Traffic Commission with modifications.
The Secretary of Public Works approved the recommendations on August 10,1940. The Mayor
of Manila and the Acting Chief of Police of Manila have enforced and caused to be enforced the
rules and regulation. As a consequence, all animal-drawn vehicles are not allowed to pass and
pick up passengers in the places above mentioned to the detriment not only of their owners but
of the riding public as well.

Issue: Whether the rules and regulations complained of infringe upon the constitutional
precept regarding the promotion of social justice to insure the well-being and economic security
of all the people
No. Social justice is “neither communism, nor despotism, nor atomism, nor anarchy,” but the
humanization of laws and the equalization of social and economic forces by the State so that
justice in its rational and objectively secular conception may  at least be approximated. Social
justice means the promotion of the welfare of all the people, the adoption by the Government
of measures calculated to insure economic stability of all the competent elements of society,
through the maintenance of a proper economic and social equilibrium in the interrelations of the
members of the community, constitutionally, through the adoption of measures legally
justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of
all governments on the time-honored principles of salus populi estsuprema lex.= the welfare of
an individual yields to that of the community.

Social justice must be founded on the recognition of the necessity of interdependence among
divers and diverse units of a society and of the protection that should be equally and evenly
extended to all groups as a combined force in our social and economic life, consistent with the
fundamental and paramount objective of the state of promoting health, comfort and quiet of all
persons, and of bringing about “the greatest good to the greatest number.”

In view of the foregoing, the writ of prohibition prayed for was denied

Garcia vs. PAL

Petitioners-employees filed a complaint for illegal dismissal against respondent PAL who
dismissed them after they were allegedly caught in the act of sniffing shabu within its premises.
The Labor Arbiter ruled for the petitioners and ordered immediately for their reinstatement.
Prior to this decision, SEC had placed PAL under an Interim Rehabilitation Receiver, and
subsequently under a Permanent Rehabilitation Receiver. PAL appealed and the Labor Tribunal
ruled in their favor. Subsequently, the Labor Arbiter issued a writ of execution for the
reinstatement and issued a notice of garnishment. The Labor Tribunal affirmed the writ and
notice but suspended and referred the action to the Rehabilitation Receiver of PAL. On appeal,
CA found for respondent PAL.

Issue: Whether or not PAL being under corporate rehabilitation suspends any monetary claims
to it

Ruling: Upon appointment by the SEC of a rehabilitation receiver, all actions for claims against
the corporation pending before any court, tribunal or board shall ipso jure be suspended. The
purpose of the automatic stay of all pending actions for claims is to enable the rehabilitation
receiver to effectively exercise its/his powers free from any judicial or extra-judicial interference
that might unduly hinder or prevent the rescue of the corporation.

The petitioners’ claim against PAL is a money claim for their wages during the pendency of
PAL’s appeal to the NLRC, the same should have been suspended pending the rehabilitation
proceedings. The Labor Arbiter, the NLRC, as well as the Court of Appeals should have
abstained from resolving petitioners’ case for illegal dismissal and should instead have directed
them to lodge their claim before PAL’s receiver.

However, to still require petitioners at this time to re-file their labor claim against PAL under the
peculiar circumstances of the case – that their dismissal was eventually held valid with only the
matter of reinstatement pending appeal being the issue – this Court deems it legally expedient
to suspend the proceedings in this case.

Capitol Medical Center vs. Dr. Meris

Facts: Petitioner (Capitol) closed its Industrial Service Unit (ISU) alleging loss and extinct
demand which resulted to Respondent Dr. Meris' termination as their chief in said unit.

Respondent filed a complaint for illegal dismissal.

The Labor Arbiter (LA) ruled in favor of petitioner that the dismissal was valid.

Issue: WON Capitol exercised its management prerogative in good faith

The records of the case, however, fail to impress that there was indeed extinct demand for the
medical services rendered by the ISU. 

Work is a necessity that has economic significance deserving legal protection. The social justice
and protection to labor provisions in the Constitution dictate so.

Employers are also accorded rights and privileges to assure their self-determination and
independence and reasonable return of capital. This mass of privileges comprises the so-called
management prerogatives. Although they may be broad and unlimited in scope, the State has
the right to determine whether an employer’s privilege is exercised in a manner that complies
with the legal requirements and does not offend the protected rights of labor. One of the rights
accorded an employer is the right to close an establishment or undertaking.

The right to close the operation of an establishment or undertaking is explicitly recognized

under the Labor Code as one of the authorized causes in terminating employment of workers,
the only limitation being that the closure must not be for the purpose of circumventing the
provisions on termination of employment embodied in the Labor Code.

ART. 283. Closure of establishment and reduction of personnel . – The employer may also
terminate the employment of any employee due to the installation of labor saving devices,
redundancy, retrenchment to prevent losses or the closing or cessation of operation of
the establishment or undertaking unless the closing is for the purpose of
circumventing the provisions of this Title, by serving a written notice on the workers and
the Ministry of Labor and Employment at least one (1) month before the intended date thereof.
In case of termination due to the installation of labor saving devices or redundancy, the worker
affected shall be entitled to a separation pay equivalent to at least his one (1) month pay or to
at least one (1) month pay for every year of service, whichever is higher. In case retrenchment
to prevent losses and in cases of closures or cessation of
operations of establishment or undertaking not due to serious business losses or financial
reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2)
month pay for every year of service, whichever is higher. A fraction of at least six (6) months
shall be considered one (1) whole year. (Emphasis and underscoring supplied)

The phrase "closures or cessation of operations of establishment or undertaking" includes a

partial or total closure or cessation

Fuentes vs. NLRC

Facts: Petitioners were regular employees of private respondent Agusan Plantations, Inc.,
which was engaged in the operation of a palm tree plantation in Trento, Agusan del Sur, since
September 1982. Agusan Plantations claims that it was suffering business losses which resulted
in the decision of the head office in Singapore to undertake retrenchment measures, private
respondent sent notices of termination to petitioners and the DOLE.

As a result of the retrenchment, petitioners filed with the DOLE office in Cagayan de Oro City a
complaint for illegal dismissal with prayer for reinstatement, backwages and damages against
private respondent Agusan Plantation, Inc., and/or Chang Chee Kong. In their answer
respondents denied the allegations of petitioners and contended that upon receipt of
instructions from the head office in Singapore to implement retrenchment, private respondents
conducted grievance conferences or meetings with petitioners' representative labor
organization, the Association of Trade Unions through its national president Jorge Alegarbes, its
local president and its board of directors. Private respondents also contended that the 30-day
notices of termination were duly sent to petitioners.

Labor Arbiter rendered a decision in favor of petitioners ordering private respondents to pay the
former separation pay equivalent to fifteen (15) days pay for every year of service plus salary
differentials and attorney's fees. The decision of the LA was reversed by the NLRC and ruled
that the  petitioners were legally terminated from their employment.

Issue: WON there was a valid retrenchment

Ruling: Under Art. 283 therefore retrenchment may be valid only when the following requisites
are met: (a) it is to prevent losses; (b) written notices were served on the workers and the
Department of Labor and Employment (DOLE) at least one (1) month before the effective date
of retrenchment; and, (c) separation pay is paid to the affected workers.

The closure of a business establishment is a ground for the termination of the services of an
employee unless the closing is for the purpose of circumventing pertinent provisions of the
Labor Code. But while business reverses can be a just cause for terminating employees, they
must be sufficiently proved by the employer .

case, the date of termination should be at least one (1) month from
the date of notice to the workers. Petitioners were terminated less
than a month after notice was sent to DOLE and to each of the
workers.

Respondents failed to prove their claim of business losses. What they submitted to the Labor
Arbiter were mere self-serving documents and allegations. Private respondents never adduced
evidence which would show clearly the extent of losses they suffered as a result of lack of
capital funding, which failure is fatal to their cause.

JAMER v. NLRC

FACTS:  Petitioners are cashiers of Isetann Department Store who were dismissed for having
accumulated shortages. Petitioners admitted this in their affidavits. The labor arbiter ruled them
having been illegally dismissed. The NLRC reversed the ruling.
 
ISSUE: Were the petitioners validly dismissed?
 
HELD:  Yes. The failure of the petitioners to report to the management the irregularities
constitute "fraud or willful breach of the trust reposed in them by their employer or duly
authorized representative"--one of the just causes of valid termination of employment . The
employer cannot be compelled to retain employees who were guilty of malfeasance as their
continued employment will be prejudicial to the former's best interest. The law, in protecting
the rights of the employees, authorizes neither oppression nor self-destruction of the employer.
 
 
GANDARA MILL SUPPLY v. NLRC

FACTS:  Private respondent Silvestre Germane did not report for work because his wife
delivered their first child. He did not however notify his employer, causing a disruption in the
business of the latter. When the respondent returned to work he was surprised upon knowing
that someone has been hired to take his place.
 
ISSUE:  Was there a case of illegal dismissal?
 
HELD:  Yes. It appeared that the respondent was illegally dismissed. While a prolonged absence
without leave may constitute as a just cause for dismissal, its illegality stems from the non-
observance of due process. Applying the WenPhil Doctrine by analogy, where dismissal was not
preceded by the twin requirement of notice and hearing, the illegality of the dismissal in
question, is under heavy clouds and therefore illegal.

Dream Land Hotel and Resort vs. Johnson

FACTS:

Petitioner Dreamland with its President, Westley Prentice, is a corporation engaged in the hotel,
restaurant and allied businesses. Respondent Stephen B. Johnson is an Australian citizen who
came to the Philippines as a businessman/investor without the authority to be employed as the
employee/officer of any business as he was not able to secure his Alien Employment Permit.

Sometime on June 21, 2007, Prentice and Johnson entered into an Employment Agreement,
which stipulates among others, that Johnson shall serve as Operations Manager of Dreamland
from August 1, 2007 and shall serve as such for a period of three (3) years.

From the start of August 2007, as stipulated in the Employment Agreement, respondent
Johnson already reported for work. It was then that he found out to his dismay that the resort
was far from finished. However, he was instructed to supervise construction and speak with
potential guests. He also undertook the overall preparation of the guestrooms and staff for the
opening of the hotel, even performing menial tasks.

As Johnson remained unpaid since August 2007 and he has loaned all his money to petitioners,
he asked for his salary after the resort was opened in October 2007 but the same was not given
to him by petitioners. Johnson became very alarmed with the situation as it appears that there
was no intention to pay him his salary.