LABOR LAW AND

SOCIAL LEGISLATION 

2015 GOLDEN NOTES 
UNIVERSITY OF S ANTO TOMAS 
F ACULTY OF CIVIL L AW 
M ANILA 
 

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2015 Edition

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No.____________

Printed in the Philippines, June 2015.

 

 ACADEMIC YEAR 2015-2016
CIVIL L AW STUDENT COUNCIL 
JOHN ROBIN G. R AMOS  PRESIDENT 
DION LORENZ L. ROMANO  VICE PRESIDENT INTERNAL 
DEXTER JOHN C. SUYAT  VICE PRESIDENT EXTERNAL 
REBECCA M ARIE G. RENTI CRUZ  SECRETARY  
J ACKIELYN K RYSTYL
RYSTYL NIHAMA C. B ANA  TREASURER 
K RISTINE
RISTINE C ARMINA R. M ANAOG  AUDITOR 

TEAM: BAR-OPS
V ANNESSA ANNE VIRAY   CHAIRPERSON 
H AZEL N AVAREZ  VICE-CHAIRPERSON 
ERIKA M ARIZ PINEDA  SECRETARY  
C ATHERINE SYMACO  ASST. SECRETARY  
M AXIMILLAN JEAN PEROLA  HEAD, PUBLIC RELATIONS  

P ATRICIA
R AFAEL L ACUESTA
LORENZ    
S ANTOS ASST. H,EAD
HEAD , PUBLIC
 FINANCE RELATIONS
COMMITTEE    
HOWELL ICO  ASST. HEAD, FINANCE COMMITTEE 
H ANNA CLARISS QUIAMBAO  HEAD, HOTEL ACCOMMODATIONS COMMITTEE 
JULIA M AGARRO  ASST. HEAD, HOTEL ACCOMMODATIONS COMMITTEE  
JINNY APOSTOL  ASST. HEAD, HOTEL ACCOMMODATIONS COMMITTEE  
JEFFREY CORONADO  HEAD, LOGISTICS COMMITTEE  
INEANDRO PEDRO TOLENTINO  ASST. HEAD, LOGISTICS COMMITTEE  
C ARLO ANGELO TING  ASST. HEAD, LOGISTICS COMMITTEE  

 ATTY . A
  L CONRAD B. ESPALDON 
 ADVISER 
 

 ACADEMICS COMMITTEE 
MENANDRO M AGCULANG 
K  ATRINA GRACE C. ONGOCO  EXECUTIVE COMMITTEE 
 ANGELIE C. QUINTO 

M A. S ALVE AURE M. C ARILLO  SECRETARY GENERAL 

R AFAEL LORENZ S ANTOS 

REUBEN BERNARD M. SORIANO  L AYOUT AND DESIGN 
JUAN P AOLO M AURINO R. OLLERO 

L ABOR AND SOCIAL LEGISLATION COMMITTEE 

C AMILLE ANGELICA B. GONZALES   L ABOR L AW COMMITTEE HEAD 
D ALEY ROSE A. LIMOSINERO  ASST. COMMITTEE HEAD – L ABOR STANDARDS 
SONIA M AE C. B ALBABOCO  ASST. COMMITTEE HEAD – L ABOR RELATIONS 
EMMA RUBY J. A AGUILAR  ASST. COMMITTEE HEAD – SOCIAL LEGISLATION 
 ANDREA VICTORIA R. A AMOG  MEMBER 
 AECAYA CHRISTINE V. C ALERO  MEMBER 
NIKKI C AREEN R. P ALACIOS  MEMBER 

L AURENCE P. SORIAO  MEMBER 

DEAN S ALVADOR A. POQUIZ 
 ADVISER 
 

F ACULTY OF CIVIL L AW 

UNIVERSITY OF S ANTO TOMAS 

 ACADEMIC OFFICIALS

 ATTY . NILO T. DIVINA  REV. FR. ISIDRO C. A

 ABAÑO, O.P.
EAN EGENT
D   R  

 ATTY . A
 ARTHUR B. C APILI 
FACULTY SECRETARY 

 ATTY . ELGIN MICHAEL C. PEREZ 

LEGAL COUNSEL 
UST CHIEF JUSTICE ROBERTO CONCEPCION LEGAL AID CLINIC 

JUDGE PHILIP A. A
 AGUINALDO 
SWDB COORDINATOR 

LENY G. G ADANIA, R.G.C.
GUIDANCE COUNSELOR 
 

OUR DEEPEST APPRECIATION TO OUR 

MENTORS & INSPIRATION 

 ATTY . S AMSON S. A
 ALCANTARA† 

 ATTY . A
  ARNOLD E. C ACHO 
 ATTY . ROLAND L. M ARQUEZ 

DEAN S ALVADOR A. POQUIZ 

 ATTY . CESAR E. S ANTAMARIA, JR.

DEAN ANTONIO H. A
  ABAD JR.
USEC. JOSEPHUS JIMENEZ 

 ATTY . M ARLON J. M ANUEL 

For being our guideposts in understanding the intricate sphere of Labor Law and Social
Legislation. 
- Academics Committee 2015
 

DISCLAIMER

THE RISK OF USE, MISUSE OR

NON-USE OF THIS BAR REVIEW
MATERIAL SHALL BE BORNE BY
THE USER/ NON-USER. 
 

L ABOR L AW AND SOCIAL LEGISLATION

EGISLATION  
2015 BAR EXAMINATIONS 
EXAMINATIONS  

I.  Fundamental Principles and Policies 1

A.  Constitutional provisions 4

1.  Article II, Secs. 9, 10, 11, 13, 14, 18, 20.
2.  Article III, Secs. 1, 4, 7, 8, 10, 16, 18(2).
3.  Article XIII, Secs. 1, 2, 3, 13, 14.

B.  Civil Code 6

1.  Article 19
2.  Article 1700
3.  Article 1702

C.  Labor Code 7

1.  Article 3 7
2.  Article 4 7
3.  Article 166 8
4.  Article 211 8
5.  Article 212 8
6.  Article 255 10
7.  Article 277 11

II. Recruitment and Placement 13  

13

A.  Recruitment of local and migrant workers 13

1.  Illegal recruitment (Sec. 5, R.A. No. 10022) 16
a)  License vs. authority 18
b)  Essential elements of illegal recruitment 18
c)  Simple illegal recruitment 19
d)  Illegal recruitment in large scale 19
e)  Illegal recruitment as economic sabotage 19
f)  Illegal recruitment vs. estafa
estafa   20
g)  Liabilities 20
(i)  Local recruitment agency 20
(ii)  Foreign employer 21
(a)  Theory of imputed knowledge 21
(iii) Solidary liability 22
h)  Pre-termination of contract of migrant worker 22

2.  Direct hiring 24

B.  Regulation and enforcement 24

1.  Suspension or cancellation of license or authority (Art. 35, Labor Code) 24
2.  Regulatory and visitorial powers of the DOLE secretary 25
3.  Remittance of foreign exchange earnings 25
4.  Prohibited activities 26

III.  Labor Standards 30

A.  Hours of work 30

1.  Coverage/Exclusion
Coverage/Exclusionss (Art. 82, Labor Code) 30
2.  Normal hours of work 31
a)  Compressed work week 33
3.  Meal break 34
4.  Waiting time 34
 

5.  Overtime work, overtime pay 35

6.  Night work (R.A. No. 10151), Night shift differential 37
7.  Part-time work 38
8.  Contract for piece work (see Civil Code) 38

B.  Wages 39
1.  Wage vs. salary 40
2.  Minimum wage defined, Minimum wage setting 40
3.  Minimum wage of workers paid by results 41
a)  Workers paid by results 41
b)  Apprentices 42
 
c)
d)  Learners
Persons with disability 42
42
4.  Commissions 42
5.  Deductions from wages 42
6.  Non-diminution of benefits 43
7.  Facilities vs. supplements 43
8.  Wage Distortion/Rectification 43
9.  Divisor to determine daily rate 45

C.  Rest Periods 46

1.  Weekly rest day 46
2.  Emergency rest day work 47

D.  Holiday pay/Premium pay 48

1.  Coverage, exclusions 50
 
2. Teachers, piece workers, takay,
takay,  seasonal workers, seafarers 50
E.  Leaves 51
1.  Service Incentive Leave 51
2.  Maternity Leave 53
3.  Paternity Leave 53
4.  Parental Leave (R.A. No. 8972) 54
5.  Leave for Victims of Violence against Women and Children (R.A. No. 9262) 54
6.  Special leave benefit for women 54

F.  Service Charge 54

G.  Thirteenth Month Pay 55

H.  Separation Pay 58

I.  Retirement Pay 58

a.  Eligibility 59
b.  Amount 60
c.  Retirement benefits of workers paid by results 61
d.  Retirement benefits of part-time workers 61
e.  Taxability 61

J.  Women Workers 61

a.  Provisions against discrimination 61
b.  Stipulation against marriage 62
c.  Prohibited acts 63
d.  Anti-Sexual Harassment Act (R.A. No. 7877) 64

K.  Employment of Minors (Labor Code and R.A. No. 7678, R.A. No. 9231) 66
 

L.  Househelpers (Labor Code as amended by R.A. No. 7655, An Act Increasing the 69
Minimum Wage of Househelpers; see also – Household Service under the Civil Code)

M.  Employment of Homeworkers 74

N.  Apprentices and Learners 75

O.  Persons with disability (R.A. No. 7277, as amended by R.A. No. 9442) 79
a.  Definition 79
b.  Rights of persons with disability 79
c.  Prohibition on discrimination against persons with disability 79
 
d. Incentives for employers 79
IV. Termination of Employment 81  
81

A.  Employer-employee relationship 81

1.  Four-fold test 82

2.  Kinds of employment 83

a.  Probationary 83
b.  Regular 87
c.  Project employment 90
d.  Seasonal 92
e.  Casual 93
f.  Fixed-term 94

3.  Job contracting 95

a.  Articles 106 to 109 of the Labor Code 95
b.  Department Order No. 18-A 97
c.  Department Circular No. 01-12 98
d.  Effects of Labor-Only Contracting 99
e.  Trilateral relationship in job contracting 99

B.  Dismissal from employment 100

1.  Just Causes 100
2.  Authorized Causes 106
3.  Due Process 112
a)  Twin-notice requirement 112
b)  Hearing; meaning of opportunity to be heard 113

C.  Reliefs for Illegal Dismissal 116

1.  Reinstatement 117
a.  Pending appeal (Art. 223, Labor Code) 117
b.  Separation pay in lieu of reinstatement 120

2.  Backwages 121

a.  Computation 122
b.  Limited backwages 122

D.  Preventive Suspension 123

E.  Constructive Dismissal 123

V. Management Prerogative 125  

125

A.  Discipline 127

 

 
B.  Transfer of employees 127

C.  Productivity standard 127

D.  Grant of bonus 128

E.  Change of working hours 128

F.  Rules on Marriage between employees of competitor-employers 129

 
G. Post-employment ban 129

VI. Social Welfare Legislation (P.D. 626) 130  

130

A.  SSS Law (R.A. No. 8282) 130

1.  Coverage 131
2.  Exclusions from coverage 133
3.  Benefits 133
4.  Beneficiaries 137

B.  GSIS Law (R.A. No. 8291) 141

1.  Coverage 145
2.  Exclusions from coverage 145
3.  Benefits 145
4.  Beneficiaries 150
C.  Limited Portability Law (R.A. No. 7699) 151

D.  Employee’s compensation – 

– coverage and when compensable 151

VII. Labor Relations Law 156  

156

A.  Right to self-organization 156

1.  Who may unionize for purposes of collective bargaining 157

a)  Who cannot form, join or assist labor organizations 157

2.  Bargaining unit 160

a)  Test to determine the constituency of an appropriate bargaining unit 160
b)  Voluntary recognition 162
(i)  Requirements
c)  Certification election 163
(i)  In an unorganized establishment 167
(ii)  In an organized establishment 167
d)  Run-off election 168
(i)  Requirements
e)  Re-run election 168
f)  Consent election 168
g)  Affiliation and disaffiliation of the local union from the mother union 169
(i)  Substitutionary doctrine 171
h)  Union dues and special assessments 171
(i)  Requirements for validity 172
i)  Agency fees 173
(i)  Requisites for assessment 173
 

B.  Right to collective bargaining 173

1.  Duty to bargain collectively 174

a)  When there is absence of a CBA 176

b)  When there is a CBA 176

2.  Collective Bargaining Agreement (CBA) 177

a)  Mandatory provisions of CBA 178

(i)  Grievance procedure 178
 
(ii)
(iii) Voluntary arbitration
No strike-no lockout clause 179
179
(iv) Labor management council 180

b)  Duration 180

(i)  For economic provisions 181
(ii)  For non-economic provisions 181
(iii)  Freedom period 183

3. Union Security 183

a)  Union security clauses; closed shop, union shop, maintenance of
membership shop, etc. 183
b)  Check-off; union dues, agency fees 184

4.  Unfair Labor Practice in collective bargaining 184

a)  Bargaining in bad faith 184
b)  Refusal to bargain 184
c)  Individual bargaining 184
d)  Blue sky bargaining 185
e)  Surface bargaining 185

5.  Unfair Labor Practice (ULP) 185

a)  Nature of ULP 185
b)  ULP of employers 185
c)  ULP of labor organizations 193

C.  Right to peaceful concerted activities 194

1.  Forms of concerted activities 194
2.  Who may declare a strike or lockout? 196
3.  Requisites for a valid strike 199
4.  Requisites for a valid lockout 199
5.  Requisites for lawful picketing 203
6.  Assumption of jurisdiction by the DOLE Secretary or Certification of the 204
labor dispute to the NLRC for compulsory arbitration
7.  Nature of assumption order or certification order 206
8.  Effect of defiance of assumption or certification orders 207
9.  Illegal strike 208
a)  Liability of union officers 209
b)  Liability of ordinary workers 209
c)  Liability of employer 210
d)  Waiver of illegality of strike 211

10.  Injunctions 211

a)  Requisites for labor injunctions 211
b)  “Innocent bystander rule” 212
 

VIII. Procedure and Jurisdiction 214  

214

A.  Labor Arbiter 214

1.  Jurisdiction 214
a)  versus Regional Director 215
2.  Reinstatement pending appeal 216
3.  Requirements to perfect appeal to NLRC 216

B.  National Labor Relations Commission (NLRC) 219

1.  Jurisdiction 219
2.  Effect of NLRC reversal of Labor Arbiter’s order of reinstatement 221
 
3. Remedies 221
4.  Certified cases 222

C.  Bureau of Labor Relations – Med-Arbiters 223

1.  Jurisdiction (original and appellate) 223

D.  National Conciliation and Mediation Board 224

1.  Nature of proceedings 224
2.  Conciliation vs. Mediation 225
3.  Preventive mediation 226

E.  DOLE Regional Directors 227

1.  Jurisdiction 227

F.  DOLE Secretary 227

1.  Visitorial and enforcement powers 227

2.  Power to suspend/effects of termination 228
3.  Assumption of jurisdiction 229
4.  Appellate jurisdiction 229
5.  Voluntary arbitration powers 229

G.  Grievance Machinery and Voluntary Arbitration 230

1.  Subject matter of grievance 230
2.  Voluntary Arbitrator 230
a)  Jurisdiction 230
b)  Procedure 230
c)  Remedies 231

H.  Court of Appeals 233

1.  Rule 65, Rules of Court 233

I.  Supreme Court 234

1.  Rule 45, Rules of Court 234

J.  Prescription of actions 234

 

FUNDAMENTAL PRINCIPLES AND STATE POLICIES 

LEGEND LABOR LAW

BFOQ - Bona Fide Occupational FUNDAMENTAL PRINCIPLES AND POLICIES
Qualification
BLR - Bureau of Labor Relations Labor
CB - Collective Bargaining
CBA - Collective Bargaining Agreement It is the exertion by human beings of physical or
CE - Certification Election mental efforts, or both, towards the production of
DOLE - Department of Labor and goods and services.
Employment
Ee - Employee The State affirms labor as a primary social
Er - Employer economic force. It shall protect the rights of
LA - Labor Arbiter workers and promote their welfare (1987
LC - Labor Code Constitution, Art. II, Sec. 18).
LLO - Legitimate Labor Organization
LOA Leave of Absence Declaration of basic policy
NCMB - National Conciliation and
Mediation Board It is the policy of the State to:
NLRC - National Labor Relations
Commission 1.  Afford full protection to labor
NSD - Night Shift Differential 2.  Promote full employment
OFW - Overseas Filipino Worker 3.  Ensure equal work opportunities regardless
OT Overtime of sex, race, or creed
PCE - Petition for Certification Election 4.  Regulate the relations betwwen Ers and
POEA - Philippine Overseas Employment workers.
Administration 5.  Assure the rights of workers to self-
RAB Regional Arbitration Branch organization, collective bargaining, security
RD - Regional Director of tenure, just and humane conditions of
RH - Regular Holiday work (LC, Art. 3). 
3). 
RTWPB - Regional Tripartite Wages and
- Productivity Boards SOCIAL JUSTICE
RW - Regular Wage
RWD - Regular Working Days The State shall promote social justice in all phases
SIL - Service Incentive Leave of national development (1987 Constitution, Art. II,
SLE - Secretary of Labor and Sec. 10).
Employment
ULP - Unfair Labor Practice The aim of Labor law is social justice
UT - Undertime
VA - Voluntary Arbitrator Social justice is “neither communism, nor
VR - Voluntary Recognition despotism, nor atomism, nor anarchy,” but the
WD - Wage Distortion humanization of laws and the equalization of
WRD Weekly Rest Day social and economic force by the State   so that
justice in its rational and objectively secular
conception may at least be approximated. Social
Justice means the promotion of the welfare of all
the people, the adoption by the government of
measures calculated to insure economic stability of
all the competent elements of society, through the
maintenance of a proper economic and social
equilibrium in the interrelations of the members of
the community, constitutionally, through the
adoption of measures legally justifiable, or extra-
constitutionally, through the exercise of powers
underlying the existence of all governments on the
time-honored principle of salus populi est suprema
lex (Calalang v. Williams, G.R. No. 47800, December
 2, 1940).

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LABOR LAW AND SOCIAL LEGISLATION

The promotion of social justice shall include the Matters that may properly fall under the term
commitment to create economic opportunities “labor law” 
based on freedom of initiative and self-reliance
(1987 Constitution, Art. XIII, Sec. 2). The term “labor law” covers the following: 
following:  
1.  Statutes passed by the State to promote the
Limitations in invoking the principle of social welfare of the workers and Ees and regulate
justice their relations with their Ers.
2.  Judicial decisions applying and interpreting
1.  Not to undermine property rights resulting the aforesaid statutes (NCC,
( NCC, Art. 8).
8).
in confiscation (Guido v. Rural Progress 3.  Rules and regulations issued by
 Adm, L-2089, October 31, 1949). It should not administrative agencies, within their legal
tolerate usurpation of property, public or competence, to implement labor statutes.
private.
 2.  May only protect the laborers who come to Classification of labor laws
court with clean hands ([Link] Distance
Telephone Co. v. NLRC, G.R. No. 80609, August 1.  Labor Standards  –  Prescribe the terms and
 23, 1988) and their motives blameless conditions of employment as affecting wages
(Gustilo v. Wyeth Phils., G.R. No. 149629, or monetary benefits, hours of work, cost of
October 4, 2004). living allowances, and occupational health,
3.  Never result to an injustice or oppression of safety and welfare of the workers. It
the Er ([Link] Inc. v. NLRC, G.R. No. provides economic benefits to the workers
106370, September 8, 1994). 
1994).   who are actually working.  
4.  If it is used to shield wrongdoings. It cannot
be permitted to be the refuge of scoundrels e.g.  13th month pay
(PNCC v. NLRC, G.R. No. 83320, Feb. 9, 1989). 
1989). 
2.  Labor Relations – Defines and regulates the
Q: May social justice as a guiding principle in status, rights and duties, and the
labor law be so used by the courts in sympathy institutional mechanisms, that govern the
with the working man if it collides with the individual and collective interactions of
Equal protection clause of the Constitution? Ers, Ees or their representatives.  It is
(2003 Bar Question) concerned with the stabilization of relations
of Ers and Ees and seeks to forestall and
 A:Yes. The State is bound under the Constitution to adjust the differences between them by the
afford full protection to Labor and when conflicting encouragement of CB and the settlement of
interests collide and they are to be weighed on the labor disputes through conciliation,
scales of social justice, the law should accord more mediation and arbitration. 
sympathy and compassion to the less privileged
workingman (Fuentes
(Fuentes v. NLRC, 266 SCRA 24, e .g . Collective Bargaining Negotiations
 January 2, 1997). 
1997). 
However it should be borne in mind that social 3.  Social Legislation  –  All
All laws passed by the
justice ceases to be an effective instrument for the State to promote public welfare.   It
“equalization of the social and economic forces” by includes statutes intended to enhance the
the State when it is used to shield wrongdoing welfare of the people even where there is no
(Corazon Jamer v. NLRC, 278 SCRA 632). Er-Ee relationship. It provides economic
benefits to workers who are at work because
LABOR LAW of the hazards of employment.  

Labor law e.g.  GSIS Law, SSS Law, Philhealth benefits,

Agrarian Laws
The law that defines State policies on labor and
employment and governs the rights and duties of Q: How do the provisions of the law on labor
the employer (Er) and employees (Ee) with respect relations interrelate, if at all, with the
to:  provisions pertaining to labor standards?
1.  The terms and conditions of employment, (2003 Bar Question)
and
2.  Labor disputes arising from collective  A: The law on Labor Relations provides for rights
bargaining or other concerted activity and procedures by which workers may obtain from
respecting such terms and conditions. their Er benefits which are over and above the

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FUNDAMENTAL PRINCIPLES AND STATE POLICIES 

minimum terms and conditions of employment set Essential characteristics of a contract of labor
by labor standards law. Labor Standards law alone
does not guarantee lasting industrial peace. It is 1.  Er freely enters into a contract with the Ee;
assured through Labor Relations law which 2.  Er can select who his Ee will be;
enables workers to obtain better benefits 3.  Er can dismiss the Ee; the Ee in turn can quit
guaranteed by labor standards laws and by his job;
providing for a mechanism to settle disputes 4.  Er must give remuneration; and
between the Er and his Ees. 5.  Er can control and supervise the conduct of
the Ee.
Labor legislation v . Social legislation
Contracts are subject to police power of the
Labor legislation Social legislation State

1.  Refers to labor 1.  Refers to Social The supremacy of the law over the nomenclature of
statutes like Labor Security Laws  the contract and the stipulations contained therein
Relations Law and 2.  is to bring to life the policy enshrined in the
Those laws that
Labor Standards  provide particular
Constitution to “afford full protection to
labor.” Thus,
labor.”  Thus, labor contracts are placed on a higher
2.  Focuses on the kinds of protecion or
plane than ordinary contracts; these are imbued
rights of the benefits to societyor
with public interest and therefore subject to the
worker in the segments thereof in
police power of the State(Leyte
State(Leyte Geothermal Power
workplace  furtherance of social
Progressive Employees Union-ALU-TUCP v.
justice 
Philippine National Oil Company-Energy
Development Corporation, G.R. No. 170351, March
NOTE: All Labor laws are social legislations, but 30, 2011).
not all social legislations are labor laws.
The relations between capital and labor are not
The purpose of labor legislation is to afford merely contractual. They are so impressed with
protection to labor, promote full employment, public interest that labor contracts must yield to
ensure equal work opportunities regardless of sex, the common good. Therefore, such contracts are
race or creed and regulate the relations between subject to the special laws on labor unions,
workers and Ers. The State shall assure the rights collective bargaining, strikes and lock outs, closed
of workers to self-organization, collective shop, wages, working conditions, hours of labor
bargaining (CB), security of tenure and just and and similar subject (NCC, Art. 1700).
humane conditions of work. Ultimately, the
primordial purpose is to promote the welfare of Prohibitions on contract of labor:
the people based on the latin maxim salus populi
est suprema lex. (2006 Bar Question)  No law impairing the obligation of contracts shall
be passed (1987 Constitution, Art. III, Sec. 10).
SOURCES OF LABOR LAWS
No involuntary servitude in any form shall exist
1.  Labor Code (LC) and other related special except as a punishment for a crime whereof the
legislation [including their respective party shall have been duly convicted. (1987
Implementing Rules and Regulations (IRR)]   Constitution, Art. III, Sec. 18(2)).
2.  Contracts  
3.  Collective Bargaining Agreement (CBA) No contract which practically amounts to
4.  Company practice involuntary servitude, under any guise whatsoever,
5.  Company policies shall be valid (NCC, Art. 1703).

Contract of labor The CBA operating as a source of law

It is a consensual, nominate, principal, and The CBA is the norm of conduct between Er and
commutative contract whereby one person, called Ees and compliance therewith is mandated by the
the Er, compensates another, called the laborer, express policy of the law (DOLE Philippines, Inc.,
worker or Ee, for the latter’s service. It is v. Pawis ng Makabayang Obrero (PAMAO-NFL), G.R.
relationship impressed with public interest in No. 146650, January 13, 2003 in citing E. Razon, Inc.
keeping with our constitutional policy of social v. Secretary of Labor and Employment, G.R. No. No .
justice. 85867, May 13, 1993).

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LABOR LAW AND SOCIAL LEGISLATION

Requisites before past company practices full employment, a rising standard of living,
would be considered as a source of labor law and an improved quality of life for all.

There must be: 3.  Sec 10, Art. II   - The State shall promote social
1.  Voluntarily institution by Er without any justice in all phases of national development. 
development.  
legal compulsion
 2.  A passage of time- should have been done 4.  Sec. 11, Art II   - The State values the dignity of
over a long period of time, and must be every human person and guarantees full
shown to have been consistent and respect for human rights.
deliberate (American Wire and Cable Daily
Rated Employees Union v. American Wire and 5.  Sec. 13, Art. II   - The State recognizes the vital
Cable Co., Inc., G.R. No. 155059, April 29, role of the youth in nation-building and shall
 2005). promote and protect their physical, moral,
spiritual, intellectual, and social well-being. It
NOTE: No passage of time is required for a shall inculcate in the youth patriotism and
company policy to become a source of labor law. nationalism, and encourage their involvement
in public and civic affairs.
CONSTITUTIONAL PROVISIONS
6.  Sec. 14, Art. II  -
 - The State recognizes the role of
Constitutional mandates on labor law women in nation-building, and shall ensure the
fundamental equality before the law of women
1.  Sec. 3,
3,  Art. XIII –  The State shall afford full and men.
protection to labor, local and overseas, Law: Magna Carta of Women
organized and unorganized, and promote full
employment and equality of employment 7.  Sec. 18, Art. II   - The State affirms labor as a
opportunities for all. primary social economic force. It shall protect
the rights of workers and promote their
It shall guarantee the rights of all workers to welfare.
self-organization, collective bargaining and
negotiations, and peaceful concerted activities, 8.  Sec. 20, Art. II –  The State recognizes the
including the right to strike in accordance with indispensable role of the private sector,
law. They shall be entitled to security of encourages private enterprise and provide
tenure, humane conditions of work, and a incentives to needed investments.
living wage. They shall also participate in
policy and decision-making processes affecting 9.  Sec. 1, Art. III  -
  - No person shall be deprived of
their rights and benefits as may be provided by life, liberty, or property without due process of
law. law, nor shall any person be denied the equal
protection of the laws.
The State shall promote the principle of shared
responsibility between workers and employers 10.  Sec. 4, Art. III   - No law shall be passed
and the preferential use of voluntary modes in abridging the freedom of speech, of expression,
settling disputes, including conciliation, and or of the press, or the right of the people
shall enforce their mutual compliance peaceably to assemble and petition the
therewith to foster industrial peace. government for redress of grievances.

The State shall regulate the relations between 11.  Sec. 7, Art. III   - The right of the people to
workers and employers, recognizing the right information on matters of public concern shall
of labor to its just share in the fruits of be recognized. Access to official records, and to
production and the right of enterprises to documents and papers pertaining to official
reasonable returns to investments, and to acts, transactions, or decisions, as well as to
expansion and growth. government research data used as basis for
policy development, shall be afforded the
2.  Sec. 9, Art. II   –  The State shall promote a just citizen, subject to such limitations as may be
and dynamic social order that will ensure the provided by law.
prosperity and independence of the nation and
free the people from poverty through policies 12.  Sec. 8, Art. III –  The right of the people,
that provide adequate social services, promote including those employed in the public and
private sectors, to form unions, associations, or

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FUNDAMENTAL PRINCIPLES AND STATE POLICIES 

societies for purposes not contrary to law shall their welfare and enable them to realize their
not be abridged. full potential in the service of the nation.
Law: EO No. 180 S. 1987 providing Law: Maternal benefits law
guidelines for the exercise of the right to
organize of government employees, State policy on labor as found in the
creating a Public Sector Labor constitution
Management Council and for other
purposes 1.  Afford full protection to labor
2.  Promote full employment  
13.  Sect. 10, Art. III   - No law impairing the 3.  Ensure equal work opportunities regardless
obligation of contracts shall be passed. of sex, race, or creed  
4.  Assure the rights of workers to self-
14.  Sec. 16, Art. III  – All persons shall have the right organization, security of tenure, just and
to a speedy disposition of their cases before all humane conditions of work, participate in
judicial, quasi-judicial or administrative policy and decision-making processes
bodies. affecting their right and benefits  
5.  Regulate the relations between Ers and
15.  Sec. 18(2), Art. III - No involuntary servitude in workers (Art. XIII, Sec. 3).
any form shall exist except as a punishment for
a crime whereof the party shall have been duly Basic rights of workers guaranteed by the
convicted. constitution

16.  Sec. 1, Art. XIII  -

 - The Congress shall give highest 1.  Security of tenure
priority to the enactment of measures that 2.  Living wage
protect and enhance the right of all the people 3.  Just and humane working conditions
to human dignity, reduce social, economic, and 4.  Share in the fruits of production
political inequalities, and remove cultural 5.  Self-organization
inequities by equitably diffusing wealth and 6.  Collective bargaining
political power for the common good. 7.  Collective negotiations
8.  Engage in peaceful concerted activities,
To this end, the State shall regulate the including the right to strike
acquisition, ownership, use, and disposition of 9.  Participate in policy and decision making
property and its increments. processes (Art. XIII, Sec. 3). 
3). 

17.  Sec 2, Art. XIII  -

  - The promotion of social justice Principle of Non-oppression
shall include the commitment to create
economic opportunities based on freedom of The principle mandates capital and labor not to act
initiative and self-reliance. oppressively against each other or impair the
interest and convenience of the public. The
18.  Sec 3, Art. XIII   - The State shall afford full protection to labor clause in the Constitution is not
protection to labor, local and overseas, designed to oppress or destroy capital (Capili v.
organized and unorganized,
u norganized, and promote full NLRC, G.R. No. 117378, March 26, 1997).
employment and equality of employment
opportunities for all. The law in protecting the rights of the Ees
authorizes neither oppression nor self-destruction
19.  Sec. 13, Art. XIII   –  The State shall establish a of the Er (Pacific
Er (Pacific Mills Inc. v. Alonzo, G.R. No. 78090,
special agency for disabled persons for their  July 26, 1991). It should be made clear that when
rehabilitation, self-development and self- the law tilts the scale of justice in favor of labor, it
reliance and their integration into the is but a recognition of the inherent economic
mainstream of society. inequality between labor and management. The
Law: RA 7277 Magna Carta for Disabled intent is to balance the scale of justice; to put the
Person two parties on relatively equal positions. There
may be cases where the circumstances warrant
20.  Sec. 14,
14,  Art. XIII –  The State shall protect favoring labor over the interests of management
working women by providing safe and but never should the scale be so tilted if the result
healthful working conditions, taking into is an injustice to the employer. Justitia
employer. Justitia nemini
account their maternal functions, and such neganda est (justice is to be denied to none )
facilities and opportunities that will enhance (Philippine Geothermal, Inc. v. NLRC and Edilberto
M. Alvarez, G.R. No. 106370, September 8, 1994).

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Neither capital nor labor shall act oppressively b.  R.A. 8291 - Government Service
against the other, or impair the interest or Insurance Act of 1997
convenience of the public (NCC, Art. 1701). 
1701).  c.  13th Month Pay Law
d.  Retirement Pay Law
NEW CIVIL CODE AND OTHER LAWS e.  SSS Law
f.  Paternity Leave Act
1.  New Civil Code (NCC) g.  Anti – Child Labor Act
a.   Art. 19
19   –  Every person must, in the h.  Anti – Sexual Harassment Act
exercise of his rights and in the i.  Magna Carta for Public Health
performance of his duties, act with Workers
justice, give everyone his due, and j.  Solo Parents Welfare Act of 2000
observe honesty and good faith. k.  National Health Insurance Act as
amended by R.A. 9241
b.   Art. 1700
1700 -
 - The relations between capital l.  Migrant Workers and Overseas
and labor are not merely contractual. Filipinos Act of 1995 as amended by
They are so impressed with public RA 10022
interest that labor contracts must yield to m.  PERA Act of 2008
the common good. Therefore, such n.  Home Development Mutual Fund Law
contracts are subject to the special laws of 2009
on labor unions, collective bargaining, o.  The Magna Carta of Women
strikes and lockouts, closed shop, wages, p.  Magna Carta for Disabled Person
working conditions, hours of labor and q.  Comprehensive Agrarian Reform Law
similar subjects. as amended by R.A. 9700
r.  Batas Kasambahay(RA No. 10361)
c.   Art. 1702
1702   - In case of doubt, all labor s.  Working “summer/Christmas”
legislation and all labor contracts shall be students as amended by RA 9547
construed in favor of the safety and expanding the coverage of the Special
decent living for the laborer. Program for Employment of Students
(SPES)  
(SPES)
d.   Art. 1704
1704   - In collective bargaining, the t.  Wage Rationalization Act (RA 6727) 
6727)  
labor union or members of the board or
committee signing the contract shall be LABOR CODE
liable for non-fulfillment thereof.
Labor code
e.   Art. 1710
1710 - - Dismissal of laborers shall be
subject to the supervision of the Presidential Decree No. 442 otherwise known as
Government, under special laws. the Labor Code of the Philippines is a decree
2.  Revised Penal Code (RPC) instituting a labor Code, thereby revising and
 Art. 289
289––  Formation, maintenance and consolidating labor and social laws to afford
 prohibition of combination of capital or protection to labor, promote employment and
threats. –  Any
labor through violence or threats. human resources development and ensure
person who, for the purpose of organizing, industrial peace based on social justice. It is a
maintaining or preventing coalitions or charter of human rights and a bill of obligations for
capital or labor, strike of laborers or lock- every working man.
out of employees, shall employ violence or
threats in such a degree as to compel or Effectivity date: November 1, 1974
force the laborers or employers in the free
and legal exercise of their industry or Presidential Decree No. 442 was signed into law on
work, if the act shall not constitute a more May 1, 1974. Article 2 says, the Code was to take
serious offense in accordance with the effect six months after its promulgation. Therefore,
provisions of the RPC. the law took effect on November 1, 1974.

3.  Special Laws Father of Labor Code

a.  E.O. 180- Providing guidelines for the
exercise of the Right to Organize of The writing of the labor code began under the
Government Employees, creating a leadership of then Minister of Labor, Mr. Blas Ople,
Public Sector Labor-Management who deserves to be regarded as the “Father of  the
of  the
Council, and for other purposes Labor Code”. 
Code”. 

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 Applicability of the labor code LABOR CODE PROVISIONS

GR: All rights and benefits granted to workers Declaration of Basic Policy (Art. 3)
under the LC shall apply alike to all workers,
whether agricultural or non-agricultural.   It is the policy of the State to:
1.  Afford full protection to labor
XPNs: 2.  Promote full employment
1.  Government Ees   3.  Ensure equal work opportunities regardless of
2.  Ees of government corporations created by sex, race, or creed
special or original charter  4.  Assure the rights of workers to self-
3.  Foreign governments  organization, security of tenure, just and
4.  International agencies   humane conditions of work, participate in
5.  Corporate officers/ intra-corporate disputes policy and decision-making processes affecting
which fall under P.D. 902-A and now fall their right and benefits
under the jurisdiction of the regular courts 5.  Regulate the relations between Ers and
pursuant to the Securities Regulation Code.   workers.
6.  Local water district
district except where NLRC’s
jurisdiction is invoked.  Construction in favor of Labor(Art. 4)
7.  As may otherwise be provided by the LC.  
All doubts in the implementation and
Original charter or manner of creation test interpretation of the provisions of this Code,
including its implementing rules and regulations,
It is determined by the manner of their creation.   shall be resolved in favor of labor (LC, Art. 4).
In case of doubt, all labor legislation and all labor
Government contracts shall be construed in favor of the safety
Corporation and decent living for the laborer (NCC, Art. 1702).
In case of doubt in the interpretation or application
Incorporated under of laws, it is presumed that the lawmaking body
intended right and justice to prevail (NCC, Art. 10).

Corporation Code Special (original) charter Concept of liberal approach in interpreting the
from Congress labor code and its IRR

The LC and its IRR, being remedial in character

covered by LC subject to Civil Service
Service rules must be accorded the broadest scope and most
beneficial interpretation. It is only in this way that
 Agency that ex ercises the “rule-making power”
th at exercises their purpose, which is to remedy evils of
granted in the labor code exploitation, manipulation and oppression, may be
achieved. Strict adherence to the letter of labor law
The Department of Labor and Employment (DOLE) is not allowed; the spirit thereof prevails and must
thru the Secretary of Labor and Employment (SLE) be given effect. Under Art. 4 of the LC, all doubts in
and other Government agencies charged with the the implementation and interpretation of the
administration and enforcement of the LC or any of provisions thereof, including its IRR, are to be
its parts shall promulgate the necessary IRRs. resolved in favor of labor.

Limitations to the “rule-making power” granted Compassionate justice

to the SLE and other government agencies
The social justice policy mandates a compassionate
1.  It must be issued under the authority of law  attitude toward the working class in its relation to
2.  It must not be contrary to law and the management. In calling for protection to labor, the
Constitution  Constitution does not condone wrong doing by the
Ee. However, it urges a moderation of the
Effectivity of rules and regulations sanctionsthat maybe applied to him in the light of
the many disadvantages that weigh heavily on him
Such rules and regulations shall become effective like an albatross on his neck. It is disregarding rigid
15 days after announcement of their adoption in rules and giving due weight to all equities of the
newspapers of general circulation. case(Gandara
case (Gandara Mill Supply and Milagros Sy v. NLRC
and Silvestre Germano, G.R. 126703, December 29,
1998).. 
1998)

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Compassion and mercy subordinate to justice 3.  Free and voluntary organization of a strong
for all and united labor movement;
4.  Enlightenment of workers concerning their
Before there can be an occasion for compassion, rights and obligations as union members and
sympathy and mercy, there must be  justice for all. as Ees;
Otherwise, Ees will be encouraged to steal and 5.  Adequate administrative machinery for the
misappropriate in the expectation that eventually, expeditious settlement of labor or industrial
in the name of social justice and compassion, they disputes;
will not be penalized but instead financially 6.  Stable but dynamic and just industrial peace;
rewarded. These are not the values the society 7.  Participation of workers in the decision-
cherishes; these are the habits that it abhors (SMC making processes affecting their rights, duties
v. NLRC, G.R. No. 117055, March 29, 2006). and welfare;
The Employees Compensation Law (P.D. 626) 8.  Truly democratic method of regulating the
operates on the principle of social justice, but relations between the Ers and Ees by means of
sympathy to the workers should also be placed in a agreements freely entered into through CB, no
sensible equilibrium with the stability of the ECC court or administrative agency or official shall
trust fund (Aquino v. SSS, G.R. No. 149256, July 21, have the power to set or fix wages, rates of pay,
 2006). hours of work or other terms and conditions of
employment, except as otherwise provided
e.g . An Ee who was validly dismissed may still be under the LC.
given severance pay.
Definitions(Art. 212)
Recognition of management prerogative
Employer
The law also recognizes that management has
rights which are also entitled to respect and Any person acting in the interest of an Er, directly
enforcement in the interest of fair play (St. Luke’s or indirectly. The term does not include a labor
Medical Center Ees Ass’n v. NLRC, G.R. No. 162053, organization or any of its officers and agents,
March 7, 2007). except when acting as an Er (LC,
( LC, Art. 212(e)).
212(e)).

Policy(Art. 166) An Er is defined as any person or entity that

employs the services of others; one for whom work
Policy of the state in relation to Ee’s is done and who pays their wages of salaries; any
compensation and state insurance fund person acting in the interest of an Er; refers to the
enterprise where the labor organization operates
TheState shall promote and develop a tax-exempt or seeks to operate (IRR,
( IRR, Book V, Rule I, Sec.1(s)).
Sec.1(s)).
Ees’ compensation program whereby Ees and their
dependents, in the event of work-connected NOTE:  The term “employer” is not restricted to
disability or death, may promptly secure adequate business owners alone because it includes any
income benefits and medical related benefits ( Art.
( Art. person as long as he acts in the interest of the Er.
166, LC).
LC).
Instance when a labor organization is deemed
Purpose of Workmen’s Compensation Act   an employer

The primary purpose of a Workmen’s When it is acting as such in relation to persons

Compensation Act is to provide compensation for rendering services under hire, particularly in
disability or death resulting from occupational connection with its activities for profit or gain.
injuries or diseases, or accidental injury to, or
death of Ees. NOTE:  The mere fact that respondent is a labor
union does not mean that it cannot be considered
Declaration of Policy(Art. 211) an Er for persons who work for it. Much less should
it be exempted from labor laws (Bautista
( Bautista v. Inciong,
The state aims to promote: G.R. No. L-52824, March 16, 1988).
1988 ).

1.  Free CB and negotiations, including voluntary Employee

arbitration, mediation and conciliation as
modes of settling labor or industrial disputes; The term “employee” covers: 
covers: 
2.  Free trade unionism; 1.  Any person in the employ of the Er

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2.  Any individual whose work has ceased as a 2.   As to subject matter   –  The test depends on
result of or in connection with any current whether it concerns terms or conditions of
labor dispute or because of any unfair labor employment or association or
practice if he has not obtained any other representation of persons in negotiating,
substantially equivalent and regular fixing, maintaining or changing terms or
employment conditions of employment.
3.  One who has been dismissed from work but
the legality of dismissal is being contested in a Kinds of labor disputes
forum of appropriate jurisdiction (D.O.
( D.O. No. 40-
03).
03 ). 1.  Labor standard disputes
a.  Compensation 
Compensation  –  E.g E.g.. Underpayment of
NOTE: The term shall not be limited to the Ees of a minimum wage; stringent output quota;
particular Er unless the LC explicitly states. illegal pay deductions
b.  Benefits
Benefits  – E.g
E.g.. Non-payment of holiday pay,
Any Ee, whether employed for a definite period or OT pay or other benefits
not, shall, beginning on the first day of service, be c.  Working Conditions 
Conditions –  E.g
E.g.. Unrectified work
considered an Ee for purposes of membership in hazards
any labor union (LC,
( LC, Art. 277(c)).
277(c)).
2.  Labor relations disputes
Managerial employee
a.  Organizational right disputes/ Unfair Labor
The person who is vested with the powers or (ULP)  –  E.g
Practice (ULP)  E.g.. Coercion, restraint or
prerogatives to lay down and execute management interference in unionization efforts;
policies and/or to hire, transfer, suspend, lay-off, reprisal or discrimination due to union
recall, discharge, assign or discipline Ees. activities; company unionism; ULP, strike
or lockout; union members’ mem bers’ complaint
Supervisory employee against union officers
b.  Representation disputes 
disputes  –  E.g
E.g.. Uncertainty
The person who effectively recommends such as to which is the majority union;
managerial actions if the exercise of such authority determination of appropriate CB unit;
is not merely routinary or clerical in nature but contests for recognition by different sets of
requires the use of independent judgment. officers in the same union
c.  Bargaining disputes 
disputes  –  E.g E.g.. Refusal to
Rank-and-file employees bargain; bargaining in bad faith;
bargaining deadlock; economic strike or
Those persons who are neither managerial nor lockout
supervisory Ees are considered rank-and-file. d.  Contract administration or personnel policy
disputes   –  E.g.
disputes E.g.   Non-compliance with CBA
Labor disputes provision (ULP if gross non-compliance
with economic provisions); 
provisions);   disregard of
A labor dispute includes any controversy or matter grievance machinery; non observance of
concerning: unwarranted use of union security clause;
1.  Terms and conditions of employment, or illegal or unreasonable personnel
2.  The association or representation of persons management policies; violation of no-
in negotiating, fixing, maintaining, changing strike/no-lockout agreement
or arranging the terms and conditions of e.  Employment tenure disputes  disputes   –  E.g.
E.g.   Non-
employment regularization of Ees; non-absorption of
3.  Regardless of whether the disputants stand labor-only contracting staff; illegal
in the proximate relation of Er and Ee (LC, termination; non-issuance of employment
 Art.212(l)).  
 Art.212(l)). contract

Tests on whether a controversy is a labor Parties to a labor dispute

dispute
1.  Primary parties are the Er, Ees and the
1.   As to nature
nature   –  It depends on whether the union.
dispute arises from Er-Ee relationship, 2.  Secondary parties are the voluntary
although disputants need not be proximately arbitrator, agencies of DOLE, NLRC, SLE and
Er or Ee of another. the Office of the President.

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Inter-union dispute 3.  Has a direct or indirect interest therein, or  
4.  Is a member, officer, or agent of any
Any conflict between and among legitimate labor association composed in whole or in part of
unions involving representation questions for the Ees or Ers engaged in such industry, trade,
purposes of CB or to any other conflict or dispute craft, or occupation.
between legitimate labor unions.
Exclusive Bargaining Representation and
Intra-union dispute Worker’s Participation in Policy and Decision-
Making (Art. 255)
Any conflict between and among union members,
grievances arising from any violation of the rights Bargaining representative of the Ees for
and conditions of membership, violation of or purposes of collective bargaining
disagreement over any provision of the union’s
constitution and by-laws, or disputes from The labor organization designated or selected by
chartering or affiliation of union. the majority of the Ees in an appropriate collective
bargaining unit shall be the exclusive
Internal union dispute representative of the Ees in such unit for the
purpose of CB. However, an individual Ee or group
It includes all disputes or grievances arising from of Ees shall have the right at any time to present
any violation of or disagreement over any grievances to their Er (LC,
(LC, Art. 255, as amended by
provision of the constitution and by-laws of a Sec. 22 of R.A. No. 6715, 1989).
1989 ).
union, including any violation of the rights and
conditions of union membership provided for in Rule on solicitation of questions, suggestions
this LC (LC, Art. 212, (q)). and complaints by the Er from the Ees who are
represented by a union
Rights disputes
GR:  The Er may not solicit questions, suggestions
They are claims for violations of a specific right and complaints from Ees who are represented by a
arising from a contract, i.e.
i.e.   CBA or company union.
policies.
XPN: Where the following requisites are met:
Interest disputes 1.  The CB representative executes an
agreement waiving the right to be present
They involve questions on “what should be on any occasion when Ee grievances are
included in the CBA.” Strictly speaking, the parties being adjusted by the Er; and
may choose a voluntary arbitrator to decide on the 2.  Er acts strictly within the terms of his
terms and conditions of employment, but this is waiver agreement.
impracticable because it will be a value judgment
of the arbitrators and not of the parties. Q: The hotel union filed a Notice of Strike with
the National Conciliation and Mediation Board
Contract –negotiation disputes (NCMB) due to an unfair labor practice against
the Diamond Hotel who refused to bargain with
These are disputes as to the terms of the CBA. it. The hotel advised the union that since it was
not certified by the DOLE as the exclusive
Contract –interpretation disputes bargaining agent, it could not be recognized as
such. The union sought to bargain for members
These are disputes arising under an existing CBA, only. May the Union bargain collectively?
involving such matters as the interpretation and
application of the contract, or alleged violation of  A: No. Art. 255 of the LC declares that only the
its provisions. labor organization designated or selected by the
majority of the Ees in an appropriate CB unit is the
Instances when a person or entity is considered exclusive representative of the Ees in such unit for
as participating or interested in a labor dispute the purpose of CB. The union is admittedly not the
exclusive representative of the majority of the Ees
 
1.
2.  If
Herelief
or itis is
sought against
engaged in him
the or it, and 
same  
industry, of thethe
hotel hotel,
righthence, it could
to bargain not demand
collectively from
in their the
behalf
trade, craft, or occupation in which such (Manila Diamond Hotel v. Manila Diamond Hotel Ees
dispute occurs, or   Union, G.R. No. 158075, June 30, 2006).
2006).

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Principle of Codetermination (2007 Bar Miscellaneous Provisions (Art. 277)
Question)
Right to security of tenure
It refers to the right of workers to participate in
policy and decision-making process affecting their It connotes that no worker shall be dismissed upon
rights and benefits (PAL
(PAL v. NLRC, G.R. No. 85985, employment without cause and without due
 August 13, 1993; 1987 Constitution, Art. XIII, Sec. 3).
3 ). process.

Extent of the worker’s right to participate in Burden of proving the existence of a valid or
policy and decision-making processes in a authorized cause of termination
company
The Er has the burden of proof in proving that the
Such right refers not only to formulation of termination was for a valid or authorized cause.
corporate programs and policies but also to The existence of a just or authorized cause for
participation in grievance procedures and dismissal cannot be presumed. A contrary rule
voluntary modes of settling disputes. would contravene the constitutional policy of
affording protection to the worker (LC,
( LC, Art. 277 ).
).
Q: Does the worker’s right to participate in
policy and decision-making process as Worker’s right to notice and hearing prior to
provided under Art. XIII, Sec. 13 of the 1987 dismissal
Constitution include membership in the Board
of Directors of a corporation? (2008 Bar 1.  The Er shall furnish the Ee whose employment
Question) is sought to be terminated a written notice
containing a statement of the causes for
 A: No, such is not included. The SC recognized the termination; and
right of the union to participate in policy 2.  Afford the Ee ample opportunity to be heard
formulation and decision-making process on and to defend himself [LC,
[LC, Art. 277(b)]. 
277(b)].  
members’ rights, duties
matters affecting the union members’
and welfare. However, such participation of the NOTE:  In connection with dismissals for
union in committees of the Er is not in the nature of authorized causes, the Er must serve a written
a co-management control of the business. notice upon the worker and the DOLE at least 1
Impliedly, therefore, workers’ participatory
participato ry right in month before the intended date of termination (LC,
( LC,
policy and decision-making processes does not  Art. 283).
283).
include the right to put a union member in a
corporation’s Board of Directors (Manila
(Manila Electric Purpose of notice and hearing
Company v. Quisumbing, G.R. No. 127598, January
 27, 1999).
1999). The twin requirement of notice and
hearing constitutes essential elements of due
Q: May the management be compelled to share process in cases of Ee dismissal. The requirement
with the union or its employees its prerogative of notice is intended to inform the Ee concerned of
of formulating a Code of Discipline? the Er’s intent to dismiss and the reason for the  
proposed dismissal, upon the other hand, the
 A: Yes.  The management may be compelled to do requirement of hearing affords the Ee opportunity
so. The Code of Discipline involves security of to answer his Er’s charges against him and
tenure and loss of employment — a property right. accordingly to defend himself therefrom before
It is time that management realizes that to attain dismissal is effected. Neither of these two
effectiveness in its conduct rules, there should be requirements can be dispensed with without
candidness and openness by Management and running afoul of the due process requirement of
participation by the union, representing its the 1987 Constitution (Century
( Century Textile Mills, Inc., et
members. In fact, our Constitution has recognized al. v. NLRC, et al. G.R. No. 77859, May 25, 1988 ).
the principle of shared responsibility between Ers
and workers and has likewise recognized the right Q: May the Er be allowed to dismiss an Ee and
of workers to participate in policy and decision- let him explain later?
making process affecting their rights (PAL
( PAL v. NLRC,
G.R. No. 85985, August 13. 1993).
1993 ).  A: No,  the Er may not do so. While the procedure
laid down by the law for the dismissal of an Ee
need not be observed to the letter of the law, at
least it must be done in the natural sequence of
notice, hearing and judgment. Dismissing the Ee

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LABOR LAW AND SOCIAL LEGISLATION

and let him explain later is not in accord with the
requirement of due process (Batangas
( Batangas Laguna
Tayabas Bus Co. v. NLRC, et al. G.R. No. 94429, May
 29, 1992).
1992).

Circumstances where the termination of Ees

may be suspended by the SLE

The SLE may suspend the effects of the termination

in the event of a prima facie finding by the
appropriate official of the DOLE before whom such
dispute is pending that the termination may cause
a serious labor dispute or is in implementation of a
mass lay-off [LC,
[LC, Art. 277(b), as amended by Sec. 33,
R.A 6715 ].
].

Labor organization’s responsibility with regard

the preservation of industrial peace

The Ministry shall help promote and gradually

develop, with the agreement of labor organizations
and Ers, labor-management cooperation programs
at 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 [LC,
[ LC, Art. 277(g) incorporated by B.P
Blg. 130].
130].

Rule with regard to establishments where no

legitimate labor organizations exists to
preserve industrial peace

Labor management committees may be formed

voluntarily by workers and Ers for the purpose of
promoting industrial peace [LC, [LC, Art. 277(h) as
ameded by Sec. 33, R.A. 6715 ].
].

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RECRUITMENT AND PLACEMENT 9.  Name hires (Omnibus Rules and Regulations
implementing the Migrant Workers and
RECRUITMENT OF LOCAL AND MIGRANT Overseas Filipinos Act of 1995 as amended by
WORKERS R.A. 10022, Rule II, Sec. 1(i)). 
1(i)). 

Worker  Name hires

Any member of the labor force, whether employed They are individual workers who are able to secure
or unemployed (LC, Art. 13 (a)). 
(a)).  contracts for overseas employment opportunities
with Ers without the assistance or participation of
Recruitment and placement any agency (Omnibus
(Omnibus Rules and Regulations
implementing the Migrant Workers and Overseas
1.  Any act of canvassing, enlisting, contracting, Filipinos Act of 1995 as amended by R.A. 10022, Rule
transporting, utilizing, hiring or procuring II).  
II).
workers; and
2.  Includes referrals, contact services, Constitution of recruitment and placement
promising or advertising for employment,
locally or abroad, whether for profit or not Regardless of the number of persons dealt with,
(LC, Art. 13 (b)). 
(b)).   recruitment and placement is still constituted. The
proviso merely lays down a rule of evidence that
Essential elements in determining whether one where a fee is collected in consideration of a
is engaged in recruitment and placement promise or offer of employment to 2 or more
prospective workers, the individual or entity
It must be shown that: dealing with them shall be deemed to be engaged
1.  The accused gave the complainant the in the act of recruitment and placement. The words
distinct impression that she had the power "shall be deemed" create that presumption (People
presumption  (People
or ability to send the complainant for work,   v. Panis, G.R. L-58674-77 July 11, 1986).
2.  Such that the latter was convinced to part
with his money in order to be so employed Private employment agency
(People v. Goce, G.R. No. 113161, August 29,
1995) . Any person or entity engaged in the recruitment
and placement of workers for a fee which is
Persons deemed engaged in recruitment and charged, directly or indirectly, from the workers or
placement Ers or both (LC, Art. 13). 
13).  

Any person or entity which, in any manner, offers Private recruitment agency 
or promises for a fee employment to 2 or more
persons (LC, Art. 13(b)). It is any person or association engaged in the
recruitment and placement of workers without
Persons or entities that may engage in charging any fee, directly or indirectly, from the
recruitment and placement workers or Ers.

GR: No person or entity other than the public Seafarer 

employment offices, shall engage in the
recruitment and placement of workers.   Refers to any person who is employed or engaged
in overseas employment in any capacity on board a
XPNs: ship other than a government ship used for
1.  Construction contractors if authorized by the military or non-commercial purposes. The
DOLE and Construction Industry Authority definition shall include fishermen, cruise ship
2.  Other persons or entities as may be personnel and those serving on mobile offshore
authorized by the SLE and drilling units in the high seas (Omnibus
( Omnibus Rules
3.  Members of the diplomatic corps (but hiring and Regulations Implementing Migrant Workers Act
must go through POEA) as amended by R.A. 10022 (2010), Rule II, Sec. 1(ss)).
4.  Public employment offices
5.  Private recruitment offices Overseas employment  
6.  Private employment agencies
7.  POEA It is the employment of a worker outside the
8.  Shipping or manning agents or Philippines.
representatives

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Overseas Filipino Worker (OFW) Q: The DOLE issued an alien employment
permit for Earl Cone, a U.S. citizen, as sports
A person who is to be engaged, is engaged or has consultant and assistant coach for GMC. Later,
been engaged in a remunerated activity in a State the Board of Special Inquiry of the Commission
of which he or she is not a citizen or on board a on Immigration and Deportation approved
vessel navigating the foreign seas other than a Cone’s application for a change of admission
government ship used for military or non- status from temporary visitor to pre-arranged
commercial purposes or on an installation located employee. A month later, GMC requested that it
offshore or on the high seas (Omnibus Rules and be allowed to employ Cone as full-fledged
Regulations Implementing Migrant Workers Act as coach. The DOLE Regional Director granted the
amended by R.A. 10022 (2010), Rule II, Sec. 1 (jj)). request. The Basketball Association of the Phils.
appealed the issuance of said permit to the SLE
NOTE: The term “OFW” is to be used who cancelled Cone’s employment permit
interchangeably with “migrant worker” as
as because GMC failed to show that there is no
provided in R.A. 10022. 
10022.  person in the Philippines who is competent and
willing to do the services nor that the hiring of
Emigrant   Cone would redound to the national interest. Is
the act of the SLE valid?
Any person, worker or otherwise, who emigrates
to a foreign country by virtue of an immigrant visa  A: Yes. GMC’s claim that hiring of a foreign coach is
or resident permit or its equivalent in the country an Er’s prerogative has no legal basis. Under Art. 40
of destination (LC, Art. 13). 
13).  of the LC, an Er seeking employment of an alien
must first obtain an employment permit from the
EMPLOYMENT OF NON-RESIDENT ALIENS DOLE. GMC’s right to choose who to employ is
limited by the statutory requirement of an
Non-residents alien may be hired if an employment employment permit (GMC v. Torres, G.R. No. 93666,
permit is issued to a non-resident alien or to the  April 22, 1991).
applicant employer after a;
PROHIBITION AGAINST TRANSFER OF
1.  Determination of the non-availability of a EMPLOYMENT
person in the Philippines who is competent,
2.  Able and willing at the time of application to Persons required to obtain employment permit
perform the services for which the alien is
desired.  GR: Only non-resident aliens;

Requirements in employment of non-resident XPNs:

aliens 1.  Diplomatic services and foreign government
officials;
Any alien seeking admission to the Philippines for 2.  Officers and staff of international

employment
Er who desirespurposes andan
to engage any domestic
alien or foreign
for employment 3.  organizations and theirboard
Members of governing legitimate
who spouses;
has voting
in the Philippines:  rights only;
1.  Shall obtain an employment permit from the 4.  Those exempted by special laws;
DOLE; 5.  Owners and representatives of foreign
2.  The permit may be issued to a non-resident principals who interview Filipino applicants
alien or to the applicant Er after a for employment abroad;
determination of the non-availability of a 6.  Aliens whose purpose is to teach, present
person in the Philippines who is competent, and/or conduct research studies;
able and willing at the time of application to 7.  Resident aliens (D.O. 75-06). 
75-06). 
perform the services for which the alien is
desired; Rule as to whether a non-resident alien may
3.  For an enterprise registered in preferred transfer employment after issuance of the
areas of investments, said permit may be employment permit
issued upon recommendation of the

Government agency
supervision of said charged
registered with the
enterprise. After the issuance
alien shall of an
not transfer employment
to another job orpermit,
change the
his
Er without prior approval of the SLE.

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RECRUITMENT AND PLACEMENT 

Requirement for immigrants and resident authorized capital stock is owned and
aliens controlled by Filipino citizens; (LC, Art. 27) 
27) 
2.  Capitalization
An Alien Employment Registration Certificate. a.  Single proprietorship or partnership
- A minimum capitalization of P2
Duration of the employment permit million
b.  Corporation
GR: Minimum of 1 year - A minimum paid-up capital of P2
million
XPN:  If the employment contract, consultancy Provided, that those with existing licenses
services, or other modes of engagement provides shall, within 4 yrs. from the effectivity
otherwise, which in no case shall exceed 5 years hereof, increase their capitalization or paid
(DOLE D.O. 97-09, Revised Rules for the Issuance of up capital, as the case may be, to P2
Employment Permits to Foreign Nationals (2009)). million at the rate of Php 250,000.00 every
year (LC, Art. 28).
Employment of aliens in entities engaged in 3.  Not otherwise disqualified by law or other
nationalized activities government regulations to engage in the
recruitment and placement of workers for
GR:  Aliens may not be employed engaged in overseas employment (POEA Rules, Part II,
nationalized activities Rule I). 
I). 
4.  Payment of registration fees
XPNs:  5.  Posting of surety/cash bonds
1.  Secretary of Justice specifically authorizes
the employment of technical personnel; Regulation of the private sector’s participation
 2.  Aliens are elected members of the board of in the recruitment and overseas placement of
directors or governing body of corporations workers
or associations engaging in partially
nationalized activities shall be allowed in By setting up a licensing and registration system
proportion to their allowable participation (Sec. 14, R.A. 10022, Sec. 14). 
14).  
or share in the capital of such entities (Anti-
Dummy Law, as amended by P.D. 715, Sec. Q: Is a corporation, 70% of the authorized and
 2(A)); or
or   voting capital of which is owned and controlled
3.  Enterprises registered under the Omnibus by Filipino citizens, allowed to engage in the
Investment Code in case of technical, recruitment and placement of workers, locally
supervisory or advisory positions, but for a or overseas? Explain briefly. (2002 Bar
limited period. Question)

PRIVATE SECTOR PARTICIPATION IN THE  A: No.  It is because Art. 27 of the LC requires at
RECRUITMENT AND PLACEMENT OF WORKERS least 75%.

Entities in the private sectors that can Persons and entities disqualified to engage in
participate in recruitment and placement of the business of recruitment and placement of
workers workers

1.  Shipping or manning agents or 1.  Travel agencies and sales agencies of airline
representatives companies (LC, Art. 26); 
26); 
2.  Private recruitment offices 2.  Officers or members of the board of any
3.  Public employment offices corporation or members in a partnership
4.  Construction contractors if authorized by the engaged in the business of a travel agency;
DOLE and Construction Industry Authority. 3.  Corporations and partnerships, when any of
5.  Persons that may be authorized by the SLE its officers, members of the board or
6.  Private employment agencies (IRR of the LC, partners, is also an officer, member of the
Book I, Rule VII, Sec. 1). 
1).   board or partner of a corporation or
partnership engaged in the business of a
Qualifications for participation in recruitment travel agency;
and placement of workers 4.  Persons, partnerships or corporations which
have derogatory records, such as but not
1.  Filipino citizens, or partnerships or limited to those:
corporations with at least 75% of the

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a.  Certified to have derogatory record or any business entity from the recruitment and
information by the NBI or by the Anti- placement of Filipino workers overseas, whether
Illegal Recruitment Branch of the POEA; they derive profit or not. 
not.  
b.  Against whom probable cause or  prima
 facie   finding of guilt for illegal
 facie FEES TO BE PAID BY WORKERS
recruitment or other related cases
exists; Instances when a worker may be charged
c.  Convicted for illegal recruitment or
other related cases and/or crimes Only when:
involving moral turpitude; and 1.  He has obtained work through recruiter’s
d.  Agencies whose licenses have been efforts, and
previously revoked or cancelled by the 2.  The worker has actually commenced
POEA for violation of R.A. 8042, P.D. 442 working
as amended and their IRRs.
NOTE: A land-based agency may charge and collect
5.  Any official or Ee of the DOLE, POEA, OWWA, from its hired workers a placement fee in an
DFA and other government agencies directly amount equivalent to 1 month salary, exclusive of
involved in the implementation of R.A. 8042 documentation costs (POEA Rules and Regulations,
and/or any of his/her relatives within the 4 th  Rule V, Sec. 3).
civil degree of consanguinity or affinity; and
6.  Persons or partners, officers and directors of  Authorized payments that may be collected
corporations whose licenses have been from a hired worker
previously cancelled or revoked for violation of
recruitment laws (2002 Rules and Regulations 1.  Placement fee in an amount equivalent to

on theWorkers,
Based Recruitment
Rule I,and
[Link]
2).   of Land- 2.  one month’s salary
Documentation of the (POEA
costs worker, Rules
and  
and  and
Regulations, Rule V, Sec. 3). 
3). 
TRAVEL AGENCIES PROHIBITED FROM
RECRUITMENT AND PLACEMENT ILLEGAL RECRUITMENT, ART. 38  (LOCAL),
 (LOCAL),
 SEC. 6, MIGRANT WORKERS ACT, R.A. 8042
Prohibition on travel agencies and sales
agencies of airline companies to recruit Prohibited practices in recruitment or
placement
They are prohibited from engaging in the business
of recruitment and placement of workers for 1.  Furnishing or publishing any falsie
overseas employment whether for profit or not. notice/information/document related to
recruitment/employment
Q: WTTA is a well-known travel agency and an 2.  Failure to file reports required by SLE
authorized sales agent of the PAL. Since 3.  Inducing or attempting to induce a worker
majority WTTA
workers, of its applied
passengers
for aarelicense
overseas
for already employed to quit his employment
in order to offer him another unless the
recruitment and placement activities. It stated transfer is designed to liberate a worker
in its application that its purpose is not for from oppressive terms and conditions
profit but to help Filipinos find employment
4.  Recruitment/placement of workers in jobs
abroad. Should the application be approved?
harmful to public health or morality or to
(2006 Bar Question)
the dignity of the country
 A: No . The application should be disapproved, as it 5.  Engaging directly or indirectly in the
is prohibited by Art. 26 of the LC, to wit: "Art. 26. management of a travel agency
Travel agencies and sales agencies of airline 6.  Substituting or altering employment
companies are prohibited from engaging in the contracts without approval of DOLE
business of recruitment and placement of workers 7.  Charging or accepting any amount greater
for overseas employment whether for profit or than that specified by DOLE or make a
not." Rule I, Part II POEA Rules and Regulations worker pay any amount greater than

Governing
Land-Basedthe Recruitment
Workers and Employment
(2002) disqualifies of
any entity actually received by him
8.  Committing any act of misrepresentation to
having common director or owner of travel secure a license or authority
agencies and sales agencies of airlines, including

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RECRUITMENT AND PLACEMENT 

9.  Influencing or attempting to influence a Difference between the prohibited acts under
person/entity not to employ any worker LC and R.A. 8042 or the Overseas Filipinos and
who has not applied employment through Overseas Migrant Workers Act, as amended by
his agency R.A. 10022
10.  Obstructing or attempting to obstruct
inspection by SLE or by his representatives R.A. 8042, as
11.  Withholding or denying travel documents LC amended by RA
from applicant workers before departure 10022
for monetary considerations other than 1.  Illegal Illegal recruitment
recruitment under Sec. 6 means
authorized by law Art.38 any recruitment
12.  Granting a loan to an overseas Filipino
2.  Prohibited acts activity committed by
worker with interest exceeding eight
under Art.34 of non-licensees/ non-
percent (8%) per annum, which will be
LC  holders of authority or
used for payment of legal and allowable
prohibited acts (same
placement fees and make the migrant
as Art. 34, LC)
worker issue, either personally or through a
guarantor or accommodation party,
Added to the following
postdated checks in relation to the said loan
in the list of prohibited
13.  Refusing to condone or renegotiate a loan
acts:
incurred by an OFW after his employment
1.  Failure to actually
contract has been prematurely terminated
deploy without
through no fault of his or her own
valid reason;
14.  For a suspended recruitment/manning 2.  Failure to
agency to engage in any kind of recruitment
activity including the processing of pending reimburse incurred
expenses
worker’s applications; and 
and  by the worker in
15.  For recruitment/manning agency or a connection with
foreign principal/Er to pass on the OFW or his/her
deduct from his or her salary the payment documentation
of the cause of fees, premium or other and processing for
insurance related charges, as provided purposes of
under the compulsory worker’s insurance deployment;
coverage To allow a non-Filipino
16.  Imposing a compulsory and exclusive citizen to head or
arrangement whereby an OFW is required manage a licensed
to: recruitment/ manning
agency. 
a.  Avail a loan only from specifically

designated
persons institutions, or entities or Persons ofprohibited
business from engaging
recruiting migrant workers in the
b.  To undergo health examinations only
from specifically designated medical, 1.  It is unlawful for any official or Ee of the
entities or persons, except   seafarers following agencies to engage in recruiting
whose medical examination cost is migrant workers:
shouldered by the ship owner a.  DOLE
c.  To undergo training of any kind only b.  POEA
from designated institutions, entities or c.  Overseas Workers Welfare
persons, except   for recommendatory Administration (OWWA)
trainings mandated by principals/ d.  DFA
shipowners (R.A. 8042, Migrant e.  Other Government agencies involved in
Workers and Overseas Filipino Act, as the implementation of R.A. 8042
amended by R.A. 10022, Sec. 6). 
6).  
2.  The relatives within the 4 th  civil degree of

consanguinity or affinity
are also prohibited from of such official
engaging or Ee
directly or
indirectly in the business of recruiting
migrant workers (R.A. 8042, Sec. 8).

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LICENSE v. AUTHORITY transferred, conveyed or assigned to any other
person or entity. It may be noted that the grant of a
License requirement in the business of license is a governmental act by the DOLE based on
recruitment and replacement personal qualifications, and citizenship and
capitalization requirements (LC, Arts.27-28). 
The business of recruitment and replacement is
regulated by law by requiring them to obtain NOTE: Change of ownership or relationship of a
license and authority. single proprietorship licensed to engage in
overseas employment shall cause the automatic

LICENSE
A document issued by AUTHORITY
A document issued by revocation of the license.
DOLE authorizing a the DOLE authorizing ESSENTIAL ELEMENTS OF ILLEGAL
person or entity to a person or association RECRUITMENT
operate a private to engage in
employment agency. recruitment and Illegal recruitment
placement activities as
a private recruitment Illegal recruitment is defined by law as any
entity. recruitment activities undertaken by non-licenses
or non-holders of authority (People v. Senoron, G.N.
Persons who may be issued license and No. 119160, January 30, 1997).
authority
Elements of illegal recruitment
1.  Natural persons – Must be a Filipino
2.  Artificial persons –  75% of the capital and 1.  Offender is a non-licensee or non-holder of

voting stock
controlled of which
by Filipino. is owned and authority to lawfullyof workers.
recruitment/placement engage in the
2.  Offender undertakes:
Non-licensee / non-holder of authority
a.  Any act of canvassing, enlisting,
Any person, corporation or entity: contracting, transporting, utilizing,
hiring, or procuring workers and
1.  Which has not been issued a valid license or includes referring, contract services,
authority to engage in recruitment and promising or advertising for
placement by the SLE, or employment abroad, whether for profit
2.  Whose license or authority has been or not (R.A. 8042 as amended by R.A.
suspended, revoked or cancelled by the 10022, Art. 13(f)); or
13(f)); or
POEA or the SLE b.  Any of prohibited practices under Art.
34 of the LC.
Non-transferability of license or authority
3. 
For complex
additional illegalthatrecruitment,
element the offenderan
License or authority is non-transferable (Art. 29,
LC). License or authority is granted on the basis of commits the act against three or more
personal qualifications of the grantee. Thus, it is persons, individually, or as a group (People v.
beyond the commerce of man. Baytic, G.R. No. 150530, February 20, 2003)
2003) or
there are three or more offenders.
Q: A recruitment and placement agency
declared voluntary bankruptcy. Among its Persons liable for illegal recruitment
assets is its license to engage in business. Is the
license of the bankrupt agency an asset which Any person (whether non-licensee, non-holder of
can be sold in public auction by the liquidator? authority, licensee or holder of authority) who
(1998 Bar Question) commits any of the prohibited acts, shall be liable
for Illegal recruitment (R.A. 8042, as amended by
 A: No,  because of the non-transferability of the R.A. 10022).
license to engage in recruitment and placement.
The LC ( Art. 29) provides
29)  provides that no license to engage Kinds of illegal recruitment
in recruitment and placement shall be used directly
or indirectly by any person other than the one in 1.  Simple Illegal Recruitment
whose favor it was issued nor may such license be 2.  Complex Illegal Recruitment

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Way to prove illegal recruitment NOTE:  “Illegal recruitment in large scale” 
scale ”   pertains
to the number of victims while “ syndicated
syndicated illegal
It must be shown that the accused gave the distinct recruitment” pertains to the number of recruiters.  
impression that he had the power or ability to send
complainants abroad for work such that the latter Q: While her application for renewal of her
were convinced to part with their money in order license to recruit workers for overseas
to be deployed (People v. Fortuna, 395 SCRA 353). employment was still pending, Maryrose
Ganda recruited Alma and her 3 sisters, Ana,
Q: Larry Domingo was accused of the crime of Joan, and Mavic, for employment as
illegal recruitment. He argued that he issued no housemates in Saudi Arabia. Maryrose
receipt or document in which he acknowledged represented to the sisters that she had a license
as having received any money for the promised to recruit workers for overseas employment
jobs. Hence, he should be free from liability. and demanded and received P30,000.00 from
Was Larry engaged in recruitment activities? each of them for her services. Her application
for the renewal of her license, however, was
 A: Yes. Even if at the time Larry was promising denied, and consequently failed to employ the
employment no cash was given to him, he is still four sisters in Saudi Arabia. The sisters charged
considered as having been engaged in recruitment Maryrose with large scale illegal recruitment.
activities, since Art. 13(b) of the LC states that the Testifying in her defense, she declared that she
act of recruitment may be for profit or not. It acted in good faith because she believed that
suffices that Larry promised or offered her application for the renewal of her license
employment for a fee to the complaining witnesses would be approved. She adduced in evidence
to warrant his conviction for illegal recruitment the Affidavits of Desistance which the four
(People v. Domingo, G.R. No. 181475, April 7, 2009). private complainants had executed after the
prosecution rested its case. In the said
SIMPLE ILLEGAL RECRUITMENT affidavits, they acknowledge receipt of the
refund by Maryrose of the total amount of Php
Simple illegal recruitment 120,000.00 and indicated that they were no
longer interested to pursue the case against
It is the violation of Arts. 13(b) and 34 of the LC her. Resolve the case with reasons. (2005 Bar
involving less than three recruiters or victims. Question)

Complex illegal recruitment  A: Maryrose is guilty of large scale illegal

recruitment. It is large scale illegal recruitment
It is the violation of Arts. 13(b) and 34 of the LC when the offense is committed against 3 or more
involving at least three recruiters or victims. It may persons, individually or as a group (LC, Art. 38(b)).
either be: In view of the above, her defense of good faith and
the Affidavit of Desistance as well as the refund
1.  Committed by a syndicate; or given will not save her because R.A. 8042 is a
2.  In large Scale or qualified special law, and illegal recruitment is malum
 prohibitum (People v. Saulo, G.R. No. 125903,
ILLEGAL RECRUITMENT IN LARGE SCALE November 15, 2000).
(SEC. 6, R.A. 10022) 
ILLEGAL RECRUITMENT AS ECONOMIC
Illegal recruitment in large scale (qualified) SABOTAGE

Illegal recruitment in large scale is committed Illegal recruitment as economic sabotage

against three or more persons individually or as a
group.  Article 38 (b) of LC, as amended by PD 2018.

Illegal recruitment committed by a syndicate It is economic sabotage when complex illegal

recruitment is committed, such that it is syndicated
Illegal recruitment is committed by a syndicate if it or done in a large scale.
was carried out by a group of three or more

persons
another.  conspiring or confederating with one

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Illegal recruitment v. Estafa not set in because illegal recruitment is malum
 prohibitum,, in which there is no necessity to prove
 prohibitum
ILLEGAL RECRUITMENT ESTAFA criminal intent, whereas estafa is malum in se, se, in
the prosecution of which, proof of criminal intent is
Malum in se,se , thus:
Malum prohibitum,
prohibitum, thus: necessary   (Sy v. People, G.R. No. 183879, April 14,
necessary
1. Criminal
Criminal intent is  2010).
1. Criminal intent is not
necessary
necessary  
necessary
2. It is a crime which
2. It is a crime which LIABILITIES
involves moral
involves moral turpitude 
turpitude  
turpitude
It is not required that it be
LOCAL RECRUITMENT AGENCY
Accused defrauded Liability of the local recruitment agency
shown that the recruiter another by abuse of
wrongfully represented confidence, or by
himself as a licensed A Local Recruitment Angency shall be jointly and
means of deceit solidarily liable with its principal or foreign-based
recruiter
Er for any violation of the recruitment agreement
NOTE: It is and violation of contracts of employment (IRR,
NOTE: It is enough that the essential that the Book I, Rule V, Sec. 10(a)(2)). 
10(a)(2)). 
victims were deceived as false statement or
they relied on the fraudulent Liability of corporate officers, directors or
misrepresentation and representation partners if the recruitment/ placement agency
scheme that caused them constitutes the is a juridical being
to entrust their money in very cause or the
exchange of what they only motive which If the recruitment/placement agency is a juridical
later discovered was a vain
hope of obtaining induces
complainant the
to being, the corporate
as the case officers,
may be, shall directors
themselves beor partners
jointly and
employment abroad. part with the thing solidarily liable with the corporation or
of value. partnership for the claims and damages (Becmen
Service Exporter and Promotion v. Cuaresma, G.R.
Illegal recruitment and estafa cases may be filed Nos. 182978-79, April 7, 2009).
simultaneously or separately. The filing of charges
for illegal recruitment does not bar the filing of Remedies under the Migrant Workers Act and
estafa, and vice versa. how may they be enforced:
Double jeopardy will not set in.
CRIMINAL ACTIONS
Q: Bugo, by means of false pretenses and RTC  
fraudulent representation, convinced Dado to
give the amount of Php 120,000.00 for Province or city:
processing the latter’s papers so that he can be 1. Where
Where the offense was committed or
2. Where
deployed
Bugo hadto misappropriated,
Japan. Dado later on found out that
misapplied and   the offended party actually resides at
the same time of the commission of the offense 
offense  
converted the money to her own personal use
and benefit. Can Dado file the cases of illegal MONEY CLAIMS
recruitment and estafa simultaneously? NLRC

 A: Yes.  Illegal recruitment and estafa cases may be Original and exclusive jurisdiction to hear and
filed simultaneously or separately. The filing of decide claims arising out of an Er-Ee relationship
charges for illegal recruitment does not bar the or by virtue of any law or contract involving
filing of estafa, and vice versa. Bugo’s acquittal in Filipino workers for overseas deployment
the illegal recruitment case does not prove that she including claims for actual, moral, exemplary and
is not guilty of estafa. Illegal recruitment and estafa other forms of damages.
are entirely different offenses and neither one   The liability of the principal/ Er and the
necessarily includes or is necessarily included in recruitment/ placement agency for any and all
the other. A person who is convicted of illegal claims shall be joint and several.
recruitment may, in addition, be convicted of estafa 
  The performance bond to be filed by the
under Art. 315, par. 2(a) of the RPC. In the same recruitment/ placement agency shall be
manner, a person acquitted of illegal recruitment answerable for all money claims or damages
may be held liable for estafa. Double jeopardy will that may be awarded to the workers.

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RECRUITMENT AND PLACEMENT 

  If the recruitment/placement agency is a for all work “performed” in excess of the regular 8
juridical being, the corporate officers and hours, and holiday pay is compensation for any
directors and partners as the case may be, shall work “performed” on designated rest days and
themselves be jointly and solidarily liable with holidays (Serrano v. Gallant Maritime Services &
the corporation or partnership for the claims Marlow Navigation Co., Inc., G.R. No.167614, March
and damages. 
damages.   24, 2009).
 ADMINISTRATIVE ACTIONS
FOREIGN EMPLOYER
POEA
THEORY OF IMPUTED KNOWLEDGE
Original
decide: and exclusive jurisdiction to hear and
1. All cases which are administrative in character,
Theory of Imputed Knowledge
involving or arising out of violations of rules
A rule in insurance law that any information
and regulations relating to licensing and
material to the transaction, either possessed by the
registration of recruitment and employment
agent at the time of the transaction or acquired by
agencies or entities and
him before its completion, is deemed to be the
2. Disciplinary action cases and other special
knowledge of the principal, at least so far as the
cases which are administrative in character,
transaction is concerned, even though in fact the
involving Ers, principals, contracting partners
knowledge is not communicated to the principal at
and Filipino migrant workers.
all (Leonor v. Filipinas Compania, 48 OG 243).
a. It may be filed with the POEA Adjudication
Office or the DOLE/POEA regional office of Q: Sunace International Management Services
the place where the complaint applied or (Sunace), deployed to Taiwan Montehermozo
was recruited at the option of the as a domestic helper under a 12-month
complainant. The office with which the contract effective Feb. 1, 1997. The deployment
complaint was first filed shall take was with the assistance of a Taiwanese broker,
cognizance of the case. Edmund Wang, President of Jet Crown
b. DA cases and other special cases, as International Co., Ltd. After her 12-month
mentioned in the preceding Section, shall contract expired on Feb. 1, 1998,
be filed with POEA Adjudication Office.   Montehermozo continued working for her
Taiwanese employer for two more years, after
Rule as to whether compromise agreement on which she returned to the Philippines on Feb. 4,
money claims is allowed 2000. Shortly after her return she file before
the NLRC against Sunace, one Perez, the
Consistent with the policy encouraging amicable Taiwanese broker, and the employer-foreign
settlement of labor disputes, Sec. 10 of R.A. 8042 principal alleging that she was jailed for three
allows resolution by compromise of cases filed months and that she was underpaid. Should
with the NLRC. Sunace be held liable for the underpayment for

Period as to when shall compromise the

her additional
Taiwanese two years that
employer undershe
theworked
theoryfor
of
agreements on money claims be paid imputed knowledge?

Any compromise/amicable settlement or voluntary  A: No.  The theory of imputed knowledge ascribes
agreement on money claims inclusive of damages the knowledge of the agent, Sunace, to the principal
shall be paid within four months from the approval Taiwanese Er, not the other way around. The
of the settlement by the appropriate authority. knowledge of the principal-foreign Er cannot,
therefore, be imputed to its agent Sunace.
Rule as to whether overtime and leave pay
included in the terms which is the basis in the There being no substantial proof that Sunace knew
computation of the monetary award of and consented to be bound under the 2-year
employment contract extension, it cannot be said
The word “salaries” in
“salaries” in Sec. 10(5) of the LC does not to be privy thereto. As such, it and its owner
include OT and leave pay. For seafarers, DO No. 33, cannot be held solidarily liable for and of

series of of
1996
1996, , provides a Standard Montehermozo’s claims (Sunace
arising v.
from theG.R.
2 -year
2-year
Contract Seafarers, in which salary isEmployment
understood employment extension NLRC, No.
as the basic wage, exclusive of OT, leave pay and 161757, January 25, 2006).
other bonuses; whereas OT pay is compensation

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LABOR LAW AND SOCIAL LEGISLATION

SOLIDARY LIABILITY be entitled to the full reimbursement
of his placement fee with interest of
Liability of the private employment agency and 12% per annum, plus his salaries for
the principal or foreign-based employer the unexpired portion of his
employment contract or for 3 months
They are jointly and solidarily liable for any for every year of the unexpired term,
violation of the recruitment agreement and the whichever is less.
contracts of employment.
Is the subject clause constitutional?

NOTE:
law  This recruitment
against joint and solidary liability
agencies imposed
and foreign Ersby
is  A: No. The subject clause contains a suspect
meant to assure the aggrieved worker of classification in that, in the computation of the
immediate and sufficient payment of what is due monetary benefits of fixed-term Ees who are
him (Becmen Service Exporter and Promotion v. illegally discharged, it imposes a 3-month cap on
Cuaresma, G.R. Nos. 182978-79, April 7, 2009). 
2009).   the claim of OFWs with an unexpired portion of
one year or more in their contracts, but none on
Effect of absence of employment contract, the claims of other OFWs or local workers with
special power of attorney and affidavit of fixed-term employment. The subject
subject clause singles
responsibility, as required by the POEA rules out one classification of OFWs and burdens it with
and regulations to the private employment a peculiar disadvantage.
agency and the principal
The clause is a violation of the right of Serrano and
Non-compliance with POEA Rules and Regulations other OFWs to equal protection and right to
cannot be utilized to relieve the agency and its substantive due process, for it deprives him of

principal
compliancefrom liabitliy. forIn the
is a ground fact, such non-
cancellation or property, consisting
any existing of monetarypurpose.
valid governmental benefits, without
suspension of their license (Hornales
license (Hornales v. NLRC, et al.,
G.R. No. 118934, September 10, 2001). 
2001).  Furthermore, prior to R.A. 8042, all OFWs,
regardless of contract periods or the unexpired
PRETERMINATION OF CONTRACT OF MIGRANT portions thereof, were treated alike in terms of the
WORKER computation of their monetary benefits in case of
illegal dismissal. Their claims were subjected to a
Q: Serrano, a seafarer, was hired by Gallant uniform rule of computation: their basic salaries
Maritime and Marlow Navigation Co. for 12 multiplied by the entire unexpired portion of their
months as Chief Officer. On the date of his employment contracts. The same applies local
departure, he was constrained to accept a workers with fixed-term employment.
downgraded employment contract for the
position of Second Officer, upon the assurance Thus, Serrano is entitled to his salaries for the
that he would be made Chief Officer after a entire unexpired period of nine months and 23

month.
stay on It
as was not Officer
Second done; hence, he repatriated
and was refused to days of his employment
and jurisprudence prior contract, pursuant to
to the enactment of law
RA
to the Phils. He had served only 2 months & 7 8042   (Serrano v. Gallant Maritime Services &
8042
days of his contract, leaving an unexpired Marlow Navigation Co., Inc., G.R. No.167614, March
portion of 9 months & 23 days.  24, 2009).

Serrano filed with the LA a Complaint against Basis in computing an employee’s

Gallant Maritime and Marlow for constructive compensation in case of premature termination
dismissal and for payment of his money claims. of contract
The LA rendered a favorable decision to
Serrano awarding him $8,770.00, representing A worker dismissed from overseas employment
his salary for 3 months of the unexpired without just, valid or authorized cause as defined
portion of his contract of employment applying by law or contract is entitled to full reimbursement
R.A. 8042, Sec 10, par. 5: of his placement fee with interest at 12% per
annum, plus his salary for the unexpired portion of

Money Claims.
of overseas - In case ofwithout
employment termination
just, his employment
every contract orterm,
year of the unexpired for three months
whichever for.
is less
valid or authorized cause as defined (Sec. 7, R.A. 10020, 2010).
by law or contract, the workers shall

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Basis in computing an employee’s  A: No. Joy is entitled to her salary for the unexpired
compensation in case of premature termination portion of her contract, in accordance with Section
of contract 10 of Republic Act No. 8042. Since she started
working on June 26, 1997 and was terminated on
The Migrant Workers Act provides that salaries for July 14, 1997, Joy is entitled to her salary from July
the unexpired portion of the employment contract 15, 1997 to June 25, 1998. Furthermore, there is an
or three months for every year of the unexpired implied stipulation in contracts between the
term, whichever is less, shall be awarded to the placement agency and the overseas worker that in
overseas Filipino worker, in cases of illegal case the overseas worker is adjudged as entitled to
dismissal. In Serrano v. Gallant Maritime Services reimbursement of his or her placement fees, the
(G.R. No. 167614, March 24, 2009) 
2009)   however, the amount shall be subject to a 12% interest per
clause “or for three months for every year of the annum. This implied stipulation has the effect of
unexpired term, whichever is less” is declared removing awards for reimbursement of placement
unconstitutional and awarded the entire unexpired fees from Circular No. 799’s coverage. However, if
portion of the employment contract to the overseas judgment did not become final and executory
Filipino worker. before July 1, 2013 and there was no stipulation in
the contract providing for a different interest rate,
Nonetheless, Sec. 7 of R.A. 10022 amended Sec. 10 other money claims under Section 10 of Republic
of the Migrant Workers Act, and once again Act No. 8042 shall be subject to the 6% interest per
reiterated the provision of awarding the unexpired annum in accordance with Circular No. 799
portion of the employent contract or three months (Sameer v. Cabiles, G.R. No. 170139, Aug. 05, 2014).
for every year of the unexpired term, whichever is
less (Skippers United Pacific, Inc. v. Doza, et. al, G.R. PENALTIES FOR ILLEGAL RECRUITMENT
No. 175558, February 8, 2012).
Consequence of conviction for illegal
The declaration in March 2009 of the recruitment:
unconstitutionality of the clause “or for three
months for every year of the unexpired term, PENALTIES (Under R.A. 10022)
whichever is less” in RA 8042 shall be given
Offender / Offense Penalty
retroactive effect to the termination that occurred
in January 1999 because an unconstitutional clause Illegal recruitment as Life imprisonment +
in the law confers no rights, imposes no duties and economic sabotage 
sabotage  fine of P2M-P5M
affords no protection. The unconstitutional
provision is inoperative, as if it was not passed into Provided:
law at all (Yap v. Thenamaris Ship’s Management
1. If person illegally
and Intermare Maritime Agencies, Inc., G.R. No.
recruited is below
179532, May 30, 2011).
18 years of age or Maximum penalty
2. Illegal recruitment is shall be imposed
Q: Joy was deployed to work for Taiwan
committed by a non-
Wacoal, that
alleged Co. Ltd. on June
Sameer 26, 1997
Overseas for 1 year.
Agency She
required licensee/non-holder
her to pay a placement fee of P70,000.00. On Any person found 12 yrs. and 1 day - 20 yrs.
July 14, 1997, Mr. Huwang of Wacoal informed guilty of illegal imprisonment; or
Joy, without prior notice, that she was recruitment   Fine: P1M-P2M
terminated and was given a salary from June 26
Any person found 6 yrs. and 1 day - 12 yrs.
to July 14, 1997 only. Joy filed a complaint for
guilty of the prohibited imprisonment; or
illegal dismissal with the NLRC. She asked for
the return of her placement fee, the withheld acts  
acts Fine of P500K - P1M
amount for repatriation costs, payment of her Licensee/holder of 2-5 yrs. imprisonment; or
salary for 23 months as well as moral and authority violates Fine: P10K - P50K;
exemplary damages. The NLRC ruled that Joy provisions or both
was illegally dismissed and awarded her three
Non-licensee/non- 4-8 yrs. imprisonment; or
months’ worth of salary, the reimbursement of
the cost of her repatriation, and attorney’s fees. holder of authority Fine: P20K - P100K
violates provisions or both
Should Joy be
salary and awarded threeofmonths’
reimbursement the costworth of
of her Corporation, Penalty imposed upon
repatriation? partnership, officer/s responsible for
association, or entity violation

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LABOR LAW AND SOCIAL LEGISLATION

Offender / Offense Penalty 3.  Members of the diplomatic organizations
Penalties prescribed 4.  Other Ers as may be allowed by DOLE
under RA 10022,
Alien +
Purposes of the prohibition on direct hiring:
Deportation without 1.  To ensure the best possible terms and
further proceedings
conditions of employment for the worker.
 Automatic revocation of
revocation  of 2.  To assure the foreign Er that he hires only
license or authority and qualified Filipino workers.
all permits and privileges 3. 
In every case 
case   of the recruitment or To ensure
order full exploitation.
to avoid regulation of employment in
manning agency, lending
institutions, training REGULATION AND ENFORCEMENT
school or medical clinic
PERIODS SUSPENSION OR CANCELLATION OF LICENSE OR
Mandatory Period for Resolution of Illegal
 AUTHORITY
Recruitment Cases
Person who can suspend or cancel license or
The preliminary investigations of cases under R.A. authority
10022 shall be terminated within a period of 30
calendar days from the date of their filing. The Secretary of Labor and Employment is vested
If the PI is conducted with power to suspend or cancel any license or
If the PI is conducted
by a prosecution authority to recruit employees for overseas
by a judge and a
officer and a prima employment.
 prima facie case is
 facie case is
established found to exist Grounds for revocation of license: 
Information shall be Prosecution officer
filed in court within 24 within 48 hours from 1.  Incurring an accumulated 3 counts of
hours from the the date of receipt of suspension by an agency based on final and
termination of the the records of the case. executory orders within the period of
investigation (Sec. 11) validity of its license
2.  Violations of the conditions of license
Prescriptive Period for Illegal Recruitment
3.  Engaging in acts of misrepresentation for the
Cases
purpose of securing a license or renewal
Simple Illegal
Economic Sabotage 4.  Engaging in the recruitment or placement of
Recruitment
workers to jobs harmful to the public health
Within 20 yrs. from the or morality or to the dignity of the country
Within 5 yrs. from the
time illegal recruitment (Rules and Regulations Governing Overseas
time illegal recruitment
has happened. (Sec.
happened. (Sec. Employment, Book VI, Rule I, Sec. 3). 
3).  
has happened 
happened 
12,R.A. 8042)
Grounds for suspension or cancellation of
DIRECT HIRING license  
license

Direct hiring 1.  Commission of prohibited acts under Art. 34

of LC
It is when an Er hires a Filipino worker for 2.  Publishing job announcements w/o POEA’s
overseas employment without going through the approval
POEA or entities authorized by the SLE. 3.  Charging a fee which may be in excess of the
authorized amount before a worker is
Ban on direct hiring employed
4.  Deploying workers w/o processing through
GR: An Er may only hire Filipino worker for POEA
overseas employment through POEA or entities 5.  Recruitment in places outside its authorized
authorized by DOLE. area (POEA Rules, Book IV, Rule II, Sec. 4).
6.  If the employment agency fails to provide the
XPNs: Direct hiring by: ticket or PTA within 48 hours from receipt of
1.  International organizations the notice (R.A. 10022). 
2.  Name hires
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RECRUITMENT AND PLACEMENT 

Degree of proof required for suspension of 2.  Issue orders and promulgate rules and
license or authority regulations

Administrative determinations require only Visitorial power

substantial proof and not clear and convincing
evidence. In proceedings for cancellation or 1.  Access to Er’s records and premises at any
suspension of license or authority, no rule requires time of the day or night, whenever work is
that testimonies or complaints be corroborated by being undertaken
documentary evidence, if the charge of unlawful 2.  To copy from said records
exaction is substantially proven. 3.  Question any Ee and investigate any fact,
condition or matter which may be necessary
Q: Concerned Filipino contract workers in the to determine violations or which may aid in
Middle East reported to the DFA that XYZ, a the enforcement of the LC and of any labor
private recruitment and placement agency, is law, wage order, or rules and regulation
covertly transporting extremists to terrorist issued pursuant thereto.
training camps abroad. Intelligence agencies of
the Government allegedly confirmed the Instances where the visitorial power of the SLE
report. Upon being alerted by the DFA, the may be exercised under the LC
DOLE issued orders cancelling the licenses of
XYZ, and imposing an immediate travel ban on 1.  Inspect books of accounts and records of any
its recruits for the Middle East. XYZ appealed to person or entity engaged in recruitment and
the Office of the President to reverse and set placement; require it to submit reports
aside the DOLE orders, citing damages from regularly on prescribed forms and act in
loss of employment of its recruits, and violations of any provisions of the LC on

violations of due by
notice and hearing process including
the DOLE. lack
The DOLE of
in its 2.  recruitment
Have access and placement
to Er’s records(LC,
andArt. 37).   to
37). 
premises
answer claimed the existence of an emergency determine violations of any provisions of the
in the Middle East which required prompt LC on recruitment and placement (LC, Art.
measures to protect the life and limb of OFWs 128).  
128).
from a clear and present danger posed by the 3.  Conduct industrial safety inspections of
ongoing war against terrorism. Should the establishments (LC, Art. 165). 
165). 
DOLE orders be upheld or set aside? (2004 Bar 4.  Inquire into the financial activities of
Question) legitimate labor organizations (LLO) and
examine their books of accounts upon the
 A:  filing of the complaint under oath and duly
1.  The DOLE order cancelling the licenses of supported by the written consent of at least
XYZ is void because a report that an agency 20% of the total membership of the labor
is covertly transporting extremists is not a organization concerned.
valid ground for cancellation of a Certificate

of Registration
failure (LC, Art.as239) 
of due process 239)
no   and there
hearing is
was SLEarrest
of cannot issue search warrants or warrants
conducted prior to the cancellation (LC, Art.
 238). Under the 1987 Constitution, only a judge may
issue search warrants or warrants of arrest. Hence,
2.  The DOLE order imposing the travel ban is Art. 38(c) of the LC is unconstitutional in as much
valid because it is a valid exercise of police as it gives the SLE the power to issue search
power to protect the national interest (Sec. 3, warrants and warrants of arrest. The labor
 Art. XIII, Constitution on full protection to authorities must go through the judicial process
labor safety of workers) 
workers)  and on the rule (Salazar v. Achacoso, G.R. No. 81510, March 14,
making authority of the SLE (LC, Art. 5; Phil. 1990).. 
1990)
 Ass’n. of Service Exporters v. Drilon,
Drilon,   G.R. No.
81958, June 30, 1988).   REMITTANCE OF FOREIGN EXCHANGE
EARNINGS
REGULATORY AND VISITORIAL POWERS OF
THE DOLE SECRETARY Remittance of foreign exchange earnings
Regulatory powers of the SLE  GR:  It shall be mandatory for all OFWs to remit a
1.  Restrict and regulate the recruitment and portion of their foreign exchange earnings to their
placement activities of all agencies families, dependents, and/or beneficiaries ranging

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LABOR LAW AND SOCIAL LEGISLATION

from 50% - 80% depending on the worker’s kind of 11.  Withholding or denying travel documents
job (POEA Rules, Book III, Rule VIII). from applicant workers before departure for
monetary considerations other than
XPNs: authorized by law
1.  The worker’s immediate family members, 12.  Granting a loan to an OFW which will be
beneficiaries and dependents are residing used for payment of legal and allowable
with him abroad placement fees
2.  Immigrants and Filipino professionals and 13.  Refusing to condone or renegotiate a loan
Ees working with the UN agencies or incurred by an OFW after his employment

3.  specialized bodies working in U.S. military

Filipino servicemen contract
through nohas been
fault prematurely
of his or her own terminated
installations (Resolution No. 1-83, Inter- 14.  For a suspended recruitment/manning
 Agency Committee for Implementation of E.O. agency to engage in any kind of recruitment
857). activity including the processing of pending
workers' applications; and
Effect of failure to remit 15.  For a recruitment/manning agency or a
foreign principal/ Er to pass on the OFW or
1.  Workers –  Shall be suspended or removed deduct from his or her salary the payment of
from the list of eligible workers for overseas the cost of insurance fees, premium or other
employment.  
employment. insurance related charges, as provided under
2.  Employers –  Will be excluded from the the compulsory worker's insurance coverage
overseas employment program. Private 16.  Imposing a compulsory and exclusive
employment agencies shall face cancellation arrangement whereby an OFW is required
or revocation of their licenses or authority to to:

recruit (E.O. 857, Sec. 9). a.  Avail a loan only from specifically
PROHIBITED ACTIVITIES designated institutions, entities or
persons
Prohibited practices in recruitment/ placement b.  To undergo health examinations only
from specifically designated medical,
1.  Furnishing or publishing any false entities or persons, except   seafarers
notice/information/document related to whose medical examination cost is
recruitment/employment shouldered by the shipowner
2.  Failure to file reports required by SLE c.  To undergo training of any kind only
3.  Inducing or attempting to induce a worker from designated institutions, entities or
already employed to quit his employment in persons, except   for recommendatory
order to offer him another unless the trainings mandated by
transfer is designed to liberate a worker principals/shipowners (R.A. 10022, Sec.
from oppressive terms and conditions 6).  
6).
 
4. Recruitment/placement of morality
harmful to public health or workersorintojobs
the PHILIPPINE OVERSEAS EMPLOYMENT
dignity of the country  ADMINISTRATION (POEA)
5.  Engaging directly or indirectly in the
management of a travel agency Principal functions of the POEA
6.  Substituting or altering employment
contracts without approval of DOLE 1.  Protection of the right of Filipino workers
7.  Charging or accepting any amount greater to fair and equitable employment practices
than that specified by DOLE or make a 2.  Regulation of private sector participation in
worker pay any amount greater than the recruitment and overseas placement of
actually received by him workers by setting up a licensing and
8.  Committing any act of misrepresentation to registration system
secure a license or authority 3.  Deployment of Filipino workers through
9.  Influencing or attempting to influence any Government to Government hiring
person/entity not   to employ any worker 4.  Formulation, implementation, and

who has not applied of employment through monitoring of overseas employment of

his agency Filipino workers taking into consideration
10.  Obstructing or attempting to obstruct their welfare and domestic manpower
inspection by SLE or by his representatives requirements
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RECRUITMENT AND PLACEMENT 

5.  Shall inform migrant workers not only of conditions and requirements, as embodied in
their rights as workers but also of their the employment contracts prescribed by the
rights as human beings, instruct and guide POEA and in accordance with
the workers how to assert their rights and internationally-accepted standards 
standards  (R.A.
provide the available mechanism to redress 10022 amending R.A. 8042, Sec. 3). 
3).  
violation of their rights (R.A. 10022, Sec. 14). 
14). 
6.  Implementation, in partnership with other Guarantees of the receiving country for the
law-enforcement agencies, of an intensified protection of the rights of OFWs
program against illegal recruitment
 
activities (R.A.
activities  (R.A. 10022, Sec. 14). 
14).  1. It has existing
protecting labor
the rights and social
of workers, laws
including
Power of the POEA’s to terminate or impose a migrant workers;
ban on employment of migrant workers 2.  It is a signatory to and/or a ratifier of
multilateral conventions, declarations or
The POEA may at any time terminate or impose a resolutions relating to the protection of
ban on employment of migrant workers, to do so, workers, including migrant workers; and
in consultation with the DFA based on the ff. 3.  It has concluded a bilateral agreement or
grounds: arrangement with the government on the
1.  In pursuit of the national interest; or protection of the rights of OFWs (R.A. 10022
2.  When public welfare so requires (R.A. 10022, amending R.A. 8042, Sec. 3). 
3).  
Sec. 4) 
4) 
Provided, that the receiving country is taking
Minimum conditions/ provisions of overseas positive, concrete measures to protect the rights of
employment contracts migrant workers in furtherance of any of the

1.  Guaranteed wages for regular hours and OT, guarantees.

not lower than the minimum wage NOTE: In the absence of a clear showing that any of
prescribed in all of the following: the guarantees exists in the country of destination
a.  The host country of the migrant workers, no permit for deployment
b.  Bilateral agreements or international shall be issued by the POEA.
conventions ratified by the host country
and the Philippines Repatriation of a worker
c.  The Philippines
2.  Free transportation to and from the worksite GR: The repatriation of the:
or offsetting benefit
3.  Free food and accommodation or offsetting 1.  Worker and the transport of his personal
benefit belongings   –  shall be the primary
belongings
4.  Just/authorized causes of termination of the responsibility of the agency which recruited
contract or services of the worker or deployed the worker overseas.
 
NOTE: An agreement that diminishes the Ees pay 2. Remains
belongingsand transportworker
of a deceased of the
andpersonal
all costs
and benefits as contained in a POEA-approved attendant thereto –  shall be borne by the
contract is void, unless such subsequent agreement principal and/or the local agency.
is approved by the POEA.
XPNs:
Deployment of OFWs 1.  If the termination of employment is due
solely to the fault of the worker, the
The State shall allow the deployment of OFWs
OF Ws principal/ Er or agency shall not be
responsible for the repatriation of the
1.  Only in countries where the rights of Filipino former and/or his belongings.
migrant workers are protected. 
protected.  2.  In cases of war, epidemic, disaster or
2.  To vessels navigating the foreign seas or to calamities, natural or man-made, and other
installations located offshore or on high seas similar event, and where the principal or
whose owners/Ers are compliant with recruitment agency cannot be identified, the

international laws
protect the rights and standards
of migrant workers. that Overseas
in Workers Welfare
coordination with Administration,
appropriate
3.  To companies and contractors with international agencies, shall take charge of
international operations: Provided, That the repatriation (R.A. 8042, Sec. 15). 
15). 
they are compliant with standards,
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LABOR LAW AND SOCIAL LEGISLATION

Mandatory repatriation of underage migrant 11.  Theft or robbery
workers 12.  Drunkenness
13.  Drug addiction or possession or trafficking
Upon discovery or being informed of the presence of prohibited drugs
of migrant workers whose ages fall below the 14.  Desertion or abandonment
minimum age requirement for overseas
deployment, the responsible officers in the foreign Jurisdiction of the LA v. POEA
service shall without delay repatriate said workers
and advise the DFA through the fastest means of JURISDICTION
communication
other relevant available of such
information. The discovery
license ofanda Labor Arbiter POEA
recruitment/manning agency which recruited or Original and exclusive
Original and
deployed an underage migrant worker shall be jurisdiction over:
exclusive
automatically revoked and shall be imposed a fine jurisdiction over
of not less than P500,000 but not more than 1. All cases which are
all claims arising
P1,000,000 (Sec. 9, R.A. 10022). administrative in
out of Er-Ee
relationship or by character relating to
Regulatory and adjudicatory functions of the virtue of any law licensing and registration
POEA or contract of recruitment and
involving OFWs employment agencies
1.  Regulatory–  It regulates the private sector including claims
participation in the recruitment and overseas
for: 2. Disciplinary Action
placement of workers through its licensing and
registration system. cases and other special
1. Actual cases, which are
2.   Adjudicatory 2. Moral administrative in
a.  Administrative cases involving violations
character, involving Ees,
3. Exemplary
of licensing rules and regulations and principals, contracting
4. Other forms of
registration of recruitment and partners and Filipino
damages (R.A.
employment agencies or entities migrant workers (POEA
8042, Sec. 10). 
10). 
b.  Disciplinary action cases and other special
Rules, Book VII, Rule VII). 
VII). 
cases which are administrative in
character involving employers, principals, Q: A seafarer was prevented from leaving the
contracting partners and Filipino port of Manila and refused deployment without
migrants. valid reason. His POEA-approved employment
contract provides that the employer-employee
Grounds for disciplinary action of OFWs relationship shall commence only upon the
seafarer’s actual departure from the port in the
Under R.A. 8042, these are: point of hire. Is the seafarer entitled to relief
1.  Prostitution under the Migrant Workers’
of an employer-employee Act, in the absence
relationship?
2.  Unjust refusal to depart for the worksite
3.  Gunrunning or possession of deadly
weapons  A: Yes.  Despite the absence of an Er-Ee
4.  Vandalism or destroying company property relationship, the NLRC has jurisdiction over the
5.  Violation of the laws and sacred practices of seafarer’s complaint. The jurisdiction of LAs is not
the host country and unjustified breach of limited to claims arising from Er-Ee relationships.
employment contract Sec. 10 of the Migrant Workers Act provides that
6.  Embezzlement of funds of the company or the LAs shall have jurisdiction over claims arising
fellow worker entrusted for delivery to out of an Er-Ee relationship or by virtue of any law
relatives in the Phils. or contract involving Filipino workers for overseas
7.  Creating trouble at the worksite or in the deployment including claims for actual, moral,
vessel exemplary and other forms of damages. Since the
8.  Gambling present case involves the employment contract
9.  Initiating or joining a strike or work entered into by petitioner for overseas

stoppage where the laws of the host country employment,

of the NLRC his claims are cognizable
(Santiago v. CF Sharpby theCrew
LAs
prohibits strikes or similar actions
10.  Commission of felony punishable by Management,G.R. No. 162419, July 10, 2007).
Philippine laws or by the host country
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RECRUITMENT AND PLACEMENT 

Matters that fall outside the jurisdiction of the
POEA

1.  Foreign judgments–  such claim must be

brought before regular courts. POEA is not a
court; it is an administrative agency,
exercising adjudicatory or quasi-judicial
functions.  
functions.
2.  Torts –  falls under the provisions of the Civil

Code.  
Code.
Q: Apolinario Siador was claiming death
benefits from a local manning agent, Agile
Maritime Resources (Agile) for allegedly, his
son, Dennis, fell from the vessel and died in the
high seas. Siador claims that Dennis was
suffering with mental disability days prior to
the incident. Agile claimed that Dennis willfully
took his life by jumping overboard. A life ring
was immediately thrown into the water by the
vessel’s crew but Dennis float on his back and
made no efforts to swim towards the life ring.
Under the Philippine Overseas Employment
 Administration Standard Employment Contract
(POEA-SEC), the if
compensation employer is not liable
the death for the
is directly
attributable to the seafarer. Does Agile able to
prove by substantial evidence that Dennis
willfully took his life by jumping overboard
thus shifting the burden on Siador to prove by
substantial evidence that Dennis was insane at
the time of incident?

 A: Yes. Unarguably, Apolinario has discharged his

burden of proof. Since Apolinario has initially
discharged his burden of proof, Agile, in order to
avoid liability, must similarly establish their
defense. If they are able to establish their defense
by substantial evidence, the burden now rests on

Apolinario
other words,to the
overcome
burdenthe employer’s
of evidence defense.
now shifts In
to
the seafarer’s heirs. Since the POEA-SEC
POEA -SEC requires
the employer to prove not only that the death is
directly attributable to the seafarer himself but
also that the seafarer willfully caused his death,
evidence of insanity or mental sickness may be
presented to negate the requirement of willfulness
as a matter of counter-defense. In this case, Agile
sufficiently established that Dennis willfully caused
his death while Siador's evidence fell short of
substantial evidence to establish its counter-
defense of insanity (Agile v. Siador, G.R. No. 191034,
October 1, 2014).
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LABOR LAW AND SOCIAL LEGISLATION

LABOR STANDARDS are employed or a department or subdivision
thereof, and other officers or members of the
HOURS OF WORK managerial staff (LC, Art. 82(2)).
82(2)).

COVERAGE/EXCLUSIONS They must meet all of the ff. conditions, namely:

1.  Primary duty: management of the
Groups of Ees under the LC establishment in which they are employed or
of a department or sub-division thereof;
1.  Managerial Ee  - One who is vested with the 2.  Customarily or regularly direct the work of 2

powers or prerogatives
execute management to lay
policies and/ordown and
to hire, 3.  or
Hasmore
the Ees;
authority to hire or fire other Ees of
transfer, suspend, lay-off, recall, discharge, lower rank; or their suggestions and
assign or discipline Ees. recommendations as to the hiring and firing
2.  Supervisory Ee - those who in the interest of and as to the promotion or any change of
the Er, effectively recommend such managerial status of other Ees are given particular weight;
actions if the exercise of such authority is not 4.  Execute under general supervision work along
merely routinary or clerical in nature but specialized or technical lines requiring special
requires the use of independent judgment. training, experience, or knowledge;
3.  Rank-and-file Ee  - all Ees not falling within 5.  Execute under general supervision special
any of the above definitions (LC,
( LC, Art. 212(m)).
212(m)). assignment and tasks; and
6.  Do not devote more than 20% of their hours
Ees covered by the conditions of employment worked to activities which are not directly and
under the LC closely related to the performance of the work
described.

GR:  Ees for

in profit
all establishments and undertakings
whether or not. Reason why managerial employees are not
covered by the conditions of employment
XPNs: under the LC
1.  Government Ees
2.  Managerial Ees They are employed by reason of their special
3.  Field personnel training, expertise or knowledge and for positions
4.  Er’s family members who depend on him for requiring the exercise of discretion and
support independent judgment. Value of work cannot be
5.  Domestic helpers and persons in the personal measured in terms of hours.
service of another,
6.  Workers who are paid by results Field personnel
as determined under DOLE regulations (LC,
( LC,
 Art. 82).
82). They are:
1.  Non-agricultural Ees

NOTE:  The conditions of employment under the LC 2.  Who regularly perform their duties
will apply only if an Er-Ee relationship exists. 3.  Away from the principal place of business or
branch office of the Er; and
Government Ees 4.  Whose actual hours of work in the field cannot
be determined with reasonable certainty.
They are Ees of the:
1.  National Government Domestic helpers and persons in the personal
2.  Any of its political subdivisions service of another
3.  Including those employed in GOCCs with
original charters Those who:

Law applicable to government Ees 1.  Perform services in the Er’s home which are
usually necessary or desirable for the
It is the Civil Service Law, Rules and Regulations maintenance or enjoyment thereof; or
2.  Minister to the personal comfort, convenience

Managerial Ees or safety of the Er as well as the members of

his Er’s household. 
household. 
Those whose primary duty consists of the
management of the establishment in which they
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LABOR STANDARDS 
Q: A house personnel was hired by a ranking XPNs:
company official to maintain a staff house 1.  Health personnel
provided for the official. The personnel is being 2.  Compressed workweek
paid by the company itself. Is the house
personnel a domestic servant of the company NOTE: Normal hours of work may be shortened or
official? compressed. Neither does it follow that a person
who does not observe normal hours of work
 A: No. The personnel is not a domestic helper but a cannot be deemed an employee. In Cosmopolitan
regular Ee of the company ( Apex
( Apex Mining v. NLRC, Funeral Homes, Inc. v. Maalat , the employer

G.R.
SalesNo. 9366, April
Corporation 22, 1991; Remington
v. Castaneda, Industrial
G.R. Nos. 169295-96, similarly denied
relationship, as the the existence
claimant of toanit, was
according Er-Ee
a
November 20, 2006).
2006). "supervisor on commission basis" who did not
observe normal hours of work. This Court declared
Q: Do bus drivers-conductors fall within the that there was an Er-Ee relationship, noting that
term regular employees? "[the] supervisor, although compensated on a
commission basis, [is] exempt from the observance
 A. Yes. It is of judicial notice that along the routes of normal hours of work for his compensation is
that are plied by these bus companies, there are its measured by the number of sales he makes"
inspectors assigned at strategic places who board (Lazaro v. SSS, 435 SCRA 472). 
472).  
the bus and inspect the passengers, the punched
tickets, and the conductor’s reports. They must be Rationale behind the law on eight-hour labor
at specific place at specified tme as they generally
observe prompt departure and arrival from their It is enacted not only to safeguard the health and
point of origin to their point of destination. In each welfare of the Ee or laborer, but also in a way to

and
whoseevery depot,
function there is to
is precisely always
see tothe dispatcher
it that the bus minimize
where more unemployment by forcing
than 8-hour operation is Ers, in cases
necessary, to
and its crew leave the premises at specific times utilize different shifts of laborers or Ees working
and arrive at the estimated proper time. The only for 8 hours each.
drivers are under constant supervision while in the
performance of their work. They cannot be Coverage of hours of work
considered as field personnel but regular
employees ( Auto Bus Transport Systems v. Antonio 1.  All time during which an Ee is required to be:  
Bautista, G.R. No. 156367, May 16, 2005). a.  On duty, or
b.  At the Ers premises, or
Person who determines working conditions c.  At a prescribed workplace
2.  All time during which an Ee is suffered or
Generally, they are determined by the Er, as he is permitted to work (IRR, Book III, Rule I, Sec.
usually free to regulate, according to his discretion, 3).  
3).
all aspects of employment.

Limitation on the Er’s power to regulate Principles in determining hours worked

working conditions 1.  All hours which the Ee is required to give to
his Er regardless of whether or not such
It must be done in good faith and not for the hours are spent in productive labor or
purpose of defeating or circumventing the rights of involve physical or mental exertion.
the Ees. Such are not always absolute and must be 2.  Rest period is excluded from hours worked,
exercised with due regard to the rights of labor. even if Ee does not leave his workplace, it
being enough that:
NOTE:  One’s employment,
employment, profession, trade or a.  He stops working
calling is a property right and the wrongful b.  May rest completely
interference therewith is an actionable wrong. c.  May leave his workplace, to go
elsewhere, whether within or outside
NORMAL HOURS OF WORK the premises of the workplace
3.  All time spent for work is considered hours

Normal hours of work of an Ee worked if:

a.  The work performed was necessary
GR: The normal hours of work of any Ee shall not b.  If it benefited the Er
exceed 8 hours a day (LC, Art. 83). 
83). 
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LABOR LAW AND SOCIAL LEGISLATION

c.  Or the Ee could not abandon his work at cuts across the Ees workday is
the end of his normal working hours clearly working time.
because he had no replacement
d.  Provided, the work was with the b.  The time is not only hours worked
knowledge of his Er or immediate on regular workdays but also during
supervisor corresponding working hours on
4.  The time during which an Ee is inactive by non-working days. Outside of these
reason of interruptions in his work beyond regular working hours, travel away
his control shall be considered working time: from home is not considered
 
a. If
thethe imminence
work requires of
thethe
Eesresumption
presence of
at working time.
the place of work; or XPN:  During meal period or when Ee is
b.  If the interval is too brief to be utilized permitted to sleep in adequate facilities
effectively and gainfully in the Ees own furnished by the Er.
interest (IRR, Book III, Rule I, Sec. 4). 
4). 
Instances when hours of work not counted as
Instances when hours of worked are compensable
compensable
1. Ee ceases to work
1.  Ee is required to be on duty 5.  Ee may rest completely
2.  Ee is suffered or permitted to work 6.  Ee may leave at his will the spot where he
3.  Rest periods of short duration during actually stays while working to go
working hours somewhere else (Luzon Stevedoring v. Luzon
4.  Travel time, when beneficial to the Er (Rada Marine G.R. No. L-9265 April 29, 1957). 
1957). 

v. NLRC, 205 SCRA 69): 7.  When work is broken/not continuous (NDC
[Link] G.R. No. L-53961 June 30, 1987). 
1987). 
a.  Travel from home to work 8.  Assembly time, routinary practice of
employees, proceedings not infected with
GR: Normal travel from home to work is complexities so as to deprive Ees time to
not working time. attend to their personal pursuits (Arica
[Link] G.R. No. 78210 February 28, 1989). 
1989).  
XPNs: 9.  Meal time (60 min.), unless predominantly
i.  Emergency call outside his regular spent for the Er’s benefit
working hours where he is
required to travel to his regular NOTE: Activities before work and after work are
place of business or some other deemed performed during work hours, where such
work site. activities are controlled or required by the Er and
ii.  Done through a conveyance are pursued necessarily and primarily for the Er’s
provided by the Er. benefit.
iii.  Done under the supervision and
control of the Er. Hours of work of health personnel
iv.  Done under vexing and dangerous
circumstance. GR: 8 hours for 5 days (40-hour workweek),
exclusive of time for meals.
b.  Travel that is all in a day’s work   – 
time spent in travel as part of the Ees XPN: Where the exigencies of the service require
principal activity 
activity  that such personnel work for 6 days or 48 hours,
they shall be entitled to an additional
E.g.  travel from job site to job site compensation of at least 30% of their regular wage
during the work day, must be counted for work on the 6th day (LC, Art. 83).
as working hours.
Health personnel covered by the 40-hour
c.  Travel away from home workweek

GR:   1.  Those in cities and municipalities with a

a.  Travel that requires an overnight population of at least 1 million; or
stay on the part of the Ee when it 2.  Those in hospitals and clinics with a bed
capacity of at least 100.
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LABOR STANDARDS 
NOTE:  Art. 83(2) of the LC does not require 2.  The notice shall be in Report Form attached
hospitals to pay the Ees a full weekly salary with to the advisory.
paid 2 days off (San Juan de Dios Ees Assoc.-AFW et The Regional Office shall conduct an ocular
al. v. NLRC, G.R. No. 126383, November 28, 1997). visit to validate whether the adoption of the
flexible work arrangements is in accordance
Resident physicians to be on duty beyond the with this issuance (Department Advisory
40-hour workweek limitation Order No. 2, Series of 2009). 
2009).  

GR: The customary practice of requiring resident Instance when the implementation of a
physicians beyondand
is not permissible the violates
40 hours oflimitation
the work per under
week compressed workweek is considered valid
Art. 83. The validity of the reduction of working hours can
be upheld when the arrangement is:
XPN:  If there is a training agreement between the 1.  Temporary
Temporary  
resident physician and the hospital and the 2.  It is a more humane solution instead of a
training program is duly accredited or approved by retrenchment of personnel 
personnel 
appropriate government agency. 3.  There is notice and consultations with the
workers and supervisors 
supervisors  
COMPRESSED WORKWEEK 4.  A consensus is reached on how to deal with
deteriorating economic conditions; and 
and  
Compressed workweek 5.  It is sufficiently proven that the company
was suffering from losses.
The normal workweek is reduced to less than 6
days but the total number of work-hours of 48 NOTE: Under the Bureau of Working Conditions’
hours per week
is increased shallthan
to more remain. The but
8 hours normal workday
not to exceed bulletin,
working a days
reduction
(RWD)of the
is number of regular
valid where the
12 hours, without corresponding overtime arrangement is resorted to by the Er to prevent
premium. The concept can be adjusted accordingly serious losses due to causes beyond his control,
depending on the normal workweek of the such as when there is a substantial slump in the
company (Department Advisory Order No. 2, Series demand for his goods or services or when there is a
of 2009). lack of raw materials. There is one main
consideration in determining the validity of
This scheme was originally conceived for reduction of working hours –  that the company
establishments wishing to save on energy costs, was suffering from losses. A year of financial losses
promote greater work efficiency and lower the rate would not justify a reduced workweek (Linton
of employee absenteeism, among others. Workers Commercial v. Hellera, G.R. No. 163147, October 10,
favor the scheme considering that it would mean  2007).
savings on the increasing cost of transportation
fares for at least one day a week; savings on meal Conditions where a "compressed workweek"
and snack52expenses;
additional longer
off-days a year thatweekends or an
can be devoted to schedule
exception may
to thebe"8-hour
legallya authorized as an
day" requirement
rest leisure, family responsibilities, studies and under the LC (2005 Bar Question)
other personal matters, and that it will spare them
for at least another day in a week from certain 1.  The Ee voluntarily agrees to it  
inconveniences that are the normal incidents of 2.  There is no diminution in their weekly or
employment, such as commuting to and from the monthly take home pay or fringe benefits 
benefits  
workplace, travel time spent, exposure to dust and 3.  The benefits are more than or at least
motor vehicl fumes, dressing up for work, etc. commensurate or equal to what is due to the
(Bisig Manggagawa sa Tryco v. NLRC, G.R. No. Ees without the compressed work week  
151309, October 15, 2008). 4.  OT pay will be due and demandable when
they are required to work on those days
Requisites for the adoption of compressed which should have ceased to be working
workweek days because of the compressed work week
schedule.  
schedule.
 
1. The Er shall notify the DOLE through the 5.  No strenuous physical exertion or that they
Regional Office which has jurisdiction over are given adequate rest periods. 
periods.  
the workplace, of the adoption of 6.  It must be for a temporary duration as
compressed workweek. determined by the DOLE. 
DOLE. 
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LABOR LAW AND SOCIAL LEGISLATION

MEAL BREAK 2.  Not Compensable  –  Ee requested for the
shorter meal time so that he can leave work
Duration of the meal period earlier than the previously established
schedule.
Every Er shall give his Ees not less than 60 minutes
or 1 hour time-off for regular meals. Requisites:

Non- compensability of the meal period a.  Ees voluntarily agree in writing and are
willing to waive OT pay for the shortened

It is not compensable during a time-off. Ee must be meal period;

completely relieved from duty. b.  No diminution in the salary and other
fringe benefits of the Ees which are
Instance when the meal period is considered existing before the effectivity of the
compensable shortened meal period;
c.  Work of the Ees does not involve
It is compensable where the lunch period or meal strenuous physical exertion and they are
time: provided with adequate coffee breaks in
1.  Is predominantly spent for the Er’
Er ’s benefit; the morning and afternoon;
or d.  Value of the benefits derived by the Ees
2.  Where it is less than 20 min. It will be from the proposed work arrangements is
considered only as a coffee break. equal to or commensurate with the
compensation due them for the shortened
NOTE: Where during a meal period, the laborers meal period as well as the OT pay for 30
are required to stand by for emergency work, or min. as determined by the Ees concerned;
where the meal hour is not one of complete rest, e.  OT pay will become due and demandable
such is considered OT (Pan Am v. Pan Am Ees after the new time schedule
 Association, G.R. No. L-16275, (1961).
(1961).Rest
Rest periods f.  Arrangement is of temporary duration.
or coffee breaks running from 5 to 20 [Link] be
considered as compensable working time (IRR, ( IRR, NOTE: The implementing rules allow the meal time
Book III, Rule, Sec. 7). 
7).   to be less than 60 minutes, under specified cases
and in no case shorter than 20 minutes (IRR, Book
Compensability of meal periods provided III, Rule 1, Sec. 7).
during overtime work
If the so called “meal time” is less than 20 minutes,
Meal periods provided during overtime work are it becomes only a rest period and under the same
compensable, since the 1 hour meal period (non- section 7, is considered working time.
compensable) is not given during OT work because
the latter is usually for a short period and to deduct WAITING TIME
from the same would reduce to nothing the Ees’ OT
work. Thus, the 1 hour break for meals during OT Waiting time considered as working time
should be treated as compensable.
1.  It is considered working time if waiting is an
Instances where meal periods are shortened integral part of his work, or
and if it is compensable or not compensable 2.  The Ee is required or engaged by the Er to
wait (engaged to wait). 
wait).  
1.  Compensable – At the instance of Er, when:
NOTE: The controlling factor is whether waiting
a.  Work is non-manual in nature or does not time spent in idleness is so spent predominantly
involve strenuous physical exertion; for the Er’s benefit or for the Ee.
b.  Establishment regularly operates less than
16 hours a day; Waiting time not considered as working time
c.  Work is necessary to prevent serious loss
of perishable goods. It is not considered working time when the Ee is
d.  Actual or impending emergency or there is waiting to be engaged; idle time is not working
urgent work to be performed on time. Hence, it is not compensable (waiting to be
machineries and equipment to avoid engaged).
serious loss which the Er would otherwise
suffer (Sec. 7, Rule I, Book III, IRR). 
IRR). 
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LABOR STANDARDS 
NOTE: Under the law, the idle time that an Ee may Rationale behind the overtime pay
spend for resting and during which he may leave
the spot or place of work though not the premises Ee is made to work longer than what is
of his Er, is not counted as working time only commensurate with his agreed compensation for
where the work is broken or is not continuous the statutory fixed or voluntarily agreed hours of
(National Development Co. v. CIR, 6 SCRA 763). 
763).  labor he is supposed to do (PNB v. PEMA and CIR,
G.R. No. L-30279, July 30, 1982). It discourages the
Idle time considered as working time Er from requiring such work thus protecting the
health and well-being of the worker, and also tend

It is when thebeyond
interruptions Ee is idle or inactive by reason of
his control. to remedy
employ unemployment
others workers tobydoencouraging Ers be
what cannot to
accomplished during the normal hours of work.
Conditions in order for lectures, meetings and
training programs to be not considered as Overtime pay v. Premium pay
working time
OVERTIME PAY PREMIUM PAY
All of the ff. conditions must be present:
1.  Attendance is outside of the Er’s regular
Additional compensation for
Additional
work performed within 8 hours
working hours compensation
on days when normally he
2.  Attendance is in fact voluntary and for work
should not be working (on non-
3.  The Ee does not perform any productive performed
working days, such as rest days
work during such attendance. beyond 8 hours
and special days.)
on ordinary
Ee considered as working while on call But additional compensation
days (within the
for work rendered in excess of
When Ee is required to remain on call in the Er’s worker’s 24-
24- 8 hours during these days is
hour workday)
premises or so close thereto that he cannot use the also considered OT pay.
time effectively and gainfully for his own purpose.
Overtime pay rates
OVERTIME WORK, OVERTIME PAY
OVERTIME PAY RATES 
Work day
During a
Work day is the 24-hour period which commences
regular Additional compensation of 25%
from the time the Ee regularly starts to work
working of the regular wage
day
Illustration: Rate of the first 8 hours worked
on
If the worker starts to work 8 am today, the plus at least 30% of the regular
wage (RW):
workday
[Link] from 8 am today up to 8 am During a
holiday or If done on a special holiday OR
NOTE: Minimum normal working hours fixed by rest day rest day:
law need not be continuous to constitute the legal 30% of 130% of RW
working day.
If done on a special holiday AND
Overtime work   rest day:
30% of 150% of RW
It is overtime work if performed beyond 8 hours
within the worker’s 24-hour
24-hour workday. If done on a regular holiday:
30% of 200% of RW
NOTE: Express instruction from the Er to the Ee to
render OT work is not required for the Ee to be Basis of computing the overtime pay and
entitled to OT pay; it is sufficient that the Ee is additional remuneration
permitted or suffered to work. However, written Regular wage which includes the cash wage only,
authority after office hours during rest days and
holidays are required for entitlement to without deduction on account of the facilities
compensation. provided by the Er (LC,
( LC, Art. 90).
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Q: In lieu of overtime pay, the employee was Instances where an Ee may or may not be
given permission to go on leave on some other compelled to render OT work
day, is that valid?
GR: An Ee may not be compelled to render OT
 A: No. Permission given to the Ee to go on leave on work; OT work is voluntary.
some other day of the week shall not exempt the Er
from paying the additional compensation required XPNs: Compulsory OT work in any of the following
because it would prejudice the Ee, for he will be situations:
deprived of the additional pay for the OT work he

has rendered and which is utilized to offset the 1.  Urgent work to be performed on machines
undertime he may have incurred. Undertime could and installations in order to avoid serious
be charged against the Ees accrued leave. loss or damage to the Er or some other cause
of similar nature
Q: Socorro is a clerk-typist in Hospicio de San 2.  Work is necessary to prevent loss or damage
Jose, a charitable institution dependent for its to perishable goods
existence on contributions and donations from 3.  In case of imminent danger to the public
well wishers. She renders work 11 hours a day safety due to an actual or impending
but has not been given OT pay since her place of emergency in the locality caused by serious
work is a charitable institution. Is Socorro accidents, fire, flood, typhoon, earthquake,
entitled to overtime pay? Explain briefly. (2002 epidemic or other disaster or calamity
Bar Question) 4.  Country is at war
5.  Completion or continuation of the work
 A: Yes.  Socorro is entitled to OT pay. She does not started before the 8th hour is necessary to
fall under any of the exceptions to the coverage of prevent serious obstruction or prejudice to
Art. 82, under the provisions of hours of work. The the business operations of the Er
LC is equally applicable to non-profit institutions. A 6.  Any other national or local emergency has
covered Ee who works beyond 8 hours is entitled been declared
to OT compensation.  7.  Necessary to prevent loss of life or property.
(LC, Art. 89) 
89) 
Q: Danilo Flores applied for the position of
driver in the motor-pool of Gold Company, a NOTE: There should be payment of additional
multinational corporation. Danilo was compensation. Ees’ refusal to obey the order of the
informed that he would frequently be working Er constitutes insubordination for which he may be
overtime as he would have to drive for the subjected to disciplinary action.
company's executives even beyond the
ordinary 8-hour work day. He was provided Q: The employment contract requires work for
with a contract of employment wherein he more than 8 hours a day with a fixed wage
would be paid a monthly rate equivalent to 35 inclusive of OT pay. Is that valid?
times his daily wage, regular sick and vacation
leaves,
time off5 day-leave
with pay withwhen
pay every
the month and
company's  A: It depends.
executives using the cars do not need Danilo's 1.  When the contract of employment requires
service for more than eight hours a day, in lieu work for more than 8 hours at specific wages
of overtime. Are the above provisions of the per day, without providing for a fixed hourly
contract of employment in conformity with, or rate or that the daily wages include OT pay,
violative of, the law? said wages cannot be considered as
including OT compensation  (Manila
compensation 
 A:  Except for the provision that Danilo shall have Terminal Co. v. CIR, et al .,., 91 Phil., 625).
time off with pay when the company's executives
using the cars do not need Danilo's service for 2.  However, the employment contract may
more than 8 hours a day, in lieu of OT, the provide for a “built -in” OT pay. Because of
provisions of the contract of employment of Danilo this, non-payment of OT pay by the employer
are not violative of any labor law because they is valid (Engineering
valid (Engineering Equipment v. Minister of
instead improve upon the present provisions of Labor, G.R. No. L-64967, September 23, 1985).
pertinent labor laws.
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LABOR STANDARDS 
Undertime (UT) cannot offset overtime (OT) Ers (LC, Chapter V, Art. 154 as amended by R.A.
10151). 
Where a worker incurs undertime hours during his
regular daily work, said undertime hours should Persons covered by the provisions on night
not be offset against the overtime hours on the work under R.A. 10151
same day or on any other day. It is both prohibited
by the statute and by jurisprudence. GR: All persons who shall be employed or
permitted or suffered to work at night.
Right to OT pay cannot be waived

GR: The right to OT pay cannot be waived as it is XPN: Those

fishing, employed
maritime in agriculture,
transport and inland stock raising,
navigation,
governed by law and not merely by the agreement during a period of not less than 7 consecutive
of the parties. 
parties.  hours, including the interval from midnight to 5 in
the morning, to be determined by the SLE after
XPNs:  consulting the workers’ representatives/labor
1.  If the waiver is made in exchange for certain organizations and Ers.
valuable benefits and privileges, which may
even exceed the OT Pay. Right of the workers to undergo health
2.  Compressed workweek assessment to avoid health problems
associated with night work
OT rate may be subject to stipulation of the Er
and Ee At their request, workers shall have the right to
undergo health assessment without charge and to
GR: The premium for work performed on the Ee’s receive advice on how to reduce or avoid health

rest days as
included or part
on special
of the days or regular
regular holidays
rate of the Ee in are
the problems associated
1.  Before takingwith their
up an work:
assignment as a night
computation of OT pay for any OT work rendered worker;
on said days especially if the Er pays only the 2.  At regular intervals during such an
minimum OT rates prescribed by law. assignment; and
3.  If they experience health problems during
XPN: Ees and Er may stipulate in their collective such an assignment which are not caused
agreement the payment of OT rates higher than by factors other than the performance of
those provided by law and exclude the premium night work.
rates in the computation of OT pay. Such
agreement may be considered valid only if the NOTE: Night workers who are certified as unfit for
stipulated OT pay rates will yield to the Ees not less night work, due to health reasons, shall be
than the minimum prescribed by law. transferred, whenever practicable, to a similar job
for which they are fit to work. If such transfer to a
OT pay in a compressed workweek scheme similar job is not practicable, these workers shall

be granted the same benefits as other workers who

Any work performed beyond 12 hours a day or 48 are unable to work, or to secure employment
hours a week shall be subject to OT premium during such period. 
(Department Advisory No. 02, s. of 2004). 
2004). 
Employability of women for night work
NIGHT WORK (R.A. 10151),
NIGHT SHIFT DIFFERENTIAL R.A. 10151 repealed Arts. 130 and 131 of the LC on
Night Work prohibition with regard to women
Night work workers. However, measures shall be taken to
ensure that an alternative to night work is
Any and all work rendered between 6 pm and 6 am  am   available to women workers who would otherwise
(National Rice & Corn Corp. v. NARIC, 105 Phil 891). be called upon to perform such work:

Night worker 1.  Before and after childbirth, for a period of at

least 16 weeks, which shall be divided
Any employed person whose work requires between the time before and after childbirth;
performance of a substantial number of hours of 2.  For additional periods, in respect of which a
night work which exceeds a specified limit. This medical certificate is produced stating that
limit shall be fixed by the SLE after consulting the said additional periods are necessary for the
workers’ representatives/labor organizations and health of the mother or child:
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a.  During pregnancy; PART-TIME WORK
b.  During a specified time beyond the
period, after childbirth is fixed pursuant Non-prohibition of part-time work
to number 1, the length of which shall be
determined by the DOLE after consulting Part-time work is not prohibited. The LC merely
the labor organizations and Ers. provides for the maximum number of hours and
not the minimum. Under Art. 124, as amended by
NOTE:  During the periods referred in Art. 158 in R.A. 6727, wage proportionate to part-time work is
RA 10151: recognized.
a.  A woman worker shall not be dismissed or
given notice of dismissal, except for just or NOTE:  The wage and benefits of a part-time
authorized causes provided for in the Code worker are in proportion to the number of hours
that are not connected with pregnancy, worked. For example, if an Ee earns P300.00 for an
childbirth and childcare responsibilities. 8-hour work, he shall then get P150.00 for work
b.  A woman worker shall not lose the benefits done in 4 hours.
regarding her status, seniority, and access to
promotion which may attach to her regular CONTRACT FOR A PIECE OF WORK
night work position.
Contract for a piece of work
Pregnant women and nursing mothers may be
allowed to work at night It is a contract whereby the contractor binds
himself to execute a piece of work for the Er, in
They are allowed if a competent physician, other price or consideration of a certain compensation.
than the company physician, shall certify their The contractor may employ his labor, skill or also
fitness to render night work, and specify, in the furnish the material.
case of pregnant Ees, the period of the pregnancy
that they can safely work. NOTE:  All workers paid on piece-work shall be
entitled to receive not less than the prescribed
Facilities required from Ers under R.A. 10151 daily minimum wage or a proportion thereof for
working less than 8 hours.
1.  Suitable first-aid facilities, including
arrangements where such workers, where Contract for piece of work v . Lease of services
necessary, can be taken immediately to a
place for appropriate treatment. CONTRACT FOR PIECE
LEASE OF SERVICES
2.  Safe and healthful working conditions and OF WORK
adequate or reasonable facilities, i.e. sleeping The object is the work
or resting quarters in the establishment, and done or the result of the The object is services.
transportation from the work premises to said work.
the nearest point of their residence subject The risk is generally
to exceptions and guidelines to be provided The risk is borne by the borne by the Er, not by
by the DOLE.  the worker unless the
worker before delivery.
latter is guilty of fault or
Night Shift Differential (NSD) negligence.

It is additional compensation of not less than 10% Contractor

of an Ee’s regular wage for every hour worked
between 10 pm to 6 am, whether or not such The worker is also called a contractor. He in turn
period is part of the worker’s regular shift. 
shift.   may obtain the services of others, who will work
under him.
Non-waivability of NSD
Test to determine if one is an Ee or an
GR: Waiver of NSD is against public policy 
policy   independent contractor
(Mercury Drug Co., Inc. v. Dayao, et al., G.R. No. L-
30452, September 30, 1982). The “right of control” test is used. If the person for
whom services are to be performed controls only
XPN: Waiver is allowed if this will result to higher the end to be achieved, the worker is a contractor;
or better benefits to Ees. if the former controls not only the end but also the
manner and means to be used, the latter is an Ee.
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LABOR STANDARDS 
Things that the contractor can furnish Effects when the Er accepts the work

1.  Both material and labor, or 1.  The contractor is generally relieved of
2.  Only labor liability.
2.  If the acceptance is made without objection,
Duties of a contractor who furnishes both work the Er may still sue for hidden defects.
and the material
Place of payment
This is equivalent to sale; therefore, these are the
 
duties: 1.
2.  Where stipulated then at the time and place
If no stipulation,
1.  To deliver of delivery.
2.  To transfer ownership
3.  To warrant against eviction and hidden Mechanic’s lien 
defects
One who executed a work on a movable property
Remedies of the ER in case of defects has a right to retain it by way of pledge until he is
paid.
1.  Ask the contractor to remove the defect or to
execute another work. WAGES
2.  If the contractor fails or refuses, the Er can
ask another at the contractor’s expense. If a It is the remuneration or earnings, however
building is involved, expenses for correction designated, capable of being expressed in terms of
and completion may be recovered. money, whether fixed or ascertained on a time,

task, piece, orthe

commission basis,by
oran
other method
Rule on agreements waiving or limiting the of calculating same, payable Er to an Ee
contractor’s liability  under a written or unwritten contract of
employment:
1.  In the absence of fraud, the agreement would
ordinarily be valid. 1.  For work done or to be done, or for services
2.  In the absence of prohibitory statute, the rendered or to be rendered; and includes
validity of a limitation is generally upheld, 2.  Fair and reasonable value of board, lodging,
with a view of obtaining compensation or other facilities customarily furnished by
commensurate to the risk assumed. the Er to the Ee as determined by SLE.

Q: A asked B to make a radio cabinet. B bound NOTE: Fair and reasonable value means it shall not
himself to furnish the material. Before the include any profit to the Er or to any person
radio cabinet could be delivered, it was affiliated with the Er.
destroyed by a fortuitous event.
“No Work, No Pay” Principle (Fair day’s wage
a.  Who suffers the loss? for a fair day’s labor); Basis of payment.  
b.  Is the contract extinguished?
GR: If there is no work performed by the Ee,
 A: without the fault of the Er, there can be no wage or
a)  B suffers the loss of both the materials and pay.
the work, unless there was mora
accipiendi.   If there was mora accipiendi,
accipiendi. accipiendi, it XPNs:  The laborer was able, willing and ready to
is evident that A suffers the loss. work but was:

b)  No. Therefore B may be required to do the 1.  Prevented by management;

work all over again, unless there had been 2.  Illegally locked out;
a prior stipulation to the contrary or 3.  Illegally suspended;
unless a re-making is possible (NCC, Art. 4.  Illegally dismissed
1717).  
1717). 5.  Illegally prevented from working 
working  (Aklan
Electric Coop. v. NLRC, G.R. No. 129246,
NOTE: The law merely refers to the burden of the  January 10, 2000). 
2000). 
loss, and not to the extinguishment of the contract.
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 Applicability of the term wages MINIMUM WAGE DEFINED, MINIMUM WAGE
SETTING
GR: It applies to all Ees.
Minimum wage
XPNs:
1.  Farm tenancy or leasehold; Statutory minimum wage is the lowest wage rate
2.  Household or domestic helpers, including fixed by law that an Er can pay his workers.
family drivers and persons working in the
personal service of another; Purpose of the minimum wage law
3.  Home workers engaged in needlework or in
any cottage industry duly registered in The compulsory payment of a fair statutory wage is
accordance with law; a preventive action, not remedial, for it settles the
4.  Workers in any duly registered cooperatives wage rates before industrial disputes arise thereby
when so recommended by the Bureau of foreclosing the eruption of social and economic
Cooperative Development and upon disquietude.
approval of the SLE;
5.  Workers of a barangay   micro business The purpose of minimum wage law is “to set
enterprise (R.A. 9178); 
9178);  barrier below which wages may not fall, in order to
6.  Retail and service establishments regularly develop competition on a high level of efficiency
employing not more than 10 workers (RA ( RA rather than competition on a low level of wages.”
6727, Sec. 4); 
4);  The establishment of a minimum wage encourages
competition above the lower limits set by the law.
NOTE: Retail and service establishments must file The minimum wage law discourages the sweat-
an application for exemption with the duly shop operators from exploiting their workers.
appropriate Regional Board. (Poquiz, Vol. I)
“Equal pay for equal work” Principle   Standards or criteria for minimum wage setting

Persons who work with substantially equal In the determination of such regional minimum
qualifications, skill, effort and responsibility, under wages, the Regional Board shall, among other
similar conditions, should be paid similar salaries relevant factors consider the following:
(International School Alliance of Educators v.
Quisumbing, G.R. No. 128845, June 01, 2000). 1.  The demand for living wages
2.  Wage adjustment vis-a-vis
vis-a-vis   the consumer
WAGE v . SALARY price index
3.  The cost of living and changes or increases
WAGE  SALARY   therein
(Gaa [Link], G.R. No. 44169, Dec. 3, 1985) 
1985)   4.  The needs of workers and their families
Compensation for 5.  The need to induce industries to invest in the
Paid to “white collared
manual labor (skilled or workers” and denotes a countryside
unskilled) also known 6.  Improvements in standards of living
higher degree of 7.  The prevailing wage levels
as “blue collared
employment or a 8.  Fair return on the capital invested and
workers,” paid at stated
superior grade of capacity to pay by Ers
times and measured by
services and implies a 9.  Effects on employment generation and
the day, week, month or
position in the office. family income
season.
Considerable pay for a Suggestive of a larger 10.  The equitable distribution of income and
lower and less and more permanent or wealth along the imperatives of economic
responsible character of fixed compensation for and social development (LC, Art. 124). 
124). 
employment. more important service.
GR: Not subject to Persons exempted from the coverage of fixing a
execution minimum wage
Subject to execution. 1.  Household or domestic helpers, including
XPN: Debts incurred for
food, shelter, clothing family drivers and persons in the personal
and medical attendance. service of another;
2.  Homeworkers engaged in needle-work;
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LABOR STANDARDS 
3.  Workers employed in any establishment Q: The Regional Wage Board of Region II issued
duly registered with the National Cottage a Wage Order granting all Ees in the private
Industries and Development Authority, sector throughout the region an across-the-
provided that such workers perform the board increase of P15.00 daily. Is this Wage
work in their respective homes; Order valid?
4.  Workers in a duly registered cooperative
when so recommended by the Bureau of  A: It depends. The Wage Order is valid insofar as
Cooperative Development and upon the mandated increase applies to Ees earning the
approval of the SLE (IRR of LC, Book III, Rule prevailing minimum wage rate at the time of the

VII, Sec. 2). 

2).  passage of the Wage Order and void with respect to
5.  Workers of a barangay   micro business its application to Ees receiving more than the
enterprise (R.A. 9178). 
9178).  prevailing minimum wage rate at the time of the
passage of the Wage Order. The Regional Wage
Economically feasible granted an across-the-board wage increase of
P15.00 to all Ees in the region. It did not set a wage
a.  From Er’s standpoint – a minimum wage is level nor a range to which a wage adjustment or
economically feasible if it will not prevent increase shall be added. In doing so, the Regional
the industry from operating efficiently and Wage Board exceeded its authority by extending
prosperously over the long run (Dir. Harry the coverage of the Wage Order to wage earners
Kantor’s analysis of Senate Bill No. 202 and receiving more than the prevailing minimum wage
House Bill No. 1732); 
1732);  rate, without a denominated salary ceiling. The
Wage Order granted additional benefits not
b.  From Ee’s standpoint –  an economically contemplated by R.A. No. 6727 (MBTC v. NWPC
feasible minimum wage should be as nearly Commission, G.R. No. 144322, February 06, 2007). 
2007). 

adequate to maintain the minimum standard

of living necessary for the health, efficiency Q: Since the Wage Order was declared void  with
  with
and general well-being of employees. respect to its application to employees
receiving more than the prevailing minimum
METHODS OF MINIMUN WAGE ADJUSTMENT wage rate at the time of the passage of the Wage
Order, should these Ees refund the wage
Salary Ceiling Method increase received by them?

A method of minimum wage adjustment whereby  A: No. The Ees should not refund the wage increase
the wage adjustment is applied to Ees receiving a since they received it in good faith, in the honest
certain denominated salary ceiling. In other words, belief that they are entitled to such wage increase
workers already being paid more than the existing and without any knowledge that there was no legal
minimum wage are also to be given a wage basis for the same (MBTC v. NWPC Commission, G.R.
increase (ECOP v. NWCP, G.R. No. 96169, September NO.144322, February 06, 2007).
 24, 1991). 
1991). 

Floor Wage Method MINIMUM WAGE OF WORKERS PAID BY

RESULTS

It involves the fixing of a determinate amount to be WORKERS PAID BY RESULTS

added to the prevailing statutory minimum wage
rates. Workers paid by results

Two basic methods of payment They are: 

1.  Paid based on the work completed; and
1.  Time wages  – refer to pay by the hour, day 2.  Not on the time spent in working
or month, without specifying the amount of 3.  Including those who are paid on piecework,
work to be done “takay”, “pakiaw”, or
“pakiaw”, or task basis if their output
2.  Production wages –  refer to pay related to rates are in accordance with the standards
the amount of work the individual or group prescribed. 
performs regardless of the time involved in
its performance. This applies to workers  Application of wage orders to workers paid by
paid by result (Beal and Wickersham, The results
Practice of Collective Bargaining; Poquiz, Vol.
I).  
I). All workers paid by result, including those who are
paid on piece work, “takay”   or task basis, shall be
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entitled to receive not less than the prescribed DEDUCTIONS FROM WAGES
daily minimum wage or a proportion thereof for
working less than 8 hours. Wage deductions 

Minimum wage of workers paid by results GR: No employer, in his own behalf or in behalf of
any person, shall make any deduction from the
1.  Those who are paid piece rates which are wages of his employees (LC, Art. 113).
prescribed in Piece Rate Orders issued by
DOLE  –  Wages or earnings are determined XPNs:
by simply multiplying the number of pieces 1.  Deductions under Art. 113 of the LC for
produced by the rate per piece. insurance premiums.
2.  Union dues in cases where the right of the
 2.  Those who are paid output rates which worker or his union to check off has been
are prescribed by the Er and are not yet recognized by the Er or authorized in writing
approved by the DOLE  –  The number of by the individual worker concerned (LC, Art.
pieces produced is multiplied by the rate per 113).  
113).
piece as determined by the Er. 
Er.  
a.  If resulting amount is equivalent to or NOTE: Art. 241(o) of the LC provides that special
more than the applicable statutory assessments may be validly checked-off provided
minimum rate in relation to the that there is an individual written authorization
number of hours worked– Worker will duly signed by every Ee.
receive such amount  
b.  If the amount is less than the 3.  Deductions for SSS, PhilHealth and Pag-ibig
applicable legal rate – Er is required by premiums
law to pay the difference between the 4.  Taxes withheld pursuant to the Tax Code
resulting amount and the applicable 5.  Deductions under Art. 114 of the LC for loss
legal minimum rate. 
rate.  or damage to tools, materials or equipment
supplied by the employer when the latter is
 APPRENTICES/LEARNERS/PERSONS WITH engaged in such trades, occupations or
DISABILITY businesses where the practice of making
deductions or requiring deposits is a
Minimum wage rate for apprentices/learners recognized one or is necessary or desirable
and persons with disability as determined by SLE
6.  Deductions made with the written
The wage or salary rate shall not be less than 75% authorization of the Ee for payment to a
of the applicable minimum wage. third person (IRR, Book III, Rule VIII, Sec 13). 
13).  
7.  Deductions as disciplinary measures for
COMMISSION habitual tardiness (Opinion
(Opinion dated March 10,
1975 of the Labor Secretary). 
Secretary). 

Commission 8.  Agency fees under Art. 248(e)of the LC

9.  Deductions for value of meals and facilities
A fee paid based on a percentage of the sale made freely agreed upon
by an Ee or agent, as distinguished from regular 10.  In case where the Ee is indebted to the Er
payments of wages or salary. where such indebtedness has become due
and demandable (NCC, Art. 1706).
1706 ).
Commissions included or not included in the 11.  In court awards, wages may be subject of
computation of the basic salary execution or attachment, but only for debts
incurred for food, shelter, clothing, and
1.  Included in the basic salary –  If the medical attendance (NCC, Art. 1703). 
1703).  
commission is comprised of a pre- 12.  Salary deduction of a member of a legally
determined percentage of the selling price of established cooperative (R.A. 6938; LC, Art.
the goods. 59).  
59).
2.  Excluded from basic salary –  If the
commission were paid as productivity Deductions for absences are allowed
bonuses or closely resemble profit-sharing,
or when it has no clear, direct or necessary Deductions for unpaid absences are allowed. If the
relation to the amount of work actually done Ee is monthly paid, the equivalent daily rate should
by each individual employee. be determined first before making the deduction.
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LABOR STANDARDS 
NON-DIMINUTION OF BENEFITS BASIS FACILITIES SUPPLEMENT
Non-diminution of benefits; Exception   Inclusion Forms part of Independent
the wage of wage
GR:  Benefits being given to Ees cannot be taken Deduction Deductible Not wage
back or reduced unilaterally by the Er because the from wage deductible
benefit has become part of the employment Granted for
contract, whether written or unwritten. However, For the benefit
To whose the
an agreement reducing certain labor standards of the worker
benefit convenience
benefits such as overtime and premium pay and his family. of the Er.
violates Art. 100. Provisions of existing laws are
deemed part of a contract. (Republic Planters Bank
v. NLRC, 266 SCRA 142).
Criterion in determining whether an item is a
supplement or facility
XPN:  When diminution of benefits is done to
The criterion is not so much with the kind of the
correct an error.
benefit or item (food, lodging, bonus or sick leave)
given, but its purpose (State Marine v. Cebu
NOTE: If the error is not corrected in a reasonable
Seamen’s Ass’n., G.R. No. L-12444,
L -12444, February 28,
time, it ripens into a company policy and Ees can
1963).
demand it as a matter of right.

Instances when non-diminution of benefits is Cost of facilities furnished by the Er may be

applicable charged against an Ee

In order that the cost be charged against the Ee,

It is applicable if it is shown that the grant of his/her acceptance of such facilities must be
benefit:
voluntary.
1.  Is based on an express policy of the law; or
2.  Has ripened into practice over a long period
of time and the practice is consistent and
Requirements for deducting values for facilities
deliberate and is not due to an error in the
1.  Proof must be shown that such facilities are
construction/ application of a doubtful or
customarily furnished by the trade
difficult question of law.
2.  The provision of deductible Facilities must
be voluntarily accepted in writing
FACILITIES v. SUPPLEMENTS
3.  The Facilities must be charged at fair and
reasonable value (Mabeza v. NLRC, G.R. No.
BASIS FACILITIES SUPPLEMENT 118506, April 18, 1997).
Items of Extra
expenses remuneration Status of food and lodging, or the electricity and
necessary for water consumed by a hotel worker
the laborer’s or special
privileges or
and his family’s benefits given These are supplements. Considering, therefore,
existence and to or received that hotel workers are required to work different
Definition subsistence by the shifts and are expected to be available at various
laborers over odd hours, their ready availability is a necessary
NOTE:  Does and above matter in the operations of a small hotel.
not include their ordinary Furthermore, granting that meals and lodging were
tools of trade earnings or provided and indeed constituted facilities, such
or articles / wages (Atok facilities could not be deducted without the Er
services Big Wedge complying first with certain legal requirements
primarily for Mining Co. v. (Mabeza v. NLRC, G.R. No. 118506, April 18, 1997).
the benefit of  Atok Big
the Er or Wedge Mutual WAGE DISTORTION/RECTIFICATION
necessary to Benefit Assoc.,
Concept of Wage Distortion (WD)
the conduct of G.R.
7349, No. L-
July 19,
the Er’s
business. 1955)..
1955) A situation where an increase in wage results in the
elimination or severe contraction of intentional
quantitative differences in wage or salary rates
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between and among the Ee-groups in an differences; a severe contraction is enough
establishment as to effectively obliterate the (Metrobank v. NLRC, G.R. No. 102636, September 10,
distinctions embodied in such wage structure 1993).
based on skills, length of service or other logical
bases of differentiation (LC, Art. 124). Wage distortion does not arise when a wage order
gives employees in one branch of a bank higher
It is the disappearance or virtual disappearance of compensation than that given to their counterparts
pay differentials between lower and higher in other regions occupying the same pay scale who
positions in an enterprise because of compliance are not covered by said wage order. In short, the
with a wage order (P.I. Manufacturing v. P.I. implementation of wage orders in one region but
Manufacturing Supervisors and Foreman, G.R. No. not in others does not in itself necessarily result in
167217, February 4, 2008). 
2008).   wage distortion (Prubankers
(Prubankers Association v.
Prudential Bank & Trust Company, G.R. No. 131247,
Elements of WD  January 25, 1999).

1.  An existing hierarchy of positions with Q: Bankard, Inc. approved a New Salary Scale
corresponding salary rates. which increased the hiring rates of new
2.  A significant change or increase in the salary employees. The Bankard Employees Union
rate of a lower pay class without a pressed the company for the increase in the
corresponding increase in the salary rate of a salary of its old, regular employees. The
higher one; company refused to do so. The union filed a
3.  The elimination of the distinction between Notice of Strike on the ground of discrimination
the 2 groups or classes; and for it claimed that a wage distortion exists and
4.  The WD exists in the same region of the the company refused to negotiate to correct the
country (Alliance Trade Unions v. NLRC, G.R. distortions.
No. 140689, February 17, 2004). 
2004).  about by theIsNew
there a wage
Salary distortion brought
Scale?

Basic principles in WD  A: No. The union cannot legally obligate the
Bankard to correct the alleged “wage distortion” as
1.  The concept of WD assumes an existing the increase in the wages and salaries of the newly-
group or classification of Ees which hired was not due to a prescribed law or wage
establishes distinctions among such Ees on order. If the compulsory mandate under Art. 124 to
some relevant or legitimate basis. This correct wage distortion is applied to voluntary and
classification is reflected in a differing wage unilateral increases by the employer in fixing
rate for each of the classes of Ees. hiring rates which is inherently a business
2.  Often results from Government decreed judgment prerogative, then the hands of the
increases in minimum wages. employer would be completely tied even in cases
3.  Should a WD exist, there is no legal where an increase in wages of a particular group is
requirement that, in the rectification of that justified due to a re-evaluation of the high
distortion by a re-adjustment of the wage productivity o a particular group or the need to
rates of the differing classes of Ees, the gap increase the competitiveness of Bankard’s hiring
which had previously or historically existed rate. An employer would be discouraged from
be restored in precisely the same amount. In adjusting the salary rates of a particular group of
other words, correction of a WD may be employees for fear that it would result to a demand
done by re-establishing a substantial or by all employees for a similar increase, especially if
significant gap (as distinguished from the the financial conditions of the business cannot
historical gap) between the wage rates of the address an across-the-board increase (Bankard
( Bankard
differing classes of Ees. Employees Union-WTU v. NLRC, G.R. No. 140689,
4.  The re-establishment of a significant February 17, 2004).
difference in wage rates may be the result of
the resort to grievance procedures or CB Duty of the Er and the union/worker if there is
negotiations (Metro
(Metro Transit Org., Inc. v. NLRC, WD
G.R. No. 116008, july 20, 1995). 
1995). 
The Er and the union shall negotiate to correct the
In mandating an adjustment, the law did not distortions. If there is no union, the Er and the
require that there be an elimination or total workers shall endeavor to correct such
abrogation of quantitative wage or salary distinctions.
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LABOR STANDARDS 
Process for correction of wage distortion of Where 313:
organized establishments v. unorganized = 298 ordinary working days
establishments = 12 regular holidays; and
= 3 special holidays
Organized Unorganized
Establishment Establishment 3.  For those who do not work and are not
(with union) (without union) considered paid on Saturdays and Sundays or
The Er and the union The Er and the workers rest days
shall negotiate to shall endeavor to correct
correct distortion.  the distortion.  EEMR = (Applicable daily rate x 261
Any dispute shall be days)/12
Any dispute shall be Where 261:
resolved through a
settled through the = 246 ordinary working days
grievance procedure
NCMB. = 12 regular holidays; and
under the CBA.
If it remains = 3 special holidays
If it remains unresolved
unresolved, it shall be
within 10 days it shall be PAYMENT OF WAGES
dealt with through
referred to the NLRC.
voluntary arbitration.
The NLRC shall conduct Forms of payment
The dispute will be
continuous hearings and
resolved within 10 The laborer’s wages shall be paid in legal currency
decide the dispute
days from the time the (NCC, Art. 1705).
within 20 days from the
dispute was referred to
time the same was
voluntary arbitration. No employer shall pay the wages of an employee
referred.
by means of promissory notes, vouchers, coupons,
Non-strikeablity of WD tokens, tickets, chits, or any object other than legal
tender, even when expressly requested by the
WD is non-strikeable (Ilaw at Buklod ng employee (LC,
(LC, Art. 102).
Manggagawa v. NLRC, G.R. No. 91980, June 27,
1991). WD is neither a deadlock in collective XPNs:
bargaining nor ULP. a.  Check
b.  Money order
NOTE: Minimum wage in NCR is P481.00 (P466
basic wage + 15 COLA). Effective April 4, 2015. When such manner of payment is:
a.  Customary on the date of effectivity of the
DIVISOR TO DETERMINE DAILY RATE code
b.  Necessary because of special circumstances
Ways for the computation of the estimated c.  Stipulated in a collective bargaining
equivalent monthly rate (EEMR) of daily-paid agreement (LC,
(LC, Art. 102). 
102). 

Ees Time of payment

1.  For those who are required to work every day
including Sundays or rest days, special days It shall be paid at least once every two weeks or
and regular holidays. twice a month at intervals not exceeding 16 days
(LC, Art. 103).
EEMR = (Applicable daily rate x 393.50
days)/12 Payment of wages of employees engaged to
Where 393.50: perform a task which cannot be completed in
= 298 ordinary working days two weeks:
= 24 for 12 regular holidays x 200%
= 67.60 for 52 rest days x 130%; and a.  Payments are to be made at intervals not
= 3.90 for 3 special days x 130% exceeding 16 days, in proportion to the
amount of work completed;
2.  For those who do not work and are not b.  Final settlement is made upon completion of
considered paid on Sundays or rest days. work.

EEMR = (Applicable daily rate x 313 NOTE: It is applicable in the absence of a collective
days)/12 bargaining agreement or arbitration award.
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No employer shall make payment with less intermediary as consideration of a promise of
frequency than once a month. employment or retention in employment (Art.
117).
Place of payment   -  It shall be unlawful for an employer to refuse
to pay or reduce the wages and benefits,
Payment of wages shall be made at or near the discharge or in any manner discriminate
place of undertaking (LC, Art. 104). against any employee who has filed any
complaint or instituted any proceeding under
Exception: this Title or has testified or is about to testify
in such proceedings (Art. 118).
Payment may be made through banks
Q: Lutgardo is working as an assistant sales
a.  All private establishments, companies, manager in the Special Steel Products, Inc. He
businesses, and other entities obtained a car loan from the Bank of Commerce
b.  With 25 or more employees with the Special Steel Products, Inc. as surety.
c.  Located within 1 km radius to a commercial, The company withheld Lutgardo’s thirteen
savings or rural banks month pay and earned vacation and sick leave
d.  Upon written permission of the majority of as a lien to protect its right as a surety. Can
the employees (RA 6727, Sec. 7). 
7).  Special Steel Products, Inc. validly do so?

WAGE PROTECTION PROVISIONS  A: No. It is not sanctioned by law. It may only
protect its right as surety by instituting an action to
Civil Code provisions demand security. It may not take the law into his
own hands. Indeed, it shall be unlawful for any

-  Withholding of the wages, except for a debt

due, shall not be made by the employer (Art.
person, directly or indirectly, to withhold any
amount from the wages of a worker. Furthermore,
1706). Lutgardo is not indebted to the company. Thus,
-  The laborer's wages shall be a lien on the Special Steel cannot offset its claim against
goods manufactured or the work done (Art. Lutgardo’s monetary benefits benefits (Special
(Special Steel
1707). Products v. Villareal, G.R. No. 143304, July 08, 2004).
-  The laborer's wages shall not be subject to
execution or attachment, except for debts REST PERIODS
incurred for food, shelter, clothing and medical
attendance (Art. 1708). WEEKLY REST DAY
-  The employer shall neither seize nor retain any
tool or other articles belonging to the laborer Right to weekly rest day (WRD)
(Art. 1709).
Every Er shall give his Ees a rest period of not less
Labor Code provisions than 24 consecutive hours after every 6
consecutive normal work days (IRR, Book III, Rule
-  No employer shall limit or otherwise interfere III, Sec. 3).
with the freedom of any employee to dispose
of his wages. He shall not in any manner force, Scope of WRD
compel, or oblige his employees to purchase
merchandise, commodities or other property It shall apply to all Ers whether operating for profit
from any other person, or otherwise make use or not, including public utilities operated by
of any store or services of such employer or private persons (IRR, Book III, Rule III, Sec. 1).  
any other person (Art. 112). 
112). 
-  It shall be unlawful for any person, directly or Person who determines the WRD
indirectly, to withhold any amount from the
wages of a worker or induce him to give up any GR: Er shall determine and schedule the WRD of
part of his wages by force, stealth, his Ee.
intimidation, threat or by any other means
whatsoever without the worker’s consent (Art. XPNs:
116). 1.  CBA
-  It shall be unlawful to make any deduction 2.  Rules and regulations as the SLE provides
provi des
from the wages of any employee for the benefit 3.  Preference of Ee based on religious grounds
of the employer or his representative or –  Ee shall make known his preference in
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LABOR STANDARDS 
writing at least 7 days before the desired Premium pay  is the additional compensation for
effectivity of the initial rest day so preferred work rendered by the Ee on days when normally
(IRR, Book III, Rule III, Sec. 4(1)). 
4(1)).  he should not be working such as special holidays
and WRDs.
XPNs to XPN no. 3: Er may schedule the
WRD of his choice for at least 2 days in a Er and Ee can agree on the rate of premium pay
month if the preference of the Ee will other than that provided by law
inevitably result in:  
a.  serious prejudice to the operations of Nothing shall prevent the Er and his Ee or their
the undertaking and representatives from entering into any agreement
b.  the Er cannot normally be expected to with terms more favorable to the Ees; Provided ,
Provided , it
resort to other remedial measures shall not be used to diminish any benefit granted to
(IRR, Book III, Rule III, Sec. 4(2)). 
4(2)).  the Ees under existing laws, agreements and
voluntary Er practices (IRR, Book III, Rule III, Sec.
Right of the Ee to know the schedule of their 9).  
9).
WRDs
Rates of compensation for rest day, Sunday or
Er shall make known rest period by means of holiday work  
1.  Written notice
2.  Posted conspicuously in the workplace RATES OF ADDITIONAL
INSTANCES
3.  At least 1 week before it becomes effective COMPENSATION
(IRR, Book III, Rule III, Sec. 5). 
5).   Work on a
+ 30% premium pay of
scheduled rest day
100% RW (IRR, Book III,
EMERGENCY REST DAY WORK
Rule III, Sec. 7) 
7) 
GR: The Ee cannot be compelled by the Er to work Work performed on
on his rest day. Sundays and
+ 30% premium pay of
Holidays by an Ee
XPNs: 100% RW (IRR, Book III,
who has no regular
1.  Urgent work to be performed on the Rule III, Sec. 7) 
7) 
workdays and rest
machinery, equipment or installation, to days
avoid serious loss which the Er would Work on a Sunday + 30% premium pay of
otherwise suffer; (If Ee’s scheduled 100% RW (IRR, Book III,
2.  Nature of work requires continuous rest day) Rule III, Sec. 7) 
7) 
operations for 7 days in a week or more and hrs: + 30% PP of
1st 8 hrs:
stoppage of the work may result in 100% RW
irreparable injury or loss to the Er;
3.  Abnormal pressure of work due to special Work performed on
hrs: + 30% of
Excess of 8 hrs:
circumstances, where the Er cannot be any Special Holiday
hourly rate on said date 
date 
ordinarily expected to resort to other (M.C. No. 10, Series of
measures;  2004).  
 2004).
4.  Actual or impending emergencies (serious 1st 8 hrs: + 50% PP of
accident, fire, flood, typhoon, earthquake, 100% RW
etc.) Work performed on
5.  Prevent loss or damage to perishable goods; a Special Holiday
Excess of 8 hrs:+ 30% of
6.  Analogous or similar circumstances as and same day is the
hourly rate on said date 
date 
determined by the SLE; scheduled rest day
(M.C. No. 10, Series of
7.  Work is necessary to avail of favorable  2004). 
weather or environmental conditions where Ee is only entitled to
performance or quality of work is dependent his basic rate. No PP is
thereon. (LC,
(LC, Art. 92) 
92)  required.
Work performed on
Ee volunteers to work on his rest
rest day under a Special Working Reason: Work performed
Reason: Work
other circumstances Holiday is considered work on
ordinary working days
He shall express it in writing subject to additional (IRR, Book III, Rule III,
compensation (IRR,
(IRR, Book III, Rule III, Sec. 6(2). Sec. 7) 
7) 
NOTE: Holiday work provided under Art. 93
pertains to special holidays or special days.
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Q: Jose applied with Mercury Drug Company for Movable date
Black Saturday
the position of Sales Clerk. Mercury Drug (April 4, 2015)
Company maintains a chain of drug stores that Ninoy Aquino Day August 21
are open every day till late at night. Jose was
informed that he had to work on Sundays and All Saints Day November 1
holidays at night as part of the regular course of Additional Special (non- December 24
employment. He was presented with a contract working) days January 2
of employment setting forth his compensation Last day of the year December 31
on an annual basis with an express waiver of
extra compensation
holidays, which Josefor workIsonsuch
signed. Sundays and
a waiver SPECIAL HOLIDAY (for all schools)
EDSA Revolution February 25
binding on Jose? Explain. (1996 Bar Question)
(Proclamation 831, s. 2014 by President Benigno
 A: No. The waiver is not binding on Jose. Rights  Aquino III) 
may be waived, unless the waiver is contrary to
law, public order, public policy, morals and Regular holidays (RH)
customs. The waiver in this case is void.
They are compensable whether worked or
HOLIDAY PAY/PREMIUM PAY unworked subject to certain conditions. They are
also called legal holidays.
Holiday pay
NOTE:  RH falling within temporary or periodic
It is a premium given to Ees pursuant to the law shutdown and temporary cessation of work are
even if he has not been suffered to work on a compensable. However, if the temporary or

regular holiday. It is limited to the 12 regular periodic shutdown and cessation of work is due to
holidays, also called legal holidays listed by law. business reverses, the Er may not pay the Ees
The Ee should not have been absent without pay on during such period.
the working day preceeding the regular holiday.
Muslim holidays (MH)
Purpose of holiday pay
Muslim holidays are those observed in specified
To secure the payment of undiminished monthly Muslim areas. All private corporations, offices,
income undisturbed by any work interruption (JRC agencies and entities or establishments operating
v. NLRC, G.R. No. 65482, Dec. 1, 1987). within the designated Muslim provinces and cities
are required to observe Muslim holidays.
REGULAR HOLIDAYS DATE
New Year’s Day 
Day  January 1 Determination of eid’l fitr and/or eid’l adha 
Araw ng Kagitingan April 9
Movable date The proclamation declaring a national holiday for
Maundy Thursday (April 2, 2015) the observance of Eid’l Fitr and/or Eid’l Adha shall
Adha shall
be issued:
Movable date
Good Friday 1.  After the approximate date of the Islamic
(April 3, 2015)
holiday has been determined in accordance
Labor Day May 1 with the: 
Independence Day June 12 a.  Islamic Calendar (Hijra)  or 
(Hijra) or
b.  Lunar Calendar or
Last Monday of
National Heroes Day c.  Upon astronomical calculations  
August
d.  Whichever is possible or convenient  
Bonifacio Day November 30  2.  The Office of Muslim Affairs shall inform the
Christmas Day December 25 Office of the President on which day the
holiday shall fall (Proclamation 295, s. 2011
Rizal Day December 30 by President Benigno Aquino III).
SPECIAL (NON-WORKING) HOLIDAYS
 A Christian Ee working within the Muslim area
Second new moon
after the winter cannot
holiday be compelled to work during muslim
Chinese New Year solstice in accordance
with the Lunisolar All workers, Muslims and Christians, working
Chinese calendar within the Muslim area are entitled to holiday pay
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LABOR STANDARDS 
on Muslim holidays (SMC v. CA, G.R. 146775, RH on Ee’s RH on Ee’s
 January 30, 2002). Basis regular workday rest day
230%
Muslim Ee working outside the Muslim area If worked 230% + 30%
cannot be compelled to work during the (OT)(excess 200% + 30% of of hourly rate
observance of the MH of 8 hours) hourly rate on on said date
said date
GR: Muslim Ees shall be excused from work during
MH without diminution of salary or wages. Important condition that should be met in
XPN: Those who are permitted or suffered to work order to avail/receive the single holiday pay
on MH are entitled to at least 100% basic pay + The Ee should not have been absent without pay on
100% as premium of their basic pay (SMC v. CA, the working day preceding the RH.
G.R. 146775, January 30, 2002).
Monthly paid v. Daily paid Ees
Regular holiday v . Special holiday
Monthly Paid Ees Daily Paid Ees
REGULAR SPECIAL One whose wage or salary is
BASIS HOLIDAY HOLIDAY One whose wage or
being paid everyday of the
Regular pay salary is being paid
month, including rest days,
If unworked (subject to only on those days
Sundays, regular or special
certain No Pay he actually worked,
days, although he does not
conditions for except in cases of
regularly work on these
daily paid Ee’s) 
Ee’s)  regular or special
days.
+30% days, although
does not he
regularly
If worked 2x regular pay premium Not excluded from benefit of
(200%) pay of 100% work on these days.
holiday pay.
RW
Effect if a legal holiday falls on a Sunday
Work on RH
A legal holiday falling on a Sunday creates no legal
An Er may require an Ee to work on RH but Ee shall obligation for the Er to pay extra to the Ee who
be compensated twice his regular rate. does not work on that day, aside from the usual
holiday pay to its monthly paid Ee (Wellington
(Wellington v.
Rates of compensation for RH on Ee’s regular Trajano, G.R. No. 114698, July 03, 1995).
workday and rest day
DIVISOR
FORMULAS TO COMPUTE WAGES ON
REGULAR HOLIDAYS The divisor assumes an important role in
2004) 
([Link].10, Series of 2004)  determining whether or not holiday pay is already
RH on Ee’s included in the monthly paid employee’s salary and
RH on Ee’s
Basis regular in the computation of his daily rate (Chartered
( Chartered
rest day
workday Bank Employees Association v. Ople, G.R. No. L-
100% 44717, August 28, 1985).
100%
If
unworked e.g. Php 300 If the divisor used is:
e.g. Php 300 RW
RW 365 (days in a year) All the 12 holidays, 52
200% + 30% Sundays and 52
of 200% Saturdays are paid.
200%
313 12 holidays and 52
If worked e.g 600 (365 – 52 = 313) Sundays (or
e.g. 300(RW)
(1st 8 (200% of Saturdays) are paid.
+ 300
hours) RW) 261 All the 12 holidays are
600 = Total X 0.3 (313 – 52 = 261) paid excluding the
Wage (TW) 180 Saturdays and
Sundays.
600 + 180 = 249 The 12 holidays are
780 (TW) (261 – 12 = 249) not paid.
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CONCEPT OF ABSENCES 8.  Ee paid fixed amount for performing work
irrespective of the time consumed in the
LOA with pay on the LOA without pay on the performance thereof   (IRR, Book III, Rule IV,
day immediately day immediately Sec.1).
preceding RH. preceding a RH. 
GR: An Ee may not be paid Retail establishments
the required HP if he
has not worked on They are engaged in the sale of goods to end users
such RH. for personal or household use. (e.g.
( e.g. Grocery)
 Grocery)

GR:  All covered Ees Service establishments

XPNs: Where the day
are entitled to
immediately preceding the
HP.
holiday is a: They are engaged in the sale of services to
1.  Non-working day in individuals for their own or household use. (e.g . . TV
 TV
the establishment or repair shop)
2.  The scheduled rest
day of the Ee. TEACHERS, PIECE WORKERS, TAKAY ,
SEAFARERS, SEASONAL WORKERS
Effect in case there is a temporary or periodic
shutdown and temporary cessation of work: Holiday pays of certain Ees

TEMPORARY OR PERIODIC SHUTDOWN and EMPLOYEES RULE

TEMPORARY CESSATION OF WORK 1.  RH during semestral
(IRR, Book III, Rule IV, Sec. 7)) Private school vacations
Instances Rule: teachers (Faculty - Not entitled to holiday
1.  Yearly inventory, or  members of pay 
2.  When the repair or RH falling within colleges and 2.  RH during Christmas
cleaning of the period shall be universities) vacation
machineries is compensated. - Entitled to holiday pay 
undertaken  1.  No pay on regular
Due to business reverses holidays including
RH may not be Christmas and semestral
(cessation as authorized
paid by the Er vacations
by the SLE)
2.  But with pay on special
COVERAGE and EXCLUSIONS public holidays and other
Hourly-paid
no-class days when
teachers
Persons entitled to holiday pay classes are called off or
shortened on account of
GR: All Ees are entitled (IRR, Book III, Rule IV, floods, typhoons, rallies
Sec.1). and the like (Jose Rizal
College v. NLRC, G.R. No.
XPNs: 65482, Dec. 1, 1987). 
1987). 
1.  Government Ees and any of its political Holiday pay shall not be less
subdivisions, including GOCCs (with original than his average daily
Ee paid by:
charter) earnings for the last 7 actual
1. results or
2.  Retail and service establishments regularly work days preceding the
2. output
employing less than 10 workers Regular holiday.
(Piece work
3.  Domestic helpers and persons in the Provided: Holiday pay shall not
payment)
personal service of another be less than the statutory
4.  Ee engaged on task or contract basis or minimum wage rate.
purely commission basis May not be paid the required
5.  Members of the Family of the Er who are Seasonal Workers Holiday pay during off-season
dependent on him for support where they are not at work.
6.  Managerial Ee and other members of the Workers having
managerial staff no regular work Shall be entitled to holiday pay
7.  Field personnel and other Ee whose time days
and performance are unsupervised by the Er Seafarers Shall be entitled to holiday pay
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LABOR STANDARDS 
Q: Are the school faculty who according to their Authorized 300%
Worked
contracts are paid per lecture hour entitled to absence (at least)
unworked holiday pay? 390%
Authorized Worked and day is (+30% of
 A: absence Rest Day each 3
1.  If during RH – No. Art. 94 of the LC is silent with 100%)
respect to faculty members paid by the hour
who because of their teaching contracts are Concept of successive regular holidays
obliged to work and consent to be paid only for
work actually done (except when an emergency WED MAUNDY GOOD ENTITLED TO
or a fortuitous event or a national need calls for THURS FRIDAY HOLIDAY PAY
the declaration of special holidays). Regular Worked RH RH Yes. Both
holiday specified as such by law are known to LOA
both school and faculty members as "no class RH RH Yes. Both
w/pay
days" certainly the latter do not expect payment LOA
for said unworked days, and this was clearly in RH RH No. Both
w/o pay
their minds when they entered into the teaching Yes. Only to
contracts (Jose Rizal College v. NLRC, G.R. No. LOA
Worked RH holiday pay on
65482, December 01, 1987). w/o pay
Friday
2.  If during special public holidays –  Yes.  The law
and the IRR governing holiday pay are silent as Conditions so that an Ee may be entitled to 2
to payment on Special Public Holidays. It is successive holiday pays
readily apparent that the declared purpose of
the holiday pay which is the prevention of On the day immediately preceding the 1 st   RH, he
diminution of the monthly income of the Ees on must be:
account of work interruptions is defeated when 1.  Present (worked), or
a regular class day is cancelled on account of a 2.  On LOA with pay (IRR, Book III, Rule IV, Sec.
special public holiday and class hours are held 10).  
10).
on another working day to make up for time
lost in the school calendar. Otherwise stated, If the above stated conditions are not met
the faculty member, although forced to take a
rest, does not earn what he should earn for that He must work on the 1st   RH to be entitled to
day. Be it noted that when a special public holiday pay on the 2 nd  RH (IRR, Book III, Rule IV,
holiday is declared, the faculty member paid by Sec. 10).
the hour is deprived of expected income, and it
does not matter that the school calendar is LEAVES
extended in view of the days or hours lost, for
their income that could be earned from other
SERVICE INCENTIVE LEAVE
sources is lost during the extended days.
Similarly, when classes are called off or Service incentive leave (SIL)
shortened on account of typhoons, floods,
rallies, and the like, these faculty members must It is 5-days leave with pay for every Ee who has
likewise be paid, whether or not extensions are rendered at least 1 year of service. It is
ordered (Jose Rizal College v. NLRC, G.R. No. commutable to its money equivalent if not used or
65482, December 01, 1987).   exhausted at the end of the year.

Double holiday pay “At least 1 year of service”  

There are 2 RHs falling on the same day. Service for not less than 12 months, whether
continuous or broken reckoned from the date the
MAUNDY Ee started working, including authorized absences
THURSDAY & and paid regular holidays unless the working days
WED RATE
 ARAW NG in the establishment as a matter of practice or
KAGITINGAN policy, or that provided in the employment
Present Unworked 200% contract is less than 12 months, in which case said
LOA w/pay Unworked 200% period shall be considered as one year (Sec. 3, Rule
300% V, Book III, IRR).
LOA w/ pay Worked
(at least)
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Persons entitled to SIL Entitlement of piece-rate workers to SIL

GR: Applies to every Ee who has rendered at least Piece-rate workers are entitled to the full benefit of
1 year of service (LC, Art. 95[a]). the yearly 5-day service incentive leave. Under P.D.
851 or the SIL Law, the exclusion from its coverage
XPNs:  of workers who are paid on a purely commission
1.  Government Ees and any of its political basis is only with respect to field personnel. Ees
subdivisions including GOCCs engaged on task or contract basis or paid on
2.  Those already enjoying the benefit purely commission basis are not automatically
3.  Domestic helpers and persons in the exempted from the grant of SIL, unless, they fall
personal services of another under the classification of field personnel (Serrano
4.  Those already enjoying vacation leave with v. Severino Santos, G.R. No. 187698, 
187698,  August 09,
pay of at least 5 days  2010).  
 2010).
5.  Managerial Ees
6.  Field personnel and other Ees whose NOTE: “Field personnel” shall refer to non-
non -
performance is unsupervised by the Er agricultural Ees who regularly perform their duties
7.  Employed in establishments regularly away from the principal place of business or
employing less than 10 workers branch office of the employer and whose actual
8.  Exempt establishments hours of work in the field cannot be determined
9.  Engaged with atask or contract basis, purely with reasonable certainty (Ibid.)
certainty  (Ibid.)  
commission basis, or those who are paid in a
fixed amount of performing work Entitlement of Ees with salaries above
irrespective of the time consumed in the minimum wage to SIL
performance thereof [LC,
[LC, Art. 95(b)]. 
95(b)].  
Ees with salaries above minimum wage are entitled
Teachers of private schools on contract basis to service incentive leave. The difference between
are entitled to service incentive leave the minimum wage and the actual salary received
by the Ees cannot be deemed as their 13 th  month
The phrase "those who are engaged on task or pay and SIL pay as such difference is not equivalent
contract basis" should, however, be related to "field to or of the same import as the said benefits
personnel" applying the rule on ejusdem generis 
generis  contemplated by law (JPL Marketing Promotions v.
that those general and unlimited terms are CA, G.R. No. 151966, July 08,2005). 
08,2005).  
restrained and limited by the particular terms that
they follow. Clearly, Cebu Institute of Technology Entitlement of terminated Ees to SIL
teaching personnel cannot be deemed as field
personnel which refers "to non-agricultural Ees 1.  Illegally dismissed Ees- entitled to SIL until
who regularly perform their duties away from the actual reinstatement (Integrated Contractor
principal place of business or branch office of the and Plumbing Works, Inc. v. NLRC, G.R. No.
Er and whose actual hours of work in the field  August 09, 2005). 
cannot be determined with reasonable certainty”  2.  Legally dismissed Ees  – the Ee who had not
(Par. 3, Art. 82, LC);
LC) ; (CIT v. Ople, G.R. No. 70203, been paid of SIL from the outset of
December 18, 1987). employment is entitled only of such pay after
a year from commencement of service until
Part-time workers are entitled to the full termination of employment or contract (JPL
benefit of the yearly 5-day service incentive Marketing Promotions v. CA, G.R. No. 151966,
leave  July 08, 2005).

A part-time worker is entitled to service incentive Commutability of SIL to monetary equivalent

leave whether the service within 12 months is
continuous or broken or where the working days It is commutable if not used at the end of the year.
in the employment contract as a matter of practice It is aimed primarily at encouraging workers to
or plicy is less than 12 months. The availment and work continuously and with dedication to the
commutation of the same can be proportionate to company.
the daily work rendered and the regular daily
salary. (DOLE’s explanatory Bulletin on Part -time
-time Basis for cash conversion
Employment, January 2, 1996).
The basis shall be the salary rate at the date of
commutation. The availment and commutation of
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the SIL may be on a pro-rata
a  pro-rata basis
 basis (No. VI(c), DOLE entitled to, and the SSS shall in turn pay such
Handbook on Worker’s Stat utory
utory Monetary Benefit, amount to the Ee concerned.
[Link](c)].
Requirements in order that maternity benefits
Establishments exempt from the application of may be claimed
the SIL Law
1.  There is childbirth, abortion or miscarriage
Establishments employing less than 10 Ees are 2.  She has paid at least three monthly
exempted by the LC and the Implementing Rules contributions
from paying SIL. The clear policy of the LC is to
include all establishments, except a few classes, PATERNITY LEAVE
under the coverage of the provision granting SIL to
workers (Murillo v. Sun Valley Realty, Inc., G.R. No. Paternity leave
L-67272 June 30, 1988). 
1988).  
It refers to the benefits granted to a married male
MATERNITY LEAVE Ee allowing him not to report for work for 7 days
but continues to earn the compensation therefore,
Maternity leave benefit on the condition that his spouse has delivered a
child or suffered a miscarriage for purposes
purpos es of
A covered female Ee, regardless of her civil statues, enabling him to effectively lend support to his wife
is entitled to a daily maternity benefit equivalent to in her period of recovery and/or in the nursing of
100% of her present basic salary, allowances and the newly-born child. In the event it is not availed
other benefits or the cash equivalent of such of, such leave is not convertible to cash.
benefits for 60 days or 78 days in case of caesarean
delivery. Concept of paternity leave benefits
Conditions for availment of maternity leave Every married male Ee in the private and public
benefit sectors shall be entitled to a paternity leave of 7
days with full pay for the first 4 deliveries of the
1.  The Ee shall have notified her Er of her legitimate spouse with whom he is cohabiting.
pregnancy and the probable date of her
childbirth which notice shall be transmitted Conditions for entitlement to paternity leave
to the SSS;
2.  The payment shall be advanced by the Er in The male Ee is:
2 equal installments within 30 days from the 1.  Legally married to, and is cohabiting with
filing of the maternity leave application; the woman who delivers the baby;  
3.  In case of caesarean delivery, the Ee shall be 2.  Ee of private or public sector;
paid the daily maternity benefit for 78 days; 3.  Maybe availed of only for the first 4
4.  Payment of daily maternity benefits shall be deliveries of the legitimate spouse with
a bar to the recovery of sickness benefits for whom he is cohabiting; and
the same compensable period of 60 days for 4.  Notify his Er of the pregnancy of his
the same childbirth, abortion, or legitimate spouse and the expected date of
miscarriage; such delivery
5.  The maternity benefits provided under Sec.
14-A shall be paid only for the first four NOTE:  Delivery
Deliv ery shall include
i nclude childbirth
child birth or any
deliveries; miscarriage.
6.  The SSS shall immediately reimburse the Er
of 100% of the amount of maternity benefits Q: Ron is a bank employee of BPI. He is
advanced to the Ee by the Er upon receipt of cohabiting with Michelle for five straight years
satisfactory proof of such payment and with whom he has four children. In the fifth
legality thereof; and year of their cohabitation, Michelle had her
7.  If an Ee should give birth or suffer abortion miscarriage. Ron is availing himself of his
or miscarriage without the required paternity leave. Is he entitled to paternity
contributions having been remitted for her leave?
by her Er to the SSS, or without the latter
having been previously notified by the Er of  A: No. Ron is not entitled to paternity leave
the time of the pregnancy, the Er shall pay to because the facts of the case only show that he is
the SSS damages equivalent to the benefits only cohabiting with Michelle. The law expressly
which said Ee would otherwise have been provides that the male must be legally married to
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the woman with whom he is cohabiting as a as he/she is entrusted with the custody
condition for entitlement of paternity leave. Even of the children;
assuming that Ron is legally married to Michelle, he f.  Abandonment of spouse for at least 1 yr;
cannot avail also of the paternity leave because the
law limits the deliveries only to four which include 3.  Unmarried mother/father who has
childbirth or miscarriage. Based on the facts, it is  preferred to keep and rear his or her
already the 5th delivery of the woman. child/children instead of :
a.  having others care for them or
PARENTAL LEAVE b.  give them up to a welfare institution;

Parental leave 4.  Any other person who solely provides:

provides :
a.  parental care and
Leave benefits granted to a solo parent to enable b.  support to a child or children;
him/her to perform parental duties and
responsibilities - where physical presence is 5.  Any family member who assumes the
required. responsibility of head of family as a result of
the::
the
In addition to leave privileges under existing laws, a.  death,
parental leave of not more than 7 working days b.  abandonment,
every year shall be granted to any solo parent Ee c.  disappearance or
who has rendered service of at least 1 year (Sec. 8). d.  prolonged absence of the parents or
solo parent.
Conditions for entitlement of parental leave
NOTE:  A change in the status or circumstance of
1.  He or she must fall among those referred to the parent claiming benefits under this Act, such
as a solo parent that he/she is no longer left alone with the
2.  Must have the actual and physical custody of responsibility of parenthood, shall terminate
the child or children his/her eligibility for these benefits. (Sec.3)
(Sec.3)  
3.  Must have at least rendered service of one
year to his or her employer LEAVES FOR VICTIMS OF VIOLENCE AGAINST
4.  He or she must remain a solo parent WOMEN and their CHILDREN (R.A. 9262)

A female Ee who is a victim of violence (physical,

Persons considered a solo parent entitled to sexual, or psychological) is entitled to a paid leave
parental leave of 10 days in addition to other paid leaves (R.A.
9262, Anti- VAWC Act). This is known as the
Any individual who falls under any of the ff. battered woman leave.
leave.
categories:
SPECIAL LEAVE BENEFIT FOR WOMEN
1. A woman who gives birth as a result
result of rape
and other crimes against chastity even A woman Ee having rendered continuous
without a final conviction of the offender; aggregate employment service of at least 6 months
Provided, That the mother keeps and raises for the last 12 months shall be entitled to a special
the child; leave benefit of 2 months with full pay based on
2. Parent left solo or alone with the her gross monthly compensation following surgery
responsibility of parenthood due to: caused by gynaecological disorders (Sec. 18, R.A.
a.  Death of spouse; 9710, Magna Carta of Women). 
Women).  
b.  Detention or service of sentence of
spouse for a criminal conviction for at SERVICE CHARGES
least 1 yr;
c.  Physical and/or mental incapacity of Service charges
spouse
d.  Legal separation or de facto separation These are charges collected by hotels, restaurants
from spouse for at least 1 year as long as and similar establishments at the rate of 85% for
he/she is entrusted with the custody of covered Ees equally distributed among them, and
the children; 15% for the management to answer for losses and
e.  Nullity or annulment of marriage as breakages.
decreed by a court or by a church as long
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Covered employees receive in a month, if their Ers are not otherwise
exempted from paying the 13 th  month pay. Such
GR: All Ees are covered, regardless of their Ees are entitled to the 13 th month pay regardless of
position, designation, and employment status, said designation of employment status, and
irrespective of the method by which their wages irrespective of the method by which their wages
are paid. are paid.

NOTE:  Applies only to hotels, restaurants and Provided, that they have worked for at least 1
similar establishment collecting service charges. month, during a calendar year (Revised Guidelines
on the Implementation of the 13 th Month Pay Law). 
Law). 
XPN: Managerial Ees (IRR,
Ees (IRR, Book III, Rule VI, Sec. 2)
Persons not covered by P.D. 851
Period to distribute the share of Ee
1.  Government Ees
The period is not less than once every 2 weeks or 2.  Household helpers
twice a month at intervals not exceeding 16 days.
NOTE: Covered by R.A. 10361 or the “Batas
Service charge v. Tips Kasamabahay”  

SERVICE CHARGE TIPS 3.  Ees paid purely on commission basis

Collected by the Voluntary payments 4.  Ees already receiving 13th month pay
management from the made by the
customers.  customers to the Ees Q: What would be your advice to your client, a
for excellent service.   manufacturing company, who asks for your
legal opinion
Pay Law on awhether
covers or who
casual Ee not the 13thaMonth
is paid daily
Rule if service charge is abolished
wage? (1998 Bar Question)
If it is abolished, the share of the covered Ees shall
be considered integrated in their wages on the  A: I will advise the manufacturing company to pay
basis of the average monthly share of each Ees for the casual Ee 13th Month Pay if such casual Ee has
the past 12 months immediately preceding the worked for at least 1 month during a calendar year.
abolition. The law on the 13th Month Pay provides that Ees
are entitled to the benefit of said law regardless of
NOTE:  Service charges form part of the award in their designation or employment status.
illegal dismissal cases.
The SC interpreted P.D. 851, as follows: Ees are
13th MONTH PAY entitled to the 13 th  month pay benefits regardless
of their designation and irrespective of the method
13th month pay or its equivalent by which their wages are paid (Jackson Building-
Condominium Corp. v. NLRC, G.R. No. 112546, March
Additional income based on wage required by P.D. 14, 1996).
851 requiring all Ers to pay their Ees a 13 th month
pay which is equivalent to 1/12 of the total basic NOTE: An Er may give to his Ees ½ of the required
salary earned by an Ee within a calendar year. 13th  Month pay before
before   the opening of the regular
school year and the other half on or before Dec. 24.
NOTE: The absence of an express provision in the
CBA obligating the Er to pay the members of a Equivalent forms of the 13 th month pay
union 13th  month pay is immaterial.
Notwithstanding therefore the absence of any 1.  Christmas Bonus
contractual agreement, the payment of a 13 th  2.  Midyear Bonus
month pay being a statutory grant, compliance 3.  Profit Sharing Scheme
with the same is mandatory and is deemed 4.  Other Cash bonuses amounting to not less
incorporated in the CBA. than 1/12 of its basic salary

Persons covered by P.D. 851 NOTE: It must always be in the form of a legal
tender. 
All rank-and-file Ees are covered by P.D. 851
regardless of the amount of basic salary that they
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Things not proper substitutes for 13th  month b.  In the case of non-profit institutions and
pay organizations, where their income,
whether from donations, contributions,
1.  Free rice grants and other earnings from any
2.  Electricity source, has consistently declined by
3.  Cash and stock dividends more than 40% of their normal income
4.  Cost-of-living Allowance (P.D. 851, Sec. 3). 
3).  for the last 2 years, subject to the
provision of Sec. 7 of P.D. 851;
Q: Concepcion Textile Co. included the OT pay, 2.  The Government and any of its political
night-shift differential pay, andththe like in the subdivisions, including GOCCs, except those
computation of its Ees’ 13   month pay. corporations operating essentially as private
Subsequently, with the promulgation of the subsidiaries of the Government;
decision of the SC in the case of  SMC v. Inciong 3.  Ers already paying their Ees 13th month pay
(103 SCRA 139)  holding that these other or more in a calendar year of its equivalent
monetary claims should not be included in the at the time of this issuance.
computation of the 13th Month Pay, Concepcion Its equivalent shall include:
Textile Co. sought to recover under the a.  Christmas bonus
 principle of solutio indebiti the overpayment of b.  Mid-year bonus
the Ees’ 13th  month pay, by debiting against c.  Profit-sharing payments and
future 13th  month payments whatever excess d.  Other cash bonuses amounting to
amounts it had previously made. not less than 1/12th of the basic
salary
a.  Is the Company's action tenable?
b.  With respect to the payment of the 13th  It shall not include:
month pay after the SMC ruling, what a.  Cash and stock dividends,
arrangement, if any, must the Company b.  COLA
make in order to exclude from the 13th  c.  All other allowances regularly
month pay all earnings and enjoyed by the Ee, as well as non-
remunerations other than the basic monetary benefits.
pay? ( 1994
1994 Bar Question)
4.  Ers of household helpers and persons in the
 A: personal service of another in relation to
a.  The Company's action is not tenable. The such workers; and
principle of solutio indebiti which
indebiti which is a civil
law concept is not applicable in labor law NOTE: Covered by R.A. 10361 or the
(Davao Fruits Corp. v. NLRC, et al., G.R. No. “Batas Kasamabahay”  
85073, August 24, 1993). After the 1981
SMC ruling, the Supreme Court decided the 5.  Ers of those who are paid on a purely
case of Philippine Duplicators Inc. v. NLRC, commission, boundary, or task basis, and
(GR 110068, November 15, 1995).  1995).  those who are paid a fixed amount for
Accordingly, management may undertake performing a specific work, irrespective of
to exclude sick leave, vacation leave, the time consumed in the performance
maternity leave, premium pay for regular thereof, except where the workers are paid
holiday, night differential pay and cost of on a piece-rate basis in which case the Er
living allowance. shall be covered by this issuance insofar as
b.  The company shall include sales such workers are concerned (P.D.
concerned  (P.D. 851, Sec 3). 
3).  
commissions based on the settled rule.
(Songco v. NLRC, G.R. No. L-50999, March Options of covered Ers
 23, 1990). 
1.  Pay 1/2 of the 13th  month pay required
Ers covered by 13th month pay under P.D. 851 before the opening of the regular school year
and the other half on or before the 24th day
GR: Payment of 13th month pay applies to all Ers. of December of every year.
2.  In any establishment where a union has been
XPNs: recognized or certified as the CB agent of the
1.  Distressed Ers: Ee, the periodicity or frequency of payment
a.  Currently incurring substantial losses or of the 13th month pay may be the subject of
agreement.
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 Adjudicated claims 14th month pay not legally demandable

Non-payment of the 13 th  month pay provided by The granting of 14 th  month pay is a management
P.D. 851 and the rules of NLRC shall be treated as prerogative and is not legally demandable. It is
money claims cases. basically a bonus and is gratuitous in nature
(Kamaya Point Hotel v. NLRC, G.R. No. 75289, August
The following Ees may or may not be entitled to 31, 1989).
13th month pay
Exception
1.  Ee paid by results  – Entitled to 13 th  month
pay. A bonus, however, becomes a demandable or
enforceable obligation when it is made part of the
NOTE: Ees paid a fixed or guaranteed wage wage or salary or compensation of the employee. If
plus commission are also entitled to the it is additional compensation which the employer
mandated 13th month pay, based on their promised and agreed to give without any
total earnings during the calendar year, i.e.
i.e.   conditions imposed for its payment, such as
on both their fixed or guaranteed wage and success of business or greater production or
commission. output, then it is part of the wage. But if it is paid
only if profits are realized or if a certain level of
2.  Those with Multiple Ers   – Government Ees productivity is achieved, it cannot be considered
working part time in a private enterprise, part of the wage. Where it is not payable to all but
including private educational institutions, as only to some employees and only when their labor
well as Ees working in 2 or more private becomes more efficient or more productive, it is
firms, whether full or part time basis, are only an inducement for efficiency, a prize
entitled to the required 13 th month pay from therefore, not a part of the wage (Metro Transit
all their private Ers regardless of their total Organization, Inc. v. National Labor Relations
earnings from each or all their Ers. Commission 315 Phil. 860, 871 (1995))

3.  Private School Teachers, including faculty Q: ETPI (company) entered into a collective
members of universities and colleges   –  bargaining agreement with ETEU (union). A
Entitled regardless of the number of months side agreement of the said CBA provided that
they teach or are paid within a year, if they company confirms that the 14th, 15th and
have rendered service for at least 1 month 16th month bonuses (other than 13th month
within a year. pay) are granted. The company then planned to
defer the payment of the 14th, 15th  and 16th 
4.  Resigned or Separated Ees  - If resigned or month bonuses due continuing deterioration of
separated from work before the time of company’s financial position. The union
payment of 13th  month pay, entitled to opposed and filed a preventive mediation
monetary benefit s  in proportion to the complaint before the NCMB. May the company
length of time he started working during the validly postpone the payment of said bonuses?
calendar year up to the time of resignation
or termination of service (Pro-rated 13th   A: No. A reading of the provision reveals that the
month pay). same provides for gi ving of 14th, 15th and
f or the giving
th
16  month bonuses without qualification.
qualification. There
 Application of pro-ration of 13th month pay were no conditions specified in the CBA Side
Agreements for the grant of the benefits contrary
GR: Pro-ration of 13th  month pay applies only in to the claim of ETPI that the same is justified only
cases of resignation or separation from work; when there are profits earned by the company.
computation should be based on length of service Terse and clear, the said provision does not state
and not on the actual wage earned by the worker that the subject bonuses shall be made to depend
(Honda Phils. v. Samahan ng Manggagawasa Honda, on the ETPI’s financial
financial standing or that their
G.R. No. 145561, June 15, 2005). payment was contingent upon the realization of
profits. Neither does it state that if the company
XPN: Ees who are paid a guaranteed minimum derives no profits, no bonuses are to be given to
wage or commissions earned are entitled to 13 th  the employees. In fine, the payment of these
Month Pay based on total earnings (Philippine bonuses was not related to the profitability of
 Agricultural Commercial and Industrial Workers business operations. Verily, by virtue of its
Union v. NLRC, G.R. No. 107994, August 14, 1995). incorporation in the CBA Side Agreements, the
grant of 14th, 15th and 16th month bonuses has
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become more than just an act of generosity on the whose continued employment is prohibited
part of ETPI but a contractual obligation it has by law or is prejudicial to his health and of
undertaken (ETPI v. ETEU, G.R. No. 185665, Feb. 8, 284 ). 
his co-Ees (LC, Art. 284).
 2012). 3.  When the termination from service has been
declared illegal, but his reinstatement to his
Commission in relation to 13th month pay former position is no longer feasible for
some valid reason (Gabuay v. Oversea Paper
1.  The salesman’s commissions , ,   comprising a Supply, G.R. No. 148837, August 13, 2004). 
pre-determined percent of the selling price 4.  In case of pre-termination of employment
of the goods sold by each salesman, were contract in job-contracting arrangement (D.O
properly included in the term basic salary 18-02, Rules Implementing Art. 106 –  109,
for purposes of computing their 13th  month LC). 
pay. 5.  Where separation pay is awarded as a
2.  The so-called commission paid to or received measure of social or compassionate justice
by medical representatives of BoieTakeda (PLDT v. NLRC, G.R. No. L-80609, August 23,
Chemicals or by the rank-and-file Ees of Phil. 1988). 
Fuji Xerox were excluded from the term
basic salary because these were paid as RETIREMENT PAY
productivity bonuses. Such bonuses closely
resemble profit sharing, payments and have Retirement
no clear, direct, necessary relation to the
amount of work actually done by each It is the result of a bilateral act of the parties, a
individual Ee. voluntary agreement between the Er and the Ee
3.  Earnings and remuneration which are whereby the latter after reaching a certain age
closely akin to fringe benefits, overtime pay agrees and/or consents to sever his employment
or profit-sharing payments are excluded in with the former (Soberano v. Secretary of Labor,
computing 13th  month pay. However, sales G.R. No. L-43753-56 and G.R. No.L-50991, August 29,
commissions which are effectively an 1980; Ariola v. Philex Mining Corp, 446 SCRA 152).
integral portion of the basic salary structure
of an employee shall be included in Persons covered by retirement benefit
determining his 13th  month pay (Philippine
(Philippine
Duplicators, Inc. v. NLRC, G.R. No. 110068, All Ees in the private sector:
February 15, 1995). 
1995).  
1.  Regardless of their position, designation or
SEPARATION PAY status; and
 2.  Irrespective of the method by which their
Separation pay wages are paid (IRR, Book VI, Rule II, Sec.1).

Separation pay refers to the amount due to the Ee Persons not covered by retirement benefits
who has been terminated from service for causes
authorized by law such as the installation of labor- 1.  Ees of the National Government and its
saving losses or the closing or cessation of political subdivisions, including GOCCs (if
operation of the establishment or undertaking. they are covered by the Civil Service Law)
2.  Domestic helpers and persons in the
Purpose for providing separation pay personal service of another
3.  Ees of retail, service, and agricultural
Separation pay intends to provide the Ee with the establishments or operations employing not
wherewithal during the period he is looking for more than 10 Ees (IRR,
(IRR, Book VI, Rule II,
another employment (Gabuay v. Oversea Paper Sec.2).
Sec.2 ).
Supply, G.R. No. 148837, August 13, 2004).
Kinds of retirement schemes
Instances when Ee is entitled to separation pay
1.  Compulsory and contributory in nature;
1.  When the termination of employment is due 2.  One set up by the agreement between the Er
to causes authorized by law (Art. 284, LC).  and Ees in the CBA or other agreements
2.  When the severance of employment is between them (other applicable
caused by a disease, particularly when the Ee employment contract);
is found to be suffering from any disease and
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LABOR STANDARDS 
3.  One that is voluntarily given by the Er, Q: The instant labor dispute between
expressly as announced company policy or petitioners (PAL) stemmed from petitioner’s
impliedly as in the failure to contest the Ee’s act of unilaterally retiring airline pilot Captain
claim for retirement benefits (Marilyn  Albino Collantes under PAL-ALPAP Retirement
Odchimar Gertach v. Reuters Limited Phils., Plan. The SLE assailed the order of PAL’s action
G.R. No. 14854, January 17, 2005). 
2005).  of unilaterally retiring Captain Collantes and
further ordered that the basis of the
Retroactive application of Art. 287 of the LC (on computation of Captain Collantes’ retirement
retirement) as amended by R.A. 7641 benefits should be Art. 287 of the LC the PAL-

Art. 287 of the LC as amended by R.A. 7641 can be

 ALPAP Retirement
the retirement planPlan.
Pla n. But
B ut prevail
should PAL contends
as it isthat
the
applied retroactively, provided that; agreement between the parties. What should be
the basis of the computation of Captain
1.  The claimant for retirement benefits was still Collantes’ retirement benefits?
the Ee of the Er at the time the statute took
effect; and  A:  The basis of computation of Collantes’
2.  The claimant was in compliance with the retirement benefits should be Art. 287 of the LC.
requirements for eligibility under the statute The given retirement benefits under the retirement
for such retirement benefits (PSVSIA v. NLRC, plan is low compared to the retirement benefits
G.R. No. 115019, April 14, 1997). provided under Art. 287 of the LC. Applying the
second paragraph of Art. 287 ofthe LC, an Ee’s
Provisions of the retirement plan binding as retirement benefits under any collective bargaining
part of the employment contract   and other agreement shall not be less than those
provided in the LC. Hence, Art. 287 of the LC and
The retirement plan forms part of the employment not the PAL-ALPAP Retirement Plan, should govern
contract since it is made known to the Ees and the computation of the benefits to be awarded to
accepted by them, and such plan has an express Captain Collantes. Moreover, a pilot who retires
provision that the company has the choice to retire after twenty years of service or after flying 20,000
an Ee regardless of age, with 20 years of service, hours would still be in the prime of his life and at
said policy is within the bounds contemplated by the peak of his career, compared to one who retires
the LC. Moreover, the manner of computation of at the age of 60 years old. Based on this peculiar
retirement benefits depends on the stipulation circumstance that PAL pilots are in, the parties
provided in the company retirement plan provided for a special scheme of retirement
(Progressive Dev’t Corporation v. NLRC, G.R. No. different from that contemplated in the LC.
138826, October 30, 2000). Conversely, the provisions of Art. 287 of the LC
could not have contemplated the situation of PAL’s
NOTE: Although retirement plan forms part of the pilots. Rather, it was intended for those who have
employment contract, before a right to retirement no more plans of employment after retirement, and
benefits or pension vests in an Ee, he must have are thus in need of financial assistance and reward
met the stated conditions of eligibility with respect for the years that they have rendered service.
to the nature of employment, age, and length of (Philippine Airlines, Inc. v. Airline PilotsAssociation
service. This is a condition precedent to his of the Philippines, G.R. No. 143686, January 15,
acquisition of rights thereunder. SC ruled that the  2002).  
 2002).
conditions of eligibility for retirement must be met
at the time of retirement at which juncture the ELIGIBILITY
right to retirement benefits or pension, if the Ee is
eligible, vests in him. Retirement age

Again, it has been held that pension and retirement It is the age of retirement that is specified in the
plans create a contractual obligation in which the 1.  CBA;
promise to pay benefits is made in consideration of 2.  Employment contract;
the continued faithful service of the Ee for the 3.  Retirement plan (IRR, Book VI, Rule II, Sec. 3);
requisite period (Brion v. South Phil. Union Mission OR 
of the Seventh Day Adventist Church, 307 SCRA 497). 4.  Optional retirement age for underground
mining Ees 
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Retirement age in the absence of a retirement Composition of ½ month salary or retirement
plan or other applicable agreement pay

1.  Optional –  Upon reaching 60 years old Unless parties provide for broader inclusions,
provided that Ee has rendered 5 years of retirement pay is comprised of:
service.
1.  15 days salary based on latest salary rate;
NOTE:  The option to retire upon reaching 2.  Cash equivalent of not more than 5 days of
the age of 60 years or more but not beyond service incentive leaves (22.5/year of
65 is the exclusive prerogative of the Ee if service)
there is no provision on retirement in a CBA 3.  1/12 of the 13 th month pay
or any other agreement or if the Er has no 4.  All other benefits as may be agreed upon by
retirement plan (R.A. 7641; Capili v. NLRC, the Er and Ee (IRR, Book VI, Rule II, Sec.5.2). 
G.R. No. 117378, March 26, 1997). 
1997).  
NOTE: Under Sec. 26 of R.A. 4670, otherwise
2.  Compulsory –  65 years old, regardless of known as “Magna Carta for Public School
years of service (IRR,
(IRR, Book VI, Rule II, Sec. 4).
4 ). Teachers”, public school teachers having fulfilled
the age and service requirements of the applicable
NOTE:  Retirement benefits, where not retirement laws shall be given one range salary
mandated by law, may be granted by raise upon
raise upon the retirement, which shall be the basis
agreement of the Ees and their Er or as a of the computation of the lump sum of the
voluntary act on the part of the Er. Retirement retirement pay and monthly benefit thereafter.
benefits are intended to help the Ee enjoy the
remaining years of his life, lessening the Q: In 1955, Hilaria was hired as a grade school
burden of worrying for his financial support, teacher at the Sta. Catalina College. In 1970, she
and are a form of reward for his loyalty and applied for and was granted a 1 year leave of
service to the Er (Aquino v. NLRC, G.R. No. absence (LOA) without pay due to the illness of
87653, February 11, 1992). 
1992).   her mother. After the expiration in 1971 of her
LOA, she had not been heard from by Sta.
Compulsory retirement age below 60 allowed Catalina. In the meantime, she was employed as
a teacher at the San Pedro Parochial School
Art. 287 permits Er and Ee to fix the applicable during SY ‘80-‘81 and at the Liceo de San Pedro,
retirement age at below 60. The same is legal and during SY 1981-1982. In 1982, she applied
enforceable so long as the parties agree to be anew at Sta. Catalina which hired her. On Mar
governed by such CBA (Pantranco North Express v. 22, 1997, during the 51 st   Commencement
NLRC, G.R. No. 95940, July 24, 1996). Exercises of Sta. Catalina, Hilaria was awarded
a Plaque of Appreciation for 30 yrs. of service
Rule for extension of service of retiree upon and Php 12,000 as gratuity pay. On May 31,
reaching the compulsory retirement age 1997, Hilaria reached the compulsory
retirement age of 65. Sta. Catalina pegged her
Upon the compulsory retirement of an Ee or official retirement benefits at Php 59,038.35. However,
in the public or private service, his employment is amount of Php 12,000 representing the gratuity
deemed terminated. The matter of extension of pay, which was given to her, was deducted from
service of such Ee or official is addressed to the her retirement benefits.
sound discretion of the Er (UST Faculty Union v.
NLRC, G.R. No. 89885, August 6, 1990). Should the gratuity pay be deducted from the
retirement benefits?
 AMOUNT
 A: Yes.  Gratuity pay is separate and distinct from
Computation of retirement benefits in the retirement benefits. It is paid purely out of
absence of an applicable agreement or generosity.
retirement plan

A retiree is entitled to a retirement pay equivalent

to at least ½ month salary for every year of service,
a fraction of at least 6 months being considered as
1 whole year (R.A.
(R.A. 7641).
7641).
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LABOR STANDARDS 
Gratuity pay v. Retirement benefits RETIREMENT BENEFITS OF WORKERS PAID BY
RESULTS/ RETIREMENT BENEFITS OF PART-
RETIREMENT TIME WORKERS
GRATUITY PAY
BENEFITS
It is paid to the Determination of the amount of retirement
beneficiary for the past Are intended to help the benefits of workers paid by results and part-
services or favor Ee enjoy the remaining time workers
rendered purely out of years of his life,
the generosity of the releasing him from the The 15-day salary of workers paid by results and
giver or grantor.
grantor.  It is burden of worrying for part-time workers shall be determined from their
not intended to pay a his financial support, average daily salary which is the average daily
worker for actual and are a form of salary for the last 12 months reckoned from the
services rendered or for reward for his loyalty to date of their retirement, divided by the number of
actual performance. It the Er (Sta. Catalina actual working days in that particular period (Rules
is a money benefit or College and Sr. Loreta Implementing the New Retirement Law, Sec. 5.2 and
bounty given to the Oranza, v. NLRC and 5.3).  
5.3).
worker, the purpose of Hilaria Tercera, G.R. No.
which is to reward Ee’s 144483, November 19, TAXABILITY
who have rendered  2003).
satisfactory service to Non-taxability of retirement benefits under R.A.
the company.  7641

RETIREMENT PAY UNDER RA 7641 VIS-À-VIS Retirement benefits under R.A 7641 are tax exempt
RETIREMENT BENEFITS UNDER SSS AND GSIS provided that such benefits provided by the
LAWS retirement plan be equal or less than the minimum
requirement provided by law.
Retirement pay under the LC in relation to
retirement benefits under SSS and GSIS laws Requirements for tax exemption under R.A.
(1997 Bar Question)  7641

Revised 1.  That there be no CBA or other applicable

Government Employees’  employment contract providing for
Social Security retirement benefits for an Ee; or
Service Compensation
Law 2.  Even if there is a CBA or other applicable
Insurance  Act
 Act employment contract providing for
retirement benefits for an Ee, that the same
Compulsory upon Compulsory for Compulsory is below the requirements set forth by law.
all Ee s n o t all permanent upon all Ers
ov er 60 yeyea ars Ees below 60 and their Ees WOMEN WORKERS
of age and their years of age not over 60
Ers. upon years of age; PROVISIONS AGAINST DISCRIMINATION
appointment of Provided, that
1. Filipinos permanent an Ee who is State policy on non-discrimination against
recruited in the status, and for over 60 years women
Philippines by all elective of age and
foreign-based Ers officials for the paying The State condemns discrimination against women
for employment duration of contributions in all its forms and pursues by all appropriate
abroad may be their tenure. to qualify for means and without delay the policy of eliminating
covered by the the retirement discrimination against women in keeping with the
SSS on a or life Convention on the Elimination of All Forms of
voluntary basis. NOTE: Any insurance Discrimination Against Women (CEDAW) and
person, benefit other international instruments consistent with
2. Compulsory whether elected administered Philippine law. The State shall accord women the
upon all self- or appointed, in by the System rights, protection, and opportunities available to
employed the service of an shall be every member of society (R.A. 9710 or the Magna
persons earning Er is a covered subject to Carta of Women, Sec. 2). 
2). 
Php 1, 800 or Ee if he receives compulsory
more per annum. compensation coverage. The State shall take steps to review and, when
for such service. necessary, amend and/or repeal existing laws that
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are discriminatory to women within 3 years from Q: May a woman worker be dismissed on the
the effectivity of this Act (R.A. 9710, Sec. 12). ground of dishonesty for having written
‘’single” on the space for civil status on the
Discriminatory acts against women Ee application sheet, contrary to the fact that she
was married? 
1.  Discrimination with respect to the terms
and conditions of employment solely on  A:  Art. 136 of the LC, explicitly prohibits
account of sex discrimination merely by reason of marriage of a
a.  Discrimination in pay – Payment of a lesser female Ee. The policy of not accepting or
compensation including wage, salary or disqualifying from work any woman worker who
other forms of remuneration and fringe contracts marriage is afoul of the right against
benefits, to a female Ee as against a male discrimination provided to all women workers by
Ee; our labor laws and by our Constitution (PT&T Co. v.
b.  Discrimination in employment opportunity NLRC, G.R. No. 118978, May 23, 1997).
– favoring a male Ee over a female Ee with
respect to promotion, assignment, Q: Can an individual, the sole proprietor of a
transfer, training opportunities, study and business enterprise, be said to have violated
scholarship grants solely in account or the Anti-Sexual Harassment Act of 1995 if he
their sexes; clearly discriminates against women in the
c.  Discrimination in hiring –  favoring a male adoption of policy standards for employment
applicant with respect to hiring where the and promotions in the enterprise? Explain . 
particular job can equally be handled by a (2003 Bar Question)
woman;
d.  Discrimination in dismissal –  favoring a  A: When an Er discriminates against women in the
male Ee over a female Ee with respect to adoption of policy standards for employment and
dismissal of personnel or the application promotion in his enterprise, he is not guilty of
of the last in / first out principle or other Sexual Harassment. Instead, the Er is guilty of
retrenchment policy of the Er (Poquiz, Vol. discrimination against women Ees which is
I).  
I). declared to be unlawful by the LC.

2.  Stipulating, whether as a condition for For an Er to commit Sexual Harassment, he –  as a

employment or continuation of person of authority, influence or moral ascendancy
employment: –  should have demanded, requested or otherwise
a.  That a woman Ee shall not get married, or required a sexual favor from his Ee whether the
b.  That upon marriage, such woman Ee shall demand, request or requirement for submission is
be deemed resigned or separated (LC, Art. accepted by the object of said act.  
136).  
136).
STIPULATION AGAINST MARRIAGE
3.  Dismissing, discriminating or otherwise (LC, ART. 136)
prejudice a woman Ee by reason of her being
married (LC, Art. 136). 
136).   No-spouse employment policy

NOTE: Discrimination in any form from pre- It is a policy banning spouses from working in the
employment to post employment, including same company.
hiring, promotion or assignment, based on the
actual, perceived or suspected HIV status of an No-spouse employment policy may or may not
individual is unlawful (Philippine AIDS violate provisions of the LC
Prevention and Control Act of 1998, R.A. 8504).
GR: It may not facially violate Art. 136 of the LC but
Standard of reasonable test it creates a disproportionate effect and the only
way it could pass judicial scrutiny is by showing
Under the standard reasonable test which is that it is reasonable despite the discriminatory and
parallel to the concept of a bona-fide occupational disproportionate effect.
qualification test in American jurisdictions, the Er
has the burden of proof to prove the existence of a XPN: Bona fide 
fide  occupational qualification rule
reasonable business necessity that would justify an (BFOQR)
employment policy (Star Paper Corp. v. Simbol, G.R.
No. 164774, April 12, 2006).
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Bona fide occupational qualification rule PROHIBITED ACTS

There must be a finding of any BFOQ to justify an Prohibited acts under Art.137 of the LC
Er’s no spouse employment rule. There must be a
compelling business necessity for which no It shall be unlawful for any Er to:
alternative exists other than the discriminating
practice. To justify a BFOQ, the Er must prove two 1.  Deny any woman Ee benefits provided by
factors: law.
2.  Discharge any woman for the purpose of
1.  That the employment qualification is preventing her from enjoying any of the
reasonably related to the essential operation benefits provided by law.
of the job involved; and 3.  Discharge such woman on account of her
2.  That there is a factual basis for believing that pregnancy, or while on leave or in
all or substantially all persons meeting the confinement due to her pregnancy.
qualification would be unable to properly 4.  Discharge or refuse the admission of such
perform the duties of the job (Star Paper v. woman upon returning to her work for fear
Simbol, G.R. No. 164774, April 12, 2006). 
2006).   that she may again be pregnant.

Importance of the BFOQR Q: At any given time, approximately 90% of the

production work force of a semiconductor
1.  To ensure that the Ee can effectively perform company are females. 75% of the female
his work   workers are married and of child-bearing
2.  So that the no-spouse employment rule will years. It is imperative that the Company must
not impose any danger to business. operate with a minimum number of absences to
meet strict delivery schedules. In view of the
Q: Glaxo, a company which has a policy against very high number of lost working hours due to
employees having relationships with the absences for family reasons and maternity
employees of its competitors, employed Tecson leaves, the company adopted a policy that it
as a medical representative. Tecson married will employ married women as production
Bettsy, a Branch coord inator in one of Glaxo’s workers only if they are at least 35 years old. Is
competitors. Tecson was then transferred to the policy in violation of any law? (1998 Bar
another area but he did not accept such Question)
transfer.
 A: Yes, it violates Art. 140 of the LC which provides
Is the policy of Glaxo valid and reasonable so as that no Er shall discriminate against any person in
to constitute the act of Tecson as willful respect to the terms and conditions of employment
disobedience? on account of his age.  

 A: Yes. The prohibition against personal or marital Persons covered under the classification of
relationships with Ees of competitor companies certain women workers
upon Glaxo’s Ees is reasonable under the
circumstances because relationships of that nature Any women who is permitted or suffered to work:
might compromise the interest of the company.
Glaxo does not impose an absolute prohibition 1.  With or without compensation
against relationships between its Ees and those of 2.  In any night club, cocktail lounge, massage
competitor companies. Its Ees are free to cultivate clinic, bar or similar establishment
relationships with and marry persons of their own 3.  Under the effective control or supervision of
choosing. What the company merely seeks to avoid the Er for a substantial period of time
is a conflict of interest between the Ee and the 4.  Shall be considered as an Ee of such
company that may arise out of such relationships. establishment for purposes of labor and
Furthermore, the prohibition forms part of the social legislation.
employment contract and Tecson was aware of
such restrictions when he entered into a
relationship with Bettsy (Duncan Assoc. of
Detailman-PTGWO v. GlaxoWellcome Phil. Inc., G.R.
No. 162994, September 17, 2004).
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 ANTI-SEXUAL HARASSMENT ACT favor.” It is not necessary that the demand, request
request
(R.A. 7877) or requirement of a sexual favor be articulated in a
categorical manner. It may be discerned, with
State policy in enacting the Anti-Sexual equal certitude, from the acts of the offender.
Harassment Law
Likewise, it is not essential that the demand,
The State shall: request or requirement be made as a condition for
continued employment or for promotion to a
1.  Value the dignity of every individual higher position. It is enough that the respondent’s
2.  Enhance the development of its human acts result in creating an intimidating, hostile or
resources offensive environment for the employee (Domingo
3.  Guarantee full respect for human rights, and v. Rayala, G.R. No. 155831, February 18, 2008). 
2008).  
4.  Uphold the dignity of workers, Ees,
applicants for employment, students or Places where sexual harassment are committed
those undergoing training, instruction or
education (R.A. 7877, Sec. 2). Specifically:

Persons who may be held liable for sexual 1.  In a work-related or employment
harassment environment:

In a work, education or training-related a.  The sexual favor is made as a condition in

environment Sexual Harassment may be the hiring or in the employment, re-
committed by an: employment or continued employment of
said individual, or in granting said
1.  Er individual favorable compensation, terms,
2.  Manager conditions, promotions, or privileges; or
3.  Supervisor the refusal to grant the sexual favor results
4.  Agent of the Er in limiting, segregating or classifying the
5.  Teacher, instructor, professor Ee which in a way would discriminate,
6.  Coach, trainer, or deprive or diminish employment
7.  Any other person who, having authority, opportunities or otherwise adversely
influence or moral ascendancy over another affect said Ee (quid pro quo sexual
in a work or training or education harassment);
environment: b.  The above acts would impair the Ees’
a.  Demands rights or privileges under existing labor
b.  Requests or laws; or
c.  Requires c.  The above acts would result in an
- any sexual favor from the other, intimidating, hostile, or offensive
regardless of whether the environment for the Ee.
demand, request or requirement
for submission is accepted by the 2.  In an education or training environment
object of R.A. 7877 (R.A. 7877, Sec. sexual harassment is employed:
3).  
3).
a.  Against one who is under the care, custody
 Acts of sexual harassment or supervision of the offender;
b.  Against one whose education, training,
Generally, sexual harassment is committed when a apprenticeship or tutorship is entrusted to
person demands, requests, or otherwise requires the offender;
any sexual favor from another, regardless of c.  When sexual favor is made a condition to
whether the demand, request or requirement for the giving of a passing grade, or the
submission is accepted by the latter. granting of honors and scholarships, or the
payment of a stipend, allowance or other
The definition of sexual harassment does not benefits, privileges, or considerations; or
require a categorical demand or request for d.  When sexual advances result in an
sexual favor intimidating, hostile or offensive
environment for the student, trainee or
While the provision states that there must be a apprentice.
“demand, request or requirement of a sexual
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Duties of the Er or head of office in a work- Three-fold liability rule in sexual harassment
related, education or training environment cases

1.  Prevent or deter the commission of acts of An act of Sexual Harassment may give rise to civil,
Sexual Harassment, and criminal and administrative liability on the part of
2.  Provide the procedures for the resolution, the offender, each proceeding independently of the
settlement or prosecution of acts of Sexual others.
Harassment.
Prescription of action
Towards this end, the Er or head of office shall
The civil, criminal and administrative action shall
1.  Promulgate appropriate rules and prescribe in 3 years.
regulations in consultation with and jointly
approved by the Ees or students or trainees, Q: A Personnel Manager, while interviewing an
through their duly designated attractive female applicant for employment,
representatives, prescribing the procedure stared directly at her for prolonged periods,
for the investigation or Sexual Harassment albeit in a friendly manner. After the interview,
cases and the administrative sanctions the manager accompanied the applicant to the
therefore (Sec. 4, R.A. 7877). 
7877).  door, shook her hand and patted her on the
shoulder. He also asked the applicant if he
NOTE:  Administrative sanctions shall not be could invite her for dinner and dancing at some
a bar to prosecution in the proper courts for future time. Did the Personnel Manager, by the
unlawful acts of Sexual Harassment. above acts, commit Sexual Harassment?
Reason. (2000 Bar Question)
The said rules and regulations issued shall
include, among others, guidelines on proper  A: Yes. The Personnel Manager, is in a position to
decorum in the workplace and educational grant or not to grant a favor (a job) to the
or training institutions. applicant. Under the circumstances, inviting the
applicant for dinner or dancing creates a situation
2.  Create a committee on decorum and hostile or unfriendly to the applicant's chances for
investigation of cases on Sexual Harassment. a job if she turns down the invitation (R.A. No. 7877,
3.  The Er or head of office, education or (3) ). 
 Anti-Sexual Harassment Act, Sec. 3 (a) (3)).
training institution shall disseminate or post
a copy of this R.A. 7877 for the information Q: In the course of an interview, another female
of all concerned applicant inquired from the same Personnel
Manager if she had the physical attributes
Liability of the Er, head of office, educational or required for the position she applied for. The
training institution  Personnel Manager replied: "You will be more
attractive if you will wear micro-mini dresses
Er shall be solidarily liable for damages arising without the undergarments that ladies
from the acts of Sexual Harassment committed in normally wear." Did the Personnel Manager, by
the employment, education or training the above reply, commit an act of sexual
environment provided:
environment  provided: harassment? Reason.

1.  The Er or head of office, educational or  A: Yes. The remarks would result in an offensive or
training institution is informed of such acts hostile environment for the Ee. Moreover, the
by the offended party; and remarks did not give due regard to the applicant’s
2.  No immediate action is taken thereon (R.A. feelings and it is a chauvinistic disdain of her
7877, Sec. 5). 
5).   honor, justifying the finding of Sexual Harassment
(Villarama v. NLRC, G.R. No. 106341, September 02,
 An independent action for damages may be 1994).
filed
Q: Pedrito Masculado, a college graduate from
Nothing under R.A. 7877 shall preclude the victim the province, tried his luck in the city and
of work, education or training-related Sexual landed a job as a utility/maintenance man at
Harassment from instituting a separate and the warehouse of a big shopping mall. After
independent action for damages and other working as a casual employee for 6 months, he
affirmative relief (Sec. 6). 
6).  signed a contract for probationary employment
for 6 months. Being well-built and physically
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attractive, his supervisor, Mr. Hercules Barak, c.  Er-parent or legal guardian provides
took special interest to befriend him. When his the child with the primary and/or
probationary period was about to expire, he secondary education prescribed by the
was surprised when one afternoon after Department of Education
working hours, Mr. Barak followed him to the
men’s comfort room. After seeing that no one 2.  The child’s employment or participation in
else was around, Mr. Barak placed his arm over public entertainment or information
Pedrito’s shoulder and softly said: “You have through cinema, theater, radio or
great potential to become a regular Ee and I television is essential provided:
think I can give you a favorable a.  Employment contract is concluded by
recommendation. Can you come over to my the child’s parents or legal guardian,
condo unit on Saturday evening so we can have b.  With the express agreement of the
a little drink? I’m alone, and I’m sure you want child concerned, if possible, and
to stay longer with the company.” c.  The approval of DOLE, the following
must be complied with:
Is Mr. Barak liable for Sexual Harassment i. The employment does not involve
committed in a work-related or employment advertisement or commercials
environment? (2000 Bar Question) promoting alcoholic beverages,
intoxicating drinks, tobacco and
 A: Yes. The elements of Sexual Harassment are all its by-products or exhibiting
present. The act of Mr. Barak was committed in a violence
workplace. Mr. Barak, as supervisor of Pedrito ii. There is a written contract
Masculado, has authority, influence and moral approved by DOLE
ascendancy over Masculado. iii. The conditions provided in the
first instance are met
Given the specific circumstances mentioned in the
question like Mr. Barak following Masculado to the B.   Above 15 but below 18  – May be employed
comfort room, etc. Mr. Barak was requesting a in any non-hazardous work
sexual favor from Masculado for a favorable C.   Above 18 – No prohibition
recommendation regarding the latter's
employment. It is not impossible for a male, who is Duty of the Er before engaging a minor into
a homosexual, to ask for a sexual favor from employment
another male.
The Er shall first secure a work permit from the
EMPLOYMENT OF MINOR WORKERS DOLE which shall ensure observance of the
requirements (R.A. 7160, Sec. 12).
Rules on employment of minor workers
Rule in the issuance of work certificates/
GR: permits to children at least 15 but below 18
1.  No person under 18 years of age will be years of age
allowed to be employed in an undertaking
which is hazardous or deleterious in nature. The issuance of a DOLE Certificate to youth aged 15
2.  No Er shall discriminate against any person to below 18 years of age is not required by law. No
in respect to terms and conditions of Er shall deny opportunity to any such youth
employment on account of his age. applying for employment merely on the basis of
lack of work permit or certificate of eligibility for
XPN:  employment. Any young person aged 15 to below
 A.  Below 15 yrs. Old 18 years of age may present copy of this DOLE
1.  The child works directly under the sole advisory to any Er, job provider, government
responsibility of his parents or legal authority, or his/her representative when seeking
guardian and where only members of the employment or anytime during employment  (DOLE
 (DOLE
family are employed, subject to the Department Advisory No. 01-08).
following conditions:
a.  Employment does not endanger the Non-hazardous work  
child’s safety, health and morals 
morals  
b.  Employment does not impair the It is any work or activity in which the Ee is not
child’s normal development   exposed to any risk which constitutes an imminent
danger to his safety and health.
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Hazardous workplaces exception provided in the Department Order of
DOLE for the engagement of persons in
1.  Nature of work exposes the workers to domestic and household service. Is her defense
dangerous environmental elements, tenable? (2004 Bar Question)  
contaminants or work conditions
2.  Workers are engaged in construction work,  A: No. Under Art. 139 of the LC on “minimum
logging, fire-fighting, mining, quarrying, employable age,” no child below 15 years of age
blasting, stevedoring, dock work, deep-sea shall be employed except when he works directly
fishing, and mechanized farming under the sole responsibility of his parents or
3.  Workers are engaged in the manufacture or guardian, the provisions of the alleged department
handling of explosives and other pyrotechnic order of DOLE to the contrary notwithstanding. A
products mere department order cannot prevail over the
4.  Workers use or are exposed to heavy or express prohibitory provisions of the LC.
power-driven tools
Q: Determine whether the following minors
Q: You were asked by a paint manufacturing should be prohibited from being hired and
company regarding the possible employment from performing their respective duties
as a mixer of a person aged 17, who shall be indicated hereunder: (2006 Bar Question)
directly under the care of the section
supervisor. What advice would you give? a.   A 17-year old boy working as miner at the
Explain briefly. (2002 Bar Question) Walwadi Mining Corporation.
b.   An 11-year old boy who is an accomplished
 A: The paint manufacturing company cannot hire a singer and performer in different parts of
person who is aged 17. Art. 139(c) of the LC the country.
provides that a person below 18 years of age shall c.   A 15-year old girl working as a library
not be allowed to work in an undertaking which is assistant in a girls' high school.
hazardous or deleterious in nature as determined d.   A 16-year old girl working as model
by the SLE. Paint manufacturing has been classified promoting alcoholic beverages.
by the SLE as a hazardous work . e.   A 17-year old boy working as a dealer in a
casino. (2006 Bar Question)
Prohibitions on the employment of children in
certain advertisements  A: 
a.  Yes. He should be prohibited from being hired
Employment of child models in all commercial and from performing the duties of a miner
advertisements promoting the following shall be because such constitutes hazardous work
prohibited: under D.O. No. 04 Series of 1999. Art. 139(c) of
LC expressly prohibits the employment of
1.  Alcoholic beverage persons below 18 years of age in an
2.  Intoxicating drinks undertaking which is hazardous or deleterious
3.  Tobacco and its by products in nature as determined by the SLE.
4.  Gambling
5.  Violence b.  No.  He should not be prohibited from being
6.  Pornography hired and from performing as a singer. Under
Art. VIII Sec. 12(2) of R.A. 7619 as amended by
Q: A spinster school teacher took pity on one of R.A. 7658, this constitutes an exception to the
her pupils, a robust and precocious 12-year old general prohibition against the employment of
boy whose poor family could barely afford the children below 15 years of age, provided that
cost of his schooling. She lives alone at her the following requirements are strictly
house near the school after her housemaid left. complied with:
In the afternoon, she lets the boy do various 1.  The Er shall ensure the protection, health
chores as cleaning, fetching water and all kinds safety and morals of the child
of errands after school hours. She gives him 2.  The Er shall institute measures to prevent
rice and Php 30.00 before the boy goes home at the child’s exploitation or discrimination
7 every night. The school principal learned taking into account the system and level of
about it and charged her with violating the law remuneration, and the duration and
which prohibits the employment of children arrangement of working time; and
below 15 years of age. In her defense, the 3.  The Er shall formulate and implement,
teacher stated that the work performed by her subject to the approval and supervision of
pupil is not hazardous, and she invoked the
 pupil is not hazardous, and she invoked the competent authorities, a continuing

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program for training and skill acquisition legal guardian and where only members
of the child. Moreover, the child must be of the child’s family are
ar e employed; or
directly under the sole responsibility of his b.  In public entertainment or information
parents or guardian and his employment
should not in any way interfere with his Instances when the state can intervene in
schooling. behalf of the child

c.  No. She should not be prohibited from working 1.  When the parent, guardian, teacher or
as a library assistant because the prohibition in person having care or custody of the child
the LC against employment of persons below fails or is unable to protect the child against
18 years of age merely pertains to employment abuse, exploitation and discrimination; or
in an undertaking which is hazardous or 2.  When such acts are committed against the
deleterious in nature as identified in the child by the said parent, guardian, teacher or
guidelines issued by the SLE. Working as a person having care and custody over the
library assistant is not one of undertakings child.
identified to be hazardous under D.O. No 04
Series of 1999. Limitation on the hours of work of a working
child
d.  Yes. She should be prohibited from working as
a model promoting alcoholic beverages. R.A. If the child is:
7610 categorically prohibits the employment
of child models in all commercials or 1.  Below 15 years of age  –  Not more than 20
advertisements promoting alcoholic beverages hours a week and not more than 4 hours a day
and intoxicating drinks, among other things. - Not allowed to work between 8:00 pm – 
6:00 am
e.  Yes. He should be prohibited from working as
a dealer in casino, because Art. 140 of the LC 2.   At least 15 years
ye ars of age but below 18 years
prohibits the employment of persons below 18 of age –  shall not exceed 8 hours a day or 40
years of age in an undertaking which is hours a week
hazardous or deleterious in nature identified - Not allowed to work between 10:00 pm – 
in the guidelines issued by the SLE. Working as 6:00 am
a dealer in a casino is classified as hazardous
under D.O. No. 04 Series of 1999 as it exposes Worst forms of labor
children to physical, psychological or sexual
abuses. 1.  All forms of slavery (Anti-Trafficking of
Persons Act of 2003) 
2003)  or practices similar to
 ACT AGAINST CHILD LABOR (R.A. 9231) AND slavery such as sale and trafficking of
CHILD ABUSE LAW (R.A. 7610) children, debt bondage and serfdom and
forced or compulsory labor, including
Child labor recruitment of children for use in armed
conflict;
Any work or economic activity performed by a 2.  The use, procuring, offering of a child for
child that subjects him or her to any form of prostitution, for the production of
exploitation or is harmful to his or her health and pornography or for pornographic
safety or physical, mental or psychosocial performances;
development. 3.  The use, procuring, offering or exposing of a
child for illegal or illicit activities, including
Working child the production and trafficking of dangerous
drugs and volatile substances prohibited
Any child engaged as follows: under existing laws;
4.  Employing child models in all commercials
1.  When the child is below 18 years of age in a or advertisements promoting alcoholic
work or economic activity that is not child beverages, intoxicating drinks, tobacco and
labor; or its byproducts and violence; and
2.  When the child is below 15 years of age: 5.  Work which, by its nature or circumstances
a.  In work where he/she is directly under in which it is carried out, is hazardous or
the responsibility of his/her parents or likely to be harmful to the health, safety or
morals of children.
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Persons who can file a complaint for unlawful Children under foster family arrangement
acts committed against children
Children under foster family arrangement are
1.  Offended party those who are living with a family or household of
2.  Parents or guardians relative/s and are provided access to education
3.  Ascendants or collateral relatives within the and given an allowance incidental to education, i.e.,
3rd degree of consanguinity “baon,”   transportation, school projects, and school
4.  Officer, social worker or representative of a activities; provided, that the foster family and
licensed child-caring institution foster care arrangements are in compliance with
5.  Officer or social worker of DSWD the procedures and requirements as prescribed by
6.  Barangay   chairman of the place where the R.A. 10165 or Foster Care Act of 2012.
violation occurred, where the child is
residing or employed Examples of persons performing work
7.  At least 3 concerned, responsible citizens occasionally or sporadically and not on an
where the violation occurred occupational basis

Jurisdiction over offenses punishable under 1.  A janitress doing irregular laundry work for
R.A. 9231 a household during rest day;
2.  A construction worker doing casual
The Family Courts shall have original jurisdiction gardening job for a household; or  
over all cases involving offenses punishable under 3.  A hospital nurse or a student doing baby-
this Act. sitting job. 

EMPLOYMENT OF HOUSEHELPERS Employable age for a kasambahay  

Persons covered by R.A. 10361 otherwise The employable age for a kasambahay   is 15 years
known as “Batas kasambahay”   old and above.

All kasambahay   engaged in domestic work, NOTE: The employment of children 15 but below
whether on a live-in or live-out arrangement, such 18 years of age may be made under the following
as, but not limited to, the following: conditions: 

1.  General househelp 1.  They shall not be allowed to work for more
2.  Nursemaid or Yaya than 8 hours a day, and in no case beyond
3.  Cook 40 hours a week;
4.  Gardener 2.  They shall not be allowed to work between
5.  Laundry person 10 p.m. to 6 a.m. of the following day;
6.  Working children or domestic workers 15 3.  They shall not be allowed to do hazardous
years and above but below 18 years of age; work; and
or 4.  They shall not be denied access to education
7.  Any person who regularly performs and training.
domestic work in one household on an
occupational basis (live-out arrangement) The consent of the parent/guardian of working
(R.A. 10361, Sec. 3(d)). 
3(d)).  children is required in the employment contract.

Persons not covered by the batas kasambahay Er of a kasambahay

The following are not covered: An Er is any person who engages and controls the
services of a kasambahay   and is party to the
1.  Service providers employment contract.
2.  Family drivers
3.  Children under foster family arrangement; Er’s household
and
4.  Any other person who performs work Household refers to the immediate family members
occasionally or sporadically and not on an or other occupants of the house who are directly
occupational and regular basis. and regularly provided services by the
kasambahay.
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Modes of hiring a kasambahay Contents of the employment contract

An Er can hire directly or through private 1.  Duties and responsibilities of the
employment agencies registered with the DOLE kasambahay ;
regional offices. The Er, whether the kasambahay is 2.  Period of employment;
hired directly or through POEA, shall shoulder the 3.  Compensation;
expenses for hiring. The kasambahay shall not be 4.  Authorized deductions;
charged of any cost of the recruitment, placement, 5.  Hours of work and proportionate additional
or finder’s fee. payment;
6.  Rest days and allowable leaves;
NOTE: The Er shall pay the expenses that are 7.  Board, lodging and medical attention;
directly used for the transfer of the kasambahay 8.  Agreements on deployment expenses, if any;
from place of origin to the place of work. An Er can 9.  Loan agreement;
be reimbursed of the deployment expenses when 10.  Termination of employment; and
the kasambahay  unreasonably
  unreasonably leaves the Er within 11.  Any other lawful condition agreed upon by
6 months from the time he/she started work. both parties.

If a kasambahay   is hired thru a Private Registration of the kasambahay

Employment Agency, the agency is allowed to
collect Service Fee from the Er. The Er is required to register the kasambahay   in
the Registry of Domestic Workers in the barangay
Pre-employment requirements where the Er resides. For this purpose, the DILG, in
coordination with the DOLE, shall formulate a
Before entering into an employment contract, the registration system. 
Er has the option to require the following from a
kasambahay: NOTE: The registration of the kasambahay   is free
of charge.
1.  Medical certificate or health certificate
issued by a local government health officer; Mandatory benefits of a kasambahay  
2.  Barangay  and
 and police clearance;
3.  NBI clearance; and 1.  Monthly minimum wage;
4.  Duly authenticated birth certificate or, if not 2.  Daily rest period of 8 (total) hours;
available, voter’s identification card, 3.  Weekly rest period of 24 (uninterrupted) hrs
baptismal record, or passport showing the 4.  5 days annual service incentive leave with
kasambahay’s age.
kasambahay’s  age. pay;
5.  13th month pay;
NOTE: Requirements are mandatory when the 6.  SSS benefit;
employment of the kasambahay   is facilitated 7.  PhilHealth benefit; and
through a private employment agency. 8.  Pag-IBIG benefit

It is not a requirement for a kasambahay   to be Other rights and privileges of a kasambahay

trained and certified by TESDA prior to
employment. However, the kasambahay   is 1.  Freedom from Er’s interference in wage
encouraged to undergo competency assessment disposal;
and be certified by TESDA. Training is not a 2.  Standard of treatment;
requirement for competency assessment. 3.  Board, lodging, and medical attendance;
4.  Right to privacy;
Contract between the Er and kasambahay   5.  Access to outside communication;
6.  Access to education and training;
The Er and the kasambahay   shall enter into a 7.  Right to be provided a copy of the
contract of employment written in a language or employment contract;
dialect understood by them. 8.  Right to Certificate of Employment;
9.  Right to form, join, or assist labor
NOTE: The contract need not be notarized. The organization;
Punong Barangay  or
 or his/her designated officer may 10.  Right to terminate employment based on
attest to the contract and serve as witness to its just cause; and
execution. 11.  Right to exercise religious beliefs and
cultural practices.
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Basic necessities of a kasambahay   for an equivalent hourly rate . The eight-hour rest
period must be observed.  
1.  At least 3 adequate meals a day, taking into
consideration the kasambahay’s
kasambahay’s   religious NOTE: Kasambahays
Kasambahays   are also entitled to at least
beliefs and cultural practices; 24 consecutive hours of rest in a week. The Er and
2.  Humane sleeping condition; and the kasambahay   may determine the schedule of
3.  Appropriate rest and basic medical the weekly rest period. The Er shall respect the
assistance. preferred weekly rest day of the kasambahay on
religious grounds (Sec. 21, R.A. 10361). 
10361).  
NOTE: Though not part of the “basic necessities”
required to be provided by the Er to the Five-day annual service incentive leave
kasambahay , shampoo, soap, toothpaste etc. may
be provided gratuitously. The kasambahay   can avail the five day annual
service incentive leave after 1 year of service.
Monthly minimum wage of a kasambahay
NOTE:  If the kasambahay   fails to avail of any of
For those employed in: his/her annual SIL, it shall be forfeited and cannot
1.  National Capital Region – Php 2,500.00  be converted to cash.  
2.  Cities and 1st class municipalities –  Php
2,000.00  Other agreement that the Er and the
3.  Other municipalities –  Php 1,500.00 (R.A. kasambahay   can enter into relative to the
10361, Sec. 24).
24). kasambahay’s  weekly rest day and service
incentive leave
NOTE:  The law provides a mechanism for
increasing the minimum wage of the kasambahay . 1.  Offsetting a day of absence with a particular
Initially, one year from 4 June 2013, the Regional rest day;
Tripartite Wages and Productivity Boards 2.  Waiving a particular rest day in return for an
(RTWPB) may review, and if proper, determine and equivalent daily rate of pay;
adjust the minimum wage (Sec.
( Sec. 24, R.A. 10361). The 3.  Accumulating rest days not exceeding 5 days;
RTWPB shall coordinate with TESDA on the wage 4.  Adding the accumulated rest days (maximum
review and adjustment based on the kasambahay’ s of 5 days) to the five-day SIL; and
competency level, in line with the thrust to 5.  Waiving a particular SIL in return for an
professionalize the domestic service sector. equivalent daily rate of pay.

Payment of Wage 13th month pay

Wage shall be in cash and at least be paid once a   is entitled to 13 th month pay after
The kasambahay  is
month. 1 month of service.

NOTE:  The Er shall at all times provide the Computation of the 13thmonth pay
kasambahay  with
  with a copy of the pay slip every pay
day containing the amount paid and all deductions In computing the 13thmonth pay, the total basic
made, if any. The copies of the pay slip shall be wage received in a given calendar year shall be
kept by the Er for a period of 3 years (R.A. 10361, divided by 12. The amount derived shall be paid
Sec. 26).  not later than December 24.

Payment of wages by means of promissory, SSS, PHILHEALTH, and PAG-IBIG

voucher, coupon, token, ticket, chit, or anything
other than the cash wage is prohibited. The kasambahay  is
  is covered by SSS, PhilHealth and
Pag-IBIG after 1 month of service.
Daily rest period
Er’s obligation to register the kasambahay in
The kasambahay   is entitled to a total daily rest SSS, PHILHEALTH, and PAG-IBIG
period of at least 8 hours.
Under the SSS, PhilHealth, and PAG-IBIG laws, the
Prohibition of work beyond 16 hours Er has the obligation to register the kasambahay  
and deduct and remit the required premiums and
The Er cannot require the kasambahay   to work contributions. The Er shall incur certain liabilities,
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including criminal prosecution, if he fails or refuses 6.  Other causes analogous to the foregoing (R.A.
to comply with his/her obligations. 10361, Sec. 33). 
33).  

Employer’s liability in case the kasambahay   Grounds for termination of contract by the Er
refuses to be a member of SSS, PHILHEALTH,
and PAG-IBIG 1.  Misconduct or willful disobedience by the
kasambahay  of
  of the lawful order of the Er in
The employer is still liable under the SSS, connection with the former’s work; 
work;  
PHILHEALTH, and PAG-IBIG laws in case the 2.  Gross or habitual neglect or inefficiency by
kasambahay   refuses membership with those the kasambahay   in the performance of
agencies, because it is mandatory and non- duties;
negotiable. 3.  Fraud or willful breach of the trust reposed
by the Er on the kasambahay ;
Person liable to pay the SSS premium, 4.  Commission of a crime or offense by the
PHILHEALTH and PAG-IBIG contributions of the kasambahay  against
  against the person of the Er or
kasambahay   immediate member of the Er’s family; 
any immediate family; 
5.  Violation by the kasambahay   of the terms
GR: The Er shall pay the SSS premium, and and conditions of the employment contract
PHILHEALTH and PAG-IBIG contributions of the and other standards set forth under the law;
kasambahay 6.  Any disease prejudicial to the health of the
kasambahay , the Er, or member/s of the
XPN: If the wage of the kasambahay is Php household; and
5,000.00 or more, the kasambahay will pay his/her 7.  Other causes analogous to the foregoing
share in the premiums/contributions. (R.A. 10361, Sec. 34). 
34). 

Provisions protecting Ers of a kasambahay   NOTE:  Neither the domestic worker nor the Er
may terminate the contract before the expiration
1.  Prohibition against privileged information; of the term except for grounds provided for in
2.  Er may require certain pre-employment Secs. 33 and 34 of the Batas Kasambahay.
Kasambahay.  
documents prior to engagement;
3.  Ers are assured of quality services through The domestic worker and the Er may mutually
DOLE-TESDA training, assessment, and agree upon written notice to pre-terminate the
certification of kasambahay ; contract of employment to end the employment
4.  Forfeiture of 15-day unpaid salary should the relationship (R.A. 10361, Sec. 32). 
32). 
kasambahay   leave the residence of the Er
without any justifiable reason; and Termination of contract if the duration of
5.  Right to terminate the employment on service is not determined in the contract
justifiable grounds.
The kasambahay   or the Er may terminate the
Grounds for termination of contract by the contract anytime if the duration of service is not
kasambahay determined in the contract. Either the Er or the
kasambahay   may give notice to end the working
1.  Verbal or emotional abuse of the relationship 5 days before the intended date of the
kasambahay  by
  by the Er or any member of the termination of service.
household;
2.  Inhuman treatment including physical abuse Effect of unjust dismissal by the Er
of the kasambahay  by
  by the Er or any member
of the household; The kasambahay   shall receive the following if
3.  Commission of a crime or offense against the he/she is unjustly dismissed by the Er:
kasambahay  by
  by the Er or any member of the 1.  Outright payment of earned wage; and
household; 2.  Indemnity benefit in the form of wage
4.  Violation by the Er of the terms and equivalent to 15 days work.
conditions of the employment contract and
other standards set forth under the law; Liabilities of a kasambahay who leaves his/her
5.  Any disease prejudicial to the health of the Er without justifiable reason
kasambahay , the Er, or member/s of the
household; and 1.  Forfeiture of wage equivalent to 15 days
work; and
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2.  Reimbursement of the deployment 3.  Ensure that the employment agreement
expenses, if the employment contract is between the kasambahay  and
  and the employer
terminated within 6 months from stipulates the terms and conditions of
employment. employment and all the benefits in
accordance with the IRR;
Right against inspection of his belongings 4.  Provide a pre-employment orientation
briefing to the kasambahay  and
 and the Er about
The Er cannot inspect the belongings of the their rights and responsibilities in
kasambahay . However, the Er and the kasambahay   accordance with this IRR;
can agree in their employment contract that an 5.  Ensure that the kasambahay is not charged
inspection can be made before he/she leaves the or required to pay any recruitment or
household. placement fees;
6.  Keep copies of employment contracts and
Kasambahay  desk
 desk officer agreements pertaining to recruited
kasambahay   which shall be made available
In case of non-payment or underpayment of wage during inspections or whenever required by
and other labor-related concerns, the kasambahay   the DOLE or local government officials;
can seek assistance to the Kasambahay   Desk 7.  Assist the kasambahay   in filing his/her
Officer situated in their respective barangays or complaints or grievances against the Ers;
the nearest DOLE field/provincial/regional office. 8.  Cooperate with government agencies in
rescue operations involving abused or
Replacement of a kasambahay   from a private exploited kasambahay ; and
employment 9.  Assume joint and solidary liability with the
Er for payment of wages, wage-related and
The Er can demand from a private employment other benefits, including monthly
agency the replacement of a kasambahay  within
  within 1 contribution for SSS, PhilHealth, and Pag-
month from the day the kasambahay  reported
  reported for IBIG membership.
work on the following cases:
Unlawful acts under the Batas Kasambahay  
1.  The kasambahay   is found to be suffering
from an incurable or contagious disease, or 1.  Employment of children below 15 years of
mental illness as certified by a competent or age;
government physician; 2.  Withholding of the kasambahay’s
kasambahay’s wages;
 wages;
2.  The kasambahay   abandons the job without 3.  Interference in the disposal of the
justifiable cause, voluntarily resigns, kasambahay’s wages;
kasambahay’s  wages;
commits theft or any other analogous acts 4.  Requiring kasambahay   to make deposits for
prejudicial to the Er or his/her family; or loss or damage;
3.  The kasambahay   is physically or mentally 5.  Placing the kasambahay  under
 under debt bondage;
incapable of discharging the minimum and
requirements of the job, as specified in the 6.  Charging another household for temporarily
employment contract. performed tasks.

Effect of failure of the private employment NOTE: Unlawful acts are punishable with an
agency to provide a qualified replacement administrative fine ranging from Php 10,000 to Php
40,000 to be imposed by the DOLE Regional Offices.
After one month from receipt of the Er’s request
and the private employment agency failed to Remedies for unlawful acts
provide a qualified replacement, the Er shall be
entitled to a refund of 75% of the fees paid to the The aggrieved party may file the appropriate civil
private employment agency. or criminal action before the regular courts.

Responsibilities of the private employment Remedy for abused or exploited kasambahay

agency under the law
The law mandates the conduct of immediate rescue
1.  Ensure that the kasambahay   is qualified as of abused or exploited kasambahay   by the
required by the Er; municipal or city social welfare officer or a social
2.  Secure the best terms and conditions of welfare officer from DSWD, in coordination with
employment for the kasambahay ; the concerned barangay   officials. The law sets out
 that crimes or offenses committed under the Penal

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Code and other criminal laws shall be filed with the rest house staff includes a caretaker, two cooks
regular courts. and a laundrywoman. All of them are reported
to the SSS as domestic or household Ees of the
Q: Erlinda worked as a cook, preparing the resthouse and recreational facility and not of
lunch and merienda  of the Ees of Remington NBC. Can NBC legally consider the caretaker,
Industrial Sales Corp. She worked at the cooks and laundrywoman as domestic Ees of
premises of the company.
company. When Erlinda
Erlinda filed the rest house and not of NBC? (2000 Bar
an illegal dismissal case, Mr. Tan, the managing Question)
director of Remington Corp., claimed that
Erlinda was a domestic helper and not a regular  A: No , they are not domestic Ees. They are the Ees
Ee of the corporation. Mr. Tan argued that it is of NBC because the rest house and recreational
only when the househelper or domestic servant facility are business facilities which are for use of
is assigned to certain aspects of the business of NBC’s top executives and clients (Traders Royal
the Er that such househelper or domestic Bank v. NLRC, G.R. No. 127864, December 22, 1999).
servant may be considered as such an Ee. Is
Erlinda a domestic or househelper? EMPLOYMENT OF HOMEWORKERS

 A: No. Erlinda is clearly not a househelper. A Homeworkers

“househelper” or “domestic servant” under the IRR
of the LC is one who is employed in the Er’s home They are those who perform in or about his own
to minister exclusively to the personal comfort and home any processing or fabrication of goods or
enjoyment of the Er’s family. A househelper, materials, in whole or in part, which have been
domestic servant or laundrywoman in a home or in furnished directly or indirectly, by an Er and sold
a company staffhouse is different in the sense that thereafter to the latter.
in a corporation or a single proprietorship engaged
in business or industry or any agricultural or Househelpers v. Homeworkers
similar pursuit, service is being rendered in the
staffhouses or within the premises of the business HOUSEHELPERS HOMEWORKERS
of the Er. In such instance, they are Ees of the Performs in or about his
company or Er in the business concerned, entitled own home any
to the privileges of a regular Ee. The mere fact that processing or
the househelper or domestic servant is working Minister to the personal fabrication of goods or
within the premises of the business of the needs and comfort of materials, in whole or in
employer and in relation to or in connection with his Er in the latter’s part, which have been
its business, as in its staffhouses for its guest or home furnished directly or
even for its officers and Ees, warrants the indirectly, by an Er and
conclusion that such househelper or domestic sold thereafter to the
servant is and should be considered a regular Ee latter.
and not a househelper (Remington Industrial v.
Castaneda, G.R. Nos. 169295-96, Nov. 20, 2006). Er of a homeworker
Q: Albert, a 40-year old Er, asked his domestic Includes any person, natural or artificial who, for
helper, Inday, to give him a private massage. his account or benefit, or on behalf of any person
When Inday refused, Albert showed her Art. residing outside the country, directly or indirectly,
141 of the Labor Code, which says that one of or through an Ee, agent contractor, subcontractor
the duties of a domestic helper is to minister to or any other person:
the Er’s personal comfort and convenience. Is
Inday’s refusal tenable? (2009 Bar Question)   1.  Delivers or causes to be delivered, any
goods, articles or materials to be processed
 A: Yes. Inday’s refusal to give her Er a “private or fabricated in or about a home and
massage” is in accordance with law because the thereafter to be returned or to be disposed
nature of the work of a domestic worker must be in of or distributed in accordance with his
connection with household chores. Massaging is directions.
not a domestic work. 2.  Sells any goods, articles or materials to be
processed or fabricated in or about a home
Q: NBC has a rest house and recreational facility and then rebuys them after such processing
in the highlands of Tagaytay City for the use of or fabrication, either by himself or through
its top executives and corporate clients. The some other person.
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LABOR STANDARDS 
Duty of the Er in case he contracts with another Q: Josie is the confidential secretary of the
in the performance of his work Chairman of the Board of the bank. She is
presently on maternity leave. In an
It shall be the duty of the Er to provide in such arrangement where the Chairman of the Board
contract that the Ees or homeworkers of the can still have access to her services, the bank
contractor and the latter’s subcontractor shall be allows her to work in her residence during her
paid in accordance with the LC. leave. For this purpose, the bank installed a fax
machine in her residence, and gave her a
Liability of the Er if the contractor or cellphone and a beeper. Is Josie a homeworker
subcontractor fails to pay the wages or under the law? Explain. (2000 Bar Question)
earnings of his Ees
 A: No, she is actually an office worker. She is not an
Er shall be jointly and severally liable with the industrial homeworker who accepts work to be
contractor or sub-contractor to the workers of the fabricated or processed at home for a contractor,
latter to the extent that such work is performed which work, when finished, will be returned to or
under such contract, in the same manner as if the repurchased by said contractor (LC, Art. 155). 
Ees or homeworkers were directly engaged by the
Er.  APPRENTICES AND LEARNERS

Right of industrial homeworkers to form labor  Apprenticeship

organizations
It is practical training on the job supplemented by
DO No. 5, replacing Rule XIV of the IRR Book 3 of related theoretical instruction involving a contract
the LC, authorizes the formation and registration of between an apprentice and an Er on an approved
labor organization of industrial homeworkers. It apprenticeable occupation.
also makes explicit the Ers duty to pay and remit
SSS, PHILHEALTH and ECC premiums.  Apprentice

Prohibitions against homework Any worker who is covered by a written

apprenticeship agreement with an individual Er or
The following shall be prohibited as homework: any of the entities recognized under the LC.
1.  Explosives, fireworks and similar articles;
2.  Drugs and poisons; and NOTE: GR:  Apprenticeship programs shall be
3.  Other articles, the processing of which primarily voluntary
requires exposure to toxic substances (IRR,
Book III, Rule XIV, Sec. 13). XPNs: Compulsory Apprenticeship:

Prohibition of any deduction from the 1.  National security or economic development
homeworkers earnings due to loss or damage so demand, the President may require
compulsory training
GR:  The Er, contractor or subcontractor shall not 2.  Services of foreign technicians are utilized
make any deduction from the homeworker’s by private companies in apprenticeable
earnings for the value of materials which have trades.
been lost, destroyed, soiled or otherwise damage.
 Apprenticeable occupation
XPNs: Unless the ff. conditions are met:
Any trade, form of employment or occupation
1.  The homeworker is clearly shown to be which requires more than three (3) months of
responsible for the loss or damage; practical training with theoretical instruction
2.  The Ee is given reasonable opportunity to officially endorsed by the tripartite body and
show cause why deductions should not be approved for apprenticeship by the TESDA.
made;
3.  The amount of such deduction is fair and On the job training (OJT)
reasonable and shall not exceed the actual
loss or damages; and It is practical work experience through actual
4.  The deduction is made at such rate that the participation in productive activities given to or
amount deducted does not exceed 20% of acquired by an apprentice.
the homeworker’s earnings in a week. 
week.  
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Highly technical industries  Conditions for employment of an apprentice

Highly technical industries are those which are 1.  Should be an apprenticeable trade as
engaged in the application of advanced technology. determined by TESDA 
TESDA 
2.  Prior approval by the DOLE of the proposed
NOTE: Prior approval by TESDA (formerly DOLE) apprenticeship program is a condition sine
of the proposed apprenticeship program is a qua non before
non before an apprenticeship agreement
condition sine qua non.
non . Otherwise, an apprentice can be validly entered into (Nitto
( Nitto Enterprises
becomes a regular Ee (Nitto
(Nitto Enterprises v. NLRC, v. NLRC, 248 SCRA 654). 
654). 
 248 SCRA 654).
NOTE:  One of the objectives of Title II (Training
Qualifications of an apprentice and Employment of Special Workers) of the LC is to
establish apprenticeship standards for the
1.  At least 15 years of age protection of apprentices. An apprenticeship
program should first be approved by the DOLE
NOTE:  Those below 18 years of age shall not
not before an apprentice may be hired, otherwise a
work in hazardous occupations person hired will be considered a regular Ee.
(Century Canning Corp. v. CA, 530 SCRA 501 )
2.  Physically fit for the occupation
3.  Possess vocational aptitude and capacity Period of apprenticeship
4.  Possess:
a.  The ability to comprehend, and Apprenticeship must not exceed 6 months.
b.  Follow oral and written instructions
5.  The company must have an apprenticeship NOTE:
program duly approved by the DOLE. 1.   2 months/4
months/400 00 hours
hours:: Trades or occupations
which normally require 1 year or more for
NOTE: Trade and industry associations may proficiency
recommend to the SLE appropriate educational 2.  1 month/200 hours:hours: Occupations and jobs
requirements for different occupations. which require more than 3 months but less
than 1 year for proficiency (IRR, Book II, Rule
When occupation deemed hazardous VI, Sec. 19). 
19). 

1.  Nature of work exposes worker to Status of an apprentice after the lapse of the
dangerous environmental elemental period of apprenticeship
contaminants or work conditions
2.  Workers are engaged in construction work, He is deemed a regular Ee. He cannot be hired as a
logging, fire fighting, mining, quarrying, probationary Ee since the apprenticeship is deemed
blasting, stevedoring, deep-sea fishing, and the probationary period.
mechanized farming
3.  Workers are engaged in the manufacture or Compensation of an apprentice
handling of explosives and other pyrotechnic
products GR: It starts at not less than 75% of the statutory
4.  Workers use, or are exposed to heavy or minimum wage for the 1st   6 months 
months  (except OJT);
OJT);
power-driven machinery or equipment. thereafter, shall be paid in full minimum wage,
including the full COLA.
Ers of apprentices 
XPN: Art. 72 of the LC provides that the SLE may
1.  Only Ers in highly technical industries and authorize the hiring of apprentices without
2.  Only in apprenticeable occupations compensation whose training on the job is
approved by SLE required:

Employment status of apprentices 1.  By the school or;

2.  By a training program curriculum or;
They are contractual workers whose length of 3.  As requisite for graduation or
service depends on the term provided for in the 4.  As requisite for board examination.
apprenticeship agreement. Thus, the Er is not
obliged to employ the apprentice after the
completion of his training.
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LABOR STANDARDS 
Rules regarding apprenticeship agreements  A: No. Gomburza College is not liable for the acts of
Padilla because there is no Er-Ee relationship
Apprenticeship agreements, including the wage between them. As provided in the IRR of the LC,
rates of apprentices, shall: "there is no Er-Ee relationship between students
on one hand, and schools, colleges, or universities
1.  Conform to the rules issued by SLE. on the other, where students work with the latter
2.  The period of Apprenticeship shall not in exchange for the privilege to study free of
exceed 6 months. charge, provided the students are given real
3.  Apprenticeship agreements providing for opportunity, including such facilities as may be
wage rates below the legal minimum wage, reasonable and necessary to finish their chosen
which in no case shall start below 75% of the courses under such arrangement."
applicable minimum wage, may be entered
into only in accordance with Apprenticeship Procedure for the termination of
programs duly approved by the SLE. apprenticeship
4.  The DOLE shall develop standard model
programs of Apprenticeship (IRR, Book II, The party terminating shall:
Rule VI, Sec. 18). 1.  Serve a written notice on the other at least 5
days before actual termination,
Every apprenticeship agreement shall be 2.  Stating the reason for such decision; and
signed by 3.  A copy of said notice shall be furnished to
the Apprenticeship Division concerned.
1.  The Er or his agent, or
2.  An authorized representative of any of the Party which can terminate an apprenticeship
recognized organizations, associations or agreement
groups, and
3.  The apprentice. 1.  Either party may terminate an agreement
after the apprenticeship period but only for a
 Apprenticeship agreement with a minor valid cause. 
cause. 
2.  It may be initiated by either party upon filing
An apprenticeship agreement with a minor shall be a complaint or upon DOLE’s own initiative.
signed in his behalf by:
Party which appeal the decision of the
1.  His parent or guardian, or if the latter is not authorized agency of the DOLE
available,
2.  An authorized representative of the DOLE. It may be appealed by any aggrieved person to the
SLE within 5 days from receipt of the decision.
Rules on working scholars
NOTE: The decision of the SLE shall be final and
There is no Er-Ee relationship between students on executory.
one hand, and schools, where there is written
agreement between them under which the former Principle of Exhaustion of Administrative
agree to work for the latter in exchange for the Remedies applied in case of breach of
privilege to study free of charge. The student is not apprenticeship agreement
considered an Ee (IRR, Book III, Rule IX, Sec. 14).
Exhaustion of Administrative Remedies is a
Q: Padilla entered into a written agreement condition precedent to the institution of an action
with Gomburza College to work for the latter in for enforcing application of agreement.
exchange for the privilege of studying in said
institution. His work was confined to keeping Duty of the plant apprenticeship committee
clean the lavatory facilities of the school. One
school day, he got into a fist fight with a The plant apprenticeship committee shall have the
classmate, Monteverde, as a result of which the initial responsibility for settling differences arising
latter sustained a fractured arm. out of Apprenticeship agreement  (IRR,
 (IRR, Book II, Rule
Monteverdefiled a civil case for damages VI, Sec. 32(b)).
against him, impleading Gomburza College due
to the latter's alleged liability as his Er. Under Learners 
the circumstances, could Gomburza College be
held liable by Monteverde as Padilla’s 1.  They are persons hired as trainees in semi-
 employer? (1997 Bar Question) skilled and other industrial occupations  

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2.  Which are non-apprenticeable and   Learnership v. Apprenticeship
3.  Which may be learned through practical
training on the job in a relatively short BASIS Learnership Apprenticeship
period of time 
Training on the
4.  Which shall not exceed 3 months  Training in
job in semi-
5.  Whether or not such practical training is trades which
Nature skilled and other
supplemented by theoretical instructions are
industrial
(IRR, Book II, Rule VII, Sec. 1(a)). 
1(a)).  apprenticeable,
occupation or
that is, practical
Employment of learners trades which are training on the
non-
job
apprenticeable
Learners may be employed when: supplemented
and which may
by related
be learned thru
1.  No experienced worker is available theoretical
practical training
2.  It is necessary to prevent curtailment of instruction for
on the job in a
employment opportunities; and 
and  more than 3
relatively short
3.  Employment does not create unfair months.
period of time.
competition in terms of labor costs or impair
or lower working standards.
standards . Duration of Min: 3 months
Max: 3 months
training Max: 6 months
Contents of a learnership agreement
With
Commitment commitment to
Any Er desiring to employ learners shall enter into
to employ employ the
a learnership agreement with them, which
agreement shall include: learner as a No commitment
regular Ee if he to hire
desires upon
1.  The names and addresses of the learners;
completion of
2.  The duration of the learnership period,
learnership
which shall not exceed 3 months;
3.  The wages or salary rates of the learners Considered a
which shall begin at not less than 75% of the regular Ee if pre-
applicable minimum wage; and In case of termination
4.  A commitment to employ the learners if they pre- occurs after2 Worker not
so desire, as regular Ees upon completion of termination months of considered as
the Learnership. of contract training and the regular Ee.
dismissal is
Employment of minors as learners without fault of
the Learner.
A learner must be at least 15 years of age.
Semi- Highly technical
industries and
NOTE: Those below 18 years of age shall not work skilled/Industrial only in
in hazardous occupations. Coverage
occupations industrial
occupation
Persons who may employ learners  
There is a list of
Only Ers in semi-skilled and other industrial List learnable trades No list
occupations which are non-apprenticeable may by TESDA
employ learners. Requires Requires
Written learnership apprenticeship
Pre-termination of Learnership contract; agreement agreement agreement
regular employment

If training is terminated by the Er before the end of

the stipulated period through no fault of the
Learners, they are deemed regular Ees (IRR, Book
II, Rule VII, Sec. 4). Provided they have already been
trained for 2 months.
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LABOR STANDARDS 
PERSONS WITH DISABILITY qualified disabled worker entitled to the same
(R.A. 7277 as amended by R.A. 9442) treatment as qualified able-bodied workers
(Bernardo v. NLRC, G.R. No. 122917, July 12, 1999). 
1999). 
DEFINITION
RIGHTS OF PERSONS WITH DISABILITY
Persons with disability (PWD)
Rights and privileges of PWD
Those whose earning capacity is impaired by:
1.  Physical deficiency 1.  Equal opportunity for employment
2.  Age 2.  Sheltered employment (the Government shall
3.  Injury endeavour to provide them work if suitable
4.  Disease employment for disabled persons cannot be
5.  Mental deficiency found through open employment)
6.  Illness 3.  Apprenticeship
4.  Vocational rehabilitation (means to develop
Employment of PWD the skills and potentials of disabled workers
and enable them to compete in the labor
1.  When their employment is necessary to market)
prevent curtailment of employment 5.  Vocational guidance and counselling
opportunities; and
2.  When it will not create unfair competition in PROHIBITIONS ON DISCRIMINATION AGAINST
labor costs or lower working standards (LC, PERSONS WITH DISABILITY
 Art. 79).
Prohibition on discrimination against PWD
Employment period of PWD 
No disabled person shall be denied access to
There is no minimum or maximum duration. It opportunities for suitable employment. A qualified
depends on the agreement but it is necessary that disabled employee shall be subject to the same
there is a specific duration stated.
stated .  terms and conditions of employment and the same
compensation, privileges, benefits, fringe benefits,
PWD as apprentices or learners incentives or allowances as a qualified able-bodied
person.
PWD may be hired as apprentices or learners if
their disability is not such as to effectively impede NOTE: 5% of all casual emergency and contractual
the performance of job operations in the particular positions in the Departments of Social Welfare and
occupations for which they are hired (LC, Art. 81). 
81).  Development; Health; Education, Culture and
Sports; and other government agencies, offices or
Persons with disability can be a regular Ee corporations engaged in social development shall
be reserved for disabled persons (R.A. 7277).
7277).
Persons with disability can be a regular Ee if work
is usually or necessarily desirable to the business INCENTIVES FOR EMPLOYERS
(Bernardo v. NLRC, G.R No. 122917, July 12, 1999).  
Incentives of Er who are employing disabled
Persons who may employ persons with workers
disability
1.  Entitled to an additional deduction, from
Ers in all industries: Provided, the disability is not their gross income, equivalent to 25% of the
such as to effectively impede the performance of total amount paid as salaries and wages to
job operations in the particular occupations for disabled persons: Provided , however, That
which they are hired. such entities present proof as certified by the
DOLE that disabled persons are under their
Not all workers with a disability are considered employ: Provided further, That the disabled
disabled workers Ee is accredited with the DOLE and the
Department of Health as to his disability,
The mere fact that a worker has a disability does not skills and qualifications.
make him a disabled worker because his disability 2.  Private entities that improve or modify their
may not impair his efficiency or the quality of his physical facilities in order to provide
work. If despite his disability he can still efficiently reasonable accommodation for disabled
 perform his work, he would be considered a persons shall also be entitled to an

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additional deduction from their net taxable
income, equivalent to 50% of the direct costs
of the improvements or modifications (R.A.
7277, Sec. 8). 
8).  

Persons with Disability v . Differently Abled

Persons with
Differently Abled
Disability
Refers to all suffering from
restriction of different
Earning capacity is abilities as a result of
impaired by age, or mental, physical or sensory
physical or mental impairment to perform an
deficiency or injury. activity in the manner or
within range considered
normal for a human being.

Covers all activities or

Covers only workers.
endeavors.

Basis:  
Basis: Basis: range
Basis: range of activity
loss/impairment of which is normal for a
earning capacity. human being.

Restriction due to
Loss due to injury or
impairment of
physical or mental
mental/physical/ sensory
defect or age.
defect.

If hired, entitled to
75% of minimum
wage. If qualified, entitled to all
terms and conditions as
qualified able-bodied
Subject to definite person.
periods of
employment.

No restrictions on
Employable only
employment.
when necessary to
prevent curtailment
of employment
Must get equal opportunity
opportunity.
and no unfair competition.
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TERMINATION OF EMPLOYMENT 
TERMINATION OF EMPLOYMENT with 20 security guards to safeguard the
persons and belongings of hotel guests, among
EMPLOYER-EMPLOYEE RELATIONSHIP others. The security guards filled up Baron
application form and submitted the executed
Existence of an employment relationship forms directly to the Security Department of
Baron. The pay slips of the security guards bore
Employment relationship is determined by law and Baron's logo and showed that Baron deducted
not by contract (Insular Life Assurance Co. Ltd. v. the amounts for SSS premiums, medicare
NLRC, G.R. No. 119930, March 12, 1998). 
1998).  contributions and withholding taxes from the
wages of the secutiry guards. The assignments
NOTE:  Taxi or jeepney drivers under the of security guards, who should be on duty or on
“boundary” system are Ee’s of the taxi or jeepney call, promotions, suspensions, dismissals and
owners/operators; so also the passenger bus award citations for meritorious services were
drivers and conductors 
conductors  (Jardin v. NLRC and all done upon approval by Baron's chief
Goodman Taxi, G.R. No. 119268, February 23, 2000). 
2000).  security officer. After the expiration of the
contract with ASIA, Baron did not renew the
Er-Ee relation is a question of law same and instead executed another contract for
security services with another agency. ASIA
An employment contract which stipulates that placed the affected security guards on "floating
there is no Er-Ee relationship between the parties status" on "no work no pay" basis. Having been
is invalid. The existence of an Er-Ee relation is a displaced from work, the ASIA security guards
question of law and being such, it cannot be made filed a case against Baron for illegal dismissal,
the subject of agreement (Tabas v. California OT pay, minimum wage differentials, vacation
Manufacturing Co., G.R. No. L-80680, January 26, leave and sick leave benefits, and 13 thmonth
1989). pay. Baron denied liability alleging that ASIA is
the Er of the security guards and therefore,
Q: Banco de Manila and the Ang Husay their complaint for illegal dismissal and
Janitorial and Pest Control Agency entered into payment of money claims should be directed
an Independent Contractor Agreement with the against ASIA. Nevertheless, Baron filed a Third
usual stipulations specifically, the absence of Party Complaint against ASIA. Is there an Er-Ee
Er- Ee relationship, and the relief from liability relationship between the Baron, on one hand,
clauses. Can the bank, as a client, and the and the ASIA security guards, on the other
agency, as an independent contractor, stipulate hand? Explain briefly. (1999 Bar Question)
that no Er-Ee relationship exists between the
bank and the employees of the Agency who may  A: Yes. As a general rule, the security guards of a
be assigned to work in the Bank? Reason. private security guard agency are the Ees of the
latter and not of the establishment that has entered
 A: Yes, they can stipulate provided that the into a contract with the private security guard
relationship is job contracting. However the agency for security services. But under the facts in
stipulation cannot prevail over the facts and the the question, Baron Hotel appear to have hired the
laws. The existence of Er-Ee relationship is security guards, paid their wages, have the power
determined by facts and law and not by stipulation to promote, suspend or dismiss the security guards
of the parties. and the power of control over them, in other
words, the security guards were under orders of
It is axiomatic that the existence of an Er-Ee Baron Hotel as regard their employment. Because
relationship cannot be negated by expressly of the above-mentioned circumstances, Baron
repudiating it in the management contract and Hotel is the Er of the security guards.  
providing therein that the Ee is an independent
contractor when the terms of the agreement Q: Assuming that ASIA is the Er, is the act of
clearly show otherwise. For the employment status  ASIA in placing the security guards on "floating
of a person is defined and prescribed by law and status" lawful? Why?
not by what the parties say it should be. In
determining the status of the management  A: Yes. It is lawful for a private security guard
contract, the "four-fold test" on employment has to agency to place its security guard on a "floating
be applied (Insular Life Assurance Co.. Ltd. v. NLRC, status" if it has no assignment to give to said
G.R. No. 119930, March 12, 1998). security guards. But if the security guards are
placed on a "floating status" for more than 6
Q: ASIA executed a 1-year contract with the months, the security guards may consider
 Baron Hotel for the former to provide the latter themselves as having been dismissed.

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Q: Lacson was one of more than 100 Ees who FOUR- FOLD TEST
were terminated from employment due to the
closure of LBM Construction Corporation. LBM Factors determining the existence of an
was a sister company of Lastimoso employer-employee relationship
Construction, Inc. and RL Realty & Dev’t Corp.
 All three entities formed what came to be  four – fold test  (indicia
The four 
The  (indicia of determination):
known as the Lastimoso Group of Companies. 1.  Selection and engagement of the
The three corporations were owned and employee;
controlled by members of the Lastimoso family; 2.  Payment of wages;
their incorporators and directors all belonged 3.  Power of dismissal; and
to the Lastimoso family. The three corporations 4.  Power of control (Azucena, Vol. I). 
I). 
were engaged in the same line of business,
under one management, and used the same Control test
equipment including manpower services.
Lacson and his co-Ees filed a complaint with the The control test assumes primacy in the overall
Labor Arbiter against LBM, RL Realty and consideration. There is an Er-Ee relationship when
Lastimoso Construction to hold them jointly the person for whom the services are performed
and severally liable for back wages and reserves the right to control not only the end
separation pay. Lastimoso Construction, Inc. RL achieved but also the manner and means used to
Realty & Development Corporation interposed achieve that end end  (Television and Production
a Motion to Dismiss contending that they are Exponents Inc. v. Servana, 542 SCRA 578).
juridical entitles with distinct and separate
personalities from LBM Construction Kinds of control exercised by an Er
Corporation and therefore, they cannot be held
jointly and severally liable for the money Not every form of control establishes employer-
claims of workers who are not their employees. employee relationship. A demarcation line should
Rule on the motion to dismiss. Should it be be drawn between: (a) rules that merely serve as
granted or denied? Why? (1999 Bar Question)  guidelines which only promote the result, and (b)
rues that fix the methodology and bind or restrict
 A:  It is very clear that even if LBM Construction the party hired to the use of such means or
company, Lastimoso Construction Company, Inc. methods. Inder the first category, there exists no
and RL Realty & Dev’t Corp. all belong to the employer-employee relationship. In the second
Lastimoso family and are engaged in the same line category, it has the effect of establishing employer-
of business under one management and used the employee relationship (Insular life v. NLRC, 179
same equipment including manpower services, SCRA 439; Consulta v. CA, G.R. No. 145443, March 18,
these corporations were separate juridical entities.  2005).  
 2005).
Thus, only the LBM Construction Corporation is the
Er of Teofilo Lacson. The other corporation do not NOTE: However, in certain cases the control test is
have any Er-Ee relations with Lacson. The case in not sufficient to give a complete picture of the
question does not include any fact that would relationship between the parties, owing to the
justify piercing the veil of corporate fiction of the complexity of such a relationship where several
other corporations in order to protect the rights of positions have been held by the worker. The better
workers. In a case (Concept Builders, Inc. v. NLRC, approach is to adopt the two-tiered test  (Francisco
  (Francisco
G.R. No. 108734, May 29,1996) the SC ruled that it is v. NLRC, G.R. No. 170087, August 31, 2006).
a fundamental principle of corporation law that a
corporation is an entity separate and distinct from This two-tiered test would provide us with a
its stockholders and from other corporations to framework of analysis, which would take into
which it may be connected. But this separate and consideration the totality of circumstances
distinct personality of a corporation is merely a surrounding the true nature of the relationship
fiction created by law for convenience and to between the parties. This is especially appropriate
promote justice. So, when the notion of separate in this case where there is no written agreement or
juridical personality is used to defeat public terms of reference to base the relationship on and
convenience, justify wrong, protect fraud or defend due to the complexity of the relationship based on
crime, or is used as a device to defeat the labor the various positions and responsibilities given to
laws, this separate personality of the corporation the worker over the period of the latter’s
maybe disregarded or the veil of corporate fiction employment (Francisco v. NLRC, G.R. No. 170087,
pierced.  August 31, 2006).
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Q: The Pizza Corporation (PizCorp) and Ready requirements: (1) compliance with the
Supply Cooperative (RSC) entered into a regulations and requirements of the company;
"service agreement" where RSC in (2) maintenance of a level of knowledge of the
consideration of service fees to be paid by company's products that is satisfactory to the
PizCorp's will exclusively supply PizCorp with a company; and (3) compliance with a quota of
group of RSC motorcycle-owning cooperative new businesses. However, EmoLife insurance
members who will henceforth perform company terminated Genesis’ services. Genesis
PizCorp's pizza delivery service. RSC assumes filed an illegal dismissal complaint alleging
under the agreement --- full obligation for the therein that an Er-Ee relationship exists and
payment of the salaries and other statutory that he was illegally dismissed. Is he an
monetary benefits of its members deployed to employee of the Insurance Company?
PizCorp. The parties also stipulated that there
shall be no Er-Ee relationship between PizCorp  A: No.  Genesis is not an Ee of EmoLife Insurance
and the RSC members.
members. However, if PizCorp is Company. Generally, the determinative element is
materially prejudiced by any act of the delivery the control exercised over the one rendering the
crew that violates PizCorp’s directives and service. The concept of “control” in LC has to be
orders, PizCorp can directly impose compared and distinguished with “control” that
disciplinary actions on, including the power to must necessarily exist in a principal-agent
dismiss, the erring RSC member/s. (2008 Bar relationship. The Er controls the Ee both in the
Question) results and in the means and manner of achieving
a.  Is the contractual stipulation that there this result. The principal in an agency relationship,
is no Er-Ee relationship binding on e.g. insurance agent, on the other hand, also has the
labor officials? prerogative to exercise control over the agent in
b.  Based on the test/s for Er-Ee undertaking the assigned task based on the
relationship, determine the issue of parameters outlined in the pertinent laws. In the
who is the Er of the RSC members. present case, the Agreement fully serves as grant of
 A: authority to Genesis as EmoLife’s insurance agent.
a. No.  The contractual stipulation that there is no This agreement is supplemented by by the company’s
Er-Ee relationship between PizCorp and the RSC agency practices and usages, duly accepted by the
members is not binding on labor officials because agent in carrying out the agency. Foremost among
what determines the existence or non-existence of these are the directives that the principal may
employer-employee relationship is the actual impose on the agent to achieve the assigned tasks,
factual situation between PizCorp and RSC to the extent that they do not involve the means
members and not what is stipulated in the contract.   and manner of undertaking these tasks. The law
 Alternative Answer  : The agreement between likewise obligates the agent to render an account;
PizCorp and RSC, that there is, or will not be, an Er- in this sense, the principal may impose on the
Ee relationship between the RSC motorcycle- agent specific instructions on how an account shall
owning cooperative members performing delivery be made, particularly on the matter of expenses
services is not binding on labor officials because and reimbursements. To these extents, control can
“the test of employer-employee
employer-employee relationship is law be imposed through rules and regulations without
and not agreement between the parties.” (Insular
(Insular intruding into the labor law concept of control for
Life, etc. v. NLRC, 287 SCRA 476). purposes of employment   (Gregorio Tongko v.
ManuLife Insurance Company, G.R. No. 167622, June
b. Using the control test, the Er of the RSC members  29, 2010).
is PizCorp. According to the facts, the RSC members
are supposed to make their deliveries in Two-tiered test
accordance with PizCorp directives and orders. In
addition, the PizCorp can directly impose 1.  The putative Er’s power to control the Ee
disciplinary sanction, including the power to with respect to the means and methods by
dismiss the RSC members. which the work is to be accomplished (Four-
fold test);
Q: Genesis entered into a Career’s Agent 2.  The underlying economic realities of the
 Agreement with EmoLife Insurance Company, a activity or relationship (economic reality
domestic corporation engaged in insurance test).
business. In the Agreement, it provides that the
agent is an independent contractor and nothing The existence or non-existence of the Er-Ee
therein shall be construed or interpreted as relationship is commonly determined by
creating an Er-Ee relationship. It further examination of certain factors or aspects of the
 provides that the agent must comply with three relationship, as follows:

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1.  The manner of selection and engagement of KINDS OF EMPLOYMENT
the putative employee;
2.  The mode of payment of wages; PROBATIONARY EMPLOYMENT
3.  The presence or absence of the power of
dismissal; and Probationary employment
4.  The presence or absence of a power to
control the putative employee’s conduct Employment where the Ee, upon his engagement:
(Hijos De F. Escano, Inc. v. NLRC, G.R. No. 1.  Is made to undergo a trial period
59229. April 22, 1991I, i.e., the power to 2.  During which the Er determines his fitness
control the employee with respect to the to qualify for regular employment,
means and methods by which the work is to 3.  Based on reasonable standards made known
be accomplished. to the Ee at the time of engagement ( IRR,
Book VI, Rule I, Sec 6).
6 ).
To bolster the payment of wages and control test,
the existing economic conditions prevailing Characteristics of probationary employment
between the parties, like the inclusion of the Ee in
the payrolls (Sevilla v. CA, G.R. Nos. 44182-3, April 1. It is an employment for a trial period;
15, 1988), submission of his name with the SSS, 2. It is a temporary employment
employment status prior to
PAG-IBIG, PhilHealth, otherwise known as the regular employment;
economic test, are also applied in determining Er- 3. It arises through a contract with the
Ee relationship (Poquiz, Vol. I). following elements:
a.  The Ee must learn and work at a
Proper standard for economic dependence particular type of work
b.  Such work calls for certain qualifications
The proper standard is whether the worker is c.  The probation is fixed
dependent on the alleged Er for his continued d.  The Er reserves the power to terminate
employment in that line of business. during or at the end of the trial period
e.  And if the Ee has learned the job to the
The determination of the relationship between Er satisfaction of the Er, he becomes a
and Ee depends upon the circumstances of the regular Ee.
whole economic activity, such as:
1.  The extent to which the services performed Rules on probationary employment
are an integral part of the Er’s business 
business  
2.  The extent of the worker’s investment in 1.  Er shall make known to the Ee at the time he
equipment and facilities; is hired, the standards by which he will
3.  The nature and degree of control exercised qualify as a regular Ee;
by the Er; 2.  An Ee allowed to continue work after the
4.  The worker’s opportunity for profit and loss; 
loss;   probationary period shall be considered a
5.  The amount of initiative, skill, judgment, or regular Ee;
foresight required for the success of the 3.  During the probationary period, the Ee
claimed independent enterprise; enjoys security of tenure; his services can
6.  The permanency and duration of the only be terminated for just or authorized
relationship between the worker and Er; and causes.
7.  The degree of dependency of the worker
upon the Er for his continued employment in Period of probationary employment
that line of business (Francisco v. NLRC, G.R.
No. 170087, August 31, 2006). 
2006).   GR: It shall not exceed 6 months.

 Application of the four-fold test and the two- XPNs:

tiered test 1.  Covered by an Apprenticeship or
Learnership agreement stipulating a
Present Philippine law recognizes a two-tiered test. different period
The first tier of the test is the four-fold test. The 2.  Voluntary agreement of parties (especially
second tier is the economics of the relationship when the nature of work requires a longer
test. But the latter test is used if and only if there is period)
going to be harshness in the results because of the 3.  The Er gives the Ee a second chance to pass
strict application of the four-fold test   (Francisco v. the standards set (Mariwasa
( Mariwasa Manufacturing,
NLRC, G.R. No. 170087, August 31, 2006).
 NLRC, G.R. No. 170087, August 31, 2006).

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Inc. v. Leogardo, Jr., G.R. No. 74246,
74246, January requires and that it is the amount of time required
26, 1989).
1989).   for an ordinary worker to learn the job.
4.  When the same is required by the nature of
the work, e.g. the probationary period set for Essence of the prohibition on double or
professors, instructors and teachers is 3 successive probation
consecutive years of satisfactory service
pursuant to DOLE Manual of Regulations for The evil sought to be prevented is to discourage
Private Schools. scheming Ers from using the system of double or
5.  When the same is established by company successive probation to circumvent the mandate of
policy. the law on regularization and make it easier for
them to dismiss their Ees 
Ees   (Holiday Inn Manila v.
NOTE:  Period of probation shall be reckoned from NLRC, G.R. No. 109114, September 14, 2003). 
the date the Ee actually started working [IRR,
[ IRR, Book
VI, Rule I, Sec.6(b)].
Sec.6(b)]. Probationary Ees may be Q: Michelle Miclat was employed on a
dismissed for cause before end of the probationary probationary basis as marketing assistant by
period. Clarion Printing House but during her
employment she was not informed of the
After the lapse of the probationary period (6 standards that would qualify her as a regular
months), Ee becomes regular. Ee. 30 days after, Clarion informed Miclat that
her employment contract had been terminated
Purpose of the probation period without any reason. Miclat was informed that
her termination was part of Clarion’s cost -
The purpose of the probation period is to afford cutting measures. Is Miclat considered as a
the Er an opportunity to observe the fitness of a regular Ee and hence entitled to its benefits?
probationary Ee at work.
 A: Yes. In all cases of probationary employment,
Extension of the probationary period beyond the Er shall make known to the Ee the standards
six months under which he will qualify as a regular Ee at the
time of his engagement. Where no standards
standa rds are
The Er and Ee may validly agree to extend the made known to the Ee at that time, he shall be
probationary period beyond six months. Such an deemed a regular Ee. In the case at bar, she was
extension may be lawfully agreed upon, despite the deemed to have been hired from day one as a
restrictive language of Art. 281. A voluntary regular Ee (Clarion
Ee (Clarion Printing House Inc., v. NLRC, G.R.
agreement extending the original probationary No. 148372, June 27, 2005).
period to give the Ee a second chance to pass the
probation standards constitutes a lawful exception Obligation of the Er to his probationary Ees
to the statutory limit   (Mariwasa Manufacturing,
Inc. v. Leogardo, Jr., G.R. No. 74246,
74246,  January 26, There is obligation on the part of Er to inform
1989).  standards for regularization at the time of
engagement. The failure to inform has the effect
NOTE: By voluntarily agreeing to such an that upon the expiry of the probationary
extension, the Ee waived any benefit attaching to employment, with or without the period provided
the completion of the period if he still failed to for in the contract, the worker is deemed to be
make the grade during the period of extension regular.
(Mariwasa Mfg. Inc. v. Hon. Leogardo, G.R. No.
74246, January 26, 1989). Q: Middleby Phils. Corp. hired Alcira as
engineering support services supervisor on a
Instances when extension of probationary probationary basis for six months. Apparently
period is allowed unhappy with Alcira’s performance, Middleby
terminated his services. Alcira contends that he
Extension is allowed only when: was already a regular Ee when his employment
was terminated. According to Alcira’s
1.  Nature of the job requires extensive training,or 
training, or   computation, since Art. 13 of the NCC provides
2.  If it is a company policy that the period of that 1 month is composed of 30 days, 6 months
probationary employment should be an totaling 180 days, then his 180th day would fall
extended period on Nov. 16, 1996 making him a regular Ee
before his termination. Is the contention of the
NOTE:  The extension of period should always be petitioner in the computation of six months
 reasonable; Such that, the nature of the work so correct?

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 A: No, the computation of the 6-month known by the Er to the Ee at the time of his
probationary period is reckoned from the date of engagement (ICMC v. NLRC, G.R. No. 72222,
appointment up to the same calendar date of the  January 30, 1989; LC, Art. 281). 
281). 
6th  month following. In short, since the number of
days in each particular month was irrelevant, NOTE: If Pre-termination of probationary contract
Alcira was still a probationary Ee when Middleby is due to the valid causes, the Er is not liable to pay
opted not to “regularize” him on Nov. 20, 1996 the monetary value of the unexpired portion of the
(Alcira v. NLRC, G.R. No. 149859, June 9, 2004). employment. 

NOTE: In Mitsubishi Motors v. Chrysler Phils. Labor While probationary Ees do not enjoy permanent
Union, G.R. No. 148738, June 29, 2004, the
2004, the SC ruled status, they are afforded the security of tenure
in this wise: protection of the Constitution. Consequently, they
cannot be removed from their positions unless for
“Applying Art. 13 of the NCC, the cause. Such constitutional protection, however,
probationary period of 6-months consists of ends upon the expiration of the period stated in
180 days.
days. This is in conformity with Art. their probationary contract of employment.
13(1) of the NCC. The number of months in Thereafter, the parties are free to renew the
the probationary period, 6, should then be contract or not   (CSA v. NLRC, G.R. No. 87333,
multiplied by the number of days within a September 6, 1991).
month, 30; hence, the
the period of 180 days. As
clearly provided for the in last par. of Art. Limitations on the Er’s power to terminate a
13, in computing a period, the first day shall probationary employment contract
be excluded and the last day included. Thus,
the 180 days commenced on May 27, 1996, 1.  The power must be exercised in accordance
and ended on Nov. 23, 1996. The with the specific requirements of the
termination letter dated Nov. 25, 1996 was contract;
served on Paras only on Nov. 26, 1996. He 2.  If a particular time is prescribed, the
was, by then already a regular Ee of the termination must be within such time and if
company under Art. 281 of the LC.” 
LC.”   formal notice is required, then that form
must be used;
How to resolve the conflict between the Alcira 3.  The Er’s dissatisfaction must be real and in
and Mitsubishi Motors case: good faith, not feigned so as to circumvent
the contract or the law; and
1.  Statutory Construction –  The latter case 4.  There must be no unlawful discrimination in
prevails (Mitsubishi Motors); or   the dismissal.
2.  Rule more favorable to the Ee –  Use the
computation which would amount to NOTE: The probationary Ee is entitled to
granting the subject Ee regular employment procedural due process prior to dismissal from
status ( based
based on Constitutional and statutory service.
provisions for the liberal interpretation of
labor laws) 
laws)  Q: Ron Cruz was employed as gardener by
Manila Hotel on “probation status” effective
Instances when a probationary Ee is deemed to Sept. 22, 1976. The appointment signed by Cruz
be a regular Ee provided for a 6 month probationary period.
On Mar. 20, 1977, or a day before the expiration
1.  If he is allowed to work after a probationary of the probationary period, Cruz was promoted
period (LC,
(LC, Art. 281).
281 ). to lead gardener position. On the same day,
2.  If no standards, under which he will qualify Cruz’ position was “abolished” by Manila Hotel
as a regular Ee, are made known to him at allegedly due to economic reverses or business
the time of his engagement [IRR,
[ IRR, Book VI, recession, and to salvage the enterprise from
Rule I, Sec. 6(d)].
6(d)]. imminent danger of collapse. Was Cruz illegally
dismissed? 
Grounds for terminating a probationary
employment  A: Yes. There is no dispute that as a probationary
Ee, Cruz had but limited tenure. Although on
1.  Just/authorized causes probationary basis, however, Cruz still enjoys the
2.  When he fails to qualify as a regular Ee in constitutional protection on security of tenure.
 accordance with reasonable standards made During his tenure of employment, therefore, or

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before his contract expires, Cruz cannot be achieved the prerequisite 3-year period under the
removed except for cause as provided for by law. Manual of Regulation for Private Schools and the
Faculty Manual of CSA.
makes Cruz’ dismissal highly suspicious is
What makes
that it took place at a time when he needs only but In the instant case where the CSA did not wish to
a day to be eligible
eligible as a regular Ee. That he is renew the contract of employment for the next
competent finds support in his being promoted to a school year, Gela has no ground to protest. She was
lead gardener in so short span of less than 6 not illegally dismissed. Her contract merely
months. By terminating his employment or expired (CSA v. NLRC, G.R No. 87333, September 6,
abolishing his position with but only one day 1991).
remaining in his probationary appointment, the
hotel deprived Cruz of qualifying as a regular Ee Q: During their probationary employment,
with its concomitant rights and privileges (Manila eight employees were berated and insulted by
Hotel Corp. v. NLRC, G.R. No. L-53453, January 22, their supervisor. In protest, they walked out.
1986). The supervisor shouted at them to go home
and never to report back to work. Later, the
Period of probationary employment of private personnel manager required them to explain
school teachers why they should not be dismissed from
employment for abandonment and failure to
The probationary employment of academic qualify for the positions applied for. They filed
teaching personnel shall not be more than a period a complaint for illegal dismissal against their
of 6 consecutive semesters or 9 consecutive Er. As the Labor Arbiter, how will you resolve
trimesters of satisfactory service, as the case may the case? (2006 Bar Question)
be (The Manual of Regulations for Private Higher
Education, Sec. 117). 
117).   A: As the LA, I will resolve the case in favor of the
8 probationary Ees due to the following:
NOTE: An academic teaching personnel, who does 1.  Probationary Ees also enjoy security of
not possess the minimum academic qualifications tenure   ( Biboso v. Victoria Milling,
tenure Milling, [Link].
under Section 35 and 36 of the Manual of L-44360, March 31, 1977).
Regulations for Private Higher Education shall be 2.  In all cases involving Ees on probationary
considered as a part-time Ee, and therefore can not status, the Er shall make known to the Ee
avail of the status and privileges of a probationary at the time he is hired, the standards by
employment. A part-time Ee cannot acquire a which he will qualify for the positions
regular permanent status, and hence, may be applied for.
terminanted when a qualified teacher becomes 3.  The filing of the complaint for illegal
available (Manual of Regulations for Provate Higher dismissal effectively negates the Er’ Er’ss
Education). theory of abandonment (Rizada v. NLRC,
G.R. No. 96982, September 21, 1999). 
1999). 
Q: Colegio de San Agustin (CSA) hired Gela Jose 4.  The order to go home and not to return to
as a grade school classroom teacher on a work constitutes dismissal from
probationary basis for SY ‘84 –   ‘85. Her employment.
contract was renewed for SY’s ‘85 -‘86 and ‘86- 5.  The 8 probationary Ees employment were
‘87. On Mar. 24, ‘87, the CSA wrote the Gela that terminated without just cause and
"it would be in the best interest of the students without due process.
and their families that she seek employment in In view of the foregoing, I will order reinstatement
another school or business concern for next to their former positions without loss of seniority
school year." Notwithstanding the said notice, rights with full back wages, plus damages and
the CSA still paid Gela her salary for April 15 to attorney’s fees.
May 15, 1987. On April 6,
6, ‘87, Gela wrote the
CSA and sought reconsideration but she REGULAR EMPLOYMENT
received no reply. Thereafter, she filed a
complaint for illegal dismissal. Was Gela Types of regular employment
illegally dismissed?
1.  An employment shall be deemed to be
 A: No. The Faculty Manual of CSA underscores the regular where the Ee has been engaged to
completion of three years of continuous service at perform activities which are usually
CSA before a probationary teacher acquires tenure. necessary or desirable in the usual business
 Hence, Gela cannot claim any vested right to a or trade of the Er, the provisions of written
permanent appointment since she had not yet agreements to the contrary notwithstanding

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and regardless of the oral agreements of the end of his first year of service. The law does not
parties [IRR,
[IRR, Book VI, Rule I, Sec. 5 (a)]. provide the qualification that the Ee must first be
(Nature of work) issued a regular appointment or must first be
2.  Any Ee who has rendered at least one year of formally declared as such before he can acquire a
service, whether such service is continuous regular status (Aurora
status (Aurora Land Projects Corp. v. NLRC,
or broken, shall be considered a regular Ee G.R. No. 114733, January 2, 1997).
with respect to the activity in which he is
employed and his employment shall Mode of compensation is not determinative of
continue while such activity exists [IRR,
[ IRR, Book regular employment
VI, Rule I, Sec. 5 (b)].
(b)]. (Years of service)
While the Ees mode of compensation was on a “per
NOTE:  Regularization is not a management piece basis” the status and nature of their
prerogative; rather, it is the nature of employment employment was that of regular Ees  Ees   (Labor
that determines it. It is a mandate of the law (PAL Congress of the Phils v. NLRC, G.R. No. 123938, May
v. Pascua, G.R. No. 143258, August 15, 2003).  21, 1998).

Regular employment does not mean permanent NOTE: Seafarers cannot be considered as regular
employment. A probationary Ee becomes a regular Ees. Their employment is governed by the
Ee after 6 months. The service of a regular Ee may contracts they sign every time they are hired and
only be terminated for just/authorized causes. their employment terminated when the contract
The practice of entering into employment contracts expires. Their employment is fixed for a certain
which would prevent the workers from becoming period of time (Ravago v. Esso Eastern Maritime
regular should be struck down as contrary to Ltd., G.R. No. 158324, March 15, 2005).
public policy and morals (Universal Robina Corp. v.
Catapang, G.R. No. 164736, October 14, 2005). In case of OFWs, Art280 of the LC does not apply.

Tests to determine regular employment Q: Moises was employed by La Tondeña at the

maintenance section of its Engineering
1.  The primary standard of determining Department paid on a daily basis through petty
regular employment is the reasonable cash vouchers.
vouchers. His work consisted mainly of of
connection between the particular activity painting company building and equipment and
performed by the Ee to the usual trade or other odd jobs relating to maintenance. After a
business of the Er. The test is whether the service of more than 1 year, Moises requested
former is usually necessary or desirable in that he be included in the payroll of regular
the usual business or trade of the Er (De workers, instead of being paid through petty
Leon v. NLRC, G.R. No. 70705, August 21, cash vouchers. Instead, La Tondeña dismissed
1989).  
1989). Moises and claimed that Moises was contracted
on a casual basis specifically to paint certain
NOTE: The connection can be determined by company buildings and that its completion
considering the nature of the work terminated Moises’ employment. Can Moises be
performed and its relation to the scheme of considered as a regular Ee?
the particular business or trade in its
entirety (Highway Copra Traders v. NLRC,  A: Yes. The law demands that the nature and
G.R. No. 108889, July 30, 1998). entirety of the activities performed by the Ee be
considered. Here, the painting and maintenance
2.  Also, the performance of a job for at least a work given to Moises manifests a treatment
year is sufficient evidence of the job’s consistent with a maintenance man and not just a
necessity if not indispensability to the painter, for if his job was only to paint a building
business. This is the rule even if its there would be no basis for giving him other work
performance is not continuous and merely assignments in-between painting activities.
intermittent. The employment is considered
regular, but only with respect to such It is not tenable to argue that the painting and
activity and while such activity exists maintenance work of Moises are not necessary in
(Universal Robina Corp. v. Catapang, G.R. No. La Tondeña’s business of manufacturing liquors;
164736, October 14, 2005). 
2005).   otherwise, there would be no need for the regular
maintenance section of the company’s engineering
NOTE:  The status of regular employment attaches department (De Leon v. NLRC, August 21, G.R. No.
 to the casual Ee on the day immediately after the 70705, 1989).

U N I V E R S I T Y O F S A N T O T O M A S

2 0 1 5  G O L D E N N O T E S 
88
 

TERMINATION OF EMPLOYMENT 
Q: Honorio Dagui was hired by Doña Aurora same terms and conditions of employment as a
Suntay Tanjangco in 1953 to take charge of the qualified able-bodied person. The fact that the Ees
maintenance and repair of the Tanjangco were qualified disabled persons necessarily
apartments and residential bldgs. He was to removes the employment contracts from the ambit
perform carpentry, plumbing, electrical and of Art. 80. Since the Magna Carta accords
Carta accords them the
masonry work. Upon the death of Doña Aurora rights of qualified able-bodied persons, they are
Tanjangco in 1982, her daughter, Teresita thus covered by Art. 280 of the LC (Bernardo v.
Tanjangco Quazon, took over the NLRC, G.R. No. 122917, July 12, 1999).
administration of all the Tanjangco properties,
and dismissed Dagui. Is Honorio Dagui a Q: Coca-Cola Bottlers Phils, Inc., (CCBPI)
regular Ee? engaged the services of the workers as “sales
route helpers” for a period of 5 months. After 5
 A: Yes . The jobs assigned to Dagui as maintenance months, the workers were employed by the
man, carpenter, plumber, electrician and mason company on a day-to-day basis. According to
were directly related to the business of the the company, the workers were hired to
Tanjangco’s as lessors of residential and apartment substitute for regular route helpers whenever
bldgs. Moreover, such a continuing need for his the latter would be unavailable or when there
services by the Tanjangcos is sufficient evidence of would be an unexpected shortage of manpower
the necessity and indispensability of his services to in any of its work places or an unusually high
their business or trade. volume of work. The practice was for the
workers to wait every morning outside the
Dagui should likewise be considered a regular Ee gates of the sales office of the company, if thus
by the mere fact that he rendered service for the hired, the workers would then be paid their
Tanjangcos for more than one year, that is, wages at the end of the day. Should the workers
beginning 1953 until 1982, under Doña Aurora; be considered as regular Ees of CCBPI?
and then from 1982 up to June 8, 1991 under the
daughter, for a total of 29 and 9 years respectively.  A: Yes, the repeated rehiring of the workers and
Owing to Dagui's length of service, he became a the continuing need for their services clearly attest
regular Ee, by operation of law, one year after he to the necessity or desirability of their services in
was employed in 1953 and subsequently in 1982 the regular conduct of the business or trade of the
(Aurora Land Projects Corp. v. NLRC, G.R. No. company. The fact that the workers have agreed to
114733, January 2, 1997). be employed on such basis and to forego the
protection given to them on their security of
Q: A total of 43 Ees who are deaf-mutes were tenure, demonstrate nothing more than the serious
hired and re-hired on various periods by Far problem of impoverishment of so many of our
East Bank and Trust Co. as money sorters and people and the resulting unevenness between
counters through a uniformly worded labor and capital (Magsalin & Coca-Cola v. N.O.W.M.,
agreement called “Employment Contract for G.R. No. 148492, May 9, 2003). 
2003). 
Handicapped Workers.” The company
disclaimed that these Ees were regular Ees and Q: Metromedia Times Corp. entered, for the
maintained among others that they are a fifth time, into an agreement with Efren Paguio,
special class of workers, who were hired appointing him to be an account executive of
temporarily under a special employment