UP LAW BOC TABLE OF CONTENTS
I. Fundamental Principle and Policies ............... 4
A. CONSTITUTIONAL PROVISIONS .............. 4
B. CIVIL CODE................................................. 5
c. LABOR CODE.............................................. 5
II. Recruitment and Placement .......................... 9
A. RECRUITMENT OF LOCAL AND MIGRANT
WORKERS ...................................................... 9
B. REGULATIONS AND ENFORCEMENT ..... 15
III. Labor Standards ......................................... 19
a. COVERAGE ................................................19
B. HOURS OF WORK .................................... 21
C. WAGES ..................................................... 27
D. REST DAY................................................. 33
E. HOLIDAY PAY/PREMIUM PAY ................ 34
F. Premium Pay ............................................ 38
G. LEAVES .................................................... 39
3
LABOR LAW
VII. Labor Relations ......................................... 89
A. Strikes, Picketing, and lockouts...............89
B. Definitions/Concepts ............................... 92
C. Representation issue in organized
Establishments ............................................. 93
D. Prohibited activities in strike/lockout ... 100
E. Appeal/Procedural Remedies ................ 101
F. Unfair Labor Practice of Employers ....... 103
G. Jurisdiction of Labor Arbiters and the
Commission ................................................ 104
H. Right of managerial and supervisory
employees concerning self-organization .. 106
I. Rights and Conditions of Membership in a
Labor Organization .................................... 106
K. Appearances and Fees ........................... 108
L. Duty to Bargain Collectively when there
exists a CBA ................................................ 108
UP LAW BOC LABOR STANDARDS LABOR LAW

I. Fundamental Article III, Section 1. No person shall be deprived of

life, liberty, or property without due process of law,

Principle and Policies nor shall any person be denied the equal protection
of the laws.

A. CONSTITUTIONAL PROVISIONS Due Process

(1) Substantive Due Process (dismissal should
A.1. ARTICLE II, SECS 9, 10, 11, 13, 14, 18, be for a valid and authorized cause as
provided by law)
20
(2) Procedural (due notice and hearing).
Article II, Section 9. The State shall promote a just
and dynamic social order that will ensure the
Article III, Section 4. No law shall be passed
prosperity and independence of the nation and free
abridging the freedom of speech, of expression, or
the people from poverty through policies that
of the press, or the right of the people peaceably to
provide adequate social services, promote full
assemble and petition the government for redress
employment, a rising standard of living, and an
of grievances.
improved quality of life for all.
Article III, Section 7. The right of the people to
Article II, Section 10. The State shall promote social
information on matters of public concern shall be
justice in all phases of national development.
recognized. Access to official records, and to
documents and papers pertaining to official acts,
Article II, Section 11. The State values the dignity of
transactions, or decisions, as well as to government
every human person and guarantees full respect
research data used as basis for policy development,
for human rights.
shall be afforded the citizen, subject to such
limitations as may be provided by law.
Article II, Section 13. The State recognizes the vital
role of the youth in nation-building and shall
Article III, Section 8. The right of the people,
promote and protect their physical, moral,
including those employed in the public and private
spiritual, intellectual, and social well-being. It shall
sectors, to form unions, associations, or societies
inculcate in the youth patriotism and nationalism,
for purposes not contrary to law shall not be
and encourage their involvement in public and civic
abridged.
affairs.
Article III, Section 10. No law impairing the
Article II, Section 14. The State recognizes the role
obligation of contracts shall be passed.
of women in nation-building, and shall ensure the
fundamental equality before the law of women and
men. Article III, Section 16. All persons shall have the right
to a speedy disposition of their cases before all
Article II, Section 18. The State affirms labor as a judicial, quasi-judicial, or administrative bodies.
primary social economic force. It shall protect the
rights of workers and promote their welfare.
Article III, Section 18(2). No involuntary servitude in
Article II, Section 20. The State recognizes the any form shall exist except as a punishment for a
indispensable role of the private sector, encourages crime whereof the party shall have been duly
private enterprise, and provides incentives to convicted.
needed investments.
A.2.ARTICLE III, SECS 1, 4, 7, 8, 10, 16, A.3 ARTICLE XIII, SECS 1, 2, 3, 13, 14
18(2) Article XIII, Section 1. The Congress shall give
highest priority to the enactment of measures that

4
UP LAW BOC LABOR STANDARDS
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.
To this end, the State shall regulate the
acquisition, ownership, use, and disposition of
property and its increments.
Article XIII, Section 2. The promotion of social
justice shall include the commitment to create
economic opportunities based on freedom of
initiative and self-reliance.
Article XIII, Section 3. 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.
Limits to Management Prerogative
(1) Good faith
(2) Without grave abuse of discretion
Article XIII, Section 13. The State recognizes the vital
role of the youth in nation-building and shall
5
LABOR LAW
promote and protect their physical, moral,
spiritual, intellectual, and social well-being. It shall
inculcate in the youth patriotism and nationalism,
and encourage their involvement in public and civic
affairs.
Article XIII, Section 14. 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.
B. CIVIL CODE
B.1. ARTICLE 19
Article 19. Every person must, in the exercise of his
rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty
and good faith.
B.2. ARTICLE 1700
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.
B.3. ARTICLE 1702
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.
Liberal Construction
All doubts in the implementation and
interpretation of the provisions of this Code,
including its implementing rules and
regulations, shall be resolved in favour of
labor. [PAL v. Santos, G.R. No. 77875, February
4, 1993].
C. LABOR CODE
C.1. ARTICLE 3
UP LAW BOC LABOR STANDARDS
LC, Art. 3. Declaration of basic policy. The State
shall afford protection to labor, promote full
employment, ensure equal work opportunities
regardless of sex, race or creed and regulate the
relations between workers and employers. The
State shall assure the rights of workers to self-
organization, collective bargaining, security of
tenure, and just and humane conditions of work.
C.2. ARTICLE 4
LC, Art. 4. Construction in favor of labor. All doubts
in the implementation and interpretation of the
provisions of this Code, including its implementing
rules and regulations, shall be resolved in favor of
labor
Liberality in Application of Rules
It is settled that subsequent and substantial
compliance may call for the relaxation of the
rules of procedure. The Court has time and
again relaxed the rigid application of the rules
to offer full opportunity for parties to ventilate
their causes and defenses in order to promote
rather than frustrate the ends of justice. [Ma.
Ligaya Santos vs. Litton Mills (2011)]
C.3. ARTICLE 166 (NOW ARTICLE 172)
Article 166. Policy. - The State shall promote and
develop a tax-exempt employees’ compensation
program whereby employees and their
dependents, in the event of work-connected
disability or death, may promptly secure
adequate income benefit and medical related
benefits.
C.4. ARTICLE 211 (NOW ARTICLE 217)
Article 211. Declaration of Policy. –
A. It is the policy of the State:
(a) To promote and emphasize the primacy of
free collective bargaining and negotiations,
including voluntary arbitration, mediation and
conciliation, as modes of settling labor or
industrial disputes;
(b) To promote free trade unionism as an
instrument for the enhancement of democracy
and the promotion of social justice and
development;
6
LABOR LAW
(c) To foster the free and voluntary organization
of a strong and united labor movement;
(d) To promote the enlightenment of workers
concerning their rights and obligations as union
members and as employees;
(e) To provide an adequate administrative
machinery for the expeditious settlement of
labor or industrial disputes;
(f) To ensure a stable but dynamic and just
industrial peace; and
(g) To ensure the participation of workers in
decision and policy-making processes affecting
their rights, duties and welfare.
B. To encourage a truly democratic method of
regulating the relations between the employers
and employees by means of agreements freely
entered into through collective bargaining, no
court or administrative agency or official shall
have the power to set or fix wages, rates of pay,
hours of work or other terms and conditions of
employment, except as otherwise provided under
this Code.
C.5. ARTICLE 212 (NOW ARTICLE 218)
Article 212. Definitions. –
(a) “Commission” means the National Labor
Relations Commission or any of its divisions, as
the case may be, as provided under this Code.
(b) “Bureau” means the Bureau of Labor
Relations and/or the Labor Relations Divisions in
the regional offices established under
Presidential Decree No. 1, in the Department of
Labor.
(c) “Board” means the National Conciliation and
Mediation Board established under Executive
Order No. 126.
(d) “Council” means the Tripartite Voluntary
Arbitration Advisory Council established under
Executive Order No. 126, as amended.
(e) “Employer” includes any person acting in the
interest of an employer, directly or indirectly. The
term shall not include any labor organization or
any of its officers or agents except when acting
as employer.
(f) “Employee” includes any person in the employ
of an employer. The term shall not be limited to
the employees of a particular employer, unless
the Code so explicitly states. It shall include any
UP LAW BOC LABOR STANDARDS
individual whose work has ceased as a result of
or in connection with any current labor dispute or
because of any unfair labor practice if he has not
obtained any other substantially equivalent and
regular employment.
(g) “Labor organization” means any union or
association of employees which exists in whole or
in part for the purpose of collective bargaining or
of dealing with employers concerning terms and
conditions of employment.
(h) “Legitimate labor organization” means any
labor organization duly registered with the
Department of Labor and Employment, and
includes any branch or local thereof.
(i) “Company union” means any labor
organization whose formation, function or
administration has been assisted by any act
defined as unfair labor practice by this Code.
(j) “Bargaining representative” means a
legitimate labor organization whether or not
employed by the employer.
(k) “Unfair labor practice” means any unfair labor
practice as expressly defined by the Code.
(l) “Labor dispute” includes any controversy or
matter concerning terms and conditions of
employment or the association or representation
of persons in negotiating, fixing, maintaining,
changing or arranging the terms and conditions
of employment, regardless of whether the
disputants stand in the proximate relation of
employer and employee.
(m) “Managerial employee” is one who is vested
with the powers or prerogatives to lay down and
execute management policies and/or to hire,
transfer, suspend, lay-off, recall, discharge,
assign or discipline employees. Supervisory
employees are those who, in the interest of the
employer, effectively recommend such
managerial actions if the exercise of such
authority is not merely routinary or clerical in
nature but requires the use of independent
judgment. All employees not falling within any of
the above definitions are considered rank-and-
file employees for purposes of this Book.
(n) “Voluntary Arbitrator” means any person
accredited by the Board as such or any person
named or designated in the Collective
Bargaining Agreement by the parties to act as
their Voluntary Arbitrator, or one chosen with or
without the assistance of the National
7
LABOR LAW
Conciliation and Mediation Board, pursuant to a
selection procedure agreed upon in the
Collective Bargaining Agreement, or any official
that may be authorized by the Secretary of Labor
and Employment to act as Voluntary Arbitrator
upon the written request and agreement of the
parties to a labor dispute.
(o) “Strike” means any temporary stoppage of
work by the concerted action of employees as a
result of an industrial or labor dispute.
(p) “Lockout” means any temporary refusal of an
employer to furnish work as a result of an
industrial or labor dispute.
(q) “Internal union dispute” includes all disputes
or grievances arising from any violation of or
disagreement over any provision of the
constitution and by laws of a union, including
any violation of the rights and conditions of
union membership provided for in this Code.
(r) “Strike-breaker” means any person who
obstructs, impedes, or interferes with by force,
violence, coercion, threats, or intimidation any
peaceful picketing affecting wages, hours or
conditions of work or in the exercise of the right
of self-organization or collective bargaining.
(s) “Strike area” means the establishment,
warehouses, depots, plants or offices, including
the sites or premises used as runaway shops, of
the employer struck against, as well as the
immediate vicinity actually used by picketing
strikers in moving to and fro before all points of
entrance to and exit from said establishment.
C.6. ARTICLE 255 (NOW ARTICLE 261)
Article 255. Exclusive bargaining representation
and workers’ participation in policy and decision
making. - The labor organization designated or
selected by the majority of the employees in an
appropriate collective bargaining unit shall be
the exclusive representative of the employees in
such unit for the purpose of collective
bargaining. However, an individual employee or
group of employees shall have the right at any
time to present grievances to their employer.
Any provision of law to the contrary
notwithstanding, workers shall have the right,
subject to such rules and regulations as the
Secretary of Labor and Employment may
UP LAW BOC LABOR STANDARDS
promulgate, to participate in policy and decision-
making processes of the establishment where
they are employed insofar as said processes will
directly affect their rights, benefits and welfare.
For this purpose, workers and employers may
form labor-management councils: Provided,
That the representatives of the workers in such
labor-management councils shall be elected by
at least the majority of all employees in said
establishment.
C.7. ARTICLE 277 (NOW ARTICLE 283)
Article 277. Miscellaneous provisions. –
(a) All unions are authorized to collect
reasonable membership fees, union dues,
assessments and fines and other contributions
for labor education and research, mutual death
and hospitalization benefits, welfare fund, strike
fund and credit and cooperative undertakings.
(b) Subject to the constitutional right of workers
to security of tenure and their right to be
protected against dismissal except for a just and
authorized cause and without prejudice to the
requirement of notice under Article 283 of this
Code, the employer shall furnish the worker
whose employment is sought to be terminated a
written notice containing a statement of the
causes for termination and shall afford the latter
ample opportunity to be heard and to defend
himself with the assistance of his representative
if he so desires in accordance with company rules
and regulations promulgated pursuant to
guidelines set by the Department of Labor and
Employment. Any decision taken by the
employer shall be without prejudice to the right
of the worker to contest the validity or legality of
his dismissal by filing a complaint with the
regional branch of the National Labor Relations
Commission. The burden of proving that the
termination was for a valid or authorized cause
shall rest on the employer. The Secretary of the
Department of Labor and Employment may
suspend the effects of the termination pending
resolution of the dispute in the event of a prima
facie finding by the appropriate official of the
Department of Labor and Employment before
whom such dispute is pending that the
termination may cause a serious labor dispute or
is in implementation of a mass lay-off.
8
LABOR LAW
(c) Any employee, whether employed for a
definite period or not, shall, beginning on his first
day of service, be considered as an employee for
purposes of membership in any labor union.
(d) No docket fee shall be assessed in labor
standards disputes. In all other disputes, docket
fees may be assessed against the filing party,
provided that in bargaining deadlock, such fees
shall be shared equally by the negotiating
parties. (e) The Minister of Labor and
Employment and the Minister of the Budget shall
cause to be created or reclassified in accordance
with law such positions as may be necessary to
carry out the objectives of this Code and cause
the upgrading of the salaries of the personnel
involved in the Labor Relations System of the
Ministry. Funds needed for this purpose shall be
provided out of the Special Activities Fund
appropriated by Batas Pambansa Blg. 80 and
from annual appropriations thereafter.
(f) A special Voluntary Arbitration Fund is hereby
established in the Board to subsidize the cost of
voluntary arbitration in cases involving the
interpretation and implementation of the
Collective Bargaining Agreement, including the
Arbitrator’s fees, and for such other related
purposes to promote and develop voluntary
arbitration. The Board shall administer the
Special Voluntary Arbitration Fund in accordance
with the guidelines it may adopt upon the
recommendation of the Council, which
guidelines shall be subject to the approval of the
Secretary of Labor and Employment. Continuing
funds needed for this purpose in the initial yearly
amount of fifteen million pesos
(P15,000,000.00) shall be provided in the 1989
annual general appropriations acts.
The amount of subsidy in appropriate cases shall
be determined by the Board in accordance with
established guidelines issued by it upon the
recommendation of the Council.
The Fund shall also be utilized for the operation
of the Council, the training and education of
Voluntary Arbitrators, and the Voluntary
Arbitration Program.
(g) The Ministry shall help promote and
gradually develop, with the agreement of labor
organizations and employers, labor-
management cooperation programs at
UP LAW BOC LABOR STANDARDS
appropriate levels of the enterprise based on the
shared responsibility and mutual respect in order
to ensure industrial peace and improvement in
productivity, working conditions and the quality
of working life.
(h) In establishments where no legitimate labor
organization exists, labor-management
committees may be formed voluntarily by
workers and employers for the purpose of
promoting industrial peace. The Department of
Labor and Employment shall endeavor to
enlighten and educate the workers and
employers on their rights and responsibilities
through labor education with emphasis on the
policy thrusts of this Code.
(i) To ensure speedy labor justice, the periods
provided in this Code within which decisions or
resolutions of labor relations cases or matters
should be rendered shall be mandatory. For this
purpose, a case or matter shall be deemed
submitted for decision or resolution upon the
filing of the last pleading or memorandum
required by the rules of the Commission or by the
Commission itself, or the Labor Arbiter, or the
Director of the Bureau of Labor Relations or
Med-Arbiter, or the Regional Director.
Upon expiration of the corresponding period, a
certification stating why a decision or resolution
has not been rendered within the said period
shall be issued forthwith by the Chairman of the
Commission, the Executive Labor Arbiter, or the
Director of the Bureau of Labor Relations or
Med-Arbiter, or the Regional Director, as the
case may be, and a copy thereof served upon the
parties.
Despite the expiration of the applicable
mandatory period, the aforesaid officials shall,
without prejudice to any liability which may have
been incurred as a consequence thereof, see to it
that the case or matter shall be decided or
resolved without any further delay.
9
LABOR LAW
II. Recruitment and
Placement
A. RECRUITMENT OF LOCAL AND
MIGRANT WORKERS
A.1. ILLEGAL RECRUITMENT (SEC. 5,
R.A. NO. 10022)
License and Authority
A license is a document issued by the
Department of Labor and Employment (DOLE)
authorizing a person or entity to operate a
private employment agency, while an
authority is a document issued by the DOLE
authorizing a person or association to engage
in recruitment and placement activities as a
private recruitment agency. (Art. 13(d) and (f),
LC)
Entities disqualified from being issued a license
(1) Travel agencies and sales agencies of
airline companies. (Art. 26)
(2) Officers or members of the Board of any
corporation or members in partnership
engaged in the business of a travel
agency.
(3) Corporations and partnerships, when any
of its officers, members of the board or
partners, is also an officer, member of the
board of partner of a corporation or
partnership engaged in the business of a
travel agency.
(4) Persons, partnerships or corporations
which have derogatory records.
(5) Any official or employee of the DOLE,
POEA, OWWA, DFA and other
government agencies directly involved in
the implementation of R.A. 8042 as
amended and/or any of his/her relatives
within the 4th civil degree of
consanguinity and affinity. (POEA Rules
of 2002)
Non-transferability of license or authority
UP LAW BOC LABOR STANDARDS
(1) No license or authority shall be used
directly or indirectly by any person other
than the one in whose favor it was issued
or at any place other than that stated in
the license or authority,
(2) Nor may such license or authority be
transferred, conveyed, or assigned to any
other person or entity.
Duration of Validity
4 years (POEA Rules of 2002)
Citizenship requirement
(1) Only Filipino citizens or
(2) Corporations, partnerships or entities at
least seventy-five percent (75%) of the
authorized and voting capital stock of
which is owned and controlled by Filipino
citizens shall be permitted to participate in
the recruitment and placement of workers,
locally or overseas. (Art. 27, LC)
SEE: POEA Rules, Part II, Rule I, Sec. 1(a)
Capitalization requirement
All applicants for authority to hire or renewal
of license to recruit are required to have such
substantial capitalization as determined by
the Secretary of Labor. (Art. 28, LC)
Based on POEA Rules the following are the
substantial capital requirements:
(1) Single proprietorships or partnerships with
minimum capitalization of P2,000,000.
(2) Corporations with minimum paid-up
capital of P2,000,000.
Essential Elements of Illegal Recruitment
“Recruitment and placement" refers to any act
of (C-E-C-T-U-H)
(a) canvassing,
(b) enlisting,
(c) contracting,
(d) transporting,
(e) utilizing, or
(f) hiring procuring workers,
10
LABOR LAW
And also includes
(a) referrals,
(b) contract services,
(c) promising, or
(d) advertising for employment, locally or
abroad, whether for profit or not
Provided, That any person or entity which, in
any manner, offers or promises for a fee
employment to two or more persons shall be
deemed engaged in recruitment and
placement. (Art. 13 (b), LC)
Simple Illegal Recruitment
Illegal recruitment for Local Workers (Governed
by the Labor Code)
Simple Illegal Recruitment (local)
Elements:
(1) The person charged with the crime must
have undertaken recruitment activities
defined under Art. 13(b) or prohibited
activities defined under Art. 34; and
(2) The said person does not have a license
or authority to do so. (Art. 38, LC)
Prohibited practices
It shall be unlawful for any individual, entity,
licensee, or holder of authority:
(a) To charge or accept, directly or indirectly,
any amount greater than that specified in
the schedule of allowable fees prescribed
by the Secretary of Labor, or to make a
worker pay any amount greater than that
actually received by him as a loan or
advance;
(b) To furnish or publish any false notice or
information or document in relation to
recruitment or employment;
(c) To give any false notice, testimony,
information or document or commit any
act of misrepresentation for the purpose of
securing a license or authority under this
Code.
UP LAW BOC LABOR STANDARDS
(d) To induce or attempt to induce a worker
already employed to quit his employment
in order to offer him to another unless the
transfer is designed to liberate the worker
from oppressive terms and conditions of
employment;
(e) To influence or to attempt to influence any
person or entity not to employ any worker
who has not applied for employment
through his agency;
(f) To engage in the recruitment or placement
of workers in jobs harmful to public health
or morality or to the dignity of the
Republic of the Philippines;
(g) To obstruct or attempt to obstruct
inspection by the Secretary of Labor or by
his duly authorized representatives;
(h) To fail to file reports on the status of
employment, placement vacancies,
remittance of foreign exchange earnings,
separation from jobs, departures and such
other matters or information as may be
required by the Secretary of Labor.
(i) To substitute or alter employment
contracts approved and verified by the
Department of Labor from the time of
actual signing thereof by the parties up to
and including the periods of expiration of
the same without the approval of the
Secretary of Labor;
(j) To become an officer or member of the
Board of any corporation engaged in travel
agency or to be engaged directly or
indirectly in the management of a travel
agency; and
(k) To withhold or deny travel documents
from applicant workers before departure
for monetary or financial considerations
other than those authorized under this
Code and its implementing rules and
regulations. (Art. 34, LC)
Illegal recruitment for Migrant Workers
(Governed by R.A. 8042, as amended by, R.A.
10022)
11
LABOR LAW
Simple Illegal Recruitment
1st type:
(1) Person charged undertakes any
recruitment activity as defined in Art.13 (b)
of the Labor Code; and
(2) Said person does not have a license or
authority to do so.
2nd type:
(1) Person charged commits any of the
enumerated acts under Sec. 6 of R.A.
8042, as amended by, R.A. 10022.
(2) It is immaterial whether he is a holder or
not of any license or authority
Other prohibited acts
It shall likewise include the following acts,
whether committed by any person, whether a
non-licensee, non-holder, licensee or holder of
authority:
a. To charge or accept directly or indirectly
any amount greater than that specified in
the schedule of allowable fees prescribed
by the Secretary of Labor and
Employment, or to make a worker pay or
acknowledge any amount greater than
that actually received by him as a loan or
advance;
b. To furnish or publish any false notice or
information or document in relation to
recruitment or employment;
c. To give any false notice, testimony,
information or document or commit any
act of misrepresentation for the purpose of
securing a license or authority under the
Labor Code, or for the purpose of
documenting hired workers with the
POEA, which include the act of
reprocessing workers through a job order
that pertains to nonexistent work, work
different from the actual overseas work, or
work with a different employer whether
registered or not with the POEA;
d. To include or attempt to induce a worker
already employed to quit his employment
UP LAW BOC LABOR STANDARDS
in order to offer him another unless the
transfer is designed to liberate a worker
from oppressive terms and conditions of
employment;
e. To influence or attempt to influence any
person or entity not to employ any worker
who has not applied for employment
through his agency or who has formed,
joined or supported, or has contacted or is
supported by any union or workers'
organization;
f. To engage in the recruitment or placement
of workers in jobs harmful to public health
or morality or to the dignity of the
Republic of the Philippines;
g. To fail to submit reports on the status of
employment, placement vacancies,
remittance of foreign exchange earnings,
separation from jobs, departures and such
other matters or information as may be
required by the Secretary of Labor and
Employment;
h. To substitute or alter to the prejudice of
the worker, employment contracts
approved and verified by the Department
of Labor and Employment from the time of
actual signing thereof by the parties up to
and including the period of the expiration
of the same without the approval of the
Department of Labor and Employment;
i. For an officer or agent of a recruitment or
placement agency to become an officer or
member of the Board of any corporation
engaged in travel agency or to be engaged
directly or indirectly in the management of
travel agency;
j. To withhold or deny travel documents
from applicant workers before departure
for monetary or financial considerations,
or for any other reasons, other than those
authorized under the Labor Code and its
implementing rules and regulations;
k. Failure to actually deploy a contracted
worker without valid reason as determined
12
LABOR LAW
by the Department of Labor and
Employment;
l. Failure to reimburse expenses incurred by
the worker in connection with his
documentation and processing for
purposes of deployment, in cases where
the deployment does not actually take
place without the worker's fault. Illegal
recruitment when committed by a
syndicate or in large scale shall be
considered an offense involving economic
sabotage; and
m. To allow a non-Filipino citizen to head or
manage a licensed recruitment/manning
agency.
In addition to the acts enumerated above, it
shall also be unlawful for any person or entity
to commit the following prohibited acts:
(1) Grant a loan to an overseas Filipino worker
with interest exceeding eight percent (8%)
per annum, which will be used for
payment of legal and allowable placement
fees and make the migrant worker issue,
either personally or through a guarantor or
accommodation party, postdated checks
in relation to the said loan;
(2) Impose a compulsory and exclusive
arrangement whereby an overseas Filipino
worker is required to avail of a loan only
from specifically designated institutions,
entities or persons;
(3) Refuse to condone or renegotiate a loan
incurred by an overseas Filipino worker
after the latter's employment contract has
been prematurely terminated through no
fault of his or her own;
(4) Impose a compulsory and exclusive
arrangement whereby an overseas Filipino
worker is required to undergo health
examinations only from specifically
designated medical clinics, institutions,
entities or persons, except in the case of a
seafarer whose medical examination cost
is shouldered by the principal/shipowner;
UP LAW BOC LABOR STANDARDS LABOR LAW

(5) Impose a compulsory and exclusive (1) The accused engages in acts of
arrangement whereby an overseas Filipino recruitment and placement of workers
worker is required to undergo training, defined under Article 13(b) of the Labor
seminar, instruction or schooling of any Code or in any prohibited activities under
kind only from specifically designated Article 43 of the Labor Code;
institutions, entities or persons, except for (2) The accused has not complied with the
recommendatory trainings mandated by guidelines issued by the Secretary of
principals/shipowners where the latter Labor and Employment, particularly with
shoulder the cost of such trainings; respect to the securing of license or an
(6) For a suspended recruitment/manning authority to recruit and deploy workers,
agency to engage in any kind of either locally or overseas; and
recruitment activity including the (3) The accused commits the unlawful acts
processing of pending workers' against three or more persons individually
applications; and or as a group.
(7) For a recruitment/manning agency or a
foreign principal/employer to pass on the Illegal recruitment as economic sabotage
overseas Filipino worker or deduct from his Offense involving Economic Sabotage (Large-
or her salary the payment of the cost of Scale or by a Syndicate)
insurance fees, premium or other Illegal recruitment is considered economic
insurance related charges, as provided sabotage when the commission thereof is
under the compulsory worker's insurance attended by the ff. qualifying circumstances:
coverage. (Sec. 6, RA 8042 as amended) (1) By a syndicate - if carried out by a group of
3 or more persons conspiring and
Illegal recruitment in large scale confederating with one another;
Illegal recruitment by a syndicate In large scale - if committed against 3 or more
(1) The offender undertakes either any activity persons individually or as a group. (Art. 38(b),
within the meaning of "recruitment and LC)
placement" defined under Article 13(b), or
any of the prohibited practices Liabilities
enumerated under Art. 34 of the Labor Local Recruitment Agency
Code; Illegal Recruitment Involving Local Workers
(2) He has no valid license or authority (Art. 39, LC)
required by law to enable one to lawfully Act Penalty
engage in recruitment and placement of Illegal recruitment Life imprisonment AND
workers; AND constituting economic Fine: P100,000.00
(3) The illegal recruitment is committed by a sabotage
group of three (3) or more persons Licensee or holder or 2 years ≤ Imprisonment
authority violating or ≤ 5 years OR
conspiring or confederating with one
causing another to P10,000 ≤ Fine ≤
another. [People v. Gallo (2010)]
violate Title I, Book I, LC P50,000 OR both
Violating or causing 4 years ≤ Imprisonment
Illegal recruitment in large scale another to violate Title I, ≤ 8 years OR
The acts committed by the accused Book I, LC P20,000 ≤ Fine ≤
constituted illegal recruitment in large scale, P100,000 OR both
whose essential elements are the following:

13
UP LAW BOC LABOR STANDARDS LABOR LAW

Illegal Recruitment Involving Migrant Workers with the corporation or partnership for the
(Sec. 7, RA 8042 as amended by RA 10022) aforesaid claims and damages. [Becmen
Act Penalty Service Exporter and Promotion, Inc. v.
Illegal 12 years and 1 day ≤ Spouses Cuaresma, G.R. 182978-79, April 7,
recruitment Imprisonment ≤ 20 years AND 2009]
P1M ≤ Fine ≤ P2M
Illegal Life imprisonment AND (4) Foreign employer shall assume joint and
recruitment P2M ≤ Fine ≤ P5M
solidary liability with the employer for all
constituting
claims and liabilities which may arise in
economic Maximum penalty:
sabotage 1. illegally recruited person connection with the implementation of the
below 18 years old OR contract, including but not limited to
2. Without license/authority payment of wages, death and disability
Prohibited 6 years and 1 day ≤ compensation and repatriation
Act/s Imprisonment ≤ 12 years AND
P500k ≤ Fine ≤ P1M Common Rules on Illegal Recruitment (Local or
Overseas)
Common Rules on Liability Venue
(1) Employees of a company corporation A criminal action arising from illegal
engaged in illegal recruitment may be held recruitment shall be filed with the RTC of the
liable as principal, together with his employer, province or city:
if it is shown that he actively and (1) where the offense was committed or
consciously participated in illegal (2) where the offended party actually resides at
recruitment. the time of the commission of the offense.
(Sec. 9, R.A. 8042 [this part was not
(2) Local Employment Agency is solidarily liable amended by R.A. 10022]).
with foreign principal. Severance of relations 11
between local agent and foreign principal Prescriptive Periods
does not affect liability of local recruiter. (1) Simple Illegal Recruitment – 5 years
Private employment agencies are held (2) Illegal Recruitment involving Economic
jointly and severally liable with the foreign- Sabotage – 20 years. (Sec. 12, R.A. 8042
based employer for any violation of the [this part was not amended by R.A,
recruitment agreement or contract of 10022]).
employment. This joint and solidary liability
imposed by law against recruitment Foreign Employer
agencies and foreign employers is meant to Foreign employer shall assume joint and solidary
assure the aggrieved worker of immediate liability with the employer for all claims and
and sufficient payment of what is due him. liabilities which may arise in connection with
[Becmen Service Exporter and Promotion, the implementation of the contract, including
Inc. v. Spouses Cuaresma, G.R. 182978-79, but not limited to payment of wages, death
April 7, 2009] and disability compensation and repatriation

(3) If the recruitment/placement agency is a Solidary Liability

juridical being, the corporate officers and Solidary Liability of Agent and Principal
directors and partners as the case may be, The written application for a license to operate
shall themselves be jointly and solidarily liable a private employment or manning agency

14
UP LAW BOC LABOR STANDARDS
shall be submitted with, among others, a
VERIFIED UNDERTAKING stating that the
applicant:
(1) Shall assume full and complete
responsibility for
 all claims and liabilities which may
arise in connection with the use of
license;
 all acts of its officials, employees and
representatives done in connection
with recruitment and placement;
(2) Shall assume joint and solidary liability
with the employer for all claims and liabilities
which may arise in connection with the
implementation of the contract, including but
not limited to payment of wages, death and
disability compensation and repatriation;
(3) Shall guarantee compliance with the
existing labor and social legislations of the
Philippines and of the country of employment
of recruited workers [POEA Rules, Book II, Rule
II, Sec. 1 (f) (2-5)]
Pre-Termination of Contract of Migrant Worker
(Sec. 10, R.A. 8042, as amended by R.A.
10022)
In case of termination of overseas employment
 without just, valid or authorized cause
as defined by law or contract, or
 any unauthorized deductions from the
migrant worker's salary
The worker shall be entitled to the full
reimbursement of:
(1) his placement fee and the deductions
made with interest at twelve percent
(12%) per annum
(2) plus his salaries for the unexpired
portion of his employment contract OR
for three (3) months for every year of
the unexpired term, whichever is less.
15
LABOR LAW
A. 2. DIRECT HIRING
General Rule: No employer may hire a Filipino
worker for overseas employment except
through the Boards and entities authorized by
the Secretary of Labor. (Art. 18, LC)
Exceptions:
(1) Members of the diplomatic corps;
(2) International organizations;
(3) Such other employees as may be allowed
by the Sec. of Labor;
(4) Name hirees – those individuals who are
able to secure contracts for overseas
employment on their own efforts and
representation without the assistance or
participation of any agency. Their hiring,
nonetheless, has to be processed through
the POEA. (Part III, Rule III of the POEA
Rules Governing Overseas Employment as
amended in 2002)
B. REGULATIONS AND
ENFORCEMENT
B.1. SUSPENSION OR CANCELLATION
OF LICENSE OR AUTHORITY
The Secretary of Labor shall have the power to
suspend or cancel any license or authority to
recruit employees for overseas employment
for
a. violation of rules and regulations
issued by the Department of Labor, the
Overseas Employment Development
Board, and the National Seamen Board
b. violation of the provisions of this and
other applicable laws, General Orders
and Letters of Instructions. (Article 35,
LC)
Who can suspend or cancel the license?
(1) DOLE Secretary
(2) POEA Administrator
UP LAW BOC LABOR STANDARDS
The power to suspend or cancel any license or
authority to recruit employees for overseas
employment is concurrently vested with the
POEA and the Secretary of Labor. [People v.
Diaz, 259 SCRA 441 (1996)]
B.2. REGULATORY AND VISITORIAL
POWERS OF THE DOLE SECRETARY
Regulatory powers (Art. 36, LC)
The Secretary of Labor shall have the power to
restrict and regulate the recruitment and
placement activities of all agencies within the
coverage of this Title and is hereby authorized
to issue orders and promulgate rules and
regulations to carry out the objectives and
implement the provisions of this Title.
Visitorial powers (Art. 37, LC)
The Secretary of Labor or his duly authorized
representatives may, at any time, inspect the
premises, books of accounts and records of
any person or entity covered by this Title,
require it to submit reports regularly on
prescribed forms, and act on violations of any
provisions of this Title.
B.3. REMITTANCE OF FOREIGN
EXCHANGE EARNINGS
It shall be mandatory for all Filipino workers
abroad to remit a portion of their foreign
earnings to their families, dependents, and/or
beneficiaries in the country (Art. 22, LC)
Amount required to be remitted (Executive
Order No. 857)
The following are the percentages of foreign
exchange remittance required from various
kinds of migrant workers:
(1) Seaman or mariner – 80% of their
basic salary
(2) Workers for Filipino contractors and
construction companies – 70%
16
LABOR LAW
(3) Doctors, engineers, teachers, nurses
and other professional workers whose
contract provide for free board and
lodging – 70%
(4) All other professional workers whose
employment contracts do not provide
for free board and lodging facilities –
50%
(5) Domestic and other service workers –
50%
(6) All other workers not falling under the
aforementioned categories – 50%
(7) Performing artists – 50%
Individuals exempted from the mandatory
remittance requirement:
(1) The immediate family members,
dependents or beneficiaries of migrant
workers residing with the latter
abroad;
(2) Filipino servicemen working within US
military installations;
(3) Immigrants and Filipino professionals
working with the United Nations and
its agencies or other specialized
bodies.
B.4. PROHIBITED ACTIVITIES
Prohibited practices
It shall be unlawful for any individual, entity,
licensee, or holder of authority:
(a) To charge or accept, directly or indirectly,
any amount greater than that specified in
the schedule of allowable fees prescribed
by the Secretary of Labor, or to make a
worker pay any amount greater than that
actually received by him as a loan or
advance;
(b) To furnish or publish any false notice or
information or document in relation to
recruitment or employment;
(c) To give any false notice, testimony,
information or document or commit any
act of misrepresentation for the purpose of
UP LAW BOC LABOR STANDARDS
securing a license or authority under this
Code.
(d) To induce or attempt to induce a worker
already employed to quit his employment
in order to offer him to another unless the
transfer is designed to liberate the worker
from oppressive terms and conditions of
employment;
(e) To influence or to attempt to influence any
person or entity not to employ any worker
who has not applied for employment
through his agency;
(f) To engage in the recruitment or placement
of workers in jobs harmful to public health
or morality or to the dignity of the
Republic of the Philippines;
(g) To obstruct or attempt to obstruct
inspection by the Secretary of Labor or by
his duly authorized representatives;
(h) To fail to file reports on the status of
employment, placement vacancies,
remittance of foreign exchange earnings,
separation from jobs, departures and such
other matters or information as may be
required by the Secretary of Labor.
(i) To substitute or alter employment
contracts approved and verified by the
Department of Labor from the time of
actual signing thereof by the parties up to
and including the periods of expiration of
the same without the approval of the
Secretary of Labor;
(j) To become an officer or member of the
Board of any corporation engaged in travel
agency or to be engaged directly or
indirectly in the management of a travel
agency; and
To withhold or deny travel documents from
applicant workers before departure for
monetary or financial considerations other
than those authorized under this Code and its
implementing rules and regulations. (Art. 34,
LC)
Other prohibited acts
17
LABOR LAW
It shall likewise include the following acts,
whether committed by any person, whether a
non-licensee, non-holder, licensee or holder of
authority:
a. To charge or accept directly or indirectly
any amount greater than that specified
in the schedule of allowable fees
prescribed by the Secretary of Labor and
Employment, or to make a worker pay or
acknowledge any amount greater than
that actually received by him as a loan or
advance;
b. To furnish or publish any false notice or
information or document in relation to
recruitment or employment;
c. To give any false notice, testimony,
information or document or commit any
act of misrepresentation for the purpose
of securing a license or authority under
the Labor Code, or for the purpose of
documenting hired workers with the
POEA, which include the act of
reprocessing workers through a job
order that pertains to nonexistent work,
work different from the actual overseas
work, or work with a different employer
whether registered or not with the
POEA;
d. To include or attempt to induce a worker
already employed to quit his
employment in order to offer him
another unless the transfer is designed
to liberate a worker from oppressive
terms and conditions of employment;
e. To influence or attempt to influence any
person or entity not to employ any
worker who has not applied for
employment through his agency or who
has formed, joined or supported, or has
contacted or is supported by any union
or workers' organization;
f. To engage in the recruitment or
placement of workers in jobs harmful to
public health or morality or to the
UP LAW BOC LABOR STANDARDS
dignity of the Republic of the
Philippines;
g. To fail to submit reports on the status of
employment, placement vacancies,
remittance of foreign exchange
earnings, separation from jobs,
departures and such other matters or
information as may be required by the
Secretary of Labor and Employment;
h. To substitute or alter to the prejudice of
the worker, employment contracts
approved and verified by the
Department of Labor and Employment
from the time of actual signing thereof
by the parties up to and including the
period of the expiration of the same
without the approval of the Department
of Labor and Employment;
i. For an officer or agent of a recruitment
or placement agency to become an
officer or member of the Board of any
corporation engaged in travel agency or
to be engaged directly or indirectly in the
management of travel agency;
j. To withhold or deny travel documents
from applicant workers before departure
for monetary or financial considerations,
or for any other reasons, other than
those authorized under the Labor Code
and its implementing rules and
regulations;
k. Failure to actually deploy a contracted
worker without valid reason as
determined by the Department of Labor
and Employment;
l. Failure to reimburse expenses incurred
by the worker in connection with his
documentation and processing for
purposes of deployment, in cases where
the deployment does not actually take
place without the worker's fault. Illegal
recruitment when committed by a
syndicate or in large scale shall be
considered an offense involving
economic sabotage; and
18
LABOR LAW
m. To allow a non-Filipino citizen to head or
manage a licensed
recruitment/manning agency.
In addition to the acts enumerated above, it
shall also be unlawful for any person or entity
to commit the following prohibited acts:
(1) Grant a loan to an overseas Filipino
worker with interest exceeding eight
percent (8%) per annum, which will be
used for payment of legal and allowable
placement fees and make the migrant
worker issue, either personally or
through a guarantor or accommodation
party, postdated checks in relation to the
said loan;
(2) Impose a compulsory and exclusive
arrangement whereby an overseas
Filipino worker is required to avail of a
loan only from specifically designated
institutions, entities or persons;
(3) Refuse to condone or renegotiate a loan
incurred by an overseas Filipino worker
after the latter's employment contract
has been prematurely terminated
through no fault of his or her own;
(4) Impose a compulsory and exclusive
arrangement whereby an overseas
Filipino worker is required to undergo
health examinations only from
specifically designated medical clinics,
institutions, entities or persons, except in
the case of a seafarer whose medical
examination cost is shouldered by the
principal/shipowner;
(5) Impose a compulsory and exclusive
arrangement whereby an overseas
Filipino worker is required to undergo
training, seminar, instruction or
schooling of any kind only from
specifically designated institutions,
entities or persons, except for
recommendatory trainings mandated by
principals/shipowners where the latter
shoulder the cost of such trainings;
UP LAW BOC LABOR STANDARDS
(6) For a suspended recruitment/manning
agency to engage in any kind of
recruitment activity including the
processing of pending workers'
applications; and
(7) For a recruitment/manning agency or a
foreign principal/employer to pass on
the overseas Filipino worker or deduct
from his or her salary the payment of the
cost of insurance fees, premium or other
insurance related charges, as provided
under the compulsory worker's
insurance coverage. (Sec. 6, RA 8042 as
amended)
III. Labor Standards
A. COVERAGE
General rule: Shall apply to employees in all
establishments and undertakings whether
for profit or not. (Art. 82, LC)
Exceptions (NOT Covered):
(1) Government employees (Art. 82; Art. 76)
(2) Managerial Employees including
members of the managerial staff (Art.
82)
(3) Field Personnel (Art. 82)
(4) Members of the family of the employer
who are dependent on him for support
(Art. 82);
(5) Domestic helpers and persons in
personal service of another (Art. 141)
(6) Workers who paid by result as
determined by DOLE regulation (Art. 82)
(a) Government employees
The terms and conditions of employment of
all government employees, including
employees of GOCCs, are governed by the
Civil Service rules and regulations, not by
the Labor Code (Art. 282).
19
LABOR LAW
However, note that GOCCs with their own
charter are governed by Civil Service Rules.
The Labor Code is only applicable to those
created under the General Corporation Law.
(Sec. 2(i) Art. IX-B of 1987 Phil. Constitution)
(b) Managerial employees
Two definitions of “managerial employees” in
the Labor Code
Article 82: Those whose primary duty
consists of the management of the
establishment in which they are employed or
of a department or subdivision thereof, and
to other officers or members of the
managerial staff. (Art. 82, LC)
Article 212 (m): One who is vested with the
powers or prerogatives to lay down and
execute management policies and/or to
hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline employees.
Supervisory employees are those who, in the
interest of the employer, effectively
recommend such managerial actions if the
exercise of such authority is not merely
routinary or clerical in nature but requires
the use of independent judgment. All
employees not falling within any of the
above definitions are considered rank-and-
file employees for purposes of this Book
Characteristics of managerial employees
(Book 3, Rule 1, Sec. 2(b), IRR)
Managerial employees qualify for the
exception if they meet all of the following
conditions:
1. Their primary duty consists of the
management of the establishment in
which they are employed or of a
department or sub-division thereof.
2. They customarily and regularly direct the
work of two or more employees therein.
UP LAW BOC LABOR STANDARDS
3. They have the authority to hire or fire
employees of lower rank; or their
suggestions and recommendations as to
hiring and firing and as to the promotion
or any other change of status of other
employees, are given particular weight.
Managerial Staff also included (Book 3, Rule
1, Sec. 2(c), IRR)
Officers or members of a managerial staff
also qualify for the exception if they perform
the following duties and responsibilities:
1. The primary duty consists of the
performance of work directly related to
management policies of their employer;
2. Customarily and regularly exercise
discretion and independent judgment;
(a) Regularly and directly assist a
proprietor or a managerial employee
whose primary duty consists of the
management of the establishment in
which he is employed or subdivision
thereof; OR
(b) Execute under general supervision
work along specialized or technical lines
requiring special training, experience, or
knowledge; OR
(c) Execute, under general supervision,
special assignments and tasks;
3. Who do not devote more than 20 percent
of their hours worked in a work week to
activities which are not directly and closely
related to the performance of the work
described in paragraphs (1), (2) and (3)
above.
(c) Field personnel
Non-agricultural employees
1. who regularly perform their duties
away from the principal place of
business or branch office of the
employer AND
20
LABOR LAW
2. whose actual hours of work in the field
cannot be determined with reasonable
certainty. (Art. 82, LC)
Test: Whether or not the employee’s time
and performance are constantly supervised by
the employer. [Far East Agricultural Supply v.
Lebatique [2007)]
(d) Dependent family members
Workers who are family members of the
employer, and who are dependent on him
for their support, are outside the coverage of
this Title on working conditions and rest
periods.
(e) Domestic helpers
"Domestic or household service" shall mean
service in the employer’s home which is
usually necessary or desirable for the
maintenance and enjoyment thereof and
includes ministering to the personal comfort
and convenience of the members of the
employer’s household, including services of
family drivers. (Art. 141, LC)
Note: The Kasambahay Law (RA 10361) has
redefined “domestic worker” or
“kasambahay”:
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,
nursemaid 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. (RA 10361 Art. 1, Sec. 4
(d))
(f) Persons in personal service of another
UP LAW BOC LABOR STANDARDS
Domestic servants and persons in the
personal service of another if they perform
such services in the employer’s home which
are usually necessary or desirable for the
maintenance and enjoyment thereof, or
minister to the personal comfort,
convenience, or safety of the employer as
well as the members of his employer’s
household. (Book 3, Rule 1, Sec. 2 (d), IRR)
Note that the definition contemplates a
domestic servant who is employed in the
employer’s home to minister exclusively to
the personal comfort and enjoyment of the
employer’s family. (Azucena)
(g) Workers Paid by Result
Workers who are paid by results, including
those who are paid on piece-work, “takay,”
“pakiao” or task basis, and other non-time
work if their output rates are in accordance
with the standards prescribed under Section
8, Rule VII, Book Three of these regulations,
or where such rates have been fixed by the
Secretary of Labor and Employment in
accordance with the aforesaid Section.
(Book 3, Rule 1, Sec. 2 (e), IRR)
B. HOURS OF WORK
B.1. COVERAGE/EXCLUSIONS
supra
B.2. NORMAL HOURS OF WORK
General Rule: 8-Hour Labor Law
The normal hours of work of any employee
shall not exceed eight (8) hours a day. (Art.
83, LC)
Exception to the 8-Hour Law: Work Hours of
Health Personnel
Health personnel in
21
LABOR LAW
a. cities and municipalities with a population
of at least one million (1,000,000) OR
b.hospitals and clinics with a bed capacity of
at least one hundred (100) shall hold
regular office hours for eight (8) hours a
day, for five (5) days a week, exclusive of
time for meals, except where the
exigencies of the service require that such
personnel work for six (6) days or forty-
eight (48) hours, in which case, they shall
be entitled to an additional compensation
of at least thirty percent (30%) of their
regular wage for work on the sixth day.
For purposes of this Article, "health
personnel" shall include resident physicians,
nurses, nutritionists, dietitians, pharmacists,
social workers, laboratory technicians,
paramedical technicians, psychologists,
midwives, attendants and all other hospital
or clinic personnel. (Art. 38, LC) Medical
secretaries are also considered clinic
personnel. (Azucena)
Compensable Hours of Work (Art. 84, LC)
Hours worked shall include
(a) All time during which an employee is
required to be on duty or to be at a
prescribed workplace; AND
(b) All time during which an employee is
suffered or permitted to work.
Rest period – short duration or “coffee
break”
Rest periods of short duration during
working hours shall be counted as hours
worked. (Art. 84, par. 2, LC)
Rest periods or coffee breaks running from
five (5) to twenty (20) minutes shall be
considered as compensable working time.
(Bk III, Rule 1, Sec. 7, par. 2, IRR)
An employee need not leave the premises of
the work place in order that his rest period
UP LAW BOC LABOR STANDARDS
shall not be counted, it being enough that
he stops working, may rest completely and
may leave his work place, to go elsewhere,
whether within or outside the premises of his
work place. (Book 3, Rule 1, Sec. 4 (b) of the
IRR)
On call
An employee who is
a. required to remain on call in the
employer’s premises or so close thereto
b.that he cannot use the time effectively and
gainfully for his own purpose
shall be considered as working while on call.
An employee who is not required to leave
word at his home or with company officials
where he may be reached is not working
while on call. (Book III, Rule 1, Sec. 5(b), IRR)
Inactive due to work interruptions
The time during which an employee is
inactive by reason of interruptions in his
work beyond his control shall be considered
working time either:
a. if the imminence of the resumption of
work requires the employee's presence at
the place of work OR
b.if the interval is too brief to be utilized
effectively and gainfully in the employee's
own interest. (Book III, Rule 1, Sec. 4(d),
IRR)
Work interruption due to brownouts
Brownouts of short duration, but not
exceeding 20 minutes, shall be treated as
hours worked, whether used productively by
the employees or not.
If they last more than 20 minutes, the time
may not be treated as hours worked if the
employees can leave their workplace or go
elsewhere whether within or without the
work premises; or the employees can use the
time effectively for their own interest. In this
22
LABOR LAW
case, the employer may extend the working
hours beyond the regular schedule on that
day to compensate for the loss of productive
man-hours without being liable for overtime
pay. (Policy Instruction No. 36, May 22, 1978)
Note: The time during which an employee is
inactive by reason of work interruptions
beyond his control is considered working
time, either if the imminence of the
resumption of work requires the employee’s
presence at the place of work or if the
interval is too brief to be utilized effectively
and gainfully in the employee’s own interest.
(Book III, Rule 1 Sec. 4-c OR)
Necessary Work After Normal Hours
If the work performed was necessary, or it
benefited the employer, or the employee
could not abandon his work at the end of his
normal working hours because he had no
replacement, all the time spent for such
work shall be considered as hours worked if
the work was with the knowledge of his
employer or immediate supervisor. [IRR, Book
III, Rule 1, Sec. 4(c)]
Lectures, meetings, trainings
Attendance at lectures, meetings, training
programs, and other similar activities shall
not be counted as working time if ALL of the
following conditions are met:
1. Attendance is outside of the employee’s
regular working hours;
2. Attendance is in fact voluntary; and
3. The employee does not perform any
productive work during such attendance.
(IRR, Book III, Rule 1, Sec. 6)
Note:
(1) Attendance in lectures, meetings, and
training periods sanctioned by the
employer are considered hours
worked.
UP LAW BOC LABOR STANDARDS
(2) Attendance in CBA negotiations or
grievance meeting is compensable
hours worked.
(3) Attendance in hearings in cases filed
by the employee is NOT compensable
hours worked.
(4) Participation in strikes is NOT
compensable working time.
Idle time
The idle time that an employee may spend
for resting and dining which he may leave
the spot or place of work though not the
premises of his employer, is not counted as
working time only where the work is broken
or is not continuous. [National Development
Co. v. CIR (1962)]
Travel time (Department of Labor Manual)
(1) Travel from home to work – An employee
who travels from home before his regular
workday and returns to his home at the
end of the workday is engaged in
ordinary home-to-work travel which is
NOT worktime, except:
a. When called to travel during
emergency;
b. When travel is done through a
conveyance furnished by the
employer;
c. Travel is done under vexing and
dangerous circumstances;
d. Travel is done under the
supervision and control of the
employer.
(2) Travel that is all in the day’s work – Time
spent by an employee in travel from
jobsite to jobsite during the workday,
must be counted as hours worked. Where
an employee is required to report at a
meeting place to receive instructions or
to perform other work there, the travel
from the designated place to the
workplace is part of the day’s work.
23
LABOR LAW
(3) Travel away from home - Travel that
keeps an employee away from home
overnight is travel away from home.
Travel away from home is worktime when
it cuts across the employee’s workday.
The time is hours worked not only on
regular working hours but also during the
corresponding hours on non-working
days.
Semestral Break of Private School Teachers
Regular full-time teachers are entitled to
salary during semestral breaks. [University of
the Pangasinan Faculty Union v. University of
Pangasinan (1984)]
Work Hours of Seamen
The correct criterion in determining whether
or not sailors are entitled to overtime pay is
not, therefore, whether they are on board
and cannot leave ship beyond the regular
eight working number of hours, but whether
they actually rendered service in excess of
said number of hours. [Cagampan, et. al. v.
NLR (1991)]
B.2.a. Flexible Work Arrangements(DOLE
Advisory No. 02, Series of 2004)
Reduction of Workdays
The normal workdays per week are reduced
but should not last for more than 6 months.
Rotation of Workers
The employees are rotated or alternately
provided work within the workweek
Forced Leave
Employees are required to go on leave for
several days or weeks utilizing their leave
credits of there are any.
Broken-time Schedule
UP LAW BOC LABOR STANDARDS
The works schedule is not continuous but
the work hours within the day or week
remain.
Flexi-holidays
The employees agree to avail the holidays at
some other days provided there is no
diminution of existing benefits as a result of
such arrangement.
Compressed Work Week (CWW)
Under the CWW scheme, the normal
workday goes beyond eight hours without
the corresponding overtime premium.
The total hours of work, however, shall not
exceed 12 hours a day or 48 hours a week, or
the employer is obliged to pay the worker
the overtime premium in excess of said work
hours.
Conditions for CWW
(1) The CWW scheme is undertaken as a
result of an express and voluntary
agreement of majority of the covered
employees or their duly authorized
representatives.
(2) In firms using substances, chemicals
and processes or operating under
conditions where there are airborne
contaminants, human carcinogens or
noise prolonged exposure to which may
pose hazards to employees’ health and
safety, there must be a certification from
an accredited health and safety
organization or practitioner from the
firm’s safety committee that work
beyond eight hours is within threshold
limits or tolerable levels of exposure, as
set in the OSHS.
(3) The employer shall notify DOLE,
through the Regional Office having
jurisdiction over the workplace, of the
24
LABOR LAW
adoption of the CWW scheme. The
notice shall be in DOLE CWW Report
Form attached to this Advisory. (DOLE
Advisory No. 02-04)
B.3. MEAL BREAK
General Rule: Subject to such regulations as
the Secretary of Labor may prescribe, it shall
be the duty of every employer to give his
employees not less than sixty (60) minutes
time-off for their regular meals (Art. 85, LC)
Exception:
Employees may be given a meal period of
not less than twenty (20) minutes provided
that such shorter meal period is credited as
compensable hours worked of the employee:
(a) Where the work is non-manual work in
nature or does not involve strenuous
physical exertion;
(b) Where the establishment regularly
operates not less than sixteen (16) hours a
day;
(c) In case of actual or impending
emergencies or there is urgent work to be
performed on machineries, equipment or
installations to avoid serious loss which the
employer would otherwise suffer; and
(d) Where the work is necessary to prevent
serious loss of perishable goods (Book 3,
Rule 1, Sec. 7 par 1, IRR)
Synthesis of the Rules
General Rule: Meal periods are NOT
compensable.
Exception:
It becomes compensable:
(1) Where the lunch period or meal time is
predominantly spent for the employer’s
benefit. (Azucena citing 31 Am. Jur. 881;
Duka, Labor Laws and Social
Legislation)
UP LAW BOC LABOR STANDARDS
(2) Meal periods of 1 hour is deemed
compensable when the employee is on
continuous shift. (National Development
Co. v. CIR, G.R. No. L-15422, Nov. 30,
1962)
(3) Shortened meal period of less than 1
hour (say, 30 minutes) must be
compensable. (Sec. 7, Rule I, Book III,
IRR)
Note: To shorten meal time to less than 20
minutes is not allowed. If the so-called meal
time is less than 20 minutes, it becomes
only a REST PERIOD and is considered
working time.
Exception to the Exception: Shortened meal
breaks upon the employees’ request – NOT
compensable. The employees themselves
may request that the meal period be
shortened so that they can leave work earlier
than the previously established schedule.
(Drilon: Letter to Kodak Philippines, Nov. 27,
1989; also Cilindro: BWC-WHSD Opinion No.
197, s. 1998).
B.4. 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. (Book III, Rule I Sec. 5(a), IRR)
An employee who is required to remain on
call in the employer’s premises or so close
thereto that he cannot use the time
effectively and gainfully for his own purpose
shall be considered as working while on call.
(Book 3, Rule 1, Sec. 5, IRR)
B.5. OVERTIME WORK, OVERTIME PAY
25
LABOR LAW
Overtime on ordinary working day
Work may be performed beyond eight (8)
hours a day provided that the employee is
paid for the overtime work, an additional
compensation equivalent to his regular wage
plus at least twenty-five percent (25%)
thereof. (Art. 87, LC)
Overtime work on holiday or rest day
Work performed beyond eight hours on a
holiday or rest day shall be paid an
additional compensation equivalent to the
rate of the first eight hours on a holiday or rest
day plus at least thirty percent (30%) thereof.
(Art. 87, LC)
Emergency overtime (Art. 89, LC)
Any employee may be required by the
employer to perform overtime work in any of
the following cases:
(1) When the country is at war or when
any other national or local emergency has
been declared by the National Assembly
or the Chief Executive;
(2) When it is necessary to prevent loss of
life or property or in case of imminent
danger to public safety due to an actual or
impending emergency in the locality
caused by serious accidents, fire, flood,
typhoon, earthquake, epidemic, or other
disaster or calamity;
(3) When there is urgent work to be
performed on machines, installations, or
equipment, in order to avoid serious loss
or damage to the employer or some other
cause of similar nature;
(4) When the work is necessary to prevent
loss or damage to perishable goods; and
(5) Where the completion or continuation
of the work started before the eighth hour
is necessary to prevent serious obstruction
or prejudice to the business or operations
of the employer.
Cannot offset undertime
UP LAW BOC LABOR STANDARDS
Undertime work on any particular day shall
not be offset by overtime work on any other
day. Permission given to the employee to go
on leave on some other day of the week shall
not exempt the employer from paying the
additional compensation required in this
Chapter. (Art. 88, LC)
Overtime pay does not preclude night
differential pay
The receipt of overtime pay will not preclude
the right to night differential pay. The latter
is payment for work done during the night
while the other is payment for the excess of
the regular eight-hour work. [Naric v. Naric
Workers Union (1959)]
B.6. NIGHT WORK, NIGHT SHIFT
DIFFERENTIAL
Night worker
Any employed person whose work requires
performance of a substantial number of
hours of night work which exceed a specified
limit. This limit shall be fixed by the Sec of
Labor after consulting the workers’
representatives/labor organizations and
employers. (Art. 154, RA 10151)
Women Night Workers (Art. 158, RA 10151)
Measures shall be taken to ensure that an
alternative to night work is available to
women workers who would otherwise be
called upon to perform such work:
(1) Before and after childbirth, for a
period of at least sixteen (16) weeks, which
shall be divided between the time before
and after childbirth;
(2) For additional periods, in respect of
which a medical certificate is produced
stating that said additional periods are
necessary for the health of the mother or
child:
(a) During pregnancy;
26
LABOR LAW
(b) During a specified time beyond the
period, after childbirth is fixed
pursuant to subparagraph (1)
above, the length of which shall be
determined by the DOLE after
consulting the labor organizations
and employers.
Night shift differential
The additional compensation of 10% of an
employee’s regular wage for each hour of
work performed between 10pm and 6am.
(Art. 86, LC)
Coverage (Book 3, Rule 2, Sec. 1, IRR)
All employees, except:
a) Those of the government and any of its
political subdivisions, including
government-owned and/or controlled
corporations;
b) Those of retail and service establishments
regularly employing not more than five (5)
workers;
c) Domestic helpers and persons in the
personal service of another;
d) Managerial employees as defined in Book
Three of this Code;
e) Field personnel and other employees
whose time and performance is
unsupervised by the employer including
those who are engaged on task or
contract basis, purely commission basis,
or those who are paid a fixed amount for
performing work irrespective of the time
consumed in the performance thereof.
Rest days (night-off)
Night shift employees are entitled to a
weekly night-off (usually Saturday evening)
or a weekly rest period of 24 hours
beginning at the start of the night shift.
Work on special days
Night shift employees are also entitled to
the premium pay on special days and
UP LAW BOC LABOR STANDARDS
holidays. These days are reckoned as
calendar days which start at midnight and
end at the following midnight. The premium
pay for the night shift also starts or ends at
midnight. However, the employment
contract, company policy or CBA may
provide that in the case of night shift
workers, days—including special days and
regular holidays—shall begin on the night
before a calendar day.
Transfer (Art. 157, RA 10151)
Night workers who are certified as unfit for
night work, due to health reasons, shall be
transferred to a similar job for which they are
fit to work. If such is not practicable, they
shall be granted the same benefits as other
workers who are unable to work, or to secure
employment during such period.
B. 7. PART-TIME WORK
A single, regular or voluntary form of
employment with hours of work
substantially shorter than those considered
as normal in the establishment.
(International Labor Organization)
This excludes those forms of employment
which, although referred to as part-time
work, are in particular, irregular, temporary
or intermittent employment, or in cases
where hours of work have been temporarily
reduced for economic, technical or structural
reasons.
The wage and benefits of part-time worker
are in proportion to the number of hours
worked.
B.8. CONTRACT FOR PIECE OF WORK
A contract for the delivery at a certain price
of an article which the vendor in the ordinary
course of his business manufactures or
27
LABOR LAW
procures for the general market, whether the
same is on hand at the time or not, is a
contract of sale
BUT if the goods are to be manufactured
specially for the customer and upon his
special order, and not for the general
market, it is a contract for a piece of work.
(Article 1467, CC)
C. WAGES
Definition
a. It is the remuneration or earnings,
however designated, capable of being
expressed in terms of money,
b. whether fixed or ascertained on a time,
task, piece, or commission basis, or
other method of calculating the same,
c. which is payable by an employer to an
employee
d. under a written or unwritten contract of
employment for work done or to be
done, or for services rendered or to be
rendered and
e. includes the fair and reasonable value,
as determined by the Secretary of Labor
and Employment, of board, lodging, or
other facilities customarily furnished by
the employer to the employee
Fair and reasonable value - shall not include
any profit to the employer, or to any person
affiliated with the employer. (Art. 97(f))
“No work no pay” principle
General Rule: the age old rule governing the
relation between labor and capital or
management and employee is that a "fair
day's wage for a fair day's labor."
Exception: When the laborer was able, willing
and ready to work but was illegally locked
out, suspended or dismissed, or otherwise
illegally prevented from working.
UP LAW BOC LABOR STANDARDS LABOR LAW

“Equal Work for Equal Pay” Principle C.2. MINIMUM WAGE

Employees working in the Philippines, if they
are performing similar functions and
responsibilities under similar working
conditions should be paid equally. If an
employer accords employees the same
position and rank, the presumption is that
these employees perform equal work.
Coverage/Exclusions (Art. 98 and Bk 3, Rule
VII, Sec 3, IRR)
The Labor Code Title on wages shall not
apply to the following:
(1) Farm tenancy or leasehold;
(2) Household or domestic helpers, including
family drivers and other persons in the
personal service of another;
(3) Homeworkers engaged in needlework;
(4) Workers in registered cottage industries
who actually work at home;
(5) Workers in registered cooperatives when
so recommended by the Bureau of
Cooperative Development upon approval
of the Secretary of Labor;
(6) Workers in registered barangay micro
business enterprise (RA 9178).
Statutory minimum wage is the lowest wage
rate fixed by law that an ER can pay his
workers. [IRR, RA 6727, (o)]
Coverage
General Rule: The wage increases prescribed
under Wage Orders apply to all private
sector workers and EEs receiving the daily
minimum wage rates or those receiving up
to a certain daily wage ceiling, where
applicable, regardless of their position,
designation, or status, and irrespective of
the method by which their wages are paid.
Exceptions:
1. Domestic Helpers/kasambahay are
covered by RA 10361
2. Workers of registered barangay micro
business enterprise with Certificates of
Authority issued by the Office of the
Municipal or City Treasurer. (RA 9178)
3. Learners (RA 602)
4. Apprentices (RA 602)
5. Handicapped Workers (RA 602)

C.1. WAGE VS. SALARY Exemptions upon Approval

Wages and salary are in essence Upon application with and as determined by
synonymous. [Songco v. NLRC (1990)] the Regional Tripartite Wages and
Productivity Board, based on documentation
There are slight differences: and other requirements in accordance with
Wage Salary applicable rules and regulations issued by
Paid for skilled or Paid to white collar the NWPC, the following may be exempted
unskilled manual workers and denote from the applicability of this Order:
labor a higher grade of 1. Distressed establishments;
employment 2. Retail/Service establishments regularly
Not subject to Not exempt from employing not more than 10 workers;
execution, execution, 3. Establishments whose total assets
garnishment or garnishment or including those arising from loans but
attachment except attachment (Gaa vs. exclusive of the land on which the particular
for debts related to CA, 1985) business entity’s office, plant and equipment
necessities (Art. are situated, are not more than P3 Million;
1708) and,

28
UP LAW BOC LABOR STANDARDS
4. Establishments adversely affected by
natural calamities. (Sec. 8, Wage Order No.
18, 2013)
Basis
The basis of the minimum wage rates
prescribed by law shall be the normal
working hours of 8 hours a day. (Sec 7, IRR
of RA 6727)
Factors/Criteria in determining regional
minimum wages:
(1) Demand for living wages;
(2) Wage adjustment the consumer price
index;
(3) Cost of living and changes or increases
therein;
(4) The needs of workers and their families;
(5) The need to induce industries to invest in
the countryside;
(6) Improvements in standards of living;
(7) Prevailing wage levels;
(8) Fair return of the capital invested and
capacity to pay of employers;
(9) Effects in employment generation and
family income; and
(10) Equitable distribution of income and
wealth along the imperatives of economic
and social development. (Art. 124)
Procedure for Wage Fixing by Regional Board
(Art. 123)
(1) Investigate and study pertinent facts,
based on criteria set in Art. 124
(2) Conduct public hearings or consultations
with notice to employer and employee
groups, provinces, city, municipal officials
and other interested parties
(3) Decide to ISSUE or NOT TO ISSUE a wage
order
 Frequency: Wage orders issued may
not be disturbed for 12 months from
effective date; this serves as a bar for
petitions for wage hikes as well
29
LABOR LAW
 EXCEPT: when Congress passes a
new law affecting wages or other
supervening circumstances
 Effectivity: If it decides to ISSUE a
wage order, the wage order takes
effect after 15 days from complete
publication in at least 1 newspaper
of general circulation in the region
(4) Appeal wage order to Commission within
10 calendar days; mandatory for the
Commission to decide within 60 calendar
days from filing
Filing of an appeal DOES NOT STAY order
unless appellant files an undertaking with a
surety, to guarantee payment of employees
if the wage order is affirmed (as amended by
RA 6727)
Note: Daily minimum wage in NCR as of Apr.
4, 2015 is P481 (Wage Order No. NCR-19)
C.3. MINIMUM WAGE OF WORKERS
C.3.1. Workers paid by results
All workers paid by result, including those
who are paid on piecework, takay, pakyaw or
task basis, shall receive not less than the
prescribed wage rates per eight (8) hours of
work a day, or a proportion thereof for
working less than eight (8) hours. (Art. 124)
C.3.2. Minimum wage of apprentices and
learners
Wages of apprentices and learners shall in
no case be less than 75% of the applicable
minimum wage rates. (Art. 61 & 75, LC)
Note:
Learners employed in piece or incentive-rate
jobs during the training period shall be paid
in full for the work done. (Art. 76, LC)
The Secretary of Labor and Employment
may authorize the hiring of apprentices
UP LAW BOC LABOR STANDARDS
without compensation whose training on the
job is required by the school or training
program curriculum or as requisite for
graduation or board examination. (Art. 72,
LC)
C.3.3. Minimum wage of persons with
disability
A qualified disabled EE shall be subject to
the same terms and conditions of
employment and the same compensation,
privileges, benefits, fringe benefits or
allowances as a qualified able-bodied
persons. (Sec 5, RA 7277, The Magna Carta
for Disabled Persons)
C.4. COMMISSIONS
Commissions have been defined as the
recompense, compensation or reward of an
agent, salesman, executor, trustee, receiver,
factor, broker or bailee, when the same is
calculated as a percentage on the amount of
his transactions or on the profit to the
principal. [Philippine Duplicator’s, Inc. v.
NLRC (1993)]
Commissions as part of minimum wage
The Court held that the definition of “wage”
under Art. 97 (f) of the LC explicitly includes
commissions as part of wages. While
commissions are, indeed, incentives or forms
of encouragement to inspire employees to
put a little more industry on the jobs
particularly assigned to them, still these
commissions are direct remunerations for
services rendered.
Likewise, there is no law mandating that
commissions be paid only after the
minimum wage has been paid to the
employee. Verily, the establishment of a
minimum wage only sets a floor below
which an employee’s remuneration cannot
fall, not that commissions are excluded from
30
LABOR LAW
wages in determining compliance with the
minimum wage law. [Iran v. NLRC (1998)]
C.5. DEDUCTIONS FROM WAGES
General Rule: No employer, in his own
behalf or in behalf of any person, shall make
any deduction from the wages of his
employees. (Art. 113)
Exceptions:
(1) In cases where the worker is insured with
his consent by the employer, and the
deduction is to recompense the employer
for the amount paid by him as premium on
the insurance;
(2) For union dues, in cases where the right of
the worker or his union to check-off has
been recognized by the employer or
authorized in writing by the individual
worker concerned; and
(3) In cases where the employer is authorized
by law or regulations issued by the
Secretary of Labor and Employment (Art.
113), such as:
(a) Employee debt to employer is due
and demandable (CC 1706);
(b) Attachment or execution in cases
of debts incurred for necessities:
food, shelter, clothing, medical
attendance (CC 1708);
(c) Withholding tax;
(d) Deductions of a legally established
cooperative;
(e) Payment to 3rd parties upon written
authority by employee;
(f) Deductions for loss or damage;
(g) SSS, Medicare, Pag-IBIG
premiums;
(h) Deduction for value meals and
other facilities.
It shall be unlawful to make any deduction
from the wages of any employee for the
benefit of the employer as consideration of a
UP LAW BOC LABOR STANDARDS LABOR LAW

promise of employment or retention in (3) Not due to error in the construction or

employment. (Art. 117) or to retaliate against application of a doubtful or difficult
the employee who filed a complaint. (Art. 118) question of law.
(4) The diminution or discontinuance is done
With Employee’s Without Employee’s unilaterally by the employer.
consent in Writing consent
(1) SSS Payments a) Worker’s When not applicable: When at least one of
(2) PHILHEALTH insurance the requisites is absent.
payments acquired by the (1) Mistake in the application of the law
(3) Contributions to employer (2) Negotiated benefits
PAG-IBIG Fund b) Union dues, (3) Reclassification of Positions – e.g. loss of
(4) Value of meals where the right to some benefits by promotion.
and other check-off is (4) Contingent or Conditional Benefits – the
facilities recognized by the rule does not apply to a benefit whose
(5) Payments to third employer grant depends on the existence of certain
persons with (provided in the conditions, so that the benefit is not
employee’s CBA) demandable if those preconditions are
consent c) Debts of the absent.
(6) Deduction of employee to the
absences employer that Benefits initiated through negotiation
(7) Union dues, have become due between Employee and Employer, e.g. CBA,
where check-off is and demandable can only be eliminated or diminished
not provided in bilaterally.
the CBA.
C.7. FACILITIES VS SUPPLEMENTS
Persons earning minimum wage are The distinction between facilities and
excepted from income tax. supplement is relevant because the former
are wage-deductible while the latter is not.
C.6. NON-DIMINUTION OF BENEFITS Simply put, a wage includes facilities. (Art.
97)
General Rule: There is a prohibition against
elimination or diminution of benefits (Art. The IRR definition (IRR Book III Rule 7-A Sec.
100) 5) has 2 components:
(1) Facilities are articles or services for the
No wage order issued by any regional board benefit of the employee or his family. This
shall provide for wage rates lower than the 1st part defines facilities.
statutory minimum wage rates prescribed by (2) Facilities shall not include tools of the
Congress. (Art. 127, as amended by Republic trade or articles or service primarily for the
Act No. 6727, June 9, 1989) benefit of the employer or necessary to the
conduct of the employer’s business. This
Requisites 2nd part is essentially defines what a
(1) Ripened company policy supplement.
(2) Practice is consistent and deliberate and
Requirements for deducting value of facilities

31
UP LAW BOC LABOR STANDARDS
Mere availment is not sufficient to allow
deductions from employees’ wages. Before
the value of facilities can be deducted from
the employees’ wages, the following
requisites must all be attendant:
1. proof must be shown that such facilities
are customarily furnished by the trade;
2. the provision of deductible facilities
must be voluntarily accepted in writing
by the employee; and
3. facilities must be charged at reasonable
value.
(SLL International Cable Specialists v.
NLRC, 2011)
C.8. WAGE
DISTORTION/RECTIFICATION
A situation where an increase in prescribed
wage rates results in the elimination or
severe contraction of intentional
quantitative differences in wage or salary
rates between and among employee groups
in an establishment as to effectively
obliterate the distinctions embodied in such
wage structure based on skills, length of
service, or other logical bases of
differentiation (Art. 124)
C.8.1. How to Resolve
Organized Establishment
(1) Employer and the union shall negotiate to
correct the distortions.
(2) Disputes shall be resolved through the
grievance procedure.
(3) If still unresolved, voluntary arbitration.
Grievance Procedure (under the CBA)  if
unresolved, VOLUNTARY arbitration
Unorganized Establishment
(1) ERs and Employees shall endeavor to
correct such distortions.
32
LABOR LAW
(2) Disputes shall be settled through the
National Conciliation and Mediation
Board.
(3) If still unresolved after 10 calendar days of
conciliation, it shall be referred to the
appropriate branch of the NLRC –
compulsory arbitration
 Both the employer and employee
cannot use economic weapons.
(4) Employer cannot declare a lock-out;
Employee cannot declare a strike because
the law has provided for a procedure for
settling
(5) The salary or wage differential does not
need to be maintained. (National
Federation of Labor v. NLRC, 1994)
National Conciliation and Mediation Board
 if unresolved, COMPULSORY arbitration
by the NLRC
CBA vis-à-vis Wage Orders – CBA
creditability
In determining an employee’s regular wage,
the pertinent stipulations in the CBA are
controlling, provided the result is not less
than the statutory requirement (Philippine
National Bank vs. PEMA, 1982)
C.9. DIVISOR TO DETERMINE DAILY
RATE
Suggested formula for computing the
Estimated Equivalent Monthly Rate (EEMR)
EEMR = (Applicable Daily Rate (ADR) x
days/year) ÷ 12
For monthly-paid EEs
Monthly-paid employees are those who are
paid every day of the month, including
unworked rest days, special days, and
regular holidays.
365 days/year
UP LAW BOC LABOR STANDARDS LABOR LAW

days)
Where 296 ordinary working
365 days – days c. For those who do not work and
days/year 52 days rest days are not considered paid on
= – regular holidays Saturdays and Sundays or rest
10 days special days days:
–
7 days – 278 days/year

For daily-paid EEs Where 261 ordinary working

Daily-paid employees are those who are 278 days days – days
paid on the days actually worked and on = 10 regular holidays
unworked regular holidays. days – special days (if
7 days considered paid;
a. For those who are required to - if actually
work every day including worked, this is
Sundays or rest days, special equivalent to 6.5
days and regular holidays: days)

394.1 days/year D. REST DAY

Where 296 days ordinary working D.1. WEEKLY REST DAY

394.10 – days
days = 20 days 10 regular It shall be the duty of every employer,
– holidays x 200% whether operating for profit or not, to
52 rest days x provide each of his employees a rest period
67.60 130 % of not less than twenty-four (24) consecutive
days – 7 special days x hours after every six (6) consecutive normal
9.1 days 130% work days. [Art. 91 (a)]
–
Preference of the employee
b. For those who do not work and The employer shall determine and schedule
are not considered paid on the weekly rest day of his employees subject
Sundays or rest days: to collective bargaining agreement and to
such rules and regulations as the Secretary
313 days/year of Labor and Employment may provide.
However, the employer shall respect the
Where 296 ordinary working preference of employees as to their weekly
313 days days – days rest day when such preference is based on
= 10 regular holidays religious grounds. [Art. 94 (b)]
days – special days (if
7 days considered paid; D.2. EMERGENCY REST DAY WORK
- if actually
worked, this is The employer may require his employees to
equivalent to 6.5 work on any day:

33
UP LAW BOC LABOR STANDARDS
a) In case of actual or
impending emergencies
caused by serious accident,
fire, flood, typhoon,
earthquake, epidemic or
other disaster or calamity to
prevent loss of life and
property, or imminent
danger to public safety;
b) In cases of urgent work to be
performed on the
machinery, equipment, or
installation, to avoid serious
loss which the employer
would otherwise suffer;
c) In the event of abnormal
pressure of work due to
special circumstances,
where the employer cannot
ordinarily be expected to
resort to other measures;
d) To prevent loss or damage
to perishable goods;
e) Where the nature of the
work requires continuous
operations and the
stoppage of work may result
in irreparable injury or loss
to the employer; and
f) Under other circumstances
analogous or similar to the
foregoing as determined by
the Secretary of Labor and
Employment. (Art. 92, LC)
E. HOLIDAY PAY/PREMIUM PAY
Holiday pay is a one-day pay given by law to
an employee even if he does not work on a
regular holiday. This gift of a day’s pay is
limited to each of the 12 regular holidays.
E.1. COVERAGE
General Rule: All employees
34
LABOR LAW
Exceptions:
(1) Those of the government and any of
the political subdivision, including
government-owned and controlled
corporation;
(2) Those of retail and service
establishments regularly employing
less than 10 workers;
(3) Domestic helpers and persons in the
personal service of another;
(4) Managerial employees as defined in
Book III
(5) Field personnel and other employees
whose time and performance is
unsupervised by the employer
including those who are engaged on
task or contract basis, purely
commission basis, or those who are
paid a fixed amount for performing
work irrespective of the time
consumed in the performance thereof.
(Sec. 1, Rule IV of the IRR)
Retail Establishment is one principally
engaged in the sale of goods to end-users
for personal or household use;
Service Establishment is one principally
engaged in the sale of service to individuals
for their own or household use and is
generally recognized as such. (IRR of RA
6727/the Wage Rationalization Act)
Regular holidays
Proclamation No. 831 signed by President
Aquino on 17 July 2014, provides for the
observance of the regular holidays and
special (non-working) days for the year 2015
on the following dates:
(1) New year’s Day - January 1
(2) Maundy Thursday – April 2
(3) Good Friday – April 3
(4) Araw ng Kagitingan – April 9
(5) Labor Day – May 1
UP LAW BOC LABOR STANDARDS
(6) Independence Day – June 12
(7) National Heroes Day – August 31
(8) Bonifacio Day – November 30
(9) Christmas Day - December 25
(10) Rizal Day - December 30
(11) Eid’l Fitr – 1st day of 10th lunar month
of Shawwal
(12) Eid’l Adha – 10th day of 12th lunar
month of Dhu’l-Hijja
Special (Non-Working Days)
(1) Chinese New Year – February 19
(2) Black Saturday – April 4
(3) Ninoy Aquino Day - August 21
(4) All Saints Day - November 1
(5) Additional special (Non-working) days
a. January 2
b. December 24
(6) Last Day of the Year - December 31
Special Holiday (for all schools)
EDSA Revolution Anniversary – February 25
P.D. 1083 (Code of Muslim Personal Laws)
SEE: Arts. 169-173
Specifically for the Muslim Areas, P.D. 1083,
in its Book V, Title, recognizes five (5)
Muslim Holidays, namely:
1) Amun Jadid (New Year) which falls on
the first (1st) day of the lunar month of
Muharram;
2) Mauli-un-Nabi (Birthday of the
Prophet Muhammad) which falls on
the twelfth (12th) day of the third (3rd)
lunar month of Rabi-ul-Awwal;
3) Lailatul Isra Wal Mi Rai (Nocturnal
Journey and Ascencion of the Prophet
Muhammand) which falls on the
twenty-seventh (27th) day of the
seventh (7th) lunar month of Rajab;
4) Id-ul-Fitr (Hari Raja Pausa) which falls
on the first (1st) day of the tenth (10th)
lunar month of Shawwal
35
LABOR LAW
commemorating the end of the fasting
season; and
5) Id-ul-Adha (Hari Raha Haji) which falls
on the tenth (10th) of the twelfth (12th)
lunar month of Dhu’l-Hijja.
Note:
Id-ul-Fitr (Eid’l Fitr) and Id-ul-Adha (Eid’l
Adha) have been added to the list of
national legal holidays.
Note: There should be no distinction
between Muslims & non-Muslims as regards
to the payment of benefits for Muslim
holidays. Wages & other emoluments
granted bylaw to the working manare
determined on the basis of the criteria laid
down by laws &not on worker’s faith.Art.
3(3), PD 1083 states that nothing herein
shall be construed to operateto the
prejudice of a non-Muslim. (San Miguel Corp
vs. CA, 2002)
Holiday pay computation
General Rule: An employer may require an
employee to work on any holiday but such
employee shall be paid a compensation
equivalent to twice his regular rate. [Art.
94(b)]
According to the LC, IRR and Memo:
Work on any regular
holiday, not exceeding 8 Computation
hours 24
Work on any regular 200% of regular
holiday, if it exceeds 8 daily wage (for
hours/overtime the 1st 8 hours)
+ 30% of hourly
rate on said day
Work on any regular 200% of regular
holiday which falls on daily wage +
the scheduled rest day, 30% of such
not exceeding 8 hours amount
UP LAW BOC LABOR STANDARDS
Work on any regular Regular holiday-
holiday which falls on on-rest day rate
scheduled rest day, if it
(200% of regular
exceeds 8daily wage plus
hours/overtime 30% of such
amount) + 30%
of hourly rate on
said day.
Work on special holiday Regular daily
not exceeding 8 hours wage + 30%
thereof
Work on special holiday Regular daily
wage + 50%
thereof
According to DOLE Memo Circular 1-04, a
“special holiday”/”special day” includes the
National Special Days, and declared special
days such as Special Non-working Holiday,
Special Public Holiday and Special National
Holiday. Such days are entitled to the rates
prescribed above. These days are not the
same as a special working holiday.
A special working holiday is considered an
ordinary working day, so there is no
premium pay.
Double holiday pay
According to “DOLE Explanatory Bulletin on
Worker’s Entitlement to Holiday Pay on 9
April 1993,” if two holidays fall on the same
day:
(1) If unworked, 200% of basic wage.
(2) If worked, 300% of basic wage.
(Azucena)
Double Holiday Rule for Monthly-paid
employees
For covered employees whose monthly
salaries are computed based on 365 days
and for those other employees who are paid
using factor 314, or 262, or any other factor
which already considers the payment for the
11 regular holidays, NO additional payment
36
LABOR LAW
is due them. (BWC-WHSD Opinion No. 053,
s. 1998)
Successive holiday pay
According to IRR, Rule IV, Sec. 10, an
employee is entitled to holiday pay for both
days, IF:
(1) He is present on day immediately
preceding first holiday; or
(2) He works on first holiday, which
entitles him to pay on second holiday.
Divisors
The divisor assumes an important role in
determining whether or not holiday pay is
already computed.
(1) Monthly paid employees are not
entitled to the holiday pay if their total
annual income is divided by 365 days
resulting in a wage which is beyond
the minimum wage per day because
they are considered paid everyday of
the year including holidays, rest days,
and other non-working days. The 365
days are as follows:
365 days = 296 days – ordinary days
52 days – rest days
10 days – regular holidays
7 days – special holidays
(2) As a general rule, for a company with a
6-day working schedule, the divisor
313 already means that the legal
holidays are included in the monthly
pay of the employee. The divisor is
arrived at by subtracting all Sundays
from the total number of calendar
days in a year.
(3) As a general rule for a company with a
5-day working schedule, the divisor
287 means that the holiday pay is
already included in the monthly salary
of the employee.
Sundays
UP LAW BOC LABOR STANDARDS
(1) When a holiday falls on a Sunday, the
following Monday will not be considered a
holiday unless a proclamation says so.
(2) Furthermore as stated in the Wellington
case (see below), a legal holiday falling on
a Sunday does not create a legal
obligation to pay extra, aside from the
usual holiday pay, to monthly-paid
employees. (Azucena citing Letter of
Instruction No. 1087)
Non-working/scheduled rest day
Where the day immediately preceding the
holiday is a non-working day in the
establishment or the scheduled rest day of
the employee, he shall not be deemed to be
on leave of absence on that day, in which
case he shall be entitled to the holiday pay if
he worked on the day immediately
preceding the non-working day or rest day.
[IRR, Book III, Rule V, Sec 6 (c)]
Right to holiday pay
In case of absences
All covered employees shall be entitled to
the benefit provided herein when they are on
leave of absence with pay.
Employees who are on leave of absence
without pay on the day immediately
preceding a regular holiday may not be paid
the required holiday pay if he has not
worked on such regular holiday. [IRR, Book
III, Rule IV, Sec 6(a)]
In case of temporary cessation of work
(a) In cases of temporary or periodic
shutdown and temporary cessation of
work of an establishment, as when a
yearly inventory or when the repair or
cleaning of machineries and equipment is
undertaken, the regular holidays falling
within the periods shall be compensated
in accordance with this Rule.
37
LABOR LAW
(b) The regular holiday during the cessation of
operation of an enterprise due to business
reverses as authorized by the Secretary of
Labor may not be paid by the employer.
(IRR, Book III, Rule IV, Sec 7)
An employee is entitled to holiday pay for
the regular holidays falling within the period
in cases of temporary shutdowns or
cessation of work, when:
(1) an annual inventory; or
(2) repair or cleaning of machineries and
equipment is undertaken.
The employer may not pay his employees for
the regular holidays during the suspension
of work if: the cessation of operation is due
to business reverses, and is authorized by the
Secretary of Labor.
E.2. TEACHERS, PIECE WORKERS,
SEAFARERS, SEASONAL WORKERS,
ETC.
Private school teachers, including faculty
members of colleges and universities, may
not be paid for the regular holidays during
semestral vacations. They shall, however, be
paid for the regular holidays during
Christmas vacation;
Where a covered employee, is paid by results
or output, such as payment on piece work,
his holiday pay shall not be less than his
average daily earnings for the last seven (7)
actual working days preceding the regular
holiday; Provided, However, that in no case
shall the holiday pay be less than the
applicable statutory minimum wage rate.
Seasonal workers may not be paid the
required holiday pay during off-season when
they are not at work
(a) Workers who have no regular working days
shall be entitled to the benefits provided in
this Rule.
UP LAW BOC LABOR STANDARDS LABOR LAW

(Book III, Rule IV, Sec. 8 of IRR) (3) Househelpers and persons in the
personal service of another;
Piece workers (4) Workers who are paid by results,
Philosophy underlying the exclusion of piece including those who are paid on piece
workers from the 8-hour law is that said rate, takay, pakyaw, or task basis, and
workers are paid depending upon the work other noontime work, if their output rates
they do irrespective of the amount of time are in accordance with the standards
employed in doing said work. (Red v. prescribed in the regulations, or where
Coconut Products Ltd., v. CIR, 1966) such rates have been fixed by the
Secretary of Labor and Employment;
Seafarers (5) Field personnel, if they regularly perform
Any hours of work or duty including hours of their duties away from the principal or
watch-keeping performed by the seafarer on branch office or place of business of the
designated rest days and holidays shall be ER and whose actual hours of work in the
paid rest day or holiday pay. (Section 11.C, filed cannot be determined with
Standard Terms and Conditions Governing reasonable certainty.
the Employment of Filipino Seafarers on
Board Ocean-Going Vessels) Premium pay rates (DOLE Memorandum
Circular 1, Series of 2004)
Seasonal workers
Seasonal workers who do not work during WHEN WORK
PREMIUM PAY
off-season are not entitled to pay for the PERFORMED
regular holidays occurring during their off- On scheduled rest 30% of regular
season. Workers assigned to “skeleton day wage
crews” that work during the off-season have On Sunday ONLY IF 30% of regular
the right to be paid on regular holidays ESTABLISHED rest wage
falling in that duration. day
No regular work and 30% of regular
F. PREMIUM PAY rest days wage for work
Premium pay refers to the additional performed on
compensation for work performed within 8 Sundays and
hours on non-work days, such as rest days holidays
and special days. On any special 30% of regular
holiday/special day wage
Coverage (Book 3, Rule 3, Sec. 7 of the IRR) On any special 50% of regular
holiday /special day wage
General Rule: All employees falling on scheduled
Exceptions: rest day
(1) Those of the government and any of the On any regular 230% of regular
political subdivision, including holiday falling on wage
government-owned and controlled scheduled rest day
corporations;
(2) Managerial employees as defined in Book Where the collective bargaining agreement
III; or other applicable employment contract
stipulates the payment of a higher premium

38
UP LAW BOC LABOR STANDARDS
pay than that prescribed under this Article,
the employer shall pay such higher rate.
(Art. 93 (d))
Nothing in this Rule shall justify an
employer in reducing the compensation of
his employees for the unworked Sundays,
holidays, or other rest days which are
considered paid-off days or holidays by
agreement or practice subsisting upon the
effectivity of the Code. (Book III, Rule III, Sec.
8 of the IRR)
Nothing herein shall prevent the employer
and his employees or their representatives in
entering into any agreement with terms
more favorable to the employees than those
provided herein, or be used to diminish any
benefit granted to the employees under
existing laws, agreements, and voluntary
employer practices. (Book III, Rule II, Sec. 9
of the IRR)
G. LEAVES
G.1. SERVICE INCENTIVE LEAVE PAY
Every employee who has rendered at least
one year of service shall be entitled to a
yearly service incentive leave of five days
with pay. (Art. 95(a))
Service Incentive Leave DOES NOT apply to
the following employees:
(1) Those of the government and any of its
political subdivisions, including GOCCs;
(2) Domestic helpers and persons in the
personal service of another;
(3) Managerial employees as defined in Book
3 of this Code;
(4) Field personnel and other employees
whose performance is unsupervised by the
employer including those who are
engaged on task or contract basis, purely
commission basis, or those who are paid a
fixed amount for performing work
39
LABOR LAW
irrespective of the time consumed in the
performance thereof;
(5) Those who are already enjoying the benefit
herein provided;
(6) Those enjoying vacation leave with pay of
at least 5 days;
(7) Those employed in establishments
regularly employing less than 10
employees.
(Book 3, Rule 5, Sec. 1 of the IRR)
Employer may require employee to work
The employer may require an employee to
work on any holiday but such employee shall
be paid a compensation equivalent to twice
his regular rate (Art. 95(b))
Meaning of “1 year of service”
The term "at least one-year service" shall
mean service for not less than 12 months,
whether continuous or broken, reckoned
from the date the employee started working,
including authorized absences and paid
regular holidays unless the working days in
the establishment as a matter of practice or
policy, or that provided in the employment
contract is less than 12 months, in which
case said period shall be considered as one
year. (Book III, Rule V, Sec. 3 of the IRR)
Entitlement
The grant of benefit in excess of that
provided herein shall not be made a subject
of arbitration or any court or administrative
action. (Art. 95 (c))
Commutable nature of benefit
The service incentive leave shall be
commutable to its money equivalent if not
used or exhausted at the end of the year.
G.2. MATERNITY LEAVE [SEC. 14-A OF
RA 1161 (SOCIAL SECURITY LAW) AS
AMENDED BY RA 7322 AND RA 8282]
UP LAW BOC LABOR STANDARDS
Coverage
Every pregnant woman in the private sector,
whether married or unmarried, is entitled to
the maternity leave benefits.
This is applicable to both childbirth and
miscarriage.
Requisites
(1) Employment: A female employee
employed at the time of delivery,
miscarriage or abortion
(2) Contribution: who has paid at least 3
monthly contributions in the 12-month
period immediately preceding the
semester of her childbirth, or miscarriage.
(3) Notice: employee notified employer of her
pregnancy and the probable date of her
childbirth, which notice shall be
transmitted to the SSS in accordance with
the rules and regulations it may provide.
Benefit received
A daily maternity benefit equivalent to 100%
of her average daily salary credit for:
(1) 60 days for normal delivery
(2) 78 days for caesarean delivery
This benefit shall NOT be included in the
computation of 13th month pay as it is
granted to an employee in lieu of wages
which is the basis for computing 13th month.
Only 4 maternity leaves available
The maternity benefits provided under the
Social Security Law shall be paid only for the
first four (4) deliveries or miscarriages
SSS pays for the maternity leave
The employer advances the benefit to the
employee but the SSS shall immediately
reimburse the employer of one hundred
percent (100%) of the amount upon
receipt of satisfactory proof of such
payment and legality thereof
40
LABOR LAW
Other conditions
(1) Employer shall advance the payment
subject to reimbursement by the SSS
within 30 days from filing of leave
application.
(2) Availment shall be a bar to the recovery of
sickness benefits provided by this Act for
the same period for which daily maternity
benefits have been received.
(3) Employee may only avail of benefit for the
first four (4) deliveries or miscarriages.
(4) Sanction:
That if an employee should give birth or
suffer miscarriage
a. without the required contributions
having been remitted for her by her
ER to the SSS, or
b. without the latter having been
previously notified by the ER of
time of the pregnancy, then the
employer shall pay to the SSS
damages equivalent to the benefits
which said employee member
would otherwise have been entitled
to.
G.3. PATERNITY LEAVE [RA 8187
(PATERNITY LEAVE ACT OF 1996)]
Coverage and purpose
Paternity leave is granted to all married
male employees in the private and public
sectors, regardless of their employment
status (e.g. probationary, regular,
contractual, project basis). The purpose of
this benefit is to allow the husband to lend
support to his wife during her period of
recovery and/or in nursing her newborn
child. (Sec. 3, RA 8187)
Benefit
UP LAW BOC LABOR STANDARDS
It shall apply to the first 4 deliveries of the
employee’s lawful wife with whom he is
cohabiting.
It shall be for 7 calendar days, with full pay,
consisting of basic salary and mandatory
allowances fixed by the Regional Wage
Board, if any, provided that his pay shall not
be less than the mandated minimum wage.
(Sec. 2, RA 8187)
Cohabiting means the obligation of the
husband and wife to live together. If the
spouses are not physically living together
because of the workstation or occupation,
the male employee is still entitled to the
paternity leave benefit. (Sec. 1, IRR, RA 8187)
Usage of the benefit
Usage of the leave shall be after the
delivery, without prejudice to an employer’s
policy of allowing the employee to avail of
the benefit before or during the delivery,
provided that the total number of days shall
not be more than 7 days for each covered
delivery. (Sec. 5, IRR, RA 8187)
Conditions for entitlement (Sec. 3, IRR, RA
8187)
(1) He is married;
(2) He is an employee at the time of the
delivery of his child;
(3) He is cohabiting with his spouse at the
time that she gives birth or suffers a
miscarriage;
(4) He has applied for paternity leave with his
ER within a reasonable period of time from
the expected date of delivery by his
pregnant spouse, or within such period as
may be provided by company rules and
regulations, or by CBA; and,
(5) His wife has given birth or suffered a
miscarriage.
Application for paternity leave
41
LABOR LAW
See number 4 under conditions for
entitlement.
In case of miscarriage, prior application for
paternity leave shall not be required. (Sec. 4,
IRR, RA 8187)
Non-conversion to cash
In the event that the paternity leave is not
availed of, it shall not be convertible to cash
and shall not be cumulative. (Sec. 7, IRR, RA
8187)
Crediting of existing benefits
1. If the existing paternity leave benefit under
the CBA, contract, or company policy is
greater than 7 calendar days as provided for
in RA 8187, the greater benefit shall prevail.
2. If the existing paternity leave benefit is
less than that provided in RA 8187, the ER
shall adjust the existing benefit to cover the
difference.
Where a company policy, contract, or CBA
provides for an emergency or contingency
leave without specific provisions on paternity
leave, the ER shall grant to the employee 7
calendar days of paternity leave. (Sec. 9, IRR,
RA 8187)
G.4. PARENTAL LEAVE [RA 8972 (SOLO
PARENTS’ WELFARE ACT OF 2000)]
Leave benefits granted to a solo parent to
enable him/her to perform parental duties
and responsibilities where physical presence
is required. [Sec. 3 (d), RA 8972]
Coverage
Any solo parent or individual who is left
alone with the responsibility of parenthood
due to:
(1) Giving birth as a result of rape or and other
crimes against chastity even without a
final conviction of the offender: Provided,
UP LAW BOC LABOR STANDARDS
That the mother keeps and raises the
child;
(2) Death of spouse;
(3) Spouse is detained or is serving sentence
for a criminal conviction for at least one (1)
year;
(4) Physical and/or mental incapacity of
spouse as certified by a public medical
practitioner;
(5) Legal separation or de facto separation
from spouse for at least one (1) year:
Provided, that he/she is entrusted with the
custody of the children;
(6) Declaration of nullity or annulment of
marriage as decreed by a court or by a
church: Provided, that he/she is entrusted
with the custody of the children;
(7) Abandonment of spouse for at least one (1)
year;
(8) Unmarried father/mother who has
preferred to keep and rear his/her
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 support to a child or
children: Provided, that he/she is duly
licensed as a foster parent by the
Department of Social Welfare and
Development (DSWD) or duly appointed
legal guardian by the court; and
(10) Any family member who assumes the
responsibility of head of family as a result
of the death, abandonment,
disappearance, or prolonged absence of
the parents or solo parent for at least one
(1) year. [Sec. 3 (a), RA 8972]
Conditions for entitlement
A solo parent employee shall be entitled to
the parental leave under the following
conditions:
(1) He/she has rendered at least one (1) year
of service, whether continuous or broken;
42
LABOR LAW
(2) He/she has notified his/her employer that
he/she will avail himself/herself of it,
within a reasonable period of time; and
(3) He/she has presented to his/her employer
a Solo Parent Identification Card, which
may be obtained from the DSWD office of
the city or municipality where he/she
resides. (Sec 19, Art. V, IRR, RA 8972)
Availment
The parental leave is in addition to leave
privileges under existing laws with full pay,
consisting of basic salary and mandatory
allowances. It shall not be more than seven
(7) working days every year. (Sec. 8, RA 8972)
Grant of flexible work schedule
The employer shall provide for a flexible
working schedule for solo parents: Provided,
That the same shall not affect individual and
company productivity: Provided, further,
That any employer may request exemption
from the above requirements from the DOLE
on certain meritorious grounds. (Sec. 6, RA
8972)
Protection against work discrimination
No employer shall discriminate against any
solo parent employee with respect to terms
and conditions of employment on account of
his/her status. (Sec. 7, RA 8972)
Termination of the benefit
A change in the status or circumstance of
the parent claiming the benefit under the
law, such that he/she is no longer left alone
with the responsibility of parenthood, shall
terminate his/her eligibility for these
benefits. [Sec. 3 (a), RA 8972]
G.5. LEAVES FOR VICTIMS OF VIOLENCE
AGAINST WOMEN [RA 9262 (ANTI-
VIOLENCE AGAINST WOMEN AND THEIR
CHILDREN ACT OF 2004)]
UP LAW BOC LABOR STANDARDS LABOR LAW

Coverage and purpose Clerk of Court, as the case may be, of a

VAWC leave is granted to women employees certification (at no cost) to the woman that
who are victims of violence, as defined in RA such an action is pending, and this is all
9262. The leave benefit covers the days that that is required for the employer to comply
the women employee has to attend to with the 10- day paid leave.
medical or legal concerns. (3) For government employees, in addition to
the aforementioned certification, the
Requirement for entitlement employee concerned must file an
To be entitled to the leave benefit, the only application for leave citing as basis R.A.
requirement is for the victim-employee to 9262. (Sec. 42, IRR, RA 8972)
present to her employer a certification from
the barangay chairman or barangay G.6. SPECIAL LEAVE BENEFITS (SLB)
councilor or prosecutor or the Clerk of Court, FOR WOMEN [RA 9710 (THE MAGNA
as the case may be, that an action relative to CARTA OF WOMEN), DOLE DO NO. 112,
the matter is pending. SERIES OF 2011 AS AMENDED BY DO
NO. 112-A SERIES OF 2012]
Benefit
In addition to other paid leaves under
Special leave benefit for women – a female
existing labor laws, company policies,
employee’s leave entitlement of two (2)
and/or CBA, the qualified victim-employee
months with full pay from her employer
shall be entitled to a leave of up to 10 days
based on her gross monthly compensation
with full pay, consisting of basic salary and
following surgery caused by gynecological
mandatory allowances fixed by the Regional
disorders, provided that she has rendered
Wage Board, if any.
continuous aggregate employment service
of at least six (6) months for the last 12
Usage of the benefit
months.
The usage of the 10-day leave shall be at the
option of the woman employee. In the event
Gynecological disorders – disorders that
that the leave benefit is not availed of, it
would require surgical procedures such as,
shall not be convertible into cash and shall
but not limited to, dilatation and curettage
not be cumulative.
and those involving female reproductive
organs such as the vagina, cervix, uterus,
A victim of VAWC who is employed shall be
fallopian tubes, ovaries, breast, adnexa and
entitled to a paid leave of up to ten (10) days
pelvic floor, as certified by a competent
in addition to other paid leaves under the
physician. It shall also include hysterectomy,
Labor Code and Civil Service Rules and
ovariectomy, and mastectomy.
Regulations and other existing laws and
company policies:
Gross monthly compensation – the monthly
(1) At any time during the application of any
basic pay plus mandatory allowances fixed
protection order, investigation,
by the regional wage boards. (Sec. 7, Rule II,
prosecution and/or trial of the criminal
IRR, RA 9710)
case, extendible when the necessity arises
as specified in the protection order.
At least six months continuous aggregate
(2) Upon the issuance of the Punong
employment service for the last 12 months
Barangay/kagawad or prosecutor or the
prior to surgery – the woman employee

43
UP LAW BOC LABOR STANDARDS
should have been with the company for 12
months prior to surgery. An aggregate
service of at least six (6) months within the
said 12-month period is sufficient to entitle
her to avail of the special leave benefit.
Employment service - includes absences
with pay such as use of other mandated
leaves, company-granted leaves and
maternity leaves
Competent physician - a medical doctor
preferably specializing in gynecological
disorders or is in the position to determine
the period of recuperation of the woman
employee. (Sec. 1, DO 112, as amended)
Conditions for entitlement of special leave
Any female employee, regardless of age and
civil status, shall be entitled to a special
leave benefit, provided she has complied
with the following conditions:
(a) She has rendered at least 6 months
continuous aggregate employment service
for the last 12 months prior to surgery;
(b) She has filed an application for special
leave
(c) She has undergone surgery due to
gynecological disorders as certified by a
competent physician. (Sec. 2, DO 112)
Application for special leave
Application before surgery
The employee shall file her application for
leave with her employer within a reasonable
period of time from the expected date of
surgery, or within such period as may be
provided by company rules and regulations
or by CBA.
Application after surgery
Prior application for leave shall not be
necessary in cases requiring emergency
surgical procedure, provided that the
employer shall be notified verbally or in
44
LABOR LAW
written form within a reasonable period of
time and provided further that after the
surgery or appropriate recuperating period,
the female employee shall immediately file
her application using the prescribed form.
(Sec. 3, DO 112)
Period of entitlement
The 2 months special leave is the maximum
period of leave with pay that a woman
employee may avail of under RA 9710.
For purposes of determining the period of
leave with pay that will be allowed to a
female employee, the certification of a
competent physician as to the required
period of recuperation shall be controlling.
(Sec. 4, DO 112, as amended)
Availment
The special leave shall be granted to the
qualified employee after she has undergone
surgery. (Sec. 5, DO 112, as amended)
Frequency of availment
A woman employee can avail of the SLB for
every instance of surgery due to
gynecological disorder for a maximum total
period of 2 months per year. (Sec. 6, DO 112,
as amended)
Special leave benefit vis-à-vis SSS sickness
benefit
The SLB is different from the SSS sickness
benefit. The former is granted by the
employer in accordance with RA 9710.
It is granted to a woman employee who has
undergone surgery due to gynecological
disorder. The SSS sickness benefit, on the
other hand, is administered and given by the
SSS in accordance with RA 1161 as amended
by RA 8282. (Sec. 7, DO 112, as amended)
UP LAW BOC LABOR STANDARDS
Special leave benefit vis-à-vis existing
statutory leaves
The SLB cannot be taken from existing
statutory leaves (i.e. 5-day SIL, leave for
victims of VAWC, Parental leave for solo
parents). The grant of SLB under the law is
in recognition of the fact that patients with
gynecological disorder needing surgery
require a longer period of recovery. The
benefit is considered an addition to the leave
benefits granted under existing laws and
should be added on top of said statutory
leave entitlements.
If the SLB has already been exhausted, the
company leave and other mandated leave
benefits may be availed of by the woman
employee. (Sec. 8, DO 112, as amended)
Special leave benefit vis-à-vis maternity leave
benefit
Where the woman employee had undergone
surgery due to gynecological disorder during
her maternity leave, she is entitled only to
the difference between the SLB and
maternity leave benefit. (Sec. 9, DO 112, as
amended)
Crediting of existing or similar benefits
If there are existing or similar benefits under
a company policy, practice or CBA providing
similar or equal benefits to what is
mandated by law, the same shall be
considered as compliance, unless the
company policy, practice or CBA provides
otherwise.
In the event the company policy, practice or
CBA provides lesser benefits, the company
shall grant the difference.
More liberal existing or similar benefits
cannot be withdrawn or reduced by reason
of the mandate of RA 9710.
45
LABOR LAW
The term “similar or equal benefits” refers to
leave benefits which are of the same nature
and purpose as that of the SLB. (Sec. 10, DO
112, as amended)
Mode of payment
The SLB is a leave privilege. The woman
employee shall not report for work for the
duration of the leave but she will still receive
her salary covering said period. The
employer, in its discretion, may allow said
employee to receive her pay for the period
covered by the approved leave before or
during the surgery. The computation of her
“pay” shall be based on her prevailing salary
at the time of the surgery. (Sec. 11, DO 112, as
amended)
Non-commutation of the benefit
The SLB shall be non-cumulative and non-
convertible to cash unless otherwise
provided by a CBA (Sec. 12, DO 112, as
amended)
F. SERVICE CHARGES
Coverage
Employers (Sec 1, Rule VI, Book 3, IRR)
This rule shall apply only to establishments
which collect service charges such as:
(a) Hotels, restaurants, lodging houses,
night clubs, cocktail lounge, massage
clinics, bars, casinos and gambling
houses and similar enterprises
(b) Including those entities operating
primarily as private subsidiaries of the
Government
Employees
Shall apply to ALL employees of covered
employers
a. Regardless of their positions,
designations, or employment status,
b. Irrespective of the method by which
their wages are paid.
UP LAW BOC LABOR STANDARDS
Exceptions
Managerial employees – or one who is
vested with powers or prerogatives to lay
down and execute managerial policies
and/or hire, transfer, suspend, layoff, recall,
discharge, assign or discipline employees or
to effectively recommend such managerial
actions. All employees not falling within this
definition shall be considered rank-and-file
employees. (Sec 2, Rule VI, Book 3, IRR)
Distribution
Service charges are distributed in
accordance with the following percentage of
sharing:
(1) Eighty-five percent (85%) for the
employees to be distributed equally
among them;
(2) Fifteen percent (15%) for the management
to answer for losses and breakages and, at
the discretion of the management,
distribution to managerial employees. (Sec
3, Rule VI, Book 3, IRR)
The shares shall be distributed to employees
not less than once every 2 weeks or twice a
month at intervals not exceeding 16 days.
(Sec 4, Rule VI, Book 3, IRR)
Note: The P2,000.00 salary ceiling for
entitlement thereto is no longer applicable.
Integration
In case service charge is abolished shares of
covered employees shall be considered
integrated in their wages. (Art 96)
The basis of the amount to be integrated
shall be the average monthly share of each
employee for the past twelve (12) months
immediately preceding the abolition of
withdrawal of such charges. (Sec. 5, Rule VI,
Book 3, IRR)
46
LABOR LAW
Synthesis of the Rules
(1) Service charges must be pooled;
(2) Where a restaurant or similar
establishment does not collect service
charges but has a practice or policy of
monitoring and pooling tips given
voluntarily by its customers to its
employees, the pooled tips should be
monitored, accounted for and
distributed in the same manner as the
services charges. (DOLE Handbook on
Workers’ Statutory Monetary Benefits,
2014ed.)
(3) The amount collected is divided
between the company (15%) and
employees (85%);
(4) It shall be given twice a month with
intervals of not more than 15 days;
(5) If discontinued, removed, or stopped,
the average share of the employees of
their service charge or tips shall be
integrated with their basic wage.
H. THIRTEENTH (13TH) MONTH PAY
AND OTHER BONUSES (PD 851 (THE
13TH-MONTH PAY LAW) AND THE
REVISED GUIDELINES ON THE
IMPLEMENTATION OF THE 13TH
MONTH PAY LAW)
Coverage
General Rule: ALL EMPLOYERS are hereby
required to pay all their rank and file
employees a 13th month pay not later than
Dec 24 of every year, Provided that they have
worked for at least one (1) month during a
calendar year.
Exempted Employers:
(1) Government, its political subdivisions,
including GOCCs except those operating
essentially as private subsidiaries of the
Government;
UP LAW BOC LABOR STANDARDS
(2) Employers already paying their employees
a 13th month pay or more in a calendar
year or its equivalent at the time of this
issuance;
(3) Employers of household helpers and
persons in the personal service of another
relation to such workers; and
(4) Employers of those who are paid on purely
commission, boundary or task basis and
those who are paid a fixed amount for
performing specific work, irrespective of
the time consumed in the performance
thereof (except those workers who are
paid on piece-rate basis, in which case
their employer shall grant them 13th month
pay).
“Equivalent” includes:
(a) Christmas bonus, mid-year bonus,
cash bonuses
(b) and other payments amounting to not
less than 1/12 of the basic salary
(c) but shall NOT INCLUDE cash and
stock dividends, cost of living
allowances and all other allowances
regularly enjoyed by the employee as
well a non-monetary benefits.
Workers paid on a piece-rate basis
Those 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.
Minimum Amount: 1/12 of the total basic
salary earned by an employee within a
calendar year
BASE AMOUNT, which is the basic salary
shall include:
(1) cost of living allowances (COLA)
integrated into the basic salary of a
covered employee pursuant to EO 178.
(2) all remunerations or earnings paid by this
employer for services rendered.
47
LABOR LAW
(3) But not the allowances and monetary
benefits which are not considered or
integrated as part of the regular or basic
salary, such as the cash equivalent of:
a. unused vacation and sick leave
credits,
b. overtime,
c. premium,
d. night differential,
e. holiday pay and, and
f. cost-of-living allowances.
Time of payment
General Rule: paid not later than Dec 24 of
each year.
Exception: ER may give to his employees half
(½) of the required 13th Month Pay before
the opening of the regular school year and
the other half on or before the 24th of
December every year.
The frequency of payment of this monetary
benefit may be the subject of agreement
between the employer and the recognized
CBA of the employees.
13th Month Pay in Special Cases
(1) Paid by Results: Employees who are paid
on piece work basis are, by law, entitled to
the 13th Month Pay. (Revised Guidelines
on the Implementation of the 13th Month
Pay Law)
(1) Fixed or Guaranteed Wage: Employees
who are paid a fixed or guaranteed wage
plus commission are entitled to 13th
month pay (not purely commission); the
basis for computation shall be both their
fixed or guaranteed wage and
commission. (Revised Guidelines)
(2) Those with Multiple Employers:
Government Employees working part time
in a private enterprise, including private
educational institutions, as well as
Employees working in two or more private
UP LAW BOC LABOR STANDARDS
firms, whether on full or part time bases,
are entitled to the required 13th Month Pay
from all their private Employers regardless
of their total earnings from each or all
their employers. (Revised Guidelines)
(3) Private School Teachers: Private school
teachers, including faculty members of
universities and colleges, are entitled to
the required 13th month pay, regardless of
the number of months they teach or are
paid within a year, if they have rendered
service for at least one (1) month within a
year. (Revised Guidelines)
(4) Resigned or Separated Employee: An
Employee who has resigned or whose
services were terminated at any time
before the time for payment of the 13th
month pay is entitled to this monetary
benefit in proportion to the length of time
he worked during the year, reckoned from
the time he started working during the
calendar year up to the time of his
resignation or termination from service.
(Revised Guidelines)
(5) Wage Difference: The difference between
the minimum wage and the actual salary
received by the Employee cannot be
deemed as his 13th month pay as such
difference is not equivalent to or of the
same import as the said benefit
contemplated by law. (JPL Marketing
Promotions vs CA, 2005)
(6) Terminated Employees: The payment of
the 13th month pay may be demanded by
the employee upon the cessation of
employer-employee relationship. (Archilles
Manufacturing Corp. vs NLRC, 1995)
Additional Rules:
(1) Commissions: If the commissions may be
properly considered part of the basic
salary, then they should be INCLUDED. If
they are not an integral part of the basic
salary, then they should be EXCLUDED.
(Phil. Duplicators Inc. vs NLRC, 1995)
48
LABOR LAW
(2) Substitute Payment not allowed: Benefits
in the form of food or free electricity,
assuming they were given, were not a
proper substitute for the 13th month pay
required by law. Neither may year-end
rewards for loyalty and service be
considered in lieu of 13th month pay.
(Framanlis Farms, Inc. vs MOLE, 1989)
(3) 14th Month Pay is not mandated: Employers
already paying their employees a 13th
month pay or its equivalent are not
covered by this Decree. (Kamaya Point
Hotel vs NLRC, 1989)
Note: Overload pay is NOT included in the
computation for 13th month pay; overload is
not overtime as it is additional work done
within the normal shift [Letran Calamba
Faculty vs NLRC, (2008)]
I. SEPARATION PAY (Art. 283 &
284, LC, DOLE Handbook on
Worker’s Statutory Monetary
Benefits, 2014)
Separation pay is defined as the amount
that an employee receives at the time of his
severance from the service and is designed
to provide the employee with the
wherewithal during the period that he is
looking for another employment. [A’ Prime
Security Services vs NLRC (1993)]
General rule: The rule embodied in the Labor
Code is that a person dismissed for cause as
defined therein (see Art. 282) is not entitled
to separation pay. (PLDT vs NLRC, 1988)
Exception:
Considerations of equity and the employee
was not dismissed on the ground of
misconduct or for cause reflecting his moral
character.
UP LAW BOC LABOR STANDARDS
Note: An employee who voluntarily resigns is
not entitled to separation pay unless
stipulated in the employment contract, or
the collective bargaining agreement, or is
sanctioned by established practice or policy
of the employer. [Phimco Industries vs NLRC
(1997); Hinatuan Mining Corp vs NLRC (1997)
cited in JPL Marketing Promotions v. CA
(2005)]
Amount
One-Half (1/2) Month Pay per Year of Service
An EE is entitled to receive separation pay
equivalent to ½ month pay for every year of
service, a fraction of at least six (6) months
being considered as one whole year, if
his/her separation from the service is due to
any of the following authorized causes:
(1) Retrenchment to prevent losses (i.e.
reduction of personnel effected by
management to prevent losses);
(2) Closure or cessation of operation of an
establishment not due to serious losses
or financial reverses; and,
(3) When the EE is suffering from a
disease not curable within a period of six
(6) months and his/her continued
employment is prejudicial to his/her
health or to the health of his/her co-
employees
In no case will an EE get less than one (1)
month separation pay if the separation is
due to the above stated causes and he/she
has served for at least six (6) months. (DOLE
Handbook on Workers’ Statutory Monetary
Benefits, 2014 ed.)
One-Month Pay per Year of Service
An EE is entitled to separation pay
equivalent to his/her one-month pay for
every year of service, a fraction of at least 6
months being considered as one whole year,
if his/her separation from service is due to
any of the following:
49
LABOR LAW
(1) Installation by ER of labor-saving
devices;
(2) Redundancy, as when the position of the
EE has been found to be excessive or
unnecessary in the operation of the
enterprise;
(3) Impossible reinstatement of the EE to
his/her former position or to a
substantially equivalent position for
reasons not attributable to the fault of
the ER, as when the reinstatement
ordered by a competent authority cannot
be implemented due to closure of
cessation of operations of the
establishment/ER, or the position to
which he/she is to be reinstated no
longer exists and there is no substantially
equivalent position in the establishment
to which he/she can be assigned. (Gaco
vs NLRC, 1994)
Basis of Separation Pay
The computation of separation pay of an EE
shall be based on his/her latest salary rate.
(DOLE Handbook on Workers’ Statutory
Monetary Benefits, 2014 ed.)
Inclusion of Regular Allowance in the
Computation
In the computation of separation pay, it
would be error not to integrate the
allowance with the basic salary. The salary
base properly used in computing the
separation pay should include not just the
basic salary but also the regular allowances
that an EE has been receiving. (Planters’
Products, Inc. vs NLRC, 1989)
J. RETIREMENT PAY (RA 7641 - THE
RETIREMENT PAY LAW)
J.1. ELIGIBILITY
All employees in the private sector,
regardless of their position, designation, or
status, and irrespective of the method by
UP LAW BOC LABOR STANDARDS
which their wages are paid (Sec. 1, IRR, RA
7641)
The only exceptions are:
(1) employees covered by the Civil Service
Law;
(2) domestic helpers and persons in the
personal service of another, and
(3) employees in retail, service and
agricultural establishments or operations
regularly employing not more than ten
employees (Sec. 2, IRR, RA 7641)
Exclusions from coverage
R.A. No. 7641, otherwise known as "The
Retirement Pay Law," only applies in a
situation where
(1) There is no collective bargaining
agreement or other applicable employment
contract providing for retirement benefits for
an employee; OR
(2) There is a collective bargaining
agreement or other applicable employment
contract providing for retirement benefits for
an employee, but it is below the
requirements set for by law.
Age of retirement
Optional retirement – in the absence of a
retirement plan or other applicable
agreement providing for retirement benefits
of EEs in an establishment, an EE may retire
upon reaching the age of 60 or more if he
has served for at least 5 years in said
establishment.
Compulsory retirement – in the absence of a
retirement plan or other applicable
agreement providing for retirement benefits
of EEs in an establishment, an EE shall be
retired at the age of 65 years. (Sec. 4, IRR,
RA 7641)
J.2. AMOUNT OF RETIREMENT PAY
50
LABOR LAW
The minimum retirement pay shall be
equivalent to one-half (1/2) month salary for
every year of service, a fraction of at least six
(6) months being considered as one whole
year.
For the purpose of computing retirement
pay, “one-half month salary” shall include
all of the following:
1. Fifteen (15) days salary based on the
latest salary rate;
2. Cash equivalent of five (5) days of service
incentive leave;
3. One-twelfth (1/12) of the 13th month pay.
(1/12 x 365/12 = .083 x 30.41 = 2.52)
Thus, “one-half month salary” is equivalent
to 22.5 days. (Capitol Wireless, Inc. vs Sec.
Confessor, 1996)
Other benefits may be included in the
computation of the retirement pay upon
agreement of the ER and the EE or if
provided in the CBA.
Retirement Benefits under a CBA or
Applicable Contract
Any EE may retire or be retired by his/her ER
upon reaching the age established in the
CBA or other applicable agreement/contract
and shall receive the retirement benefits
granted therein; provided, however, that
such retirement benefits shall not be less
than the retirement pay required under RA
7641, and provided further that if such
retirement benefits under the agreement are
less, the ER shall pay the difference.
Where both the ER and the EE contribute to
a retirement fund pursuant to the applicable
agreement, the ER’s total contributions and
the accrued interest thereof should not be
less than the total retirement benefits to
which the EE would have been entitled had
there been no such retirement benefits’
UP LAW BOC LABOR STANDARDS
fund. If such total portion from the ER is
less, the ER shall pay the deficiency.
J.3. RETIREMENT BENEFITS OF
WORKERS WHO ARE PAID BY RESULTS
For covered workers who are paid by result
and do not have a fixed monthly salary rate,
the basis for the determination of the salary
for 15 days shall be their average daily salary
(ADS). The ADS is derived by dividing the
total salary or earning for the last 12 months
reckoned from the date of retirement by the
number of actual working days in that
particular period, provided that the
determination of rates of payment by results
are in accordance with established
regulations
J.4. RETIREMENT BENEFIT OF PART-
TIME WORKERS
Part-time workers are also entitled to
retirement pay of “one-month salary” for
every year of service under RA 7641 after
satisfying the following conditions precedent
for optional retirement:
(a) There’s no retirement plan between the
ER and the EE; and,
(b) The EE should have reached the age of
60 years, and should have rendered at
least 5 years of service with the ER.
Applying the foregoing principle, the
components of retirement benefit of part-
time workers may likewise be computed at
least in proportion to the salary and related
benefits due them. (DOLE Handbook on
Workers’ Statutory Monetary Benefits, 2014
ed.)
J.5. TAXABILITY (SEC. 1, RA 4917)
Any provision of law to the contrary
notwithstanding, the retirement benefits
51
LABOR LAW
received by officials and employees of
private firms, whether individual or
corporate, in accordance with a reasonable
private benefit plan maintained by the
employer
1. shall be exempt from all taxes and
2. shall not be liable to attachment,
garnishment, levy or seizure by or under any
legal or equitable process whatsoever
Exception
Except to pay a debt of the official or
employee concerned to the private benefit
plan or that arising from liability imposed in
a criminal action:
Additional conditions
1. That the retiring official or employee has
been in the service of the same employer for
at least ten (10) years and is not less than
fifty years of age at the time of his
retirement;
2. That the retirement benefits shall be
availed of by an official or employee only
once; and,
3. That in case of separation of an official or
employee from the service of the employer
due to death, sickness or other physical
disability or for any cause beyond the control
of the said official or employee, any amount
received by him or by his heirs from the
employer as a consequence of such
separation shall likewise be exempt as
hereinabove provided.
"Reasonable private benefit plan" means a
pension, gratuity, stock bonus or profit
sharing plan maintained by an employer for
the benefit of some or all of his officials and
employees, wherein contributions are made
by such employer or officials and employees,
or both, for the purpose of distributing to
such officials and employees the earnings
and principal of the fund thus accumulated,
and wherein it is provided in said plan that
UP LAW BOC
at no time shall any part of the corpus or
income of the fund be used for, or be
diverted to, any purpose other than for the
exclusive benefit of the said officials and
employees.
K. WOMEN WORKERS
K.1. PROVISIONS AGAINST
DISCRIMINATION
It shall be unlawful for any employer to
discriminate against any woman employee
with respect to terms and conditions of
employment solely on account of her sex.
The following are acts of discrimination:
(1) Payment of a lesser compensation,
including wage, salary or other form of
remuneration and fringe benefits, to a
female employees as against a male
employee, for work of equal value; and
(2) Favoring a male employee over a
female employee with respect to
promotion, training opportunities,
study and scholarship grants solely on
account of their sexes. (Art.133)
K.2. STIPULATION AGAINST MARRIAGE
It shall be unlawful for an employer to:
(a) require as a condition of
employment or continuation of
employment that a woman
employee shall not get married,
or
(b) stipulate expressly or tacitly that
upon getting married a woman
employee shall be deemed
resigned or separated or
(c) actually dismiss, discharge,
discriminate or otherwise
prejudice a woman employee
LABOR STANDARDS LABOR LAW
merely by reason of her marriage.
(Art. 134)
Exceptions:
1. Reasonable demands of business require
the distinction based on marital status AND
there is no better available policy to
accomplish the business purpose.
2. Spouse is an employee of the competitor
K.3. PROHIBITED ACTS (ART. 135)
Note: Nightwork/ Exception (Art 130-131) –
No more nightwork prohibition under R.A.
10151.
Discrimination (Art 133, RA 9710)
See previous section
Stipulation against marriage (Art 134)
See previous section
Discharge to prevent enjoyment of benefits
To deny any woman employee the benefits
provided for in this Chapter or to discharge
any woman employed by him for the
purpose of preventing her from enjoying any
of the benefits provided under this Code.
[Art. 135 (1)]
Discharge on account of pregnancy
To discharge such woman on account of her
pregnancy, while on leave or in confinement
due to her pregnancy. [Art. 135 (2)]
Discharge on account of testimony
To discharge or refuse the admission of such
woman upon returning to her work for fear
that she may again be pregnant. [Art. 137
(3)]
It shall be unlawful for any employer: …to
discharge any woman or child or any other
employee for having filed a complaint or
having testified or being about to testify
52
UP LAW BOC LABOR STANDARDS
under the Code [Book III, Rule XII, Sec 13(d),
IRR]
Expulsion of Women faculty/ female student
due to pregnancy outside of marriage
Expulsion and non-readmission of women
faculty due to pregnancy outside of marriage
shall be outlawed. No school shall turn out
or refuse admission to a female student
solely on the account of her having
contracted pregnancy outside of marriage
during her term in school. [Sec. 13(c), RA
9710]
K.4. ANTI-SEXUAL HARASSMENT (RA
7877 - ANTI-SEXUAL HARASSMENT ACT
OF 1995)
Forms of Sexual Harassment
(1) Employment or Work Related
a. The sexual favor is made as a
condition
i. in the hiring or in the
employment, re-employment
or continued employment of
said individual or
ii. in granting said individual
favorable compensation,
terms, conditions,
promotions, or privileges, or
iii. in the refusal to grant the
sexual favor results in limiting,
segregating or classifying the
EE which in any way would
discriminate, deprive or
diminish employment
opportunities or otherwise
adversely affect said employee;
b. The above acts would either:
i. impair the employee’s rights
or privileges under existing
labor laws; or
ii. result in an intimidating,
hostile, or offensive
53
LABOR LAW
environment for the
employee.
(2) Education or Training environment. In an
education or training environment, sexual
harassment is committed:
a. Against one who is under the care,
custody or supervision of the
offender
b. Against one whose education,
training, apprenticeship or tutorship
is entrusted to the offender;
c. When the sexual favor is made a
condition to the giving of a passing
grade, or the granting of honors and
scholarships, or the payment of a
stipend, allowance or other benefits,
privileges, or considerations; or
d. When the sexual advances result in
an intimidating, hostile or offensive
environment for the result, trainee or
apprentice.
Persons who may be liable
(1) Any employer, employee, manager,
supervisor, agent of the employer, teacher,
instructor, professor, coach, trainer or any
other person, regardless of whether the
demand, request for requirement for
submission is accepted by the object of
said act having authority, influence or
moral ascendancy over another in a work
or training or education environment, who
demands, requests or otherwise requires
any sexual favor from another,
(2) Any person who directs or induces another
to commit any act of sexual harassment as
herein defined. OR
(3) Any person who cooperates in the
commission by another without which it
would NOT have been committed, shall
also be held liable under this Act (Sec. 3,
RA 7877)
Role of the employer or Head of Office
UP LAW BOC LABOR STANDARDS
The Employer or Head of Office shall have the
duty:
(1) to prevent the commission of such acts
and
(2) to lay down the procedure for the
resolution, settlement or prosecution of
committed acts. (Sec. 4, RA 7877)
He shall be solidarily liable for damages:
(1) if he is informed of such acts by the
offended party and
(2) no immediate action is taken thereon.
(Sec. 5, RA 7877)
Independent Action for Damages
The victim of work, education or training-
related sexual harassment can institute a
separate and independent action for
damages and other affirmative relief. (Sec.
6, RA 7877)
Sanctions
(1) Criminal: imprisonment of 1 month to mos.
Or fine of P10k to P20k or both
Prescription of such action is in 3 years.
(2) Termination (Sec. 7, RA 7877)
L. MINOR WORKERS
Relevant Laws: RA 7610 (Special Protection
of Children Against Abuse, Exploitation and
Discrimination Act), RA 9231 (Special
Protection of Children Against Child Abuse,
Exploitation and Discrimination Act), Art.
137(a)
Constitutional basis: Art II, Sec. 13 of the 1987
Constitution
The State recognizes the vital role of the
youth in nation-building and shall promote
and protect their physical, moral, spiritual,
intellectual, and social well-being. It shall
inculcate in the youth patriotism and
nationalism, and encourage their
54
LABOR LAW
involvement in public and civic affairs.
Child - refers to any person under 18 years of
age
Child labor - refers to any work or economic
activity performed by a child that subjects
him/her to any form of exploitation or is
harmful to his/her health and safety or
physical, mental or psychosocial
development
General Rule: Children below 15 shall NOT
be employed
Exceptions
(1) Child works directly under the sole
responsibility of his parents or legal
guardian and where only members of the
ER’s family are employed, provided:
(a) his employment does NOT endanger
his life, safety, health and morals,
(b) nor impairs his normal development,
and
(c) the parent or legal guardian shall
provide the said minor child with the
prescribed primary and/or secondary
education; (Sec. 12 of RA 7610 as
amended by RA 7658)
(2) child’s employment or participation in
public entertainment or information
through cinema, theater, radio or
television is essential, provided that:
(a) employment does NOT involve ads or
commercials promoting alcohol,
tobacco and its by-products or violence
[Sec. 14 of RA 7610]
(b) the employment contract is concluded
by the child’s parents or guardian, and
approved by DOLE
(c) The ER shall ensure the protection,
health, safety and morals of the child
UP LAW BOC LABOR STANDARDS LABOR LAW

(d) The ER shall institute measures to

prevent the child’s exploitation or Quantity
discrimination taking into account the Age Bracket Daily Max Weekly Max
system and level of remuneration, and Below 15 y 4 hours 20 hours
the duration and arrangement of 15 to below
8 hours 40 hours
working time 18
(e) The ER shall formulate and
implement, subject to the approval
and supervision of competent Night work prohibition
authorities, a continuing program for Age Bracket Prohibited Hours
training and skills acquisition of the 8 pm to 6 am (10
child. (Sec. 12 of RA 7610 as amended Below 15 y
hrs)
by RA 7658) 10 pm to 6 am (8
15 to below 18
hrs)
Employment of Children from 15 to 18
Employment is allowed but restricted to non-
M. EMPLOYMENT OF
hazardous work.
HOUSEHELPERS
Non-hazardous work shall mean any work or
activity in which the EE is not exposed to any RA 10361 (Batas Kasambahay or Domestic
risk which constitutes an imminent danger Worker’s Act) has expressly repealed
to his safety and health. (Sec. 3, Rule XII, Chapter III, “Employment of Househelpers”,
Book III, IRR of LC) Title III of Book III of the LC.

The Secretary of Labor shall from time to Domestic work

time publish a list of hazardous work and
activities in which persons 18 years of age
and below cannot be employed (Sec. 3, Rule
XII, Book III, IRR of LC)
The following are HAZARDOUS workplaces:
(1) Nature of the work exposes the workers to
dangerous environmental elements,
contaminants or working conditions;
(2) construction work, logging, fire-fighting,
mining, quarrying, blasting, stevedoring,
dock work, deep sea fishing, and
mechanized farming;
(3) manufacture or handling of explosives and
other pyrotechnic products;
(4) exposure to or use of heavy power-driven
machinery or equipment;
(5) exposure to or use of power-driven tools
Working Hours of a Child
This refers to work performed in or for a
household or households. (Sec 4(C). RA
10361)
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, nursemaid or “yaya”,
cook, gardener, or laundry person. (Sec 4(D).
RA 10361)
The term domestic worker or “kasambahay”
excludes any person who performs domestic
work only occasionally or sporadically and
not on an occupational basis. (Sec.4(D), RA
10361)
Rights and Privileges
(a) Minimum wage

55
UP LAW BOC LABOR STANDARDS
The minimum wage of domestic workers
shall not be less than the following:
(1) P2,500 a month for those employed in
NCR
(2) P2,000 a month for those employed in
chartered cities and first class
municipalities
(3) P1,500 a month for those employed in
other municipalities
Within one year from the effectivity of the
Act, and periodically thereafter, the
Regional Tripartite and Productivity Wage
Boards shall review, and if proper, determine
and adjust the minimum wage rates of
domestic workers. (Sec. 24, RA 10361)
(b) Standard of Treatment
The employer or any member of the
household shall not subject a domestic
worker or “kasambahay” to any kind of
abuse nor inflict any form of physical
violence or harassment or any act tending to
degrade the dignity of a domestic worker.
(Sec. 5, RA 10361)
(c) Board, Lodging and Medical
Attendance
The employer shall provide for the basic
necessities of the domestic worker to include
at least three (3) adequate meals a day and
humane sleeping arrangements that ensure
safety and shall provide appropriate rest and
assistance to the domestic worker in case of
illnesses and injuries sustained during
service without loss of benefits. (Sec. 6, RA
10361)
(d) Privacy
Respect for the privacy of the domestic
worker shall be guaranteed at all times and
shall extend to all forms of communication
and personal effects (Sec. 7, RA 10361)
(e) Access to Outside Communication
56
LABOR LAW
The employer shall grant the domestic
worker access to outside communication
during free time: Provided, That in case of
emergency, access to communication shall
be granted even during work time. (Sec. 8,
RA 10361)
(f) Education and Training
The employer shall afford the domestic
worker the opportunity to finish basic
education and may allow access to
alternative learning systems and, as far as
practicable, higher education or technical
and vocational training. (Sec. 9, RA 10361)
(g) Social and Other Benefits
A domestic worker who has rendered at
least one (1) month of service shall be
covered by the Social Security System (SSS),
the Philippine Health Insurance Corporation
(PhilHealth), and the Home Development
Mutual Fund or Pag-IBIG, and shall be
entitled to all the benefits in accordance
with the pertinent provisions provided by
law.
(h) Leave Benefits
A domestic worker who has rendered at
least one (1) year of service shall be entitled
to an annual service incentive leave of five
(5) days with pay (Sec. 29, RA 10361)
Pre-Employment Requirement
Prior to the execution of the employment
contract, the employer may require the
following from the domestic worker:
(a) Medical certificate or a health certificate
issued by a local government health officer;
(b) Barangay and police clearance;
(c) National Bureau of Investigation (NBI)
clearance; and
(d) Duly authenticated birth certificate or if
not available, any other document showing
the age of the domestic worker such as
UP LAW BOC LABOR STANDARDS
voter’s identification card, baptismal record
or passport.
However, Section 12(a), (b), (c) and (d) shall
be standard requirements when the
employment of the domestic worker is
facilitated through the PEA.
The cost of the foregoing shall be borne by
the prospective employer or agency, as the
case may be. (Sec. 12, RA 10361)
Time and Manner of Payment: Payment of
wages shall be made on time directly to the
domestic worker in cash at least once a
month and unless allowed by the domestic
worker through a written consent, employer
shall make no deductions from the wages
other than that which is mandated by law.
(Sec. 25, RA 10361)
Right against assignment to non-household
work at a wage rate lower than that
mandated for agricultural or non-
agricultural enterprises depending on the
case. (Sec. 22, RA 10361)
Employment Age of Domestic Workers:
Unlawful to employ any person below fifteen
(15) years of age as a domestic worker (Sec.
16, RA 10361)
Persons between 15-18 years old should only
be employed in non-hazardous work. (DO 4-
99 Sec. 4)
Daily Rest Period: Aggregate of eight (8)
hours per day. (Sec. 20, RA 10361)
Employment Certification: ER shall give the
househelper a written statement of the
nature and duration of the service and his or
her work performance as househelper upon
severance. (Sec. 35, RA 10361)
57
LABOR LAW
Termination
A. Initiated by the domestic worker (at any
time)
(a) Verbal or emotional abuse of the
domestic worker by the employer or any
member of the household;
(b) Inhuman treatment including physical
abuse of the domestic worker by the
employer or any member of the household;
(c) Commission of a crime or offense against
the domestic worker by the employer or any
member of the household;
(d) Violation by the employer of the terms
and conditions of the employment contract
and other standards set forth under this law;
(e) Any disease prejudicial to the health of
the domestic worker, the employer, or
member/s of the household; and
(f) Other causes analogous to the foregoing.
(Sec. 33, RA 10361)
B. Initiated by the employer (at any time)
(a) Misconduct or willful disobedience by the
domestic worker of the lawful order of the
employer in connection with the former’s
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;
(d) Commission of a crime or offense by the
domestic worker against the person of the
employer or any immediate member of the
employer’s family;
(e) Violation by the domestic worker of the
terms and conditions of the employment
contract and other standards set forth under
this law;
(f) Any disease prejudicial to the health of
the domestic worker, the employer, or
member/s of the household; and
(g) Other causes analogous to the foregoing.
(Sec. 34, RA 10361)
UP LAW BOC LABOR STANDARDS
Unjust dismissal
Neither the domestic worker nor the
employer may terminate the contract before
the expiration of the term except for grounds
provided in Sec. 33 and 34 of RA 10361.
If the domestic worker is unjustly dismissed,
the domestic worker shall be paid the
compensation already earned plus the
equivalent of 15 days work by way of
indemnity.
Leaving without justifiable reason by the
domestic worker
1. Any unpaid salary due not exceeding the
equivalent 15 days work shall be forfeited
AND
2. The employer may recover from the
domestic worker the costs incurred related
to the deployment expenses, if any:
Provided, that the service has been
terminated within 6 months from the
domestic worker’s employment.
Notice to end the working relationship
If the duration of the domestic service is not
determined either in stipulation or by the
nature of the service, the employer or the
domestic worker may give notice to end the
working relationship five (5) days before the
intended termination of the service.
The domestic worker and the employer may
mutually agree upon written notice to pre-
terminate the contract of employment to
end the employment relationship. (Sec. 32,
RA 10361)
N. EMPLOYMENT OF
HOMEWORKERS
DO 5, DOLE (February 4, 1992), is now Rule
XIV, Book III of the IRR.
58
LABOR LAW
Industrial homework
A system of production under which work for
an ER or contractor is carried out by a
homeworker at his/her home.
(1) Materials may or may not be furnished
by the ER or contractor.
(2) Decentralized form of production,
where there is ordinarily very little
supervision or regulation of methods
of work. (Sec. 2(a), Rule XIV, Book III,
IRR)
Industrial Homeworker means a worker who
is engaged in industrial homework
Employer means any person who
(1) Acts as a contractor – delivers or
causes to be delivered any goods,
articles, or materials to be processed
or fabricated in or about a home and
thereafter to be returned or to be
disposed of or distributed in
accordance with ER’s direction; OR
(2) Sells any goods, articles, or materials
to be processed or fabricated in or
about a home and then rebuys them
after. (Art. 153, LC)
Sec 2(d), Rule XIV, Book III is substantially
similar to the above.
Rights and benefits accorded homeworkers
(1) Right to form, join or assist
organizations (Sec 3, Rule XIV, Book
III, IRR)
(2) Right to acquire legal personality and
the rights and privileges granted by
law to legitimate labor organizations
upon issuance of the certification of
registration (Sec 4, Rule XIV, Book III,
IRR)
UP LAW BOC LABOR STANDARDS
(3) Immediate payment upon ER’s receipt
of finished goods or articles (Sec 6,
Rule XIV, Book III, IRR)
(4) SSS, MEDICARE and ECC premium
contributions shall be deducted from
their pay and shall be remitted by
ER/contractor/subcontractor to the
SSS (Sec 6, Rule XIV, Book III, IRR)
Liability of Employer
(1) ER may require
homeworker to redo work
improperly executed
without additional pay
(Sec 9a, Rule XIV, Book III,
IRR)
(2) ER need not pay
homeworker for any work
done on goods or articles
not returned due to
homeworker’s fault (Sec
9b, Rule XIV, Book III, IRR)
(3) If
subcontractor/contractor
fails to pay homeworker,
ER is jointly and severally
liable with the former to
the homeworker for
his/her wage (Sec 11, Rule
XIV, Book III, IRR)
(4) ER shall assist the
homeworkers in the
maintenance of basic safe
and healthful working
conditions at the
homeworkers’ place of
work. (Sec 11, Rule XIV,
Book III, IRR of LC)
Regional Office shall provide technical
assistance to registered homeworkers’
organizations (Sec 14, Rule XIV, Book III, IRR
of LC)
Prohibited Homework
59
LABOR LAW
Homework is prohibited in the ff:
(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.
(Sec 13, Rule XIV, Book III, IRR)
Conditions for deduction from homeworker’s
earnings
No deduction from the homeworker’s
earnings for the value of materials lost,
destroyed or damaged unless:
(1) Homeworker is clearly shown to be
responsible for loss or damage
(2) Reasonable opportunity to be heard
(3) Amount of deduction is fair and
reasonable, and does not exceed
actual loss or damage
(4) Deduction does not exceed 20% of
homeworker’s weekly earnings (Sec. 8,
Rule XIV, Book III, IRR)
O. APPRENTICES AND LEARNERS
Relevant Law: RA 7796 (Technical Education
and Skills Development Act of 1994 or
TESDA Act of 1994)
O.1. APPRENTICES
Art. 58 has been superseded by Section 4 (j),
(k), (l), (m) of RA 7796 quoted below:
(j) "Apprenticeship" training within
employment with compulsory related
theoretical instruction involving a contract
between an apprentice and an employer on
an approved apprenticeable occupation.
(k)“Apprentice" is a person undergoing
training for an approved apprenticeable
occupation during an apprenticeship
agreement.
UP LAW BOC LABOR STANDARDS
(l)"Apprenticeship Agreement" is a contract
wherein a prospective employer binds
himself to train the apprentice who in turn
accepts the terms of training for a
recognized apprenticeable occupation
emphasizing the rights, duties and
responsibilities of each party.
(m) “Apprenticeable Occupation” is an
occupation officially endorsed by a tripartite
body and approved to be apprenticeable by
the authority. (Sec. 4, RA 7796)
The act of filing the proposed apprenticeship
program with the DOLE is a preliminary step
towards its final approval, and does not
instantaneously give rise to an employer-
apprentice relationship. It must be duly
approved by the Minister of Labor and
Employment.
Integrating both the abovementioned
provisions then the qualifications of an
apprentice are as follows:
(1) At least 15 years of age (as amended by
R.A. 7610), provided that if he is below 18
years, he shall not be eligible for
hazardous occupation;
(2) Possess vocational aptitude and capacity
for appropriate tests;
(3) Possess the ability to comprehend and
follow oral and written instructions. (Art.
59 of the LC, as amended by R.A. 7610).
(4) Physically fit for occupation
Employment of Apprentices: When
applicable:
(1) Only employers in highly technical
industries may employ apprentices;
and
(2) Only in apprenticeable occupations
approved by the Secretary of Labor.
(Art. 60, LC)
Period
60
LABOR LAW
The period of apprenticeship shall not
exceed six months.
Enforcement
No person shall institute any action for the
enforcement of any apprenticeship
agreement or damages for breach of any
such agreement, unless he has exhausted all
available administrative remedies. (Art. 67,
LC)
Summary of Rules:
(1) The apprentice must be paid not less
than 75% of the prescribed minimum
salary (Art. 61);
HOWEVER, the employer MAY NOT pay any
wage if the apprenticeship training is:
a. part of the school curriculum,
b. a requirement for graduation,
or
c. a requirement for board
examination (Art. 72)
(2) The apprenticeship agreement must
be approved by the DOLE Secretary
(without such one shall be deemed a
regular employee) (Nitto Enterprises v.
NLRC, G.R. No. 114337, Sept. 29,
1995);
(3) The employer is not compelled to
continue one’s employment upon
termination of apprenticeship;
(4) One-half (1/2) of the value of labor
training expenses incurred for
developing the productivity and
efficiency of apprentices of the training
cost is deducted from the employer’s
income tax but it shall not exceed 10%
of direct labor wage (Art. 71)
Working scholars – there is no employer-
employee relationship between students on
one hand, and schools, colleges or
universities on the other, where there is
written agreement between them under
which the former agree to work for the latter
UP LAW BOC LABOR STANDARDS
in exchange for the privilege to study free of
charge, provided, the students are given real
opportunities, including such facilities as
may be reasonable and necessary to finish
their chosen courses under such agreement.
(Sec. 14, Rule X, IRR)
N.2. LEARNERS
Persons hired as trainees in semi-skilled and
other industrial occupations which are non-
apprenticeable. Learnership programs must
be approved by the authority. (Sec. 4, RA
7796)
[Occupations] which may be learned
through practical training on the job in a
relatively short period of time which shall
not exceed three (3) months. (Art. 73(2), LC)
When may learners be hired
(1) No experienced workers are available;
(2) The employment of learners being
necessary to prevent the curtailment of
employment opportunities; and
(3) The employment will neither create
unfair competition in terms of labor
costs nor impair working standards.
(Art. 74, LC)
Learnership Agreement
Any employer desiring to employ learners
shall enter into a learnership agreement
with them, which agreement shall include:
(1) The names and addresses of the
learners;
(2) The duration of the learnership period,
which shall not exceed three (3)
months;
(3) The wages or salary rates of the
learners which shall begin at not less
than seventy-five percent (75%) of the
applicable minimum wage; and
(4) A commitment to employ the learners
if they so desire, as regular employees
upon completion of the learnership.
61
LABOR LAW
All learners who have been allowed or
suffered to work during the first two
(2) months shall be deemed regular
employees if training is terminated by
the employer before the end of the
stipulated period through no fault of
the learners.
The learnership agreement shall be subject
to inspection by the Secretary of Labor and
Employment or his duly authorized
representative. (Art. 75, LC)
Learners employed in piece or incentive-rate
jobs during the training period shall be paid
in full for the work done. (Art. 76, LC)
P. HANDICAPPED WORKERS –
DIFFERENTLY-ABLED WORKERS (RA
7277 - MAGNA CARTA FOR DISABLED
PERSONS, AS AMENDED BY RA 9442)
Disabled Persons are those suffering from
restriction or different abilities, as a result of
a mental, physical or sensory impairment, to
perform an activity in the manner or within
the range considered normal for a human
being [Sec. 4(a), RA 7277]
Impairment is any loss, diminution or
aberration of psychological, physiological, or
anatomical structure or function [Sec. 4(b),
RA 7277]
Disability shall mean:
a. physical or mental impairment that
substantially limits one or more
psychological, physiological or
anatomical function of an individual or
activities of such individual; OR
b. a record of such an impairment; OR
c. being regarded as having such an
impairment [Sec 4(c), RA 7277]
UP LAW BOC LABOR STANDARDS
Handicap refers to a disadvantage for a
given individual, resulting from an
impairment or a disability that limits or
prevents the function, or activity that is
considered normal given the age and sex of
the individual. [Sec 4(d), RA 7277]
Rights of disabled workers
(1) Equal opportunity for employment
(2) Reserved contractual positions
5% of all casual, emergency and contractual
positions in the DSWD; DOH, DepEd; and
other government agencies, offices or
corporations engaged in social development
[Sec 5 (par. 2), RA 7277]
(3) Sheltered employment
(4) Apprenticeship opportunity
(5) Full minimum wage (Sec 6, Wage
Order No. NCR-17, May 17, 2012)
IV. Termination of
Employment
A.EMPLOYER-EMPLOYEE
RELATIONSHIP
A.1. FOUR-FOLD TEST
TEST OF EMPLOYER-EMPLOYEE
RELATIONSHIP
(a) Selection and engagement of the
employee;
(b) Payment of wages;
(c) Power of dismissal; and
(d) Employer’s power to control the
employee’s conduct with respect to the
means and methods by which the work is
to be accomplished (Brotherhood Labor
Unity Movement of the Philippines et. al. v.
Zamora, G.R. No. 48645, Jan. 7, 1987).
62
LABOR LAW
The most important element is the employer’s
control of the employee’s conduct, not only as
to the result of the work to be done, but also
as to the means and methods to accomplish it.
(Lirio v. Genovia, G.R. No. 169757, Nov. 23,
2011).
The control test calls merely for the
“existence” of the right to control and not the
“actual exercise” of the right. (Zanotte Shoes v.
NLRC, G.R. No. 100665, Feb. 13, 1995).
Economic Dependence Test
Two-tiered approach.
(1) First Tier: Control Test (refer to the Four-
Fold Test)
(2) Second Tier: The underlying economic
realities of the activity or relationship.
(Sevilla v. Court of Appeals, G.R. Nos. L-
41182-3, Apr. 15, 1988).
A.2. KINDS OF EMPLOYMENT
I. PROBATIONARY
A probationary employee is one who is on trial
by an employer during which the employer
determines whether or not he is qualified for
permanent employment (Robinson’s Galleria et
al. v. Ranchez, G.R. No. 177937, Jan. 19, 2011)
Duration
General Rule: not exceed six (6) months from
the date the employee started working.
Exceptions:
(1) When it is covered by an apprenticeship
agreement stipulating a longer period
(Art. 287, LC);
(2) When the parties to an agreement
contract otherwise, such as when
established by company policy or required
by the nature of the work performed by the
employee (San Miguel Corp, v. del Rosario,
G.R. Nos. 168194 & 168603, December 13,
2005, citing Buiser v. Leogardo, G.R. No. L-
63316, July 31, 1984); or
UP LAW BOC LABOR STANDARDS
(3) When it involves the 3 year probationary
period of teachers (Mercado v. AMA
Computer College, G.R. No. 183572, April
13, 2010).
Standards to qualify as a regular employee
REQUIREMENTS:
(a) The employer must communicate the
regularization standards to the
probationary employee; and
(b) The employer must make such
communication at the time of the
probationary employee’s engagement.
If the employer fails to comply with either, the
employee is deemed as a regular and not a
probationary employee.
Termination
A probationary employee enjoys only a
temporary employment status. This means
that he is terminable at any time, permanent
employment not having been attained in the
meantime. As long as the termination was
made before the termination of the six-month
probationary period, the employer was well
within his rights to sever the employer-
employee relationship. (De la Cruz, Jr. v. NLRC,
G.R. No. 145417. Dec. 11, 2003)
A probationary employee can only be
terminated for:
(1) Just causes;
(2) Authorized causes; or
(3) Failure to qualify as a regular employee in
accordance with reasonable standards
made known by the employer to the
employee at the time of engagement.
(Robinson’s Galleria et al. v Ranchez, G.R.
No. 177937, Jan. 19, 2011)
The probationary employee is entitled to
substantial and procedural due process before
termination.
63
LABOR LAW
Limits to termination
(1) It must be exercised in accordance with
the specific requirements of the contract
(2) If a particular time is prescribed, the
termination must be within such time and
if formal notice is required, then that form
must be used;
(3) The employer’s dissatisfaction must be
real and in good faith, not feigned so as to
circumvent the contract or the law;
(4) There must be no unlawful discrimination
in the dismissal. (Manila Hotel Corporation
v. NLRC, G.R. No. 53453, January 22, 1986)
II. REGULAR
A regular employee is one who is engaged to
perform activities which are necessary and
desirable in the usual business or trade of the
employer as against those which are
undertaken for a specific project or are
seasonal.
Art 286 provides two kinds of regular
employees:
(1) Those engaged to perform activities which
are necessary or desirable in the usual
business or trade of the employer; and
(2) casual employees who have rendered at
least 1 year of service, whether continuous
or broken, with respect to the activity in
which they are employed. (Romares v.
NLRC, G.R. No. 122327. Aug. 19, 1998)
Primary standard to determine regular
employment: reasonable connection rule
The test is whether the former is usually
necessary or desirable in the usual business or
trade of the employer. If the employee has
been performing the job for at least one year,
even if the performance is not continuous or
merely intermittent, the law deems the
repeated and continuing need for its
performance as sufficient evidence of the
necessity, if not indispensability of that activity
to the business of the employer. Hence, the
UP LAW BOC LABOR STANDARDS
employment is also considered regular, but
only with respect to such activity and while
such activity exists. (Forever Richons Trading
Corp. v. Molina, G.R. No. 206061, Sept. 16,
2013).
Length of time involved
Length of time is not controlling, merely
serves as a badge of regular employment.
(Maraguinot v. NLRC, G.R. No. 120969. Jan.
22, 1998)
III. PROJECT EMPLOYMENT
A project employee is one who is hired for
carrying out a separate job, distinct from the
other undertakings of the company, the scope
and duration of which has been determined
and made known to the employees at the time
of employment. (Hanjin Heavy Industries &
Const. Co. v. Ibañez, G.R. No. 170181, June 26,
2008)
Whether or not the project has a direct relation
to the business of the employer is not
important, BUT:
(1) Employee must be informed of the nature
and duration of project
(2) Project and principal business of ER are
two separate things
(3) No attempt to deny security of tenure to
the worker
Two Kinds of Project Employee
(1) For a particular job or undertaking that is
WITHIN the regular or usual business of
the employer company, but which is
distinct and separate, and identifiable as
such, from the other undertakings of the
company (i.e. construction)
(2) For a particular job or undertaking that is
NOT within the regular business of the
corporation. Such a job or undertaking
must also be identifiably separate and
distinct from the ordinary or regular
64
LABOR LAW
business operations of the employer (Villa
v. NLRC, G.R. No. 117043, Jan. 14, 1988)
Work pool employee
A project employee or a member of a work
pool may acquire the status of a regular
employee when the following concur:
(1) There is a continuous rehiring of project
employees even after cessation of a
project; and
(2) The tasks performed by the alleged
“project employee” are vital, necessary,
and indispensable to the usual business or
trade of the employer. However, the
length of time during which the employee
was continuously rehired is not
controlling, but merely serves as a badge
of regular employment.
A work pool may exist although the workers in
the pool do not receive salaries and are free to
seek other employment during temporary
breaks in the business, provided, that the
worker shall be available when called to report
for a project. Although primarily applicable to
regular seasonal workers, this set-up can
likewise be applied to project workers insofar
as the effect of temporary cessation of work is
concerned. (Maraguinot v. NLRC, G.R. No.
120969. Jan. 22, 1998)
IV. SEASONAL
Seasonal employees are those whose work or
services to be performed are seasonal in
nature, employment is for the duration of the
season.
There is no continuing need for the worker.
V. CASUAL
A casual employee is engaged to perform a
job, work or service which is merely incidental
to the business of the employer, and such job,
work or service is for a definite period made
UP LAW BOC LABOR STANDARDS
known to the employee at the time of
engagement.
Someone who is not a regular, project or
seasonal employee.
Requirements to become regular employee:
(1) One (1) year service, continuous or broken
with respect to activity employed
(2) Employment shall continue while such
activity exists
VI. FIXED-TERM
Art. 286 has no application to instances where
a fixed period of employment was agreed
upon knowingly and voluntarily by the parties,
without any force, duress or improper pressure
being brought to bear upon the employee and
absent any other circumstances vitiating his
consent, or where it satisfactorily appears that
the employer and employee dealt with each
other on more or less equal terms with no
moral dominance whatever being exercised by
the former over the latter. (Brent School v.
Zamora, G.R. No. L-48494, Feb. 5, 1990)
Conditions for the validity of fixed contract
agreement between employer and employee
(1) Fixed period of employment was
knowingly and voluntarily agreed upon by
the parties without any force, duress, or
improper pressure or any other
circumstances vitiating his consent; or
(2) The employer and the employee dealt with
each other on more or less equal terms
with no moral dominance exercised by the
former or the latter.
A.3. JOB CONTRACTING
I. ARTICLES 106 – 109
Art. 106, LC: Contractor or subcontractor.
Whenever an employer enters into a contract
with another person for the performance of
the former’s work, the employees of the
65
LABOR LAW
contractor and of the latter’s subcontractor, if
any, shall be paid in accordance with the
provisions of this Code.
In the event that the contractor or
subcontractor fails to pay the wages of his
employees in accordance with this Code, the
employer shall be jointly and severally liable
with his contractor or subcontractor to such
employees to the extent of the work performed
under the contract, in the same manner and
extent that he is liable to employees directly
employed by him.
The Secretary of Labor and Employment may,
by appropriate regulations, restrict or prohibit
the contracting-out of labor to protect the
rights of workers established under this Code.
In so prohibiting or restricting, he may make
appropriate distinctions between labor-only
contracting and job contracting as well as
differentiations within these types of
contracting and determine who among the
parties involved shall be considered the
employer for purposes of this Code, to prevent
any violation or circumvention of any provision
of this Code.
There is "labor-only" contracting where the
person supplying workers to an employer does
not have substantial capital or investment in
the form of tools, equipment, machineries,
work premises, among others, and the workers
recruited and placed by such person are
performing activities which are directly related
to the principal business of such employer. In
such cases, the person or intermediary shall be
considered merely as an agent of the employer
who shall be responsible to the workers in the
same manner and extent as if the latter were
directly employed by him.
Art. 107, LC: Indirect employer. The provisions
of the immediately preceding article shall
likewise apply to any person, partnership,
association or corporation which, not being an
UP LAW BOC LABOR STANDARDS
employer, contracts with an independent
contractor for the performance of any work,
task, job or project.
Art. 108, LC: Posting of bond. An employer or
indirect employer may require the contractor
or subcontractor to furnish a bond equal to the
cost of labor under contract, on condition that
the bond will answer for the wages due the
employees should the contractor or
subcontractor, as the case may be, fail to pay
the same.
Art. 109, LC: Solidary liability. The provisions of
existing laws to the contrary notwithstanding,
every employer or indirect employer shall be
held responsible with his contractor or
subcontractor for any violation of any provision
of this Code. For purposes of determining the
extent of their civil liability under this Chapter,
they shall be considered as direct employers.
II. D.O. NO. 18-A-11: RULES IMPLEMENTING
ARTICLES 106 TO 109 OF THE LC, AS
AMENDED
Contracting or subcontracting refers to an
arrangement whereby a principal agrees to
put out or farm out with a contractor the
performance or completion of a specific job,
work or service within a definite or
predetermined period, regardless of whether
such job, work or service is to be performed or
completed within or outside the premises of
the principal.
Cabo refers to a person or group of persons or
a labor groups which, in the guise of a labor
organization, cooperative or any entity,
supplies workers to an employer, with or
without any monetary or other consideration,
whether in the capacity of an agent of the
employer or as an ostensible independent
contractor.
66
LABOR LAW
Legitimate contracting or subcontracting
Contracting or subcontracting shall be
legitimate if all the following circumstances
occur:
(1) The contractor must be registered in
accordance with these rules and carries a
distinct and independent business
(2) The contractor undertakes to perform the
job, work or service on its own
responsibility, according to its own
manner and method, and free from control
and direction of the principal in all matters
connected with the performance of the
work except as to the results thereof;
(3) The contractor has substantial capital
and/or investment; and
(4) The Service Agreement ensures
compliance with all the rights and benefits
under Labor laws.
Rights of contractor’s employees
All contractor’s employees, whether deployed
or assigned as reliever, seasonal, week-ender,
temporary, or promo jobbers, shall be entitled
to all the rights and privileges as provided for
in the LC, as amended.
Security of tenure of contractor’s employees
It is understood that all contractor’s
employees enjoy security of tenure regardless
of whether the contract of employment is co-
terminus with the service agreement, or for a
specific job, work, or service, or phase thereof.
Effect of termination of employment
[Sec. 13, D.O. 18-A-11]
Cause Effect
Prior to the Governed by Art. 284 – 292
expiration of the of LC
Service
Agreement
Prior to The right of the contractor
expiration of the employee to unpaid wages
Service and other unpaid benefits
UP LAW BOC LABOR STANDARDS LABOR LAW

Agreement and including unremitted legal completed within or outside the premises of
not due to mandatory contributions, the principal; or
authorized e.g., SSS, PhilHealth, Pag- (b) The contractor does not exercise the right
causes ibig, ECC, shall be borne by to control the performance of the work of the
the party at fault, without employee.
prejudice to the solidary
liability of the parties to the Substantial capital – refers to paid-up capital
Service Agreement. stocks/shares of at least P3,000,000 in the
case of corporations, partnerships and
cooperatives; in case of single proprietorship,
Due to expiration Employee may opt for
a net worth of at least P3,000,000.
of Service payment of separation
Agreement, or benefits as may be
Mandatory registration
from the provided by law or the
It shall be mandatory for all persons or
completion of the Service Agreement, without
entities, including cooperative, acting as
phase of the job, prejudice to his/her
contractors, to register with the Regional
work or service entitlement to the
Office of the DOLE where it principally
for which the completion bonuses or
operates.
employee is other emoluments,
Failure to register shall give rise to the
engaged including retirement
presumption that the contractor is engaged in
benefits whenever
labor-only contracting.
applicable
Accordingly, the registration system
governing contracting arrangements and
Prohibition against labor-only contracting implemented by the Regional Offices of the
Labor-only contracting, a prohibited act, is an DOLE is hereby established, with the Bureau
arrangement where the contractor or of Working Conditions (BWC) as the central
subcontractor merely recruits, supplies or registry. (Sec. 14, D.O. 18-A-11)
places workers to perform a job, work or
service for a principal. (Polyfoam-RGC III. DEPARTMENT CIRCULAR NO. 01-12
International Corp. v. Concepcion, G.R. No. Applicability of D.O. 18-A-11 to BPO
172349, June 13, 2012) DO 18-A speaks of a trilateral relationship that
characterizes the covered contracting/sub-
ELEMENTS OF LABOR-ONLY CONTRACTING: contracting arrangement. Thus, vendor-
(a.1) The contractor does not have substantial vendee relationship for entire business
capital or investments in the form of tools, processes covered by the applicable provisions
equipment, machineries, work premises, of the Civil Code on Contracts is excluded.
among others, and
(a.2) The employees recruited and places are DO 18-A contemplates generic or focused
performing activities which are usually singular activity in one contract between the
necessary or desirable to the operation of the principal and the contractor (for example,
company, or directly related to the main janitorial, security, merchandising, specific
business of the principal within a definite or production work) and does not contemplate
predetermined period, regardless of whether information technology-enabled services
such job, work or service is to be performed or involving an entire process (for example, BPO,
KPO, legal process outsourcing, hardware

67
UP LAW BOC LABOR STANDARDS
and/or software support, medical
transcription, animation services, back office
operations/support). These companies
engaged in BPOs may hire employees in
accordance with applicable laws, and
maintain these EEs based on business
requirements, which may or may not be for
different clients of the BPOs at different
periods of the EE’s employment.
Applicability of D.O. 18-A-11 to the Construction
Industry
Licensing and the exercise of regulatory
powers over the construction industry is
lodged with PCAB which is under the
Construction Industry Authority of the
Philippines and not with the DOLE or any of its
regional offices.
Thus, the DOLE, through its regional offices
shall not require contractors licensed by PCAB
in the Construction Industry to register under
DO 18-A. Moreover, findings of violation/s on
labor standards and occupational health and
safety standards shall be coordinated with
PCAB for its appropriate action, including the
possible cancellation/suspension of the
contractor’s license.
IV. EFFECTS OF LABOR-ONLY CONTRACTING
Employees become regular employees
Where an entity is declared to be a labor-only
contractor, the employees supplied by said
contractor to the principal employer become
regular employees of the latter. Having gained
regular status, the employees are entitled to
security of tenure and can only be dismissed
for just or authorized causes and after they
had been afforded due process. (Norkis
Trading v. Buenavista, G.R. No. 182018. Oct. 10,
2012)
Contractor solidarily liable with principal
A finding by competent authority of labor-only
contracting shall render the principal jointly
and severally liable with the contractor to the
68
LABOR LAW
latter's employees, in the same manner and
extent that the principal is liable to employees
directly hired by him/her, as provided in Article
106 of the Labor Code, as amended.
A finding of commission of any of the
prohibited activities in Sec. 7, or violation of
either Secs. 8 or 9 hereof shall render the
principal the direct employer of the employees
of the contractor or subcontractor, pursuant to
Article 109 of the Labor Code, as amended.
(Sec. 27, D.O 18-A-11)
V. TRILATERAL RELATIONSHIP IN JOB
CONTRACTING
(1) Principal refers to any employer, whether a
person or entity, including government
agencies and GOCCs, who/which puts out
or farms out a job, service or work to a
contractor.
(2) Contractor refers to any person or entity,
including a cooperative, engaged in a
legitimate contracting or subcontracting
arrangement providing either services,
skilled worker, temporary workers or a
combination of services to a principal
under a Service Agreement.
(3) Contractor’s employee includes one
employed by a contractor to perform or
complete a job, work, or service pursuant
to a Service Agreement with a principal
It shall also refer to regular employees of
the contractor whose functions are not
dependent on the performance or
completion of a specific job, work or
service within a definite period of time i.e.
administrative staff.
Relationships that exist in a legitimate
contracting or subcontracting:
(1) An employer-employee relationship
between the contractor and the employees
it engaged to perform the specific job,
work or service being contracted; and
UP LAW BOC LABOR STANDARDS LABOR LAW

(2) A contractual relationship between the under special laws or under valid
principal and the contractor as governed agreements. (San Miguel Brewery Sales
by the provisions of the Civil Code. (Sec. 5, Force Union v. Ople, G.R. No. 53515,
par. 1, D.O. 18-A-11) February 8, 1989)

B. DISMISSAL FROM EMPLOYMENT Termination of Employment by Employee

Resignation
Coverage: General rule: Written notice to resign
General rule: All establishments (Art. 284, LC) submitted one (1) month in advance
Exception: Government, and its political Exception: No notice required for any of the
subdivisions, including GOCCs without original following:
charter. (Book VI, Rule 1, Sec. 1. IRR) (1) Serious insult by the employer or his
representative on the honor and person of
Security of Tenure the employee;
Right not be removed from one’s job without (2) Inhuman and unbearable treatment
valid cause and valid procedure. (Kiamco v. accorded the employee by the employer or
NLRC, G.R. No. 129449, June 29, 1999) his representative;
(3) Commission of a crime or offense by the
Requisites for the validity of management employer or his representative against the
prerogative affecting security of tenure person of the employee or any of the
(a) Exercised in good faith for the immediate members of his family; and
advancement of the Employer's interest, (4) Other causes analogous to any of the
and foregoing.
(b) not for the purpose of defeating or
circumventing the rights of the Employees
B.1. JUST CAUSE
JUST CAUSE REQUISITES
Serious Misconduct a) There must be misconduct;
b) The misconduct must be of such grave and
aggravated character;
c) It must relate to the performance of the employee’s
duties; and
d) There must be showing that the employee becomes
unfit to continue working for the employer.
Willful Disobedience 1. The employee’s assailed conduct must have been lawful or
intentional, the willfulness being characterized by a wrongful
and perverse attitude; and
2. The order violated must have been reasonable, or lawful,
made known to the employee and must pertain to the duties
which he had been engaged to discharge.

Gross and Habitual Neglect In order to constitute just cause for an EE’s dismissal due to
negligence, it must not only be gross, but also habitual. A
single or an isolated act that cannot be categorized as
habitual, hence, not a just cause for their dismissal.

69
UP LAW BOC LABOR STANDARDS LABOR LAW

Loss of Trust and Confidence
(a) There must be an act, omission, or concealment
(b) The act, omission or concealment justifies the loss of trust
and confidence of the employer to the employee;
(c) The employee concerned must be holding a position of
trust and confidence;
(d) The loss of trust and confidence should not be simulated;
(e) It should not be used as a subterfuge for causes which are
improper, illegal, or unjustified; and
(f) It must be genuine and not a mere afterthought to justify
an earlier action taken in bad faith (China City Restaurant
Corp. v. NLRC, 217 SCRA 443; Midas Touch v. NLRC, G.R.
No. 111639, 29 July 1996)

Commission of a Crime Commission of a crime or offense by the employee against

Other analogous causes
the person of his employer or any immediate member of his
family or his duly authorized representatives
Examples
(1) Abandonment
(2) Courtesy Resignation
(3) Change of Ownership
(4) Habitual Absenteeism/Tardiness
(5) Past Offenses
(6) Habitual Infractions
(7) Immorality
(8) Conviction/Commission of a Crime

Positions of trust and confidence:

(1) Managerial employees - those vested with the powers or prerogatives to lay down management
policies and to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees or
effectively recommend such managerial actions.
(2) Fiduciary Rank and file - those who in the normal and routine exercise of their functions, regularly
handle significant amounts of money or property. Examples are cashiers, auditors, property
custodians, etc. (Prudential Guarantee and Assurance Employee Labor Union v. NLRC, G.R. No. 185335,
June 13, 2012)

Managerial Fiduciary rank-and-file

Mere existence of a basis for the belief of Proof of involvement in the alleged events in
employee’s guilt (Grand Asian Shipping Lines, Inc. question required; mere uncorroborated
v. Galvez, G.R. No. 178184, January 29, 2014) assertions and accusations
are not enough (Etcuban, Jr. v. Sulpicio Lines, Inc.,
G.R. No. 148410, January 17, 2005)
Employment for a long time is counted against the
employee (Salvador v. Philippine Mining Service
Corp., G.R. No. 148766, January 22, 2003)

70
UP LAW BOC LABOR STANDARDS LABOR LAW

B.2. AUTHORIZED CAUSE

Authorized Causes Requisites
Installation of Labor Saving Devices 1. Good faith on the employer
2. Written notice to DOLE and employees at least
30 days before termination
3. Separation pay equivalent to one-month pay or
at least ½ month pay for every year of service,
whichever is higher.
Retrenchment 1. Retrenchment is reasonable necessary and
likely to prevent business losses which, if
already incurred, are not merely de
minimis, but substantial, serious, actual and
real, or if only expected, are reasonably
imminent as perceived objectively and in
good faith by the employer;

2. Written notice to DOLE and employees at least

30 days before termination
3. Separation pay equivalent to one-month pay or
at least ½ month pay for every year of service,
whichever is higher.
4. Prerogative to retrench in good faith
5. Reasonable and fair criteria in ascertain who to
dismiss and retain
Redundancy 1. Written notice to DOLE and employees at least
30 days before termination
2. Separation pay equivalent to one-month pay
for every year of service, 3.Prerogative to abolish
redundant positions in good faith
5. Reasonable and fair criteria in ascertaining
what positions are redundant
Closure of Business 1. it was done in good faith to advance the
employer's interest
2. Written notice on the affected employees and
the DOLE is served at least one month before the
intended date of termination of employment.
3. Separation pay of 1 month for every year of
service if not due to serious business losses. If the
closure or cessation of operations of
establishment or undertaking is due to serious
business losses or financial reverses, the
employer must prove such allegation in order to
avoid the payment of separation pay.
Disease (1) The employee must be suffering from a

71
UP LAW BOC LABOR STANDARDS
Enforcement of Union Security Clause
Dismissal of union officers for the conduct of an 1. Union officer who knowingly participates in an
illegal strike / dismissal of union members for illegal strike; or
participating in the commission of illegal acts
Termination in conformity with existing statute /
Qualification requirements
B.3 DUE PROCESS
Requisites for Valid Dismissal
(1) Substantive due process: The dismissal
must be for any of the causes provided for
in Article 288 – 290 of the Labor Code;
and
(2) Procedural due process: The employee
must be afforded an opportunity to be
heard and defend himself. [Fujitsu
Computer Products Corporation of the Phil.
v. Court of Appeals, G.R. No. 158232, March
31, 2005]
Right to Counsel
The right to counsel, a very basic requirement
of substantive due process, has to be
observed. Indeed, the rights to counsel and to
due process of law are two of the fundamental
rights guaranteed by the 1987 Constitution to
any person under investigation, be the
proceeding administrative, civil, or criminal.
[Salaw v. NLRC, G.R. No. 90786, September 27,
1991]
LABOR LAW
disease which cannot be cured within six
months;
(2) His continued employment is prohibited by
law or prejudicial to his health or to the
health of his co-employees; and
(3) A certification to that effect must be issued by
a competent public health authority.
(1) The union security clause is applicable;
(2) The union is requesting for the enforcement
of the union security provision in the CBA; and
(3) There is sufficient evidence to support the
union's decision to expel the employee from
the union or company
2. Any worker and union officer who knowingly
participates in the commission of illegal acts
during a strike
Burden of Proof
In illegal dismissal cases, the onus of proving
that the employee was not dismissed or, if
dismissed, that the dismissal was not illegal,
rests on the employer, failure to discharge
which would mean that the dismissal is not
justified and, therefore, illegal. [Macasero v.
Southern Industrial Gases Philippines, G.R. No.
178524, January 30, 2009]
Degree of Proof
Substantial evidence
I. TWIN-NOTICE REQUIREMENT
The employer has the burden of proving that a
dismissed worker has been served two notices:
(1) The first to inform the employee of the
particular acts or omissions for which the
employer seeks his dismissal, and
(2) The second to inform the employee of his
employer's decision to terminate him.
An employee may be dismissed only if the
grounds mentioned in the pre-dismissal notice
72
UP LAW BOC LABOR STANDARDS LABOR LAW

were the ones cited for the termination of Process backwages

employment. [Erector Advertising Sign Group,
Inc. v. Cloma, G.R. No. 167218, July 2, 2010] Just or Valid Liable for damages
Authorized due to procedural
II. HEARING; MEANING OF OPPORTUNITY TO Cause infirmity.
BE HEARD + No Due Separation pay if for
While a formal hearing or conference is ideal, Process authorized cause
it is not an absolute, mandatory or exclusive
avenue of due process. [Perez v. PT&T, G.R. No.
152048, April 7, 2009] C. RELIEFS FOR ILLEGAL DISMISSAL

PROCEDURE TO BE OBSERVED IN A finding of illegal dismissal entitles the

TERMINATION CASES Employee to:
Just Causes Authorized Cause 1. Reinstatement without loss of seniority
1. Notice specifying Notice to: rights and privileges, and
the grounds for (1) Employee, and 2. Full backwages inclusive of allowances and
which dismissal is (2) DOLE at least 1 to benefits or their monetary equivalent from
sought month prior to the time withheld up to actual reinstatement
2. Hearing or the effectivity of (Art. 279)
opportunity to be the separation
heard C.1. REINSTATEMENT
3. Notice of the Reinstatement means restoration to a state or
decision to dismiss condition from which one had been removed
or separated. The person reinstated assumes
the position he had occupied prior to his
CONSEQUENCES FOR NON-
dismissal [Asian Terminals, Inc. v. Villanueva,
COMPLIANCE OF PROCEDURAL DUE
G.R. No. 143219, November 28, 2006]
PROCESS
Validity of General Rule: Reinstatement
Situation Liability of ER
Dismissal
Just or Valid No liability. Exceptions:
Authorized Separation pay only (1) Separation pay
Cause in authorized cause (2) Closure of business (Retuya v. Hon.
+ Due Dumarpa, G.R. No. 148848, Aug. 5, 2003)
Process (3) Economic business conditions (Union of
Supervisors v. Secretary of Labor, G.R. No.
No Just or Invalid Reinstatement or
L-39889, November 12, 1981)
Authorized separation pay.
(4) Employee’s unsuitability (Divine Word High
Cause If reinstatement not
School v. NLRC, G.R. No. 72207, August 6,
+ Due possible, + full
1986)
Process backwages
(5) Employee’s retirement/ overage (New
No Just or Invalid Reinstatement or Philippine Skylanders, Inc. v. Dakila, G.R.
Authorized separation pay. No. 199547, September 24, 2012)
Cause If reinstatement not
+ No Due possible, + full

73
UP LAW BOC LABOR STANDARDS
(6) Antipathy and antagonism (Wensha Spa
Center v. Yung, G.R. No. 185122, Aug. 16,
2010)
(7) Job with a totally different nature (DUP
Sound Phils. v. CA, G.R. No. 168317m Nov.
21, 2011)
(8) Long passage of time
(9) Inimical to the employer's interest
(10) When supervening facts have transpired
which make execution on that score unjust
or inequitable or, to an increasing extent
(Emeritus Security & Maintenance Systems,
Inc. v. Dailig, G.R. No. 204761, April 2,
2014)
Prescription Period
4 years from the time of dismissal. [Art. 1146,
CC]
I. REINSTATEMENT PENDING APPEAL
If the order of reinstatement of the Labor
Arbiter is reversed on appeal, it is obligatory
on the part of the employer to reinstate and
pay the wages of the dismissed employee
during the period of appeal until reversal by
the higher court. The Labor Arbiter's order of
reinstatement is immediately executory and
the employer has to either re-admit them to
work under the same terms and conditions
prevailing prior to their dismissal, or to
reinstate them in the payroll, and that failing
to exercise the options in the alternative,
employer must pay the employee's salaries
[Magana v. Medicard Philippines, Inc., G.R. No.
174833, December 15, 2010]
II. SEPARATION PAY IN LIEU OF
REINSTATEMENT
Kinds of separation pay (SP)
(1) SP as a statutory requirement for
authorized causes
(2) SP as financial assistance found in the
next section
(3) SP in lieu of reinstatement where
reinstatement is not feasible; and
74
LABOR LAW
(4) SP as a benefit in the CBA or company
policy
Instances when the award of separation pay, in
lieu of reinstatement to an illegally dismissed
employee, is proper:
(1) When reinstatement is no longer possible,
in cases where the dismissed employee's
position is no longer available;
(2) The continued relationship between the
employer and the employee is no longer
viable due to the strained relations
between them; and
(3) When the dismissed employee opted not
to be reinstated, or the payment of
separation benefits would be for the best
interest of the parties involved. (Book VI,
Rule 1, Section 4 (b), Rule I, IRR)
Separation Pay and Reinstatement, Exclusive
Remedies
The payment of separation pay and
reinstatement are exclusive remedies. The
payment of separation pay replaces the legal
consequences of reinstatement to an
employee who was illegally dismissed. [Bani
Rural Bank, Inc. v. De Guzman, G.R. No.
170904, November 13, 2013]
Doctrine of Strained Relations
Where reinstatement is not feasible, expedient
or practical, as where reinstatement would
only exacerbate the tension and strained
relations between the parties or where the
relationship between the employer and
employee has been unduly strained by reason
of their irreconcilable differences, particularly
where the illegally dismissed employee held a
managerial or key position in the company, it
would be more prudent to order payment of
separation pay instead of reinstatement
[Quijano v. Mercury Drug Corp., G.R. No.
126561, July 8, 1998]
Computation
UP LAW BOC LABOR STANDARDS LABOR LAW

SP as a statutory requirement is computed by of a private right but, rather, in the nature of a

integrating the basic salary with regular
allowances employee has been receiving
[Planters Products, Inc. v. NLRC, G.R. No.
78524, 78739, January 20, 1989]; allowances
include transportation and emergency living
allowances [Santos v. NLRC, G.R. No. 76721,
September 21, 1987]
C.2. BACKWAGES
Backwages are earnings lost by a worker due
to his illegal dismissal; a form of relief that
restores the income lost by reason of such
unlawful dismissal; it is not private
compensation or damages; nor is it a redress
command to the employer to make a public
reparation for illegally dismissing an
employee. [St. Theresa's School of Novaliches
Foundation v. NLRC, G.R. No. 122955, April 15,
1998]
Effect of failure to order backwages
A “plain error” which may be rectified, even if
employee did not bring an appeal regarding
the matter [Aurora Land Projects Corp. v.
NLRC, G.R. No. 114733, January 2, 1997]

Indemnity of Employer
Doctrine in Validity of
Period Liability of ER
effect Dismissal
Prior 1989 Pre-Wenphil Illegal Reinstatement + Backwages
Feb. 1989 – 1999 Wenphil Valid Dismiss now, indemnity pay later
Jan. 2000 – Oct. Serrano Ineffectual Full backwages up to reinstatement/finality of
2004 decision

Nov. 2004 – Agabon Valid Nominal damages

present
D. PREVENTIVE SUSPENSION
Preventive suspension is a disciplinary
measure for the protection of the company's
property pending investigation of any alleged
malfeasance or misfeasance committed by the
employee. The employer may place the worker
concerned under preventive suspension if his
continued employment poses a serious and
imminent threat to the life or property of the
employer or of his co-workers.
E. CONSTRUCTIVE DISMISSAL
Constructive dismissal is cessation of work
because continued employment is rendered
impossible, unreasonable or unlikely; when
there is a demotion in rank or diminution in
pay or both; or when a clear discrimination,
insensibility, or disdain by an employer
becomes unbearable to the employee.
The test of constructive dismissal is whether a
reasonable person in the employee's position
would have felt compelled to give up his
position under the circumstances.
V. Management
Prerogative
So long as a company’s management
prerogatives are exercised in good faith for the

75
UP LAW BOC LABOR STANDARDS
advancement of the employer’s interest and
not for the purpose of defeating or
circumventing the rights of the employees
under special laws or under valid agreements,
this Court will uphold them…Even as the law is
solicitous of the welfare of the employees, it
must also protect the right of an employer to
exercise what are clearly management
prerogatives. The free will of management to
conduct its own business affairs to achieve its
purpose cannot be denied. [Ernesto G. Ymbong
vs. ABS-CBN Broadcasting Corp., 2012]
A. DISCIPLINE
The employer’s right to conduct the affairs of
his business, according to its own discretion
and judgment, includes the prerogative to
instill discipline in its employees and to
impose penalties, including dismissal, upon
erring employees. [Consolidated Food
Corporation vs. NRLC, 1999] [St. Michael’s
Institute vs. Santos, 2001]
Although we recognize the right of employers
to shape their own work force, this
management prerogative must not curtail the
basic right of employees to security of tenure.
[Alert Security & Investigation Agency, Inc. vs.
Saidali Pasawilan, et. al., 2011]
B. TRANSFER OF EMPLOYEES
The Employer has the right to transfer or
assign Employees from one area of operation
to another, or one office to another or in
pursuit of its legitimate business interest,
Provided there is no demotion in rank or
diminution of salary, benefits and other
privileges and not motivated by discrimination
or made in bad faith, or effected as a form of
punishment or demotion without sufficient
cause. [Westin Phil. Plaza Hotel v. NLRC, 1999]
76
LABOR LAW
When the transfer is not unreasonable, or
inconvenient, or prejudicial to the employee,
and it does not involve a demotion in rank or
diminution of salaries, benefits, and other
privileges, the employee may not complain
that it amounts to a constructive dismissal.
[Bisig ng Manggagawa sa TRYCO v. NLRC,
2008]
C. PRODUCTIVITY STANDARD
The employer has the right to demote and
transfer an employee who has failed to
observe proper diligence in his work and
incurred habitual tardiness and absences and
indolence in his assigned work. [Petrophil
Corporation vs. NLRC, 1986]
D. GRANT OF BONUS
A bonus is "a gratuity or act of liberality of the
giver which the recipient has no right to
demand as a matter of right" [Aragon vs. Cebu
Portland Cement Co., 61 O.G. 4597].
The granting of a bonus is basically a
management prerogative which cannot be
forced upon the employer "who may not be
obliged to assume the onerous burden of
granting bonuses or other benefits aside from
the employee's basic salaries or wages" xxx
[Kamaya Point Hotel vs. National Labor
Relations Commission, Federation of Free
Workers and Nemia Quiambao, G.R. No. 75289,
August 31, 1989]. [Traders Royal Bank vs.
NLRC, 1990]
E. CHANGE OF WORKING HOURS
Further, management retains the prerogative,
whenever exigencies of the service so require,
to change the working hours of its
employees. So long as such prerogative is
exercised in good faith for the advancement of
the employer’s interest and not for the
UP LAW BOC LABOR STANDARDS LABOR LAW

purpose of defeating or circumventing the
rights of the employees under special laws or
under valid agreements, this Court will uphold
such exercise. [Sime Darby Pilipinas Inc. v.
NLRC, 1998]
F. RULES ON MARRIAGE BETWEEN
EMPLOYEES OF COMPETITOR-
EMPLOYERS
The prohibition against personal or marital
relationships with employees of competitor
companies is reasonable because
relationships of that nature might compromise
the interests of the company. The company
only aims to protect its interests against the
possibility that a competitor company will gain
access to its secrets and procedures. [Star
Paper Corp. vs. Simbol, 2006]
G. POST-EMPLOYMENT BAN
In cases where an employee assails a contract
containing a provision prohibiting him or her
from accepting competitive employment as
against public policy, the employer has to
adduce evidence to prove that the restriction is
reasonable and not greater than necessary to
protect the employer’s legitimate business
interests. The restraint may not be unduly
harsh or oppressive in curtailing the
employee’s legitimate efforts to earn a
livelihood and must be reasonable in light of
sound public policy. [Rivera v Solidbank, 2006]

77
UP LAW BOC SOCIAL WELFARE LEGISLATION
VI. Social Welfare
Legislation
A. SSS LAW [RA 8282]
A.1. COVERAGE
I. COMPULSORY [SEC. 9 [A]; SEC. 9-A]
(1) Employees not over 60 years including
domestic helpers with at least P1,000
monthly pay; and
(2) Self-employed as may be determined by
the Commission, but not limited to:
I. Self-employed professionals
II. Partners and single proprietors of
businesses
III. Actors and actresses, directors,
scriptwriters, and news
correspondents who do not fall
within the definition of the term
“employee” under Section 8 [d]
IV. Professional athletes, coaches,
trainers and jockeys
V. Individual farmers and fishermen
A domestic worker who has rendered at least
one [1] month of service shall be covered by
the Social Security System [SSS], the
Philippine Health Insurance Corporation
[PhilHealth], and the Home Development
Mutual Fund or Pag-IBIG, and shall be entitled
to all the benefits in accordance with the
pertinent provisions provided by law.
Premium payments or contributions shall be
shouldered by the employer. However, if the
domestic worker is receiving a wage of Five
thousand pesos [P5,000.00] and above per
month, the domestic worker shall pay the
proportionate share in the premium payments
or contributions, as provided by law.
78
LABOR LAW
The domestic worker shall be entitled to all
other benefits under existing laws. [Sec. 30,
Kasambahay Law [RA 10361]]
II. VOLUNTARY [SEC. 9]
(1) Spouses who devote full time to managing
household and family affairs, unless they
are also engaged in other vocation or
employment [which is subject of
compulsory coverage];
(2) OFWs recruited by foreign-based
employers;
(3) Employees [previously under compulsory
coverage] already separated from
employment or those self-employed [also
under compulsory coverage] with no
realized income for a given month, who
chose to continue with contributions to
maintain right to full benefit.
A.2. EXCLUSIONS FROM COVERAGE
[SEC. 8 [J]]
(1) Employment purely casual and not for the
purpose of occupation or business of the
employer.
(2) Service performed on or in connection with
an alien vessel by an employee if he is
employed when such vessel is outside the
Philippines;
(3) Service performed in the employ of the
Philippine Government or instrumentality
or agency thereof;
(4) Service performed in the employ of a
foreign government or international
organization, or their wholly-owned
instrumentalities; and
(5) Services performed by temporary and
other employees which may be excluded
by SSS regulation. Employees of bona fide
independent contractors shall not be
deemed employees of the employer
engaging the services of said contractors.
UP LAW BOC SOCIAL WELFARE LEGISLATION
A.3. BENEFITS
I. MONTHLY PENSION [SEC.12]
Computation of monthly pension
The monthly pension shall be the highest of
the following amounts:
(1) P300 + [20% x [average monthly credit]] +
[2% x [average monthly credit] x [# of cash
credited years of service in excess of 10
years]];
(2) 40% x [average monthly credit];
(3) P1,000; provided, that the monthly
pension shall in no case be paid for an
aggregate amount of less than 60
months.
Note: Notwithstanding the abovementioned,
minimum pension is P1,200 for members with
at least 10 years credit service, P2,400 for
those with 20 years.
II. DEPENDENTS’ PENSION [SEC. 12-A]
(1) Paid on account of members’
I. death,
II. retiring, or
III. permanent total disability;
(2) Paid to each child conceived on or prior to
contingency, but not exceeding 5,
beginning with the youngest and
preferring the legitimate;
(3) Amount is either P250 or 10% of the
monthly pension as computed above,
whichever is higher.
III. RETIREMENT BENEFITS [SEC. 12-B]
Eligibility requirements
(1) 120 monthly contributions;
(2) Age
I. 65 years old; or
II. a member who has reached 60
years may also avail if he is already
separated from employment or
has ceased to be self-employed.
Benefit – entitlement to monthly pension from
retirement until death.
79
LABOR LAW
The monthly pension shall be suspended upon
the reemployment or resumption of self-
employment of a retired member who is less
than sixty-five [65] years old.
In Case of Death of Member
(1) His/her primary beneficiaries as of the
date of his/her retirement shall be entitled
to receive the monthly pension; or
(2) If he/she has no primary beneficiaries AND
he/she dies within sixty [60] months from
the start of his/her monthly pension,
his/her secondary beneficiaries shall be
entitled to a lump sum benefit equivalent
to the total monthly pensions
corresponding to the balance of the five-
year guaranteed period, excluding the
dependents’ pension.
Lump Sum Alternative
Member may opt to receive his first 18 monthly
pensions in lump sum but such is discounted
at a preferential rate of interest.
Lump Sum Eligibility
A 60 year old member with less than 120
monthly contributions who is no longer
employed or self-employed, and who is not
continuing contributions independently, he is
entitled to a lump sum equal to his total
contributions paid.
IV. PERMANENT DISABILITY BENEFITS
[SEC. 13-A]
Eligibility requirement
 36 monthly contributions prior to the
semester of disability; same as death
benefit; the only difference is that the
pension is paid directly to the member.
 In case the permanently disabled member
dies, it would be given the same treatment
as a retiree dying.
 For permanent partial disability, the
pension is not lifetime. [e.g. loss of thumb
UP LAW BOC SOCIAL WELFARE LEGISLATION
entitles member to only 10 months of
pension, while loss of arm 50 months]. It
shall be paid in lump sum if the period is
less than 12 months.
 For multiple partial disabilities, they shall
be additive when related or deteriorating –
the percentage shall be equal to the
number of months the partial disability is
entitled to, divided by 75 months. [e.g. loss
of sight in one eye  25/75; loss of arm 
50/75; if both occur due to same cause,
then 25/75 + 50/75 = 100% so treated as
if it were permanent total disability]
Lump Sum Alternative
A member is entitled to a lump sum benefit
equivalent to the monthly pension times the
number of monthly contributions paid to the
SSS or twelve [12] times the monthly pension,
whichever is higher.
Lump Sum Eligibility
A member who has not paid at least 36
monthly contributions
Note: A member who [1] has received a lump
sum benefit; and [2] is reemployed or has
resumed self-employment not earlier than one
[1] year from the date of his disability shall
again be subject to compulsory coverage and
shall be considered a new member.
In Case of Death of Member
(1) His primary beneficiaries as of the date of
disability shall be entitled to receive the
monthly pension; OR
(2) If he has no primary beneficiaries and he
dies within sixty [60] months from the start
of his monthly pension, his secondary
beneficiaries shall be entitled to a lump
sum benefit equivalent to the total
monthly pensions corresponding to the
balance of the five-year guaranteed period
excluding the dependents’ pension.
80
LABOR LAW
V. DEATH BENEFITS [SEC. 13]
Eligibility requirement
36 monthly contributions prior to the semester
of death.
Benefit – monthly pension to primary or a
lump sum benefit equivalent to thirty-six [36]
times the monthly pension secondary
beneficiaries.
To those ineligible – lump sum benefit which
shall be the higher between the two:
 [monthly pension] x 12; or
 [monthly pension] x [# of monthly
contributions]
VI. FUNERAL BENEFITS [13-B]
P12,000 in cash or in kind, upon death of
member
VII. LOAN
Social Security Commission Resolution No.
669. Moreover, several SSS-issued circulars
such as Circular No. 21-P and No. 52 pertain to
the treatment of salary loans, sometimes
providing for more flexible payment terms or
condonation for delinquent payers; Santiago v.
CA and SSS, GR # L-39949 [1984] resolved an
issue involving the treatment of salary loan
repayments; SSS website also shows loans
VIII. SICKNESS BENEFITS [SEC. 14]
Eligibility requirements and other conditions
(1) Inability to work due to sickness or injury
(2) Confined for at least 4 days either in a
hospital or elsewhere with SSS approval;
(3) At least 3 months of contributions in the 12
month period immediately before the
semester of sickness or injury has been
paid;
(4) All company sick leaves with pay for the
current year have been used up;
UP LAW BOC SOCIAL WELFARE LEGISLATION
(5) Maximum of 120 days per 1 calendar year
[i.e maximum permissible for the same
sickness and confinement is 240 days for 2
consecutive years];
(6) The employer has been notified, or, if a
separated, voluntary or self-employed
member, the SSS directly notified within 5
days of confinement;
(7) Notice to employer or SSS not needed
when confinement is in a hospital; notice
to employer not required as well when
Employee became sick or injured while
working or within premises of the
employer.
Benefit: daily cash allowance paid for the
number of days a member is unable to work
due to sickness or injury equivalent to 90% x
[average daily salary credit]
Note: One hundred percent [100%] of the daily
benefits provided in the preceding paragraph
shall be reimbursed by the SSS to said
employer upon receipt of satisfactory proof of
such payment and legality thereof if the
following conditions are met:
(1) The employer notified the SSS of the
confinement within five calendar days
after receipt of the notification from the
employee member
(2) If the notification to the SSS is made by
the employer beyond five calendar days
after receipt of the notification from the
employee member, he shall be reimbursed
only for each day of confinement starting
from the tenth calendar day immediately
preceding the date of notification to the
SSS.
(3) SSS shall reimburse the employer or pay
the unemployed member only for
confinement within the one-year period
immediately preceding the date the claim
for benefit or reimbursement is received by
the SSS, except confinement in a hospital
in which case the claim for benefit or
81
LABOR LAW
reimbursement must be filed within one [1]
year from the last day of confinement.
IX. MATERNITY LEAVE BENEFITS [SEC.
14-A]
Eligibility Requirements
(1) A female member
(2) Paid at least three [3] monthly
contributions in the twelve-month period
immediately preceding the semester of her
childbirth or miscarriage
(3) She shall have notified her employer of her
pregnancy and the probable date of her
childbirth, which notice shall be
transmitted to the SSS in accordance with
the rules and regulations it may provide;
Process
The full payment shall be advanced by the
employer within thirty [30] days from the filing
of the maternity leave application;
Coverage
The maternity benefits provided under this
section shall be paid only for the first four [4]
deliveries or miscarriages;
Employer’s Reimbursement
That the SSS shall immediately reimburse the
employer of one hundred percent [100%] of
the amount of maternity benefits advanced to
the employee by the employer upon receipt of
satisfactory proof of such payment and legality
thereof. Note: All of these benefits are tax-exempt.
A.4. BENEFICIARIES
1. PRIMARY
(1) Dependent spouse – until remarriage [see
above];
(2) Dependent children [legitimate,
legitimated, legally adopted, and
illegitimate] [see above]; illegitimate
children are entitled only to 50% of the
share of legitimate children unless there
UP LAW BOC SOCIAL WELFARE LEGISLATION LABOR LAW

are no legitimate children, in which case, separation which is compensable under this
they get 100%. Act, all service credited for retirement,
resignation or separation for which
2. SECONDARY corresponding benefits have been awarded
Shall only receive when the primary under this Act or other laws shall be excluded
beneficiaries are absent in the computation of service
 Dependent parents
Note: The GSIS may prescribe rules for the
3. OTHERS – shall only receive when the inclusion of part time and other services with
primary and secondary beneficiaries are compensation.
absent
 Any other person designated by I. MONTHLY PENSION [SEC. 9]
member as his/her secondary The amount shall be:
beneficiary. (a) 37.5% x [revalued ave. monthly
compensation]
(b) Plus 2.5 x [revalued ave. monthly
B. GSIS [RA 8291]
compensation] x [years in service in excess
of 15 years].
B.1. COVERAGE
 The monthly pension shall not exceed
All public sector employees below the
90% of the average monthly
compulsory retirement age of 65, irrespective
compensation.
of employment status.
 It shall not be less than P2,400 for those
with 20 years of service and not less than
B.2. EXCLUSIONS FROM COVERAGE
P1,300 for everyone else.
(1) AFP and PNP;
(2) Members of the Judiciary and
Constitutional Commissions who are
II. RETIREMENT BENEFITS [SEC. 13]
covered only by life insurance as they have Eligibility requirements [Sec. 13-A]
separate retirement schemes; (1) 15 years service;
(3) Contractual employees with no employer- (2) 60 years of age; and
employee relationship with the agency (3) Not receiving pension benefit from
they serve. permanent total disability.

Note: Retirement is compulsory for employees

B.3. BENEFITS
65 years of age who have rendered at least 15
Computation of Service
years of service; if employee has less than 15
From date of original appointment/election,
years of service, he may be allowed to
including periods of service at different times
continue in accordance with civil service laws.
under one or more employers, those
performed overseas under the authority of the
Benefit [Sec. 13]: Choice between
Republic of the Philippines, and those that
(a) 60 x [basic monthly pension] lump sum
may be prescribed by the GSIS in coordination
payment at the time of retirement plus
with the Civil Service Commission.
basic monthly pension payable monthly
for life after expiry of the 5-year
In case of reinstatement in the service of an
guaranteed period which is already
employer and subsequent retirement or
covered by the lump sum; or

82
UP LAW BOC SOCIAL WELFARE LEGISLATION
(b) Cash payment equivalent to 18 x [basic
monthly pension] plus monthly pension for
life immediately but with no 5-year
guarantee
Note: Subject to periodic adjustment [Sec. 14]
III. PERMANENT DISABILITY BENEFITS
Eligibility requirements for Permanent Total
Disability
(1) Disability not due to employee’s own grave
misconduct, notorious negligence,
habitual intoxication, or willful intention to
kill himself or another;
(2) Employee is:
(a) In service at the time of disability; or
(b) Even if separated, he has paid at least
36 monthly contributions within the 5-
year period immediately prior to
disability or has paid a total of at least
180 monthly contributions prior to
disability; and
(c) Member is not enjoying old-age
retirement benefit.
Benefit for Permanent Total Disability
 Monthly income benefit for life equal to
basic monthly pension – This is effective
from date of disability;
 If member is in service at the time of
disability and he has paid at least 180
monthly contributions, in addition to the
monthly income benefit, he shall receive
an additional cash payment of 18 times
basic monthly pension.
To the ineligible
If member has rendered at least 3 years of
service, then he shall receive cash payment
equal to 100% of ave. monthly compensation
for each year of service [essentially total
amount of contributions made] or P12,000
whichever is higher.
Partial Disability
83
LABOR LAW
Paid according to GSIS prescribed schedule
[this is similar to the scheme used by SSS;
refer to section II subsection D-3 above];
member availing of permanent partial
disability must satisfy condition E.1.a. above
regarding the disability not being due to his
own fault and either E.1.b.i. or E.1.b.ii.
regarding employment status and services
rendered.
IV. DEATH BENEFITS [SEC. 21]
When member dies, the primary beneficiaries
are entitled to only one of the following:
(1) Survivorship pension
a. If he was in the service when he died;
or
b. Even if separated from the service, he
has at least 3 years of service and has
paid 36 monthly contributions within
the 5 years immediately preceding
death; or
c. Even if separated from the service, he
has paid 180 monthly contributions
prior to death.
(2) Survivorship pension plus cash payment of
100% ave. monthly compensation for
every year of service [so essentially,
pension plus total contributions made]
a. If he was in the service when he died;
and
b. With 3 years of service.
(3) Cash payment equivalent to 100% ave.
monthly compensation for each year of
service he paid contributions or P12,000
whichever is higher
a. With 3 years of service; and
b. He has failed to qualify in the prior 2
schemes.
V. FUNERAL BENEFITS [SEC. 23]
Fixed by GSIS rules and regulations
Entitled to this are the following:
(1) Active member;
UP LAW BOC SOCIAL WELFARE LEGISLATION LABOR LAW

(2) Member separated from service but still
entitled to funeral benefit;
(3) Pensioner;
(4) Retiree who at the time of retirement was
of pensionable age but opted to retire
under RA 1616.
VI. LOAN
GSIS website provides for this
VII. TEMPORARY DISABILITY BENEFITS
Similar to sickness
Eligibility requirements and other conditions:
(1) Employee must be:
I. in service at the time of disability; or
II. if separated, he has rendered at least
3 years of service and paid at least 6
monthly contributions in the 12
month period immediately prior to
disability;
(2) All sick leave credits including CBA sick
leaves for the current year has been used
up; and
(3) Maximum of 120 days per 1 calendar year
[so maximum permissible for the same
sickness and confinement is 240 days for 2
consecutive years].
Benefit
75% of the current daily compensation for
every day or fraction thereof of disability or
P70 whichever is higher.
payment of 100% of ave. monthly
compensation for each year of service [so
essentially, the total amount of all
contributions paid] or P12,000 whichever
is higher.
(2) Below 60 years of age and at least 15 years
of service: cash payment equivalent to 18 x
[monthly pension] at the time of
resignation or separation plus an old-age
pension benefit equal to basic monthly
pension.
IX. UNEMPLOYMENT BENEFITS [SEC. 11]
Eligibility requirements
(1) Employee separated from service due to
abolition of his office or position; and
(2) Employee has been paying integrated
contributions for at least 1 year prior to
separation.
Benefit
Monthly cash payments of 50% of average
monthly compensation for a duration which is
proportional to years rendered, ranging from 2
months to 6 months.
X. SURVIVORSHIP BENEFITS
Beneficiaries are entitled to the following:
(1) Basic survivorship pension which is 50% of
basic monthly pension; and
(2) Dependent children’s pension not
exceeding 50% of the basic monthly
pension.

VIII. SEPARATION BENEFITS XI. LIFE INSURANCE BENEFITS

Eligibility requirements Note: Judiciary and Constitutional
(1) 60 years of age, or separation from service Commissions are entitled to life insurance
with at least 3 years but not over 15 years only.
served
(2) Below 60 years of age, but at least 15 B.4. BENEFICIARIES
years of service rendered. I. PRIMARY
(1) Dependent spouse – until remarriage;
Benefit (2) Dependent children [legitimate,
(1) For 60 years of age or separated from legitimated, legally adopted, and
service with 3 to 15 years of service: cash illegitimate] – but RA 8291 does not

84
UP LAW BOC SOCIAL WELFARE LEGISLATION LABOR LAW

distinguish share of legitimate and (2) Legitimate descendants, subject to the

illegitimate children. restrictions on dependent children.
II. SECONDARY
Shall only receive when the primary
beneficiaries are absent:
(1) Dependent parents

SSS GSIS
Enabling law RA 1161 as amended by RA 8282: RA 8291 amending PD 1146
Social Security Act of 1997
Definition of Employer – any person, natural or juridical, Employer – National government, its
Terms domestic or foreign, who carries on in the political subdivisions, branches,
Philippines any trade business, industry, agencies or instrumentalities,
undertaking, and uses the services of including government-owned or
another person who is under his orders as controlled corporations and financial
regards the employment, except those institutions with original charters
considered as employer under the GSIS. A [GOCCs]; constitutional commissions;
self-employed person shall be both and judiciary
employer and employee at the same time.
Employee – any person who performs Employee – any person receiving
services for an employer in which either or compensation while in service of an
both mental and physical efforts are used employer whether by election or
and who receives compensation for such appointment, irrespective of status of
services, where there is an employer— appointment; baranggay officials; and
employee relationship; also, a self- sangguniang officials
employed person who is both employee
and employer at the same time
Self-employed – any person whose income Note: No counterpart for self-
is not derived from employment, including, employed.
but not limited to:
 self-employed professionals;
 partners and single proprietors of
businesses;
 actors, directors, scriptwriters, news
correspondents not considered as
employees under the above definition;
 athletes, coaches, trainers, jockeys;
and
 individual farmers and fishers.
Dependents: Same except that a child here is below
 Legal spouse entitled by law to receive 18
support;
 Child – unmarried, not gainfully
employed, and below 21 or
 Child over 21 if he or she became
permanently incapacitated and

85
UP LAW BOC SOCIAL WELFARE LEGISLATION LABOR LAW

incapable of self-support, physically or

mentally,; child may be legitimate,
legitimated, legally adopted, or
illegitimate;
 Parent who is receiving regular
support.
Beneficiaries Same except that RA 8291 does not
Primary distinguish share of legitimate and
 Dependent spouse – until remarriage illegitimate children
[see above];
 Dependent children [see above];
illegitimate children are entitled only
to 50% of the share of legitimate
children unless there are no legitimate
children, in which case, they get 100%.
Secondary
 Shall only receive when the primary
beneficiaries are absent: Dependent
parents
Other
 Any other person designated by the
member as his/her secondary
beneficiary.
Compensation – all actual remuneration for Compensation – basic pay received
employment, including living allowance, as excluding per diems, bonuses,
well as the cash value of any remuneration overtime, honoraria, allowances and
paid in any medium other than cash except other emoluments not integrated into
that portion already above the max salary the basic pay under existing laws.
credit under Sec. 18 of the Act.
Coverage Compulsory Public sector employees below the
 Employers as defined above; compulsory retirement age of 65.
 Employees not over 60 years including
household helpers with at least P1,000
Exceptions:
monthly pay; and (1) AFP and PNP;
 Self-employed. (2) Members of the Judiciary and
Constitutional Commissions who
Voluntary are covered only by life insurance
 Spouses who devote full time to as they have separate retirement
managing household and family schemes;
affairs; (3) Contractual employees with no
 OFWs recruited by foreign-based employee-employer relationship
employers; with the agency they serve.
 Employees already separated from
employment or those self-employed
with no realized income for a given
month, who chose to continue with
contributions to maintain right to full
benefit.

86
UP LAW BOC SOCIAL WELFARE LEGISLATION LABOR LAW

Note: Foreign governments, international

organizations or their wholly owned
instrumentality employing workers in the
Philippines may enter into an agreement
with the Philippine government to include
their employees in the SSS except those
already covered by their civil service
retirement system.
Effective Date Employer: 1st day of operation
of Coverage Employee: 1st day at work
Self-employed: upon registration with SSS
Summary of (1) Monthly pension (1) Monthly pension
Benefits (2) Dependents’ pension (2) Retirement benefits
(3) Retirement benefits (3) Permanent disability benefits
(4) Permanent disability benefits (4) Death Benefits
(5) Death benefits (5) Funeral benefits
(6) Funeral benefits (6) Loan – GSIS website provides for
(7) Loan – Social Security Commission this
Resolution No. 669. Moreover, several (7) Temporary disability benefits
SSS-issued circulars such as Circular [similar to sickness]
No. 21-P and No. 52 pertain to the (8) Separation benefits
treatment of salary loans, sometimes (9) Unemployment benefits – Sec 11
providing for more flexible payment (10) Survivorship benefits
terms or condonation for delinquent (11) Life insurance benefits
payers; Santiago v. CA and SSS, GR # L-
39949 [1984] resolved an issue Note: Judiciary and Constitutional
involving the treatment of salary loan Commissions are entitled to life
repayments; SSS website also shows
insurance only.
loans
(8) Sickness benefits
(9) Maternity leave benefits
Effects of (1) Employer’s contribution, and Continued membership for the
separation (2) Employee’s obligation to pay unemployed member; and entitlement
from contribution both cease at the end of to whatever benefits he has qualified
employment the month of separation; to in the event of any compensable
(3) Employee shall be credited with all
contributions paid on his behalf and contingency.
entitled to all benefits set forth by the
law.
Dispute Social Security Commission CA [Rule 43; GSIS  CA [Rule 43] SC [Rule 45];
Settlement questions of law and fact]  SC [Rule 45; appeal does not stay execution.
questions of law only]
Prescriptive 20 years 4 years
Period
C.1 COVERAGE
C. LIMITED PORTABILITY LAW [RA (1) Workers who transfer employment from one
sector to another; or
7699]
(2) Those employed in both sectors [public and
private].

87
UP LAW BOC LABOR RELATIONS
C.2. PROCESS
The covered worker shall have his credible
services or contributions in both Systems
credited to his service or contribution record in
each of the Systems and shall be totalized for
purposes of old-age, disability, survivorship and
other benefits in case the covered member does
not qualify for such benefits in either or both
systems without totalization: Provided,
however, That overlapping periods of
membership shall be credited only once for
purposes of totalization [Sec. 3]
“Totalization” shall refer to the process of
adding up the periods of creditable services or
contributions under each of the Systems, for
purposes of eligibility and computation of
benefits [Sec. 2e].
Overlapping periods of membership in case of
those employed in both sectors at once are to
be counted only ONCE for purposes of
totalization to be able to satisfy eligibility
requirements of benefits provided for by either
SSS or GSIS.
D. EMPLOYEE’S COMPENSATION –
COVERAGE AND WHEN
COMPENSABLE
D.1 COVERAGE
(1) Every employer shall be covered.
(2) Every employee not over sixty [60] years of
age shall be covered.
(3) An employee over sixty [60] years of age
shall be covered if he had been paying
contributions to the System prior to age
sixty [60] and has not been compulsorily
retired.
(4) An employee who is coverable by both the
GSIS and SSS shall be compulsorily covered
88
LABOR LAW
by both Systems. [Sec. 2, IRR of Title II, Book
IV of LC]
(5) Filipinos working abroad in the service of an
employer as defined in Section 3 hereof
shall be covered by the System, and entitled
to the same benefits as are provided for
employees working in the Philippines. [Sec.
5, IRR of Title II, Book IV of LC]
D.2. EFFECTIVITY
Coverage of employees shall take effect on the
first day of employment. [Sec. 6]
D.3. WHEN COMPENSABLE
Grounds
(1) For the injury and the resulting disability or
death to be compensable, the injury must
be the result of accident arising out of and in
the course of the employment.
(2) For the sickness and the resulting disability
or death to be compensable, the sickness
must be the result of an occupational
disease listed under Annex “A” of these
Rules with the conditions set therein
satisfied, otherwise, proof must be shown
that the risk of contracting the disease is
increased by the working conditions.
Limitation: No compensation shall be allowed
to the employee or his dependents when the
injury, sickness, disability, or death was
occasioned by any of the following:
(1) his intoxication;
(2) his willful intention to injure or kill
himself or another; or
(3) his notorious negligence
(4) As otherwise provided by law.
UP LAW BOC LABOR RELATIONS
VII. Labor Relations
A. STRIKES, PICKETING, AND
LOCKOUTS
(a) Strike
A strike is any temporary stoppage of work by
the concerted action of employees as a result of
an industrial or labor dispute. [Art. 218(o)]
Strikes not limited to work stoppages
The term “strike” shall comprise not only
concerted work stoppages, but also slowdowns,
mass leaves, sit-downs, attempts to damage,
destroy or sabotage plant equipment and
facilities, and similar activities. [Samahang
Manggagawa v. Sulpicio Lines, 2004]
Payment of wages during lawful strikes
General rule: Pursuant to the principle of “no
work-no pay”, striking employees are not
entitled to the payment of wages for un-worked
days during the period of the strike.
Exception: Agreement to the contrary.
FORMS OF STRIKES
As to legality
(1) Legal strike – one called for a valid
purpose and conducted through means
allowed by law.
(2) Illegal strike – one staged for a purpose
not recognized by law, or if for a valid
purpose, conducted through means not
sanctioned by law.
As to grounds
(1) Economic strike – one staged by workers to
force wage or other economic concessions
from the employer which he is not required
by law to grant [Consolidated Labor
Association of the Phil. v. Marsman and
Company, 1964]
89
LABOR LAW
(2) ULP strike – called against a company's
unfair labor practice to force the employer
to desist from committing such practices.
As to how committed
(1) Slowdown strike – one by which workers,
without a complete stoppage of work,
retard production or their performance of
duties and functions to compel
management to grant their demands.
(2) Wild-cat strike – one declared and staged
without filing the required notice of strike
and without the majority approval of the
recognized bargaining agent.
(3) Sit-down strike – one wherein workers take
over possession of the property of such
business to cease production and to refuse
access to owners.
(4) Sympathetic strike – one in which the
striking workers have no demands of their
own, but strike to make common cause with
other strikers in other establishments.
Conversion from economic to ULP strike
It is possible for a strike to change its character
from an economic to a ULP strike. [Consolidated
Labor Assoc. of the Phil. v. Marsman and
Company, 1964]
A.1. WHO MAY DECLARE A STRIKE OR
LOCKOUT?
Who may declare a strike
(1) The certified or duly recognized bargaining
representative
(2) Any legitimate labor organization in the
absence of #1, but only on grounds of ULP
[Book V, Rule XXII, §6]
Who may declare a lockout
(1) The employer [Book V, Rule XXII, Sec. 6]
UP LAW BOC LABOR RELATIONS
A.2. REQUISITES FOR A VALID STRIKE
A valid strike must have a lawful ground and
must conform with the procedural requirements
set by law.
Substantial Requirements/Grounds
A strike or lockout may be declared in cases of:
 Bargaining deadlocks
 ULP [Art. 263 (c)]
Note: Only gross violations of the economic
provisions of the CBA are treated as ULP. [BPI
Employees Union-Davao FUBU v. BPI, 2013]
When no lawful strike can be declared
(1) Ground is an inter-union or intra-union
dispute
(2) No notice of strike
(3) No strike vote obtained and reported to the
NCMB
(4) After assumption or certification by the
Secretary of Labor
Procedural requirements
(1) Effort to bargain
(2) Filing and service of notice of strike
 With the Department at least 30 days
before intended date of strike. (Art.
269(c))
(3) Observance of cooling-off period
 bargaining deadlock – 30 days
 ULP but not union busting – 15 days
 ULP and union busting – no cooling-off
period
(4) Strike vote
 Requirements:
(a) approval by a majority of the total
union membership in the
bargaining nit concerned
(b) approval is obtained by secret ballot
in a meeting/referendum called for
the purpose
(5) Strike vote report
 [I]n every case, the union or the
employer shall furnish the Department
90
LABOR LAW
the results of the voting at least 7 days
before the intended strike1 or lockout,
subject to the cooling-off period herein
provided. [Art. 269 (f)]
(6) Observance of the 7-day waiting period
Compliance with both cooling-off and waiting
periods
The observance of both periods must be
complied with, although a labor union may take
a strike vote and report the same within the
statutory cooling-off period. The cooling-off and
7-day strike ban provisions of law constitute a
valid exercise of police power of the State.
[National Federation of Sugar Workers v. Ovejera,
1982]
A.3. REQUISITES FOR A VALID LOCKOUT
Lockout
Lockout is the temporary refusal of an employer
to furnish work as a result of an industrial or
labor dispute. [Art. 218 (p)]
Limitations
[N]o employer may declare a lockout on
grounds involving inter-union and intra-union
disputes. [Art. 269 (b)]
Grounds
Similar to a strike, the proper grounds for a
lockout are
(1) bargaining deadlock
(2) ULP by labor organizations
Requisites
(1) Effort to bargain
(2) Filing and service of notice of lockout
 [Filed] with the Department at least 30
days before the intended date thereof.
[…] (Art. 269(c))
 Notice must be served to the employees
through the representative union.
1 7-day “Waiting Period”.
UP LAW BOC LABOR RELATIONS
(3) Observance of cooling-off period
 based on bargaining deadlock – 30
days
 based on ULP – 15 days.
(4) Lockout vote
 [A]pproved by a majority of the board of
directors of the corporation or
association or of the partners in a
partnership, obtained by secret ballot in
a meeting called for that purpose. [Art.
269 (f)]
(5) Report of lockout vote
 The Report must be filed with the
Department at least 7 days before the
intended lockout.
(6) Observance of the 7-day waiting period
Effect of Illegal Lockout
Any worker whose employment has been
terminated as a consequence of any unlawful
lockout shall be entitled to reinstatement with
full backwages. [Art. 270 (a) ¶3, 1st Sentence]
A.4. REQUISITES FOR LAWFUL
PICKETING
(b) Picketing
The right of legitimate labor organizations to
strike and picket and of employers to lockout,
consistent with the national interest, shall
continue to be recognized and respected. [Art.
269 (b)]
Picketing is the right of workers to peacefully
march to and fro before an establishment
involved in a labor dispute generally
accompanied by the carrying and display of
signs, placards and banners intended to inform
the public about the dispute. [NCMB Manual,
§1]
91
LABOR LAW
Prohibited activities in picketing
(1) By any person. No person shall obstruct,
impede, or interfere with, by force, violence,
coercion, threats or intimidation, any
peaceful picketing by employees during any
labor controversy or in the exercise of the
right to self-organization or collective
bargaining, or shall aid or abet such
obstruction or interference. [Art. 264 (b)]
(2) By police force. The police force shall keep
out of the picket lines unless actual violence
or other criminal acts occur therein:
Provided, That nothing herein shall be
interpreted to prevent any public officer
from taking any measure necessary to
maintain peace and order, protect life and
property, and/or enforce the law and legal
order. [Art. 264 (d)]
(3) By person engaged in picketing. No person
engaged in picketing shall commit any act
of violence, coercion or intimidation or
obstruct the free ingress to or egress from
the employer’s premises for lawful
purposes, or obstruct public thoroughfares.
[Art. 264 (e)]
Picketing as part of freedom of
speech/expression; limitations
General rule: picketing enjoys constitutional
protection as part of freedom of speech and/or
expression.
Exceptions/limitations:
(1) when picketing is coercive rather than
persuasive [Security Bank Employees Union
v. Security Bank]
(2) when picketing is achieved through illegal
means [Mortera v. CIR]
(3) courts may confine the
communication/demonstration to the
parties to the labor dispute [PCIB v.
Philnabank Employees Association]
(4) Innocent bystander rule. Courts may
insulate establishments or persons with no
industrial connection or having interest
UP LAW BOC LABOR RELATIONS
totally foreign to the context of the dispute
[PCIB v. Philnabank Employees Association]
Picketing and libel
Libel laws are not applied strictly considering
that there is emotional tension in the picket
lines and expected discourteous and impolite
exchanges between the employees and the
employer. [PCIB v. Philnabank Employees
Association, 1981]
A.4. ASSUMPTION OF JURISDICTION BY
THE DOLE SECRETARY OR
CERTIFICATION OF THE LABOR DISPUTE
TO THE NLRC FOR COMPULSORY
ARBITRATION
When Sec. of Labor can Assume Jurisdiction:
(1) When the labor dispute is in an industry
indispensable to the national interest
(2) Such dispute is causing or is likely to cause
a strike or lockout
Powers of the Secretary of Labor (alternative)
(1) Assumption of jurisdiction. The Secretary of
Labor will decide the labor dispute
himself/herself.
(2) Certification for compulsory arbitration. The
Secretary of Labor will certify the labor
dispute to the NLRC for compulsory
arbitration.
Powers of the President (not precluded by the
powers of the Secretary of Labor)
(1) determine the industries indispensable to
the national interest
(2) assume jurisdiction over any such labor
dispute to settle or terminate such dispute
A.5. NATURE OF ASSUMPTION ORDER
OR CERTIFICATION ORDER
(1) Automatic injunction
(2) Return-to-work and admission
(3) Immediately executory
92
LABOR LAW
(1) Automatic injunction of intended of
impending strike or lockout
[S]uch assumption or certification shall have
the effect of automatically enjoining the
intended or impending strike or lockout as
specified in the assumption or certification
order. […] [Art.269 (g)]
(2) Return-to-work and readmission if strike or
lockout has already taken place
[A]ll striking or locked out employees shall
immediately return-to-work and the employer
shall immediately resume operations and
readmit all workers under the same terms and
conditions prevailing before the strike or
lockout. […] [Art.269 (g)]
Nature of return-to-work order
[T]he return-to-work order not so much confers
a right as it imposes a duty[…] The worker must
return to his job together with his co-workers so
the operations of the company can be resumed
and it can continue serving the public and
promoting its interest. That is the real reason
such return can be compelled. So imperative is
the order in fact that it is not even considered
violative of the right against involuntary
servitude. [Kaisahan ng Mga Manggagawa sa
Kahoy v. Gotamco Sawmills, 1948]
(3) Immediately executory
The assumption and certification orders are
executory in character and must be strictly
complied with by the parties. [Allied Banking v.
NLRC, 1996]
B. DEFINITIONS/CONCEPTS
Labor Dispute
“Labor Dispute” includes any controversy or
matter concerning terms and conditions of
employment or the association or
representation of persons in negotiating, fixing,
maintaining, changing or arranging the terms
and conditions of employment, regardless of
UP LAW BOC LABOR RELATIONS LABOR LAW

whether the disputants stand in the proximate Who may vote

relation of employer and employee. [Art. 218 (l)] All employees whether union members or not,
as long as they belong to the appropriate
C. REPRESENTATION ISSUE IN bargaining unit can vote.
ORGANIZED ESTABLISHMENTS
Who may file a petition for certification election
(1) Legitimate labor organization (registered
C.1. CERTIFICATION ELECTION
w/ DOLE)
“Certification Election" is the process of
(2) Unregistered local chapter with charter
determining, through secret ballot, the sole and
certificate from national union or federation
exclusive bargaining agent of the employees in
(3) National union or federation in behalf of its
an appropriate bargaining unit, for purposes of
local/chapter
collective bargaining. [Book V Rule I Sec. 1 [x]]
(4) Employer (when requested to bargain
collectively and no existing CBA)
Purpose
The purpose of a certification election is
1. Legitimate Labor Organization
precisely the ascertainment of the wishes of the
"Legitimate labor organization" means any
majority of the employees in the appropriate
labor organization duly registered with the
bargaining unit: to be or not to be represented
Department of Labor and Employment, and
by a labor organization, and in the affirmative
includes any branch or local thereof. [Art. 218
case, by which particular labor organization.
(f)]
[Reyes v Trajano, 1992]

Nature of proceeding 2. Unregistered Chapter with Charter certificate

A duly registered federation or national union
may directly create a local chapter by issuing a
Certification Election Union Election
charter certificate indicating the establishment
To determine the To elect union officers of the local chapter. The chapter shall acquire
Exclusive Bargaining legal personality only for purposes of filing a
Agent petition for certification election from the date it
All members of the Only union members was issued a charter certificate. [Art. 240-A]
appropriate may vote.
bargaining unit may 3. National Union/Federation
vote. In any establishment where there is no certified
bargaining agent, a certification election shall
Implications automatically be conducted by the Med-Arbiter
Technical rules and objections should not upon filing of a petition by any legitimate labor
hamper the correct ascertainment of the labor organization, including a national union or
union that has the support and confidence of federation which has already issued a charter
the majority of the workers and is thus entitled certificate to its local/chapter participating in
to represent them in bargaining for the terms the certification election, or a local/chapter
and conditions of their employment. [Port which has been issued a charter certificate by
Workers Union v. DOLE, 1992] the national union or federation. In cases where
the petition was filed by a national union or
federation, it shall not be required to disclose

93
UP LAW BOC LABOR RELATIONS
the names of the local chapter’s officers and
members. [Art. 263]
4. Employer
When requested to bargain collectively, an
employer may petition the Bureau for an
election. [Art. 264]
Bystander rule
The employer shall not be considered a party in
the petition with a concomitant right to oppose
a petition for certification election. The
employer’s participation shall be limited to:
(1) being notified or informed of petitions of
such nature
(2) submitting the list of employees during the
pre-election conference should the Med-
arbiter act favorably on the petition [Art
258-A introduced by RA 9481]
The employer is a total stranger in the process
of certification election. The employer has no
standing to file a motion to dismiss. [PT&T v
Laguesma, 1993]
Venue for filing the petition
BLR Regional Office which issued the
petitioning union’s certificate of registration or
certificate of creation of chartered local.
C.2.a. CERTIFICATION ELECTION IN AN
UNORGANIZED ESTABLISHMENT
Procedure
(1) A petition for certification election shall be
filed by a legitimate labor organization.
(2) Upon filing of the petition, the Med- Arbiter
shall automatically conduct a certification
election.
Filing of petition is by a legitimate labor
organization
It cannot be an unregistered labor organization.
This is best read in relation to Art. 242 which
enumerates the rights granted to a legitimate
94
LABOR LAW
labor organization and one of those rights is the
right to be chosen as the exclusive bargaining
representative. This is one way the law
encourages union registration.
Venue
BLR Regional Office which issued the
petitioning union’s certificate of registration or
certificate of creation of chartered local.
C.2.b. CERTIFICATION ELECTION IN AN
ORGANIZED ESTABLISHMENT
Procedure
(1) A verified petition questioning the majority
status shall be filed by a legitimate labor
organization
(2) It must be filed within the 60-day period
before expiration of CBA (freedom period)
(3) Supported by written consent of at least
25% of ALL employees in the bargaining
unit (substantial support)
Substantial support rule
In organized establishments, the incumbent
sole bargaining agent should not be easily
replaced for that would disturb industrial peace.
To justify the disturbance, it must appear that at
least a substantial number (25% requirement)
seeks to have a new exclusive bargaining unit.
Rule does not apply to Motions for Intervention
The requisite written consent representing
substantial support of the workers in the
bargaining unit [as required in Art. 256 applies
to petitions for certification only, and not to
motions for intervention. [PAFLU v Calleja, 1989]
Discretionary rule
If the petition does not comply with the
substantial support requirement, the BLR may
exercise its discretion in determining whether or
not a certification election must be conducted.
[Scout Albano Memorial College v. Noriel, 1978]
UP LAW BOC LABOR RELATIONS LABOR LAW

Effect of withdrawal of signatures why is there

The employees’ withdrawal from a labor union none in
made before the filing of the petition for unorganized
certification election is presumed voluntary, establishments?
while withdrawal after the filing of such petition It has
is considered to be involuntary and does not something to do
affect the petition. [S.S. Ventures International with industrial
vs. S.S. Ventures Labor Union, 2008] peace
Substantial Must be duly NO
Forced Intervenor support rule supported by substantial
The incumbent bargaining agent shall 25% of ALL THE support rule.
automatically be one of the choices in the MEMBERS OF WHY?
certification election as forced intervenor. [Book THE Intention of
71
V Rule VIII Sec. 7] APPROPRIATE law is to bring
BARGAINING in the union,
Organized vs. Unorganized Establishment UNIT. to implement
Art. 256: Art. 257: Percentage policy behind
ORGANIZED UNORGANIZED base: all Art. 211a.
Bargaining Existing, has None members of an
agent one appropriate
Petition Has to be a No need to be bargaining unit.
filed VERIFIED verified What is intent
petition and purpose of
Freedom No petition for Not law for requiring
Period Certification applicable. the substantial
election support rule?
EXCEPT within No freedom Law wants to
60 days before period. know the
the expiration of Can file intention of the
the collective petition employees. If
bargaining anytime. they really want
agreement (See a CE, since they
Art. 253 & 253- already have a
A) bargaining
agent.
Take note how
SC interpreted Bars to certification election
the term (1) One year bar rule
“WITHIN”. (2) Negotiation bar rule
(3) Deadlock bar rule
What is the (4) Contract bar rule
rationale of
freedom period (1) One year bar rule
in Organized No certification election may be held within 1
establishments, year from the fact that voluntary recognition

95
UP LAW BOC LABOR RELATIONS
has been entered, or a valid certification,
consent or run-off election has been conducted
within the bargaining unit.
If appealed, the reckoning period is the date
when the decision becomes final and executory.
[Book V, Rule VIII, Sec 3 [a]]
(2) Negotiation bar rule
A petition for certification election may be filed
anytime EXCEPT:
(1) When the duly certified union has
commenced and sustained negotiations in
good faith with the employer
(2) In accordance with Art. 256 of the Labor
Code
(3) Within one year after the certification
election. [Book V, Rule VIII, Sec 3 [b]]
(3) Deadlock bar rule
A petition for certification election may be filed
anytime, EXCEPT:
[w]hen a bargaining deadlock to which an
incumbent or certified bargaining agent is a
party had been submitted to conciliation or
arbitration or had become the subject of a valid
notice of strike or lockout [Book V, Rule VIII, Sec.
3 [c]]
A “deadlock” is defined as the counteraction of
things producing entire stoppage; a state of
inaction or of neutralization caused by the
opposition of persons or of factions (as in
government or voting body); standstill. [Divine
World University v Sec of Labor and Employment,
1992]
(4) Contract Bar Rule
The Bureau shall not entertain any petition for
certification election or any other action which
may disturb the administration of duly
registered existing collective bargaining
agreements affecting the parties except under
Articles 253, 253-A and 256 of this code. (Art.
238)
96
LABOR LAW
The contract bar rule shall not apply:
(1) When the petition is filed during the
freedom period in Articles 253, 253-A, and
256.
(2) When the CBA is incomplete
(3) When the CBA is substandard
(4) When the CBA is prematurely renewed
(5) When the CBA is unregistered
No petition for certification election may be filed
after the lapse of the freedom period. The old
CBA is extended until a new one is agreed upon
by the parties. [Colegio de San Juan de Letran v.
Assoc., 2000]
Freedom Period
The last 60 days in a Collective Bargaining
Agreement (CBA) is referred to as the “freedom
period” when rival union representation can be
entertained during the existence of a CBA. It is
during this particular period when the majority
status of the incumbent bargaining agent can
be challenged. [Tanduay Distillery Labor Union
v. NLRC, 1987]
The purpose of the prohibition against the filing
of a petition for certification election outside the
so-called freedom period is to ensure industrial
peace between the employer and its employees
during the existence of the CBA. [Republic
Planters Bank Union v. Laguesma, 1996]
The premature renewal of a CBA cannot bar the
holding of a certification election by virtue of a
bona fide petition filed within the freedom
period if the clear intention was to frustrate the
constitutional right of the employees to self-
organization. [Associated Labor Union v. Calleja,
1989]
What is prohibited is the filing of the petition for
certification election outside the 60-day
freedom period. The signing of the
authorization to file was merely preparatory to
UP LAW BOC LABOR RELATIONS
the filing of the Petition for Certification
Election, or an exercise of the right to self-
organization. [PICOP Resources Inc. v. Ricardo
Dequita, 2011]
Expiration of Freedom Period
At the expiration of the freedom period, the
employer shall continue to recognize the
majority status of the incumbent bargaining
agent where no petition for certification election
is filed.
Petition for cancellation of union registration
does not bar certification election
A petition for cancellation of union registration
shall not suspend the proceedings for
certification election nor shall it prevent the
filing of a petition for certification election.[…]
[Art. 238-A]
A certification election can be conducted
despite pendency of a petition to cancel the
union registration certificate. For the fact is
that at the time the union, whose registration
certificate is sought to be cancelled, filed its
petition for certification, it still had legal
personality to perform such act absent an order
directing its cancellation. [Samahan ng mga
Manggagawa v Laguesma, 1997]
Suspension of Election: Prejudicial Question
Rule
Rationale
If there is a union dominated by the company,
to which some of the workers belong, an
election among workers and employees of the
company would not reflect the true sentiment
and wishes of the said workers and employees
because the votes of the members of the
dominated union would not be free. Such
charge of company domination is a prejudicial
question that until decided, shall suspend or
bar proceedings for certification election.
97
LABOR LAW
If it were a labor organization objecting to the
participation in a certification election of a
company-dominated union, as a result of which
a complaint for an unfair labor practice case
against the employer was filed, and when the
court finds that said union is employer-
dominated in the unfair labor practice case, the
union selected would be decertified and the
whole election proceedings would be rendered
useless and nugatory.' There would be an
impairment of the integrity of the collective
bargaining process if a company-dominated
union were allowed to participate in a
certification election. [United CMCTextile
Worker’s Union v. BLR, 1984]
Note: The ONLY party who could ask for the
suspension of the Certification Election is the
labor union which filed a complaint for Unfair
Labor Practices against the employer.
Notice Requirement
Posting of Notice
Who: Election Officer shall cause the posting
What: Notice of election
Where: 2 conspicuous places in company
premises
When: At least 10 days before actual election
The posting of the notice of election, the
information required to be included therein and
the duration of the posting cannot be waived by
the contending unions or the employer. [Book V
Rule IX Sec 6, IRR]
All Employees entitled to vote
All rank-and-file employees in the appropriate
bargaining unit are entitled to vote. The Code
makes no distinction as to their employment
status. All they need to be eligible to support
the petition is to belong to a bargaining unit.
[Airtime Specialists, Inc. v Director of BLR, 1990]
UP LAW BOC LABOR RELATIONS
Employees who have been improperly laid off
but who have a present, unabandoned right to
or expectation of reemployment, are eligible to
vote in certification elections. If the dismissal is
under question, employees concerned could
still qualify to vote in the elections. [Philippine
Fruits v Torres, 1992]
Rationale for Non-Distinction Policy
Collective bargaining covers all aspects of the
employment relation and the resultant CBA
binds all employees in the bargaining unit. All
rank and file employees, probationary or
permanent, have a substantial interest in the
selection of the bargaining representative.
[Reyes v. Trajano, 1992]
Voting List and Voters
The basis of determining voters may be agreed
upon by the parties (i.e. the use of payroll).
[Acoje Workers Union v NAMAWU, 1963]
Effect of Non-participation in previous election
Failure to take part in previous elections is no
bar to the right to participate in future elections.
[Reyes v. Trajano, 1992]
Challenge Voter
An employer […] may question the inclusion of
any disqualified employee in the certification
election during the exclusion-inclusion
proceedings before the representation officer.
[Phil. Telephone & Telegraph Co. v Laguesma,
1993]
Validity
Double majority requirement: (voters, valid
votes)
To have a valid election, at least a majority of all
eligible voters in the unit must have cast their
votes. The labor union receiving the majority of
the valid votes cast shall be certified as the
exclusive bargaining agent of all the workers in
the unit. [Art. 262]
98
LABOR LAW
C.2.c. RUN-OFF ELECTION
A "Run-Off election" refers to an election
between the labor unions receiving the 2
highest number of votes in a certification
election.
C.2.c.i. Run-off election: Requirements
(1) majority of the bargaining unit voted (first
majority of the double majority rule)
(2) three or more choices are available (note:
“no union” is a choice)
(3) not one of the choices receives a majority of
the valid votes cast
(4) total number of votes for all contending
unions is at least 50% of the total number
of votes cast (this means that at least 50%
of the bargaining unit wants to have a
union)
(5) the run-off election shall be conducted
between the labor unions receiving the two
highest number of votes
Illustration
The CBU has 100 members and eighty of which
voted. Union “A”= 30; Union “B”= 15; Union
“C”=15 and No Union= 20. There were no
invalid votes. Since none got the majority of the
80 valid votes and the contending unions
obtained 60 votes(which exceeds½ of the total),
a run-off election is proper. The run-off will be
between the labor unions receiving “the two
highest number of votes.” The run-off is NOT
between two unions but between “two highest
votes”. Thus, the run-off will be among Union
“A”, “B” and “C.” [Azucena]
C.2.d. RE-RUN ELECTION
A motion for the immediate holding of another
certification or consent election can be filed
within six (6) months from the date of the
declaration of failure of election. [Book V, Rule IX
Sec 18]
C.2.e. CONSENT ELECTION
UP LAW BOC LABOR RELATIONS LABOR LAW

"Consent Election" means the election Affiliate

voluntarily agreed upon by the parties to An affiliate is an independent union affiliated
determine the issue of majority representation with a federated, national union or a chartered
of all the workers in the appropriate collective local which was subsequently granted
bargaining unit. […] [Book V RVIII Sec 10] independent registration but did not disaffiliate
from its federation, reported to the Regional
Certification Consent Office and the Bureau in accordance with Rule
election Election III Secs. 6 and 7 of the IRR. [Book V Rule 1 Sec. 1
Purpose Aimed at Merely to [a]]
determining the determine the
sole and exclusive issue of Independent Union
bargaining agent majority A labor organization operating at the enterprise
of all employees in representation level that required legal personality through
an appropriate of all the independent registration under Art.234 of the
bargaining unit for workers in the Labor Code and Rule III Sec. 2-A of the IRR.
the purpose of appropriate [Book V Rule 1 Sec. 1 [w]]
collective collective
bargaining bargaining Local Chapter (Chartered Local)
unit A labor organization in the private sector
1st Level of Choice: operating at the enterprise level that acquired
Yes Union or No legal personality through the issuance of a
Union charter certificate by a duly registered
federation or national union, and reported to
2nd Level of the Regional Office in accordance with Rule III
Choice: If “Yes Sec. 2-E of the IRR. [Book V Rule 1 Sec. 1 [i]]
Union” wins,
WHICH union. National Union or Federation
(UST Faculty Union National Union or Federation – a group of
v. Bitonio, 1999) legitimate labor unions in a private
Conduct Ordered by the Voluntarily establishment organized for collective
DOLE agreed upon bargaining or for dealing with employers
by the parties, concerning terms and conditions of
with or w/o employment for their member union or for
intervention participating in the formulation of social and
from DOLE employment policies, standards and programs,
registered with the BLR in accordance with Rule
III Sec. 2-B of the IRR. [Book V Rule 1 Sec. 1 [kk]]

C.2.f. AFFILIATION AND DISAFFILIATION Purpose of affiliation

OF THE LOCAL UNION FROM THE To foster the free and voluntary organization of
MOTHER UNION a strong and united labor movement [Art. 211]

DEFINITIONS

99
UP LAW BOC LABOR RELATIONS
The sole essence of affiliation is to increase, by
collective action, the common bargaining power
of local unions for the effective enhancement
and protection of their interests. Admittedly,
there are times when without succor and
support local unions may find it hard, unaided
by other support groups, to secure justice for
themselves. [Philippine Skylanders v. NLRC,
1992]
Nature of Relationship (Agency)
The mother union, acting for and in behalf of its
affiliate, had the status of an agent while the
local remained the basic unit of the association,
free to serve the common interest of all its
members, subject only to restraints imposed by
the constitution and by the by-laws of the
association. The same is true even if the local is
not a legitimate labor organization. [Filipino
Pipe and Foundry Corp v. NLRC, 1998]
Effect of Affiliation
Inclusion of [the federation] in the registration is
merely to stress that they are its affiliates at the
time of registration. It does not mean that said
local unions cannot stand on their own.
Affiliation does not mean they lost their own
legal personality. [Adamson v CIR, 1984]
Disaffiliation
General rule: Local unions may disaffiliate from
the mother union.
Disaffiliation Must be by a Majority Decision
The members shall determine by secret
ballot, after due deliberation, any question
of major policy affecting the entire
membership of the organization, unless the
nature of the organization or force majeure
renders such secret ballot impractical, in
which case, the board of directors of the
organization may make the decision. [Art.
247 (d)]
100
LABOR LAW
Limitations: Terms of the affiliation agreement
(e.g. agreement may require 2/3 vote to
disaffiliate instead of a majority) [Phil.
Skylanders v. NLRC]
Generally, a labor union may disaffiliate from
the mother union to form a local or independent
union only during the 60-day freedom period
immediately preceding the expiration of the
CBA. However, even before the onset of the
freedom period, disaffiliation may be carried out
when there is a shift of allegiance on the part of
the majority of the members of the union.
[ANGLO KMU v Samana Bay, G.R. No. 118562
July 5, 1996]
Effect of disaffiliation
A registered independent union retains its legal
personality while a chartered local loses its
legal personality unless it registers itself.
D. PROHIBITED ACTIVITIES IN
STRIKE/LOCKOUT
Prohibited Activities [Art. 270]
(1) No labor organization or employer shall
declare a strike or lockout without first
having bargained collectively in accordance
with Title VII of this Book or without first
having filed the notice required in the
preceding Article or without the necessary
strike or lockout vote first having been
obtained and reported to the Ministry.
No strike or lockout shall be declared after
assumption of jurisdiction by the President
or the Minister or after certification or
submission of the dispute to compulsory or
voluntary arbitration or during the
pendency of cases involving the same
grounds for the strike or lockout.
Any worker whose employment has been
terminated as a consequence of any
unlawful lockout shall be entitled to
UP LAW BOC LABOR RELATIONS
reinstatement with full backwages. Any
union officer who knowingly participates in
an illegal strike and any worker or union
officer who knowingly participates in the
commission of illegal acts during a strike
may be declared to have lost his
employment status: Provided, That mere
participation of a worker in a lawful strike
shall not constitute sufficient ground for
termination of his employment, even if a
replacement had been hired by the
employer during such lawful strike.
(2) No person shall obstruct, impede, or
interfere with, by force, violence, coercion,
threats or intimidation, any peaceful
picketing by employees during any labor
controversy or in the exercise of the right to
self-organization or collective bargaining,
or shall aid or abet such obstruction or
interference.
(3) No employer shall use or employ any strike-
breaker, nor shall any person be employed
as a strike-breaker.
(4) No public official or employee, including
officers and personnel of the New Armed
Forces of the Philippines or the Integrated
National Police, or armed person, shall
bring in, introduce or escort in any manner,
any individual who seeks to replace strikers
in entering or leaving the premises of a
strike area, or work in place of the strikers.
The police force shall keep out of the picket
lines unless actual violence or other
criminal acts occur therein: Provided, That
nothing herein shall be interpreted to
prevent any public officer from taking any
measure necessary to maintain peace and
order, protect life and property, and/or
enforce the law and legal order.
(5) No person engaged in picketing shall
commit any act of violence, coercion or
101
LABOR LAW
intimidation or obstruct the free ingress to
or egress from the employer’s premises for
lawful purposes, or obstruct public
thoroughfares.
E. APPEAL/PROCEDURAL REMEDIES
E.1. REINSTATEMENT PENDING APPEAL
An order for reinstatement entitles an employee
to receive his accrued backwages from the
moment the reinstatement order was issued up
to the date when the same was reversed by a
higher court without fear of refunding what he
had received. [Garcia v. Philippine Airlines, Inc.,
G.R. No.164856, 2009]
E.1.a. REQUIREMENTS TO PERFECT
APPEAL TO NLRC
(1) The appeal should be filed within the
reglementary period;
(2) The Memorandum of Appeal should be
under oath;
(3) The appeal fee should be paid;
(4) There should be posting of cash or surety
bond, if judgment involves monetary award;
and
(5) There should be proof of service to the
adverse party.
E.2.a. NATIONAL LABOR RELATIONS
COMMISSION (NLRC)
NLRC divisions
(1) Original Jurisdiction: Over petitions for
injunction or temporary restraining order
under Art. 218 (e).
(2) Exclusive Appellate Jurisdiction: over all
cases decided by labor arbiters (Art 217[b])
and the DOLE regional directors under Art
129.
Period of Appeal
(1) Labor Arbiter to NLRC: Decisions and
Resolutions of the LA shall be final and
executory unless appealed to the NLRC by
UP LAW BOC LABOR RELATIONS
any or both parties within 10 calendar days
from receipt thereof. [2005 NLRC Rules of
Procedure]
(2) Regional director to NLRC: Decisions of the
Regional director shall be final and
executory unless appealed within 5 days
from receipt thereof. [Art. 129]
Note: If the last day of the reglementary period
falls on a Sunday or a holiday, the last day shall
be the next working day.
Grounds of Appeal
(1) If there is prima facie evidence of abuse of
discretion on the part of the Labor Arbiter or
Regional Director;
(2) If the decision, resolution or order was
secured through fraud or coercion,
including graft and corruption;
(3) If made purely on questions of law; and/or
(4) If serious errors in the findings of fact are
raised which, if not corrected, would cause
grave or irreparable injury to the appellant
E.2.b. EFFECT OF NLRC REVERSAL OF
LABOR ARBITER’S ORDER OF
REINSTATEMENT
Even if the order of reinstatement of the Labor
Arbiter is reversed on appeal, it is obligatory on
the part of the employer to reinstate and pay
the wages of the dismissed employee during
the period of appeal until reversal by the higher
court.
On the other hand, if the employee has been
reinstated during the appeal period and such
reinstatement order is reversed with finality, the
employee is not required to reimburse whatever
salary he received for he is entitled to such,
more so if he actually rendered services during
the period. [Garcia v. Philippine Airlines, Inc.,
G.R. No.164856, 2009]
E.3. REMEDIES
102
LABOR LAW
Requisites for Perfection of Appeal to the Court
of Appeals [Rule 43]
(1) The appeal shall be:
 Filed within the reglementary period;
 Verified by the appellant himself in
accordance with §4, Rule 7 of the Rules
of Court;
 In the form of a memorandum of appeal
which shall state the grounds relied
upon and the arguments in support
thereof, the relief prayed for, and with a
statement of the date the appellant
received the appealed decision,
resolution or order;
 In three (3) legibly typewritten or
printed copies; and
 Accompanied by (a) proof of payment of
the required appeal fee; (b) posting of a
cash or surety bond as provided in
Section 6 of the 2005 NLRC Rules, (c) a
certificate of non-forum shopping; and
(d) proof of service upon the other
parties.
(2) A mere notice of appeal without complying
with the other requisites aforestated shall
not stop the running of the period for
perfecting an appeal.
(3) The appellee may file with the Regional
Arbitration Branch or Regional Office where
the appeal was filed, his answer or reply to
appellant’s memorandum of appeal, not
later than 10 calendar days from receipt
thereof. Failure on the part of the appellee
who was properly furnished with a copy of
the appeal to file his answer or reply within
the said period may be construed as a
waiver on his part to file the same.
Subject to the provisions of Article 218 of the
Labor Code, once the appeal is perfected in
accordance with these Rules, the Commission
shall limit itself to reviewing and deciding only
the specific issues that were elevated on appeal.
UP LAW BOC LABOR RELATIONS
F. UNFAIR LABOR PRACTICE OF
EMPLOYERS
(1) Interference/ Restraint/ Coercion
An act which restrains, coerces, or interferes
with employees in the exercise of their right to
self-organization is an Unfair Labor Practice.
Interrogation
General rule: employer may interrogate its
employees regarding their union affiliation for
legitimate purposes and with the assurance
that no reprisals would be taken against the
unionists.
Exception: when interrogation interferes with or
restrains employees' right to self-organization.
[Phil. Steam Navigation Co. v. Phil. Marine
Officer’s Guild, 1965]
Speech
The acts of a company which subjects a union to
vilification and its participation in soliciting
membership for a competing union are also
acts constituting a ULP. [Phil. Steam Navigation
Co. v. Phil. Marine Officer’s Guild, 1965]
An employer may not send letters containing
promises or benefits, nor of threats of obtaining
replacements to individual workers while the
employees are on strike due to a bargaining
deadlock. This is tantamount to interference
and is not protected by the Constitution as free
speech. [Insular Life Assurance Co. Employees
Assn. v. Insular Life Assurance Co. Ltd, 1971]
Espionage
Espionage and/or surveillance by the employer
of union activities are instances of interference,
restraint or coercion of employees in connection
with their right to organize, form and join
unions as to constitute unfair labor practice. […]
The information obtained by means of
espionage is invaluable to the employer and
can be used in a variety of cases to break a
103
LABOR LAW
union. [Insular Life Assurance Co. Employees
Assn. v. Insular Life Assurance Co. Ltd, 1971]
(2) Yellow dog contracts
Yellow dog contracts require, as a condition of
employment, that a person or an employee
shall not join a labor organization or shall
withdraw from one to which he belongs.
Examples:
(1) a representation by the employee that he is
not a member of a labor organization
(2) a promise by the employee that he will not
join a union
(3) a promise by the employee that upon
joining a labor organization, he will quit his
employment
(3) Contracting out
General rule: contracting out is not a ULP
Exception:
(1) contracted-out services or functions are
performed by union members AND
(2) contracting out will interfere with, restrain,
or coerce employees in the exercise of their
right to self-organization. [Art. 248 (c)]
(4) Company union
"Company union" means any labor organization
whose formation, function or administration has
been assisted by any act defined as unfair labor
practice by this Code. [Art. 212[i]]
The employer commits ULP if it initiates,
dominates, or otherwise inteirferes with the
formation or administration of any labor
organization.
Example: giving out financial aid to any union's
supporters or organizers.
(5) Discrimination – Encourage/Discourage
Unionism
UP LAW BOC LABOR RELATIONS
General rule: it is ULP to discriminate in regard
to wages, hours of work and other terms and
conditions of employment in order to encourage
or discourage membership in any labor
organization. [Art. 254 [e]]
Exception (union security clause):
Nothing in this Code or in any other law shall
stop the parties from requiring membership in a
recognized collective bargaining agent as a
condition for employment. [Art. 254 [e]]
Exception to exception: Those employees who
are already members of another union at the
time of the signing of the collective bargaining
agreement. [Art. 254 [e]]
(6) Testimony
It is an act of ULP by an employer to dismiss,
discharge or otherwise prejudice or discriminate
against an employee for having given or being
about to give testimony under this Code. [Art.
254 (f)]
(7) Violate duty to bargain collectively
Duty to bargain collectively is a continuous
process, non-compliance constitutes ULP.
Collective bargaining does not end with the
execution of an agreement, being a continuous
process, the duty to bargain necessarily
imposing on the parties the obligation to live up
to the terms of such a collective bargaining
agreement if entered into, it is undeniable that
non-compliance therewith constitutes an unfair
labor practice. [Shell Oil Workers Union v Shell
Co., 1971]
(8) Payment of negotiation or attorney's fees
Sweetheart contracts
Sweetheart contracts are favorable both to the
union and the employer at the expense of the
employees. The settlement of bargaining issues
must be made by fair bargaining in good faith,
and not through the payment of negotiation or
104
LABOR LAW
attorney's fees which will ultimately lead to
sweetheart contracts.
(9) To violate a collective bargaining agreement
Flagrant and/or malicious refusal required
Violations of collective bargaining agreements,
except flagrant and/or malicious refusal to
comply with its economic provisions, shall not
be considered unfair labor practice and shall
not be strikeable. (IRR)
Note: The list in Art. 254 is not exhaustive.
Other acts which are analogous to those
enumerated can be ULPs.
The alleged violation of the CBA, even
assuming it was malicious and flagrant, is not a
violation of an economic provision, thus not an
Unfair Labor Practice. [BPI Employees Union-
Davao FUBU v. BPI, 2013]
G. JURISDICTION OF LABOR ARBITERS
AND THE COMMISSION
Labor Arbiter: Jurisdiction
Except as otherwise provided under the Code
the Labor Arbiters shall have original and
exclusive jurisdiction to hear and decide:
(1) Unfair labor practices cases;
(2) Termination disputes;
(3) If accompanied with a claim for
reinstatement, those cases that workers
may file involving wages, rates of pay, hours
of work and other terms and conditions of
employment;
(4) Claims for actual, moral, exemplary and
other forms of damages arising from the
employer-employee relations;
(5) Cases arising from any violation of Art. 264
of this Code, including questions involving
the legality of strikes and lockouts;
(6) Except claims for Employees
Compensation, Social Security, Medicare
and maternity benefits, all other claims,
UP LAW BOC LABOR RELATIONS
arising from employer-employee relations,
including those of persons in domestic or
household service, involving an amount
exceeding five thousand pesos (P5,000)
regardless of whether accompanied with a
claim for reinstatement. [Art. 217]
(7) Money claims arising out of employer-
employee relationship or by virtue of any
law or contract, involving claims for actual,
moral, exemplary an other forms of
damages, as well as employment
termination of OFWs;
(8) Wage distortion disputes in unorganized
establishments not voluntarily settled by
the parties. [Art. 124]
(9) Enforcement of compromise agreements
when there is non-compliance by any of the
parties. [Art. 227]
(10) Other cases as may be provided by law.
“Exclusive and Original” Jurisdiction subject to
Articles 261 and 262.
A case under Art 217 may be lodged instead
with a voluntary arbitrator. The policy of the law
is to give primacy to voluntary modes of settling
dispute.
G.1. VERSUS REGIONAL DIRECTOR
Jurisdiction on Money Claims (Labor Arbiter vs.
Regional Director)
A money claim arising from employer-employee
relations, except SSS, ECC/Medicare claims, is
within the jurisdiction of a labor arbiter if:
(1) The claim, regardless of amount, is
accompanied with a claim of reinstatement;
or
(2) The claim exceeds P5,000, whether or not
there is a claim for reinstatement.
The Regional Director has jurisdiction if:
(1) the money claim is not accompanied by
reinstatement AND
105
LABOR LAW
(2) the claim does not exceed P5,000
Notes:
(1) The money claim must arise from law or
contracts other than CBA.
(2) For money claims arising from the
implementation of a CBA – Voluntary
Arbitrator or Panel of Voluntary Arbitrators
have jurisdiction.
(3) For money claims which do not arise from
ER-EE relations – Regular Courts have
jurisdiction.
(4) Nature of Proceeding: Non-litigious. The
Labor Arbiter is not bound by the technical
rules of procedure.
(5) The Labor Arbiter shall use all reasonable
means to ascertain the facts in each
speedily and objectively. [Art. 221]
(6) Employer-employee relationship is a
jurisdictional requisite, absent of which, the
NLRC has no jurisdiction to hear and decide
the case. [Hawaiian-Philippine Company v.
Gulmatico]
(7) Venue: Regional Arbitration Branch (RAB)
having jurisdiction over the workplace of the
complainant or petitioner.
(8) Workplace – place or locality where the
employee is regularly assigned at the time
the cause of action arose.
(9) In the case of field employees, ambulant or
itinerant workers, their workplace is (a)
where they are regularly assigned or (b)
where they are supposed to regularly
receive their salaries and wages or work
instructions from, and report the results of
their assignment to their employers.
Some Rules on Venue
(1) Exclusion. Where 2 or more Regional
Arbitration Branches have jurisdiction over
UP LAW BOC LABOR RELATIONS
the workplace of the complainant, that first
which acquired jurisdiction over the case
shall exclude others.
(2) Waiver. When venue is not objected to
before the filing of position papers, such
issue shall be deemed waived.
(3) Transfer. Venue of an action may be
transferred to a different Regional
Arbitration Branch upon written agreement
of the parties or upon order of the LA in
meritorious cases and on motion of the
proper party.
OFW Cases. Cases involving overseas Filipino
workers may be filed before the RAB having
jurisdiction over the place where the
complainant resides or where the principal
office of any of the respondents is situated.
H. RIGHT OF MANAGERIAL AND
SUPERVISORY EMPLOYEES
CONCERNING SELF-ORGANIZATION
Supervisory Employees
Supervisory employees are those who, in the
interest of the employer, effectively recommend
such managerial actions if the exercise of such
authority is not merely routinary or clerical in
nature but requires the use of independent
judgment. [Art. 218 (m)]
Supervisory employees shall not be eligible for
membership in a labor organization of the rank-
and-file employees but may join, assist or form
separate labor organizations of their own. [Art.
251]
Rationale
Supervisory employees, while in the
performance of supervisory functions, become
the alter ego of the management in the making
and the implementing of key decisions. It
would be difficult to find unity or mutuality of
interests in a bargaining unit consisting of a
mixture of rank-and-file and supervisory
106
LABOR LAW
employees. [Toyota Motor Phil. Corp. v Toyota
Motor Phil. Corp. Labor Union, 1997]
Effect of Mixed Membership
The inclusion as union members of employees
outside the bargaining unit shall not be a
ground for the cancellation of the registration of
the union. Said employees are automatically
deemed removed from the list of membership
of said union. [Art. 251-A]
Note: [T]he rank and file union and the
supervisors’ union operating the same
establishment may join the same federation or
national union. [Art. 251]
Managerial Employees
A managerial employee is one who is vested
with the powers or prerogatives to lay down and
execute management policies and/or to hire,
transfer, suspend, lay-off, recall, discharge,
assign or discipline employees. [Art. 218 (m)]
Managerial employees are not eligible to join,
assist or form any labor organization. [Art. 251]
I.RIGHTS AND CONDITIONS OF
MEMBERSHIP IN A LABOR
ORGANIZATION
I.1. UNION SECURITY
Union security is any form of agreement which
imposes upon employees the obligation to
acquire or retain union membership as a
condition affecting employment. [GMC v. Casio,
2010]
Purpose
To safeguard and ensure the existence of the
union and thus, promote unionism in general as
a state policy.
Limitation
Employees who are already members of
another union at the time of the signing of the
UP LAW BOC LABOR RELATIONS
collective bargaining agreement may not be
compelled by any union security clause to join
any union. [Art. 254 (e)]
Types
(1) Closed shop
(2) Maintenance of membership shop
(3) Union shop
(4) Modified union shop
(5) Agency shop
I.1.a. UNION SECURITY CLAUSES;
CLOSED SHOP, UNION SHOP,
MAINTENANCE OF MEMBERSHIP SHOP,
ETC.
Closed shop
[In a Closed shop], no person may be employed
in any or certain agreed departments of the
enterprise unless he or she is, becomes, and, for
the duration of the agreement, remains a
member in good standing of a union entirely
comprised of or of which the employees in
interest are a part. [GMC v. Casio, 2010]
Only union members can be hired by the
company and they must remain as members to
retain employment in the company. [Azucena]
Note: Substantive and procedural due process
must be complied with even if termination is
due to a closed shop provision. [Del Monte v.
Saldivar, 2007]
Construction
Any doubt as to the existence of a closed shop
provision in the CBA will be resolved in favor of
the nonexistence of the closed shop provision.
Maintenance of membership shop
There is maintenance of membership shop
when employees, who are union members as of
the effective date of the agreement, or who
thereafter become members, must maintain
union membership as a condition for [their]
107
LABOR LAW
continued employment until they are promoted
or transferred out of the bargaining unit or the
agreement is terminated. [GMC v. Casio, 2010]
No employee is compelled to join the union, but
all present or future members of the union
must, as a condition of employment, remain in
good standing in the union. [Azucena]
Union shop
There is union shop when all new regular
employees are required to join the union within
a certain period as a condition for their
continued employment. [GMC v. Casio, 2010]
Non-members may be hired, but to retain
employment, they must become union
members after a certain period. The
requirement applies to present and future
employees. [Azucena]
Modified union shop
Employees who are not union members at the
time of signing the contract need not join the
union, but all workers hired thereafter must
join. [Azucena]
Agency shop
An agreement whereby employees must either
join the union or pay to the union as exclusive
bargaining agent a sum equal to that paid by
the members. [Azucena]
I.2.CHECK-OFF; UNION DUES, AGENCY
FEES
Check-off
A check-off is a process or device whereby the
employer, on agreement with the Union,
recognized as the proper bargaining
representative, or on prior authorization from
the employees, deducts union dues or agency
fees from the latter’s wages and remits them
directly to the Union. [Marino v. Gamilla, 2009]
UP LAW BOC LABOR RELATIONS
The system of check-off is primarily for the
benefit of the Union, and only indirectly, for the
benefit of the individual employees. [Marino v.
Garnilla, 2009]
Note: For a check-off to be valid, it must comply
with the requirements of a valid special
assessment.
Jurisdiction over Check-off disputes
The Bureau of Labor Relations has jurisdiction
to hear, decide and to mete out punishment any
reported violation under Article 241.
K. APPEARANCES AND FEES
(1) Non-lawyers may appear before the
commission or any Labor Arbiter only:
(a) if they represent themselves; or
(b) if they represent their organization or
members thereof
(2) No attorney’s fees, negotiation fees or
similar charges of any kind arising from any
collective bargaining agreement shall be
imposed on any individual member of the
contracting union: Provided, however, that
attorney’s fees may be charged against
union funds in an amount to be agreed
upon by the parties. Any contract,
agreement or arrangement of any sort to
the contrary shall be null and void. [Art.
228]
L. DUTY TO BARGAIN COLLECTIVELY
WHEN THERE EXISTS A CBA
L.1. WHEN THERE IS A CBA
General Rule: The duty to bargain collectively
shall also mean that neither party shall
terminate nor modify such agreement during its
lifetime.
Exception: In organized establishments, when a
verified petition questioning the majority status
of the incumbent bargaining agent is filed
before the Department of Labor and
Employment within the sixty-day period before
the expiration of the collective bargaining
108
LABOR LAW
agreement, the Med-Arbiter shall automatically
order an election by secret ballot when the
verified petition is supported by the written
consent of at least twenty-five percent (25%) of
all the employees in the bargaining unit to
ascertain the will of the employees in the
appropriate bargaining unit.
[A]t the expiration of the freedom period, the
employer shall continue to recognize the
majority status of the incumbent bargaining
agent where no petition for certification election
is filed. [Art. 256)]
Hold Over Principle
[In the absence of a new CBA], [i]t shall be the
duty of the parties to keep the status quo and to
continue in full force and effect the terms and
conditions of the existing agreement during the
60-day period and/or until a new agreement is
reached by the parties. [Art. 259]
The last sentence of Article [259], which
provides for automatic renewal pertains only to
the economic provisions of the CBA, and does
not include representational aspect of the CBA.
[PICOP Resources, Inc. v. Taneca et al., 2010]
L.2. SUBSTITUTIONARY DOCTRINE
The “substitutionary” doctrine provides that the
employees cannot revoke the validly executed
collective bargaining contract with their
employer by the simple expedient of changing
their bargaining agent. And it is in the light of
this that the phrase “said new agent would
have to respect said contract” must be
understood. It only means that the employees,
thru their new bargaining agent, cannot renege
on their collective bargaining contract, except of
course to negotiate with management for the
shortening thereof. [Benguet Consolidated v. BCI
Employees and Workers Union-PAFLU, 1998]
Conditions:
UP LAW BOC LABOR RELATIONS LABOR LAW

(1) change of bargaining agent (through

affiliation, disaffiliation, or other means)
(2) existing CBA with the previous bargaining
agent

Effects:
(1) new bargaining agent cannot revoke and
must respect the existing CBA
(2) it may negotiate with management to
shorten the existing CBA’s lifetime

109