LMGLABR K31 – Atty. Hilario Caraan b.

US-inspired Transition
Legislation (1946 – 1974)
Philippine Legal Environment:
Theoretical Foundation in Labor Law 2. Labor Code Era (1974 – 2008)
a. Codification of Experimentation
Trilateral Relations in Business Environment (1974 – 1986)
b. Period of “Temporary
1. Business Entities;
Confusion” (1986 - 2008)
2. Government; and
3. Stakeholders. Hierarchy of Laws
State Powers 1. 1987 Constitution
2. Statutes
1. Police Power
3. Implementing Rules and Regulation
Balancing the powers of business entities and
Labor Code of the Philippines (P.D. 442, 1974)
right of the stakeholders through government’s
regulatory authority  May 1, 1974 enactment; Nov. 1, 1974
effectivity
2. Eminent Domain or Expropriation
 PD 607: deferred effectivity of Book IV
3. Taxation
(Health, Safety & Social Welfare
Transforming Problematic Confluence into a Benefits)
Confluent Solution
Branches of Labor Law:
 “Efficient Administration of Justice”
1. Labor Standards Law
 Public Service Delivery is a
2. Labor Relations Law
Responsibility
Statutory Construction Rules
Administration of Labor Justice:
 General Law vs. Special Law
 Government – “Balancing Act”
 Workers – Social Justice and Human (Labor Code vs. special labor laws); context:
Rights Labor Code is in itself a special law but is a
 Employers – Industrial Peace general law when compared to a special labor
law
“Principle of Shared Responsibility”
 Special Law vs. Special Law
- Article XIII, Section 8, par. 3, 1987
Constitution The most recent special law shall prevail
- Something that is yet to be realized
 Supreme Court decisions are part of
Historical Phases in Labor Reform Approaches laws (interpretation)
[Caraan, 2010] (1908 – 2008)  SC EN Banc decision vs. Division
decision
1. Piecemeal Labor Legislation Era (1908 –
1974) EN Banc decision shall prevail (even though a
a. Advent of Labor Legislation Division decision is the decision of the whole
(1908 – 1946) Supreme Court)
  SC Division decision vs. Division decision If the power to control the employee’s conduct
is absent, no employment relationship may be
The latest Division decision shall prevail
considered as existing between the parties. The
I. Basic Employment Laws in right of control is deemed to be such an
important factor that the other requirements
the Philippines may even be disregarded.
Basic Principles : Controlling both the end

 Autonomy of Contracts  Sufficiency of the Mere Existence of

 Objective resolution of conflict: the Power to Control
“balancing” of employer prerogatives
It is not essential for the employer to actually
and workers’ rights
supervise the performance of duties of the
(“substantial evidence” rule): apply the
employee. It is enough that the employer has
law when clear
the right to wield that power, in order that an
 In case of doubt, interpretation issue
employer-employee relationship may be
should be resolved in favor of
considered existing between the parties.
employees
 The Relationship between Jeepney
Independent Learning Activity No. 1 Owner/Operators and Jeepney Drivers
Employment Relationship v. Independent under the Boundary System is that of
Contractorship Employer-Employee and not of Lessor-
Lessee.
I. When an Employment Relationship
is Present The fact that the drivers do not receive fixed
wages but only get the amount in excess of the
Employee – a person who performs services for so-called “boundary” that they pay to the
an employer in which either or both mental and owner/employer is not sufficient to negate the
physical efforts are used and who receives relationship between them as an employer and
compensation for such services, where there is employee.
an employer-employee relationship
“The relationship of lessor-lessee cannot be
The Fourfold Test sustained because they did not invest anything
a. Selection and engagement of the in the acquisition of the jeeps nor participate in
employee (Power to Hire) the management thereof.” (National Labor
b. Payment of Wages Union v. Dingsalan, 1956, G.R. No. L-7945).
c. Power of Dismissal  An express provision in the contract
d. Power to Control the employee’s that an employee is an independent
conduct (Power of Control at the contractor cannot negate an
Workplace) employment relationship
Note: See ‘Legend Hotel (Manila) and/or Napud The employment status of a person is defined
v. Realuyo (2012) G.R. No. 153511 and prescribed by law, and not by what the
The Right-of-Control Test parties say it is. In determining the status of the
contract, the fourfold test of employment,
specifically the right-of-control test has to be talents enjoy the freedom to offer their services
applied. as independent contractors without anyone
controlling the means and methods by which
 Evidence to prove existence of
they perform their art or craft.” (Sonza v ABS-
Employer-Employee Relationship
CBN Broadcasting Corporation, 2004, G.R. No.
No particular form of evidence is required to 138051)
prove the existence of the relationship, but a
“The contractual stipulations do not pertain to,
finding that the relationship exists must
much less dictate, how and when Jose will blow
nonetheless rest on substantial evidence. Well-
the whistle and make the call. They merely
entrenched is the doctrine that the existence of
served as rules of conduct or guidelines in order
the relationship is ultimately a question of fact
to maintain the integrity of the professional
and that the findings thereon by the Labor
basketball league. The very nature of Jose’s job
Arbiter and NLRC shall be accorded not only
of officiating a professional basketball game
respect but even finality when supported by
undoubtedly calls for freedom of control of the
substantial evidence.
PBA. Hence, Jose is an independent contractor
II. No Employment Relationship: and not an employee of PBA.” (Bernarte v.
Independent Contractorship Philippine Basketball Association et al., 2011,
G.R. No. 192084)
Independent Contractor – One who has
contracted to do the work according to his own Not every form of control will establish an
methods and without being subject to the employment relationship
control of the employer, except as to the result
The principal may establish guidelines to be
of the work.
followed by the person whose services are
In determining whether the relationship is that engaged because not every form of control that
of employer and employee or one of an the principal reserves to himself over the
independent contractor, each case must be conduct of the person engaged may be
determined on its own facts and all the features accorded the effect of establishing an employer-
of the relationship considered. employee relationship between them.

The presence of power of control is indicative if It would be a rare contract of service that gives
an employment relationship and the absence of untrammeled freedom to the person whose
such power is indicative of an independent services are engaged and eschews any
contractorship. intervention whatsoever in his performance of
work.
The control test is based on the extent of
control a hirer exercises over a worker. The 1. There is No Control when guidelines do
greater the supervision and control the hirer not dictate the methods to achieve the
exercises, the more likely the worker is deemed desired results
an employee. The less control the hirer
“A line should be drawn between rules that
exercises, the more likely the worker is
merely serve as guidelines towards the
considered an independent contractor.
achievement of mutually desired results without
“Not every performance of services for a fee dictating the means or methods to be employed
creates an employer-employee relationship. in attaining it, and rules that control or fix the
Individuals with special skills, expertise or methodology and bind or restrict the party hired
to the use of such means. The first creates no and whether such authority is not merely
employer-employee relationship.” (Insular Life routinary or clerical in nature, but requires the
Assurance, Co., Ltd. V. NLRC and Basiao, 1989, use of independent judgment (Clientlogic
G.R. No. 84484) Philippines et al. v. Castro, 2011, G.R. No.
186070)”
”A newspaper’s power to approve or reject
publication of any specific article a columnist 3. Officers and members of the managerial
writes cannot be the control contemplated in staff
the control test , as it is but logical that one who 4. Field personnel
commissions another to do a piece of work
“Antonio was in constant supervision (through
should have the right to accept or reject the
inspectors) while in the performance of his
product. The important factor to consider is still
work, and thus cannot be considered as field
the element of control over how the work itself
personnel (Auto Bus Transport, Inc. v. Bautista,
is done, not just the end result thereof.” (Orozco
2005, G.R. No. 156367)
v. The 5th Division of the Honorable CA et al.,
2008, G.R. No. 155207) 5. Employer’s family members
6. Domestic helpers and persons in the
2. The Dealer is an Independent
personal service of another
Contractor
7. Workers paid by results
(see Insular Life Assurance, Co., Ltd. V. NLRC
Additional Excluded employees for Night-shift
and Basiao, 1989, G.R. No. 84484)
differential:
Conditions of Employment and 1. Employees of retail and service
Leave Benefits under Special Laws establishments regularly employing not
more than five (5) workers (Section 1,
Title I. Working Conditions and Rest Periods
Rule II, Book III, Omnibus Rules)
(Articles 82 – 96) refers to the following
employment benefits: Retail establishment – one principally engaged
in the sale of goods to end-users for personal or
1. Normal hours of work
household use.
2. Meal periods
3. Rest periods Service establishment – one engaged in the
4. Night-shift differential sale of service to individuals for their own use
5. Overtime pay or for household use
6. Weekly rest day
Additional Excluded Employees for Holiday
7. Holiday pay
Pay:
8. Service incentive leave
9. Service charges 1. Employees of retail and service
establishments regularly employing less
Excluded employees: (p. 68-74)
than ten (10) workers
1. Government employees
Additional Excluded Employees for Service
2. Managerial employees
Incentive Leave:
“The test of “supervisory” or “managerial
status” depends on whether a person possesses
authority to act in the interest of his employer
 1. Employees who are already enjoying time spent for such work shall be
the benefit of five days service incentive considered as hours worked, if work
leave with pay was with the knowledge of his
2. Employees enjoying vacation leave with employer or immediate supervisor
pay of at least five days 4. The time during which an employee is
3. Employees of retail and service inactive by reason of interruptions in his
establishments regularly employing less work beyond his control shall be
than ten workers considered working time.
4. Employees in establishments exempted
Broken Shifts
from granting service incentive leave by
the Secretary of Labor and Employment Employee may only be compensated for the
after considering the viability or actual hours worked (Working hours of 8AM-
financial condition of the establishment 12NN & 4PM-8PM)
Hours of Work Waiting Time
Art. 83. Normal Hours of Work. The normal Shall be considered as working time in the
hours of work of any employee shall not exceed following circumstances:
eight (8) hours a day. x x x
1. When waiting is an integral part of the
Art. 84. Hours Worked. Hours worked shall work
include: 2. When employee is required or engaged
by the employer to wait
(a) All time during which an employee is
required to be on duty or to be at a On-Call Time
prescribed workplace; and
(b) All time during which an employee is An employee who is required to remain on-call
suffered or permitted to work. x x x in the employer’s premises or so close to the
premises that he cannot use the time effectively
(Section 3, Rule I, Book III, Omnibus Rules) and gainfully for his own purpose shall be
considered as working while on-call.
How to Determine Hours Worked
However, an employee is not working while on-
1. Hours worked which the employee is
call when he is not required to leave word at his
required to give his employer
home or with company officials as to where he
(productive labor or physical or mental
may be reached.
exertion)
2. Hours shall not be counted the moment “There is no doubt that the work performed by
he stops working, rest completely, leave the on-call technicians during the 11AM to 7PM
his workplace to go elsewhere, whether shift is necessary and beneficial to the hospital,
within or outside the premises of the where emergencies may occur at any time of
workplace day or night. Thus, the fact that technicians are
3. If the work performed was necessary, available to the hospital for the whole span of
or benefitted the employer, or the sixteen hours means the on-call duty of the
employee could not abandon his work technicians is indeed working time (San Pedro
at the end of his normal working hours Hospital Employees Union-FFW v. San Pedro
because he had no replacement, all the
Hospital, Inc., 1990, Case No. CA-218-RBXI-06- Anywhere as long as they return to their posts
02-90) on time.

Rest Period

Attendance in Lectures, Meetings, or Training Or coffee breaks are periods of short durations,
Programs running from five to twenty minutes during
working hours; considered as compensable
Shall not be counted as working time if all of the
working time.
following conditions are met:

1. Attendance is outside of the employee’s Independent Learning Activity No. 2

regular working hours
Employment Benefits and
2. Attendance is voluntary
3. Employee does not perform any Limitations
productive work during such Summary of Mandated Employment Benefits:
attendance [subject to the “principle of diminution” and
Meal Period employer’s gratuity]

A period consisting of sixty (60) minutes time-  13th Month Pay: 1/12 of total actually
off given by employers to employees for their earned basic salary in a calendar year;
regular meals; not considered working time, must have worked at least a month;
hence, not compensable. regardless of employment status
 Regular Holidays: Twelve (12) regular
When Meal Period is Compensable holidays which are deemed paid for
A meal period of not less than 20 minutes may monthly-paid employees; Daily paid
be given by the employer, provided that such employees are entitled to additional
shorter meal is credited as compensable hours pay even if they did not work, subject to
worked by the employee: the prohibition on absence a day before
regular holiday; twice the regular rate
1. Where the work is non-manual work in
nature or does not involve strenuous Regular Holidays in the Philippines:
physical exertion 1. New Year’s Day (Jan. 1)
2. Where the establishment regularly 2. Araw ng Kagitingan (Apr. 9)
operates not less than 16 hours a day 3. Maundy Thursday
3. In case of actual or impending 4. Good Friday
emergencies or there is urgent work to 5. Labor Day (May 1)
be performed on machineries, 6. Independence Day (Jun. 12)
equipment, or installations to avoid 7. National Heroes Day (last
serious loss which the employer would Monday of August)
otherwise suffer 8. Bonifacio Day (Nov 30)
4. Where the work is necessary to prevent 9. Christmas Day (Dec. 25)
serious loss of perishable goods 10. Rizal Day (Dec. 30)
Where Meals may be taken 11. Eid al-Fitr
12. Eid al-Adha
Pretermission of Holiday: if the employee  Service Charges: 100% to employees
absented himself the day before the holiday, he (hotels, restaurants, and service
will not get holiday pay. (must be an approved establishments)
paid absence)  Vacation/Sick Leave: Employers are not
bound to grant vacation or sick leave
 Special Holidays: Those declared by law
with pay benefits to employees.
or ordinance; by national or local
Employees may avail of SSS and ECC
government; principle of “no-work, no-
sickness benefits under certain
pay” applies to daily-paid employees;
conditions.
monthly-paid employees are deemed
 Overtime Pay: Entitled to 25% (regular
paid, and if required to work, they
day) or 30% (holiday/rest day) premium
should be allowed to offset working
pay for work hours rendered in excess
days (no special holiday premium).
of 8 hours a day, excluding meal and
 Minimum Wage Benefit: Follows the
snack breaks; based on basic pay only;
regional directives of the RTWPB
must have prior approval of overtime;
(Regional Tripartite Wages and
employees may be compelled to render
Productivity Board), subject to
overtime if “emergency” (Art. 89);
exceptions
managerial employees are not entitled
 Rest Day Benefit: Employees are
to overtime pay.
entitled to have a rest day after working
for six (6) consecutive days, not When Meal Period is considered as Overtime
necessarily Sunday; principle of “no-
1. When an employee is required to stand
work, no-pay” applies; additional 30% if
by for emergency work and if he
Sunday or holiday (or 50%)
happens to be unavailable when called,
If 40-hour work week, the 6 th day shall be he was reprimanded by the supervisor
regular pay, or if excess of 40 hours, overtime 2. When the employee is called from his
pay. meals or told to hurry up eating to
perform work during the meal period
For health personnel:

6th day or 48-hours shall be entitled additional  Night Shift Differential: For any work
compensation of 30% rendered between 10:00 p.m. to 6:00
a.m., employee is entitled to 10%
Compressed Workweek (p.89-90) premium per hour
 Meal Period: If more than 60 minutes,  Service Incentive Leave: For those who
not included in 8 paid work hours; have completed 1 work year, whether
employees must be free to go out of continuous or broken, they are entitled
company premises and/or attend to to 5 days service incentive leave with
personal matters. pay yearly. If not used, the balance is
 Snack Breaks: If more than 20 minutes, convertible to cash. If the employer is
not included in 8 paid working hours; already giving at least 5 days vacation
employees must be free to go out of leave with pay, employees are not
company premises and/or attend to entitled to Service Incentive Leave
personal matters. benefit.
 Paternity Leave: Seven (7) work days, the option of the mother, regardless if
with full basic pay for the first 4 married or not.
deliveries by lawful spouse he is  SSS, HDMF and Philhealth Mandatory
cohabitating with; not convertible to Coverage: Basic Pay
cash if not availed of; must be applied  Retirement Pay: Computed at 22.5 days
for by employee prior to expected per year of service; requires a minimum
delivery or miscarriage. of 5 years of service; optional at 60
 Solo Parent Leave: Seven (7) work days years old and mandatory at 65 years
with full basic pay every year; needs old, but age requirement may be
DSWD certification; not convertible to lowered.
cash; must have served the employer
Note: In a double holiday, when a daily-paid
for at least a year.
employee is not required to work and there is
 Leave for Victims of Violence Against
no “pretermission of holiday,” 200% of basic
Women and Children: Paid leave for
salary of the employee must be paid;
ten (10) work days and extendible when
necessity arises as specified in barangay On the other hand, when a daily-paid employee
or court protection order; not is required to work and there is no
convertible to cash. “pretermission of holiday,” 300% of basic salary
 Special Leave Benefit for Women: Two of employee must be paid.
(2) months with full pay based on gross
monthly compensation is granted to Principle of Non-Diminution of
female employees who underwent Benefits
surgery caused by gynecological
disorders; employee must have The principle of non-diminution of benefits
rendered continuous work for at least 6 prohibits the elimination of supplements or
months for the last 12 months prior to other benefits already enjoyed by the
surgery; not convertible to cash. employees under existing laws, decrees,
 Maternity Leave: One hundred five executive orders, company policy or practice, or
(105) continuous and uninterrupted any agreement or contract between the
days with pay based on average employer and employees.
monthly salary credit regardless of civil Generally, employees have a vested right over
status; if live childbirth, with option of existing benefits voluntarily granted to them by
additional thirty (30) days without pay, their employer. Thus, any benefit or
upon notice; additional fifteen (15) days supplement being enjoyed by the employees
with full pay if solo parent; must have cannot be reduced, diminished, discontinued,
paid at least 3 SSS monthly or eliminated.
contributions in the 12-month period
immediately preceding childbirth, The principle is founded on the Constitutional
miscarriage, or emergency termination mandate to protect the rights of workers, to
of pregnancy. In case of differential pay promote their welfare, and to afford labor full
between SSS benefit and actual salary, protection.
employer shoulders the difference. Supplements or benefits – extra remuneration;
 Allocation of Maternity Leave Credits: special privileges given to or received by
Seven (7) days for father of the child, at
employees over and above their ordinary Requisites for Diminution of Benefits
earnings.
1. The benefit is founded on a policy or
Includes but not restricted to: has ripened into a practice over a long
period of time
1. Pay for vacation and special holidays
2. The practice is consistent and deliberate
not worked
3. The practice is not due to error in the
2. Paid sick leave
construction or application of a
3. Overtime rate in excess of what is
doubtful or difficult question of law
required by law
4. The diminution or discontinuance is
4. Profit-sharing
done unilaterally by the employer
5. Family allowances
6. Christmas and cost-of-living bonuses As a general rule, a practice or a custom is not a
7. Bonuses other than those paid as a source of a legally demandable or enforceable
reward for extra output or time spent right.
on the job
8. Funeral of bereavement aid Tripartite Labor Relations Policies
9. Any other benefits stipulated in a CBA Limitations
Indicators that Benefits have ripened into
 Due process
Company practice
 Good faith
The employee mist prove by substantial  Just cause/ Authorized cause
evidence that the giving of the benefit is done
over a long period of time, and that it has been 1. Management Prerogative
made consistently and deliberately.
The free will of the employer to conduct his
While jurisprudence has not laid down any hard own business affairs to achieve his purpose.
and fast rule as to the length of time the This exercise, while not ordinarily interfered
company practice should have been exercised in with, is not absolute and is subject to limitations
order to constitute voluntary employer practice, imposed by law, CBAs, and general principles of
the common denominator appears to be the fair play and justice.
regularity and deliberateness of the grant of
benefits over a significant period of time. An employer is free to regulate, according to his
own discretion and judgment, all aspects of
The following indicators must be considered: employment, including (1) hiring; (2) work
1. Employer’s knowledge that he is not assignments; (3) working methods; (4) time,
required to extend such benefit place, and manner of work; (5) tools to be used;
2. Granting of the benefits is consistent (6) processes to be followed; (7) supervision of
and deliberate employees; (8) working regulations; (9) transfer
3. Employer continues to grant his of employees; (10) work supervision; (11) lay off
employees the benefit for several years of employees; and (12) discipline, dismissal, and
recall of work.
Considerable length and time indicates a
unilateral and voluntary act on the employer’s Based on the established rule that the law does
part, sufficient in itself to negate any claim of not authorize the substitution of the judgment
mistake. of employer in the conduct of his business.
Every business endeavors to increase profits the employee’s position, but his very livelihood.
and in the process, may adopt or devise means The Constitution does not condone wrongdoing
designed toward that goal. by the employee, but where a penalty less harsh
would suffice, whatever wrongs the worker has
May be availed with fear of any liability as long
committed should not be meted with a
as:
consequence as severe as dismissal from
1. It is exercised in good faith for the employment (The Coca-Cola Export Corporation
advancement of the employer’s interest v. Gacayan, G.R. No. 149433, Dec. 15, 2010)
and not for the purpose of
circumventing the rights of employees
under special laws or a valid agreement
2. Not exercised in a malicious harsh,
b. Discipline of Employees
oppressive, vindictive or wanton
manner or out of malice or spite Generally not subject to judicial interference
but can only be justified if the disciplinary action
Must be fair and reasonable, and the
is dictated by legitimate business reasons and is
corresponding penalties prescribed
not oppressive.
commensurate to the infraction or offense.
“What should not be overlooked is the
a. Hiring and Firing of Employees
prerogative of an employer to prescribe
The limitation is embodied in the constitutional reasonable rules and regulations necessary for
requirement for the protection of labor and the the proper conduct of its business and to
promotion of social justice, which favors the provide certain disciplinary measures in order to
employee whenever there is doubt. implement said rules and ensure compliance
(Areno, Jr. v. Skycable PCC – Baguio, G.R. No.
Certain mandatory requirements must be
180302, Feb. 5, 2010)”
complied with to ensure that this prerogative is
exercised without arbitrariness or abuse of c. Transfer of Personnel
discretion. Hence, both the reason for dismissal
Based on the assessment of employee’s
and the manner of dismissing an employee
qualification, aptitudes and competence, to
must be appropriate. Otherwise, the
move employees around in the various areas of
termination itself is gravely defective and may
his business operations to function with
be declared unlawful.
maximum benefit to the company.
An employee’s job is considered a property
An employee’s security of tenure does not give
right and is therefore within the constitutional
a vested right in a position as would deprive the
mantle of protection that “no person shall be
employer of the prerogative to change the
deprived of life, liberty, or property without due
assignment or transfer where employees will be
process of law, nor shall any person be denied
most useful.
the equal protection of the laws.”
The employee may not complain that the
“While an employer may terminate a
transfer amounts to a constructive dismissal if
managerial employee for a just cause, such
the transfer is not unreasonable, inconvenient,
prerogative to dismiss or lay off an employee
or prejudicial, or does not involve a demotion in
should be tempered with compassion and
understanding, since what’s at stake is not only
rank or diminution of salaries, benefits and holiday pay, and leave benefits, which are
other privileges. provided by the Labor Code.

“An objection to a transfer being grounded Decrease in the midyear and year-end bonuses
solely upon the personal inconvenience or or even outright elimination would not
hardship that will be caused to the employee by constitute a diminution of the employee’s
reason of the transfer is not a valid reason to salaries, as granting of bonuses is a
disobey an order of transfer (Herida v. F&C management prerogative.
Pawnshop and Jewelry Store, G.R. No. 172601,
“The bank may not be forced to distribute
Apr. 16, 2009).”
bonuses which it can no longer afford to pay
d. Productivity Standards and in effect, be penalized for its past
generosity to its employees (Traders Royal Bank
The company policy of laying off workers
v. NLRC and Traders Royal Bank Employees
because they failed to make the work quota has
Union, G.R. No. 88168, August 30, 1990).”
been recognized by the Supreme Court, ruling
that failure to meet work quota assigned to an f. Change of Working Hours
employee—either by failing to complete it
Management retains the prerogative, whenever
within the allotted reasonable period, or by
exigencies of the service so require, to change
producing unsatisfactory results—constitutes a
the working hours of its employees.
just cause of dismissal regardless of the
permanent or probationary status of The prerogative must be exercised in good faith
employment. and with due regard to the rights of labor —
with the principles of fair play at heart and
Such prerogative must be exercised in good
justice in mind.
faith to advance the employer’s interest.
“The prerogative accorded to management
“An employee’s failure to meet sales or work
cannot defeat the very purpose for which labor
quotas falls under the concept of gross
laws exist: to balance the conflicting interests of
inefficiency, which in turn is analogous to gross
labor and management, not tilting the scale in
neglect of duty, a just cause for dismissal under
favor of one over the other, but guaranteeing
the Labor Code
that labor and management stand on equal
xxx footing when bargaining in good faith with each
other (Unicorn Safety Glass Inc. v. Basarte et al.,
The duty to prove good faith rests with the
G.R. No. 154689, November 24, 2004).”
company as part of its burden to show that the
dismissal was for a just cause (Aliling v. Wide g. Rules on Marriage
wide World Express Corporation, G.R. No.
185829, April 25, 2012).”  Prohibition on Marriage to Employees
of Competitor Companies
e. Granting of Bonus
A valid exercise of management prerogative
Some companies dole out bonuses depending
where relationships of this nature might
on its past performance, at specific times of the
compromise the interests of the company.
year. Despite being a general practice, bonuses
are not part of labor standards in the same class The employer has a right to guard its trade
as salaries, cost-of-living allowance (COLA), secrets, manufacturing formulas, marketing
strategies and other confidential programs and would better accomplish the business purpose,
information from competitors, and may issue a an employer may not discriminate against an
company policy prohibiting marriage with employee based on the identity of the
employees of competitor companies to protect employee’s spouse. This is known as the bona
its interests against the possibility that a fide occupational qualification exception
competitor company will gain access to its
xxx
secrets and procedures.
Bona fide occupational qualification exception
“No less than the Constitution recognizes the
right of enterprises to adopt and enforce such Must prove two factors:
policy to protect its right to reasonable returns
on investment and to expansion and growth.  That the employment qualification is
Indeed, while laws endeavor to give life to the reasonable related to the essential
constitutional policy on social justice and the operation of the job involved; and
protection of labor, it does not mean that every  That there is a factual basis for
labor dispute will be decided in favor of the believing that all or substantially all
workers. The law also recognizes that the persons meeting the qualification would
management has rights, which are also entitled be unable to properly perform the
to respect and enforcement in the interest of duties of the job.
fair play (Duncan Association of Detailman- While the questioned policy may not facially
PGTWO and Tecson v. Glaxo Wellcome violate the article on prohibition of marriage of
Philippines, G.R. No 162994, Sept. 17, 2004).” employees, the only way it could pass judicial
 Prohibition on Marriage to Co- scrutiny is to show that it is reasonable despite
Employees (No-Spouse Employment discriminatory, albeit disproportionate, effect.
Policy) (Star Paper Corporation et al. v. Simbol et al.,
Whether this policy violates the rights of the G.R. No. 164774, April 12, 2006).”
employee under the Constitution and the Labor
2. Employee’s Rights
Code, and is a valid exercise of management
prerogative, depends on the reasonableness of
a. Right to Security of Tenure
the business necessity.
No employee can be dismissed from work
“For a no-spouse policy to be valid, the
except for a just or authorized cause, and only
employer must present evidence of business
after due process.
necessity other than the general perception that
spouses in the same workplace might adversely Limitations:
affect the business. Courts hold that the
Termination of employee has two aspects:
absence of such bona fide occupational
qualification invalidates a rule denying  The legality of the act of dismissal per
employment to one spouse due to the current se, which constitutes substantive due
employment of the other spouse in the same process; and
office. Thus, unless the employer can prove that  The legality of the manner of dismissal,
the reasonable demands of the business require which constitutes procedural due
a distinction based on marital status and there process
is no better available or acceptable policy which
Substantive due process is the termination of duties which he has been engaged to
the employee for just or authorized cause as discharge
provided by law
 Gross and habitual neglect of duties
Procedural due process is the termination of
the employee only after complying with the Includes gross inefficiency, negligence, and
notice requirements provided by law. carelessness, as well as unauthorized absences
and tardiness.
An employer cannot be legally compelled to
continue with the employment of a person who Habitual neglect implies repeated failure to
admittedly was guilty of an infraction or offense perform one’s duties for a period of time.
toward his employer and whose continuance in
Repeated and habitual infractions, committed
the service of the employer is patently inimical
despite several warnings, constitute gross
to his interests. The law, in protecting the rights
misconduct. Habitual absenteeism without
of the laborer, authorizes neither oppression
leave constitute gross negligence and is
nor self-destruction of the employer.
sufficient to justify termination of an employee.
Just causes for termination of employment:
A single or isolated act of negligence cannot
The inability of a probationary employee to constitute just cause; the neglect of duty must
meet the employer’s prescribed standards of be BOTH gross and habitual
performance made known to him or her at the
 Fraud or loss of trust and confidence
time of hiring is also a just cause for dismissal.
Requisites:
 Serious misconduct
1. The employee concerned must be
Transgression of some established or definite
holding a position of trust and
rule of action, a forbidden act, a dereliction of
confidence; and
duty, willful in character, and implies wrongful
2. There must be an act that would justify
intent and not mere error in judgment; must be
the loss of trust and confidence
of such grave and aggravated character and not
merely trivial and unimportant; must also be in Must be based on a willful breach of trust
connection with the employee’s work to founded on clearly established facts; the basis
constitute just cause for termination. must be clearly and convincingly established,
but proof beyond reasonable doubt is not
 Willful disobedience or
necessary.
insubordination
Breach is willful if done intentionally, knowingly,
Requires the occurrence of at least two
and purposely, without justifiable excuse, as
requisites:
distinguished from an act done carelessly,
1. The employee’s assailed conduct must thoughtlessly, heedlessly, or inadvertently.
have been willful or intentional (the
Must be related to the performance of the
willfulness being characterized by
employee’s duties. The act must show that the
wrongful and perverse attitude)
employee concerned is unfit to continue to
2. The order violated must have been
work for the employer.
reasonable, lawful, made known to the
employee, and must pertain to the Holding a Position of Trust and Confidence
 1. Managerial employees whose primary Closely related to gross neglect, for both involve
duty consists of the management of the specific acts of omission on the part of the
establishment in which they are employee resulting in damage to the employer
employed or of a department or a or his business.
subdivision thereof, and other
Failure to observe prescribed standards of
officers/members of the managerial
work, or to fulfill reasonable work assignments
staff;
due to inefficiency may constitute just cause for
2. Fiduciary rank-and-file employees, such
dismissal.
as cashiers, auditors, property
custodians, or those who, in the normal o Violation of company rules and
exercise of their functions, regularly regulations
handle significant amounts of money or
property Closely related to willful disobedience. It is
recognized that company policies and
With respect to rank-and-file employees, loss of regulations, unless shown to be grossly
trust and confidence as a ground for dismissal oppressive or contrary to law are generally valid
requires proof of involvement in the alleged and binding on the parties and must be
events in question. Mere uncorroborated complied with.
assertions and accusations by the employer will
not be sufficient. o Abandonment of work

With respect to managerial employees, the Closely related to gross and habitual neglect of
mere existence of a basis for believing that the duties. The employer has the burden of proof to
employee has breached the trust of his show the employee’s deliberate and unjustified
employer would suffice for his dismissal. refusal to resume his employment without any
intention of returning. Mere absence is not
Guidelines for application of the Doctrine of sufficient. There must be unequivocal intent on
Loss of Trust and Confidence the part of the employee to discontinue his
1. Loss of confidence should not be employment.
simulated; It is essential that (1) the employee must have
2. It should not be used as a subterfuge failed to report for work or must have been
for causes which are improper, illegal, absent without valid or justifiable reason, and
or unjustified; (2) there must have been a clear intention to
3. It may not be arbitrarily asserted in the sever employee-employer relationship,
face of overwhelming evidence to the manifested by some overt acts.
contrary;
4. It must be genuine, not a mere Complaint for illegal dismissal is inconsistent
afterthought to justify earlier action with abandonment. It implies the continued
taken in bad faith. interest of the employee to stay employed.
Claiming of separation pa or reinstatement does
 Commission of a crime or offense not reflect the intention to leave either, but
analogous to the foregoing, including: only exercises his option under Art. 291 of the
o Gross inefficiency Labor Code, which entitles the employee to
either reinstatement and backwages, or
payment of separation pay in the event of illegal May only be imposed if employee’s continued
dismissal. employment poses a threat to the life or
property of the employer or of his co-workers.
Abandonment of work does not per se sever
employee-employer relationship. The operative Shall not exceed thirty (30) days. After this
act that will ultimately put an end to the period, the employee must be reinstated to his
employment relationship is the dismissal of the former position or in a substantially equivalent
employee after complying to the procedure position. If the suspension is extended, the
prescribed by law. If the employer does not employee shall be entitled to his salaries and
follow this procedure, there is illegal dismissal. benefits that may accrue to him during the
period of extension of the suspension. If upon
--
the completion of the hearing, the employer
Offense against any of the following: (1) the decides to dismiss the services of the employee,
person of his employer, (2) any immediate the employee has no obligation to reimburse
member of the employer’s family, and (3) the the amount paid to him during the extension of
employer’s duly authorized representative. his suspension.

Penalty Less Harsh than Dismissal may be Authorized causes:

imposed by the Employer
 Installation of Labor-Saving Devices
Where a penalty less harsh than dismissal
Installation of machinery to effect economy and
would be sufficient to penalize the employee,
efficiency in the employer’s method of
whatever missteps may be committed by the
production. The institution of “new methods or
employee should not be visited with a
more efficient machinery, or of automation” is
consequence as severe as dismissal. Hence, all
technically a ground for termination of
the circumstances of the case should be
employment by reason of installation of labor-
considered, including the length of service of
saving devices. However, where the
the employee and the gravity of his offense.
introduction of these methods is resorted to not
 Suspension merely effect greater efficiency in the operation
of the business but principally because of
A penalty lighter than dismissal, which may be
serious business reverses and to avert further
imposed upon an employee after findings that
losses, the device could then be verily be
the employee has committed an infraction or
considered retrenchment.
offense against the employer. It may only be
meted upon the employee at the termination of A management prerogative, and the courts will
the investigation or the final disposition of the not interfere with its exercise in the absence of
case. abuse of discretion, arbitrariness, or
maliciousness on the part of management.
 Preventive Suspension
 Redundancy
Imposed during the pendency of an
administrative investigation. It is not a penalty Exists when the service capability of the
in itself but merely a measure of precaution so workforce is in excess of what is reasonable
that the employee who is charged may be needed to meet the demands of the enterprise.
separated from the scene of his alleged A redundant position is one rendered
misfeasance while he is being investigated. superfluous by any number of factors, such as:
(1) overhiring of workers, (2) decreased volume  Reasonably imminent, as such
of business, (3) dropping of a particular product imminence can be perceived objectively
line previously manufacture by the company, or and in good faith by employer
(4) phasing out of a service activity previously  Reasonably necessary and likely to
undertaken by the business effectively prevent expected losses
 Alleged losses if already realized, and
Criteria for Redundancy Programs and
the expected imminent losses sought to
Duplication of Work
be forestalled, must be proved by
Such as but not limited to: sufficient and convincing evidence.

 Preferred status Done in good faith for the advancement of the

 Efficiency company’s interest and not to defeat or
 Seniority circumvent the employees’ right to security of
tenure; used fair and reasonable criteria to
Redundancy does not mean duplication of ascertain who would be dismissed and who
work. would be retained such as status, efficiency,
A position may properly be abolished by the seniority, physical fitness, age, and financial
employer due to redundancy (management hardship for certain workers.
prerogative). The characterization of the Business losses should be shown by Audited
employee’s service as no longer necessary or Financial Statements not only for the year
sustainable, and therefore, properly terminable, during the retrenchment.
is an exercise of business judgment.
 Closing or cessation of operation of the
Redundancy due to the hiring of Independent establishment or undertaking, unless
Contractors is valid when the engagement of the closing is for the purpose of
independent contractors is undertaken in order circumventing the law
to effectuate more economic and efficient
methods of production. Complete cessation of the operations and/or
shutdown of the establishment of the employer
 Retrenchment to prevent losses to stave off financial ruin or promote business
Termination of employment initiated by the interest of the employer.
employer through no fault of the employee and Need not depend for validity on evidence of
without prejudice to the latter, resorted by actual or imminent reversal of the employer’s
management during periods of business fortune, Art. 289 authorizes termination of
recession, industrial depression, or seasonal employment due to business closure regardless
fluctuations, or during lulls over shortage of of the underlying reasons and motivation
materials; a reduction in manpower, a measure therefore, be it financial losses or not.
utilized to minimize losses incurred in the
operation of business.  The closure must be bona fide
 Closure is of the entire establishment
Must be due to serious, actual, and real and not merely a division or
business losses. department of the establishment
 Loss should be substantial and not (retrenchment)
merely de minimis in extent ---
Procedural Due Process in Termination of affected employees to separation pay is lost
for obvious reasons.
1. Termination based on Just Causes
Provided by Law Other Limitations:

No renewal or extension of probationary

 Notice to employee of intent to dismiss
employment (otherwise, employee becomes
and grounds for dismissal
permanent)
 Opportunity for employee to explain his
or her side (hearing) The total contractual employment should not
 Notice of decision to dismiss exceed a total of 12 months or 1 year,
otherwise the contractual or casual employee
2. Termination based on Authorized becomes permanent. If it extends, the
Causes Provided by Law employee becomes permanent. The total 12
months may be continuous or intermittent.
 Written notice of dismissal specifying
the grounds, at least 30 days before b. Right to Humane/Safe
termination Workplace Conditions
 Written notice to DOLE Employers must provide workers with every
Separation Pay Necessary in Cases of kind of on-the-job protection against injury,
Termination Due to Authorized Causes sickness or death through safe and healthful
working conditions.
Given at the time of the employee’s severance
from employment and is designed to provide Jobs may be hazardous or highly hazardous.
the employee with the wherewithal, or the Hazardous jobs are those which expose the
financial means, during the period that he is employee to dangerous environment elements,
looking for another employment. including contaminants, radiation, fire,
poisonous substances, biological agents and
Computation of Separation Pay explosives, or dangerous processes or
equipment including construction, mining,
1. Installation of Labor-Saving Devices or
quarrying, blasting, stevedoring, mechanized
Redundancy
farming and operating heavy equipment
At least one month pay or at least one month
c. Equal Work Opportunities for
pay for every year of service, whichever is
All
higher, a fraction of at least 6 months being
considered as one whole year The state shall protect labor, promote full
employment, provide equal work opportunity
2. Retrenchment or Cessation of Business
regardless of gender, race, or creed; and
At least one month pay or at least one-half regulate employee-employer relations.
month pay for every year of service, whichever
Male and female employees are entitled to
is higher, a fraction of at least 6 months being
equal compensation for work of equal value and
considered as one whole year
to equal access to promotion and training
If the closure of business is due to serious opportunities. Discrimination against female
business losses which are duly proved, the right employees unlawful. It is also unlawful for an
employer to require a condition of employment
that a woman employee shall not get married, because he had no replacement, all the
or to stimulate expressly or tacitly that a time spent for such work shall be
woman employee shall be dismissed upon considered as hours worked, if the work
marriage. was with the knowledge of his
employer or immediate supervisor;
The minimum age of employment is 18 years
for hazardous jobs, and 15 years for non- 4. The time during which an employee is
hazardous jobs. But a child below 15 maybe inactive by reason of interruptions in his
employed by parents or guardians in a non- work beyond his control shall be
hazardous job if the employment does not considered working time, either if the
interfere with the child's schooling. imminence or the resumption of work
requires the employee’s presence at
d. Work Days and Work Hours
the place of work, or if the interval is
Art. 83 - Normal Hours of Work. The normal too brief to be utilized effectively and
hours of work of any employee shall not exceed gainfully in the employee’s own
eight (8) hours a day interest.

Art. 84 - Hours Worked. Hours worked shall

include:

1. All time during which an employee is

required to be on duty or to be at a
prescribed workplace; and Limitations:
2. All time during which an employee is
Broken Shifts
suffered or permitted to work.
The employer and employee may agree on the
How to Determine Hours Worked
schedule of working hours of the employee. 
1. All hours are hours worked which the
If the established working hours of an employee
employee is required to give his
run from 8AM to 12NN and then from 4PM up
employer, regardless of whether such
to 8PM, the employee may only be
hours are spent in productive labor or
compensated for the actual hours worked. 
involve physical or mental exertion;
The period from 12NN up to 4PM is not
2. An employee need not leave the
considered as working time as he is not
premises of the workplace in order that
required to be at the prescribed workplace
his rest period shall not be counted, it
during this 4 hour period.
being enough that he stops working,
may rest completely and may leave his Waiting Time
workplace to go elsewhere, whether
within or outside the premises of his 1. When waiting is an integral part of the
workplace work 

3. If the work performed was necessary, 2. When the employee is required or

or it benefited the employer or the engaged by the employer to wait
employee could not abandon his work A company driver who brings the
at the end of his normal working hours manager to a meeting, waits for the
 manager and after the meeting, drives Covers all employees, mandates all
the manager back to the establishment employers/companies to follow (for profit or
of the employer is considered to be non-profit)
working while waiting.
Compensation for Rest Day, Sunday or Holiday
On-call time Work

An employee who is required to remain on-call Where an employee is made or permitted to

in the employer’s premises or so close to the work on his scheduled rest day, he shall be paid
premises that he cannot use the time effectively an additional compensation of at least 30% of
and gainfully for his own purpose shall be his regular wage. An employee shall be entitled
considered as working while on-call.  to such additional compensation for work
performed on Sunday only when it is his
An employee is not working while on-call when
established rest day. 
he is not required to leave word at his home or
with company officials as to where he may be When the nature of the work of the employee is
reached such that he has no regular work days and no
regular rest days can be scheduled, he shall be
Attendance in Lectures, Meetings or Training
paid an additional compensation of at least 30%
Programs
of his regular wage for work performed on
Shall not be counted as working time if all of the Sundays and holidays 
following conditions are met:
Work performed on any special holiday shall be
1. Attendance is outside of the paid an additional compensation of at least 30%
employee’s regular working of the regular wage of the employee. Where
hours such holiday work falls on the employees
2. Attendance is voluntary; and  scheduled rest day he shall be entitled to an
3. The employee does not additional compensation of at least 50% of his
perform any productive work regular wage
during such attendance 
Where the collective bargaining agreement or
Meetings conducted by employees to organize other applicable employment contract
themselves to form a union is not working time. stipulates the payment of a higher premium pay
Similarly, attendance at a company outing or then that prescribed under this article, the
training is not working time unless attendance is employer shall pay such higher rate. 
compulsory.
When an employee volunteers to work on his
e. Weekly Rest Day rest day and circumstances other than those
mentioned for compulsory work, he shall
Art. 91- Duty of every employer (whether for express his desire in writing and shall be given
profit or not) to grant his employees a rest additional compensation for work done on a
period of not less than 24 consecutive hours rest day for (Section 6, Rule 3, Book 3, Omnibus
after 6 consecutive normal work days. Not Rules) 
necessarily Sunday. Employer shall determine
the weekly rest day subject to collective Rest day pay rates page 86 to 87
bargaining agreement & to rules of DOLE.
Limitations:
Extent:
Employers shall respect rest day preference Wages
based on religious grounds (Employee shall
Art. 97 of the Labor Code
make known his preferred rest day at least 7
days before desired effectivity) Wage - Paid to any employee that means the
remuneration or earnings, however designated,
Exception: When choice of rest day by the
capable of being expressed in terms of money,
employee (based on religious grounds) will
whether fixed or ascertained on a time, tasl,
prejudice the business operations & the
piece, or commission basis, or other method of
employer cannot result to other remedial
calculating the same, which is payable by an
measures, the employer may schedule the
employer to an employee under written or
weekly rest day chosen by the employee for at
unwritten contract of employment for work
least 2 days a month
done or to be done, or for services rendered or
Art. 92 (p.84) - When Employer may require to be rendered and includes fair and reasonable
work on a rest day: value, as determined by the Secretary of Labor
and Employment, of board, lodging, or other
1. In case of actual or impending
facilities customarily furnished by the employer
emergencies cause by serious accident,
to the employee.
fire, flood, typhoon, earthquake,
epidemic or other disaster or calamity
to prevent loss of life and property or
Wages includes facilities but not supplements -
imminent danger to public safety
“facilities” include articles or services for the
2. In cases of urgent work to be performed
benefit of the employee and his family. BUT
on the machinery equipment or
SHALL NOT include tools or trade or articles or
installation to avoid serious loss which
services PRIMARILY for the benefit of the
the employer would otherwise suffer
employer or necessary to the conduct of the
3. In the event of abnormal pressure of
employer’s business. (Section 5. Rule VII-A.
work due to special circumstances
Book III. Omnibus Rule). Moreover, the value of
where the employer cannot ordinarily
the facility involved can be deducted from the
be expected to resort to other
wage to be paid to the employee given that the
measures
employer SHALL NOT gain profit from the
4. To prevent loss or damage to perishable
deduction of the value.
goods
5. Where the nature of the work requires Requirements for the deduction of cost of
continuous operations and the facilities from wages
stoppage of work may result in
irreparable injury or loss to the 1. Proof must be shown that the facilities
employer are customarily furnished by the trade.
6. Other circumstances analogous or 2. The provision of the deductible facilities
similar to the foregoing as determined must be voluntarily accepted in writing
by the secretary of labor and by the employee.
employment 3. Facilities must be charged at fair and
reasonable values.
f. Wage and Wage-related Supplement vs. Facility
Benefits
A supplement is a benefit or privilege given to A bonus is also a management prerogative
the employee which constitutes extra which cannot be forced upon the employer who
remuneration over and above his basic may not be obliged to assume the onerous
earnings. A facility is a benefit or privilege that burden of granting bonuses or other benefits
forms part of the employee’s basic wage. aside from the employee’s basic salary. IT IS
NOT DEMANDABLE and an enforceable
Extent
obligation unless stipulated therein. 
The privilege shall extend to employees in all
establishments and undertakings whether for Extent
profit or not
To any employee at the generosity of the
Limitations employer as a form of reward
The rules on wages shall not apply to the
Limitations
following:

1. Tenants of farm tenancy or leasehold It is not demandable and an enforceable

2. Domestic helpers and persons in the obligation on the part of the employer. Only if
personal service of another the said bonus is made part of the wage of the
3. Persons working in their respective employee, then it is demandable. 
homes in needlework or in any cottage
industry duly registered with 13th Month Pay
accordance of the law
PD. 851 - “13th Month Pay Law”. All employers
4. Employees engaged in any
are REQUIRED to pay all their employees
establishment duly registered with the
receiving a basic salary of NOT MORE THAN
NACIDA provided that they work in
P1,000 a month, regardless of the nature of
their respective homes
their employment. Not later than December 24
5. Employees of any duly registered
of every year. The following are employees
cooperative when recommended by the
entitled for a 13th month pay:
Bureau of Cooperative Development
and approved by the Labor Secretary. 1. All employees not falling within the
(Book III Rule IV - Article 98 Section 3). definition of a managerial employee
Bonus shall be considered a rank-and-file
employee and shall be entitled to a
A bonus is an amount paid to an employee for 13th month pay.
his industry and loyalty which contributed to
the success of the employer’s business and Extent
made possible the realization of profits. An act
of GENEROSITY, an act of LIBERALITY of the 13th month pay extends to an employee who
employer for which the employee should be has already resigned or whose services were
thankful and grateful for. The recipient cannot terminated at any time before the time for the
demand as a matter of right, as a bonus is payment.  This payment may be demanded
something given in addition to what is ordinarily upon termination. Unless the employee is
received by or strictly due the recipient. terminated, he is to be granted a 13th month
pay.
 When deduction are with the written
g. Payment of Wages authorization of the employees for payment to
3rd person and employer agrees to do so
Form - By means of promissory notes, voucher,
coupon, or anything that is not of legal tender, Deposits for Loss or Damage
even if the employee requested it is not
Employers should not require his worker to
allowed.
make deposits from which deductions shall be
Wages by check or money order shall be made for the reimbursement of loss of or
allowed when it is customary on the date of damage to materials/tools/equipment that
effectivity of the Labor Code or necessary employer supplied
because of special circumstances specified in
Limitations
regulations or stipulated in CBA
No deduction from the deposits of an employee
Time - Paid at least once every 2 weeks or
for the actual amount of the loss or damage
twice a month at intervals not exceeding 16
unless employee has been heard and his
days. If force majeure, pay immediately after
responsibility has been clearly shown
the occurence. Wage payment frequency
should not be less than once a month.  Withholding of Wages and Kickbacks
Place - Made at or near place of undertaking, It is unlawful for any person to withhold any
except if secretary of DOLE prescribe amount from the wages of a worker or induce
regulations under conditions for greater him to give up any part of his wages by force,
protection intimidation or threat, or other means that
would not establish consent
Limitations (Prohibitions)
Deduction to Ensure Employment
Interference in the Disposal of Wages
Unlawful to deduct from wages for the benefit
Employer cannot limit or interfere with the
of employer or his representative or
freedom of any employee to dispose of his
intermediary as consideration of a promise of
wages.
employment or retention in employment
Wage Deduction

Employer cannot make any deduction from the

Retaliatory Measures
wages of his employees except:
Unlawful for employer to refuse to pay or
Employee is insured by the employer with
reduce wages and benefits, discharge or in any
former’s consent and deduction is to
manner discriminate against any employee who
recompense the employer for amount by him as
has filed any complaint or instituted any
premium on the insurance
proceeding, or has testified or is about to testify
For union dues, when he right worker or his such proceedings
union to check-off has been recognized by
False Reporting
employer or authorized in writing by individual
worker concerned Unlawful for any person to make any
statement, report, or record files such as
payrolls and time records, knowing such
statement, report or record is false in any Acts under this:
material respect.
To discharge a woman on account of her
Other prohibitions pregnancy, or while on leave or in confinement
due to her pregnancy
No employer shall pay his employees in any bar,
night or day club, drinking establishment, To discharge or refuse the admission of a.
massage clinic, dance hall, etc. or in places woman upon her return to work, for fear that
where games are played with money or items she may again become pregnant
representing money at stake except if in case of
4. Denial of benefits
persons unemployed in such places.
It is unlawful for an employer to deny any
h. Employment of Women
female employee the benefits provided for
The following are prohibited on the under the law, or to discharge any woman
employment of women: employed by him for the purpose of preventing
her from enjoying any benefits.
1. Discrimination
5. Discharge due to a complaint or
Acts of discrimination:
testimony
Payment of lesser compensation, including
It is unlawful for an employer to discharge any
wage, salary, or other forms of remuneration
woman or any other employee for having filed a
and fringe benefits to a female employee as
complaint, having testified or for being about to
against a male employee, for work of equal
testify under the Labor Code
value.
Others
Favoring a male employee over a female
employee with respect to promotion, training Nightwork prohibition unless allowed by the
opportunities, study, and scholarship grants Rules:
solely on account of their sex.
 In industrial undertakings from 10PM to
2. Stipulation against marriage 6AM
 In commercial/non-industrial
Acts under this:
undertakings from 12MN to 6AM
To require as a condition of employment or  In agricultural undertakings, at night
continuation of employment that a female shall time unless given not less than 9
not get married consecutive hours of rest

To stipulate expressly or tacitly that upon Welfare facilities must be installed at the
getting married, a female employee shall be workplace such as seats, separate toilet rooms,
deemed resigned or separated lavatories, and dressing rooms.

To actually dismiss, discharge, discriminate, or Prohibition against discrimination with respect

otherwise prejudice a female employee by to pay (i.e. equal pay for work of equal value),
reason of her marriage. promotion, training opportunities, study and
scholarship grants.
Cannot be demanded in cases of just cause
RA 7877. “An Act Declaring Sexual Harassment
3. Discharge on account of pregnancy Unlawful in the Employment, Education or
Training Environment and for Other Purposes” 7. Instructor
or the Anti-Sexual Harassment Act of 1995 8. Professor
9. Coach
Work-related sexual harassment - committed by
10. Trainor
an employer, employee, manager, supervisor,
11. Any other person who has authority or
agent of the employer or any other person who,
moral ascendancy over another in work,
having authority, influence or moral ascendancy
education, or training-related
over another in a work environment, demands,
environment
requests, or otherwise requires a sexual favor
from the other, regardless of whether the
i. Employment of Children
demand, request or requirement for sexual
favor is accepted by the object of the demand, Children below 15 years old
request or requirement for sexual behavior
Cannot be employed
It is also committed in the following instances:
Exception: when he works directly under the
The sexual behavior is made as a condition for: sole responsibility of his parents or guardian,
and his employment does not in any way
 Employment, reemployment, or
interfere with his schooling.
continued employment of said
individual Children between 15 and 18 years old

 Granting said individual favorable May be employed in any non-hazardous or non-

compensation or privileges deleterious environment

 The refusal to grant the sexual behavior Hours of a Working Child

results in discrimination or deprivation
A child below 15 years of age may be allowed to
of employment opportunities on the
work for not more than four (4) hours a day,
said employee
twenty (20) hours a week. He shall not be
The demand, request or requirement of sexual allowed to work between 8PM to 6AM.
behavior would impair the employee’s rights
A child between 15 and 18 may be allowed to
and privileges
work for not more than eight (8) hours a day,
The demand, request, or requirement for sexual forty (40) hours a week he shall not be allowed
favor would result in an intimidating, hostile, or to work between 10PM to 6AM.
offensive environment for the employee.

Persons who can be liable for sexual

j. Self-Organization and
harassment 
Collective Bargaining
1. Employer
Employees are allowed to organize or affiliate
2. Employee
with a labor union or determine which of them
3. Manager
(in cases of multiple ones) they will join. They
4. Supervisor
have the right to engage in concerted activities
5. Agent of the employer
with their co-workers for the ff. Purposes:
6. Teacher
 - Collective Bargaining (CBA) through Confidential employees are those who: (1)
representatives of their own choosing assist or act in a confidential capacity; (2)
- For their mutual aid and protection or formulate, determine and effectuate
the protection, enhancement, or management policies in the field of labor
promotion of their rights and interests. relations.

SILENT PROVISION: The right to join also ADDITIONAL: Unfair Labor Practices of
enshrines the right to refrain or refuse the Employers are those which discourage
practice of such right. They are not compelled employees from exercising their right to SELF-
to join. ORGANIZATION AND COLLECTIVE BARGAINING

Extent 3. Government’s Regulatory Role

All those employed in commercial, industrial,
_______________________________
and agricultural enterprises and religious,
charitable, medical, or educational institutions, II. Labor Management
whether operating for profit or not, may
exercise such rights.
Relations

The following may also form labor organizations Union Registration and Recognition
for their mutual aid and protection: (1) Process
ambulant; (2) intermittent; (3) itinerant; (4) self-
employed; (5) rural; and (6) those without any Right to Self-Organization:
definite employers.  Not only a right, but a constitutional
Limitations human right
 Includes right to organize or affiliate
Managerial Employees: Cannot  or are not with a labor union
eligible to form, join, or assist labor unions for  Right to engage in concerted activities
the purposes of CBA. They are employees who for purposes of:
have the powers to lay-down and execute o Collective Bargaining
management policies.  o Mutual aid and protection or
Employees of branches, subdivisions, promotion of rights and
instrumentalities and agencies of government, interests of employees at the
as well as employees of government workplace
corporations with original charter cannot form,
join or assist labor unions. However, they can
form or join an employees’ association of their
own choosing for the furtherance and
Issues:
protection of their interests.
May the right be curtailed by law? By
Supervisory Employees: Cannot join, form, or
stipulation of parties? May the right be
assist labor unions of the rank-and-file. (Applies
modified, enhanced or limited in scope?
vise versa)
NO. The right to self-organize is a constitutional
Confidential Employees: ineligible to form, join
human right, and thus cannot be curtailed,
or assist labor organizations.
modified, or limited in scope.
*The Congress cannot be more powerful than *confidential employees – (1) assist or act in a
the Constitution confidential capacity; and (2) formulate,
determine and effectuate management policies
Does the right include freedom not to join
in the field of labor relations. The rationale
labor unions? Freedom to disaffiliate?
behind the rules rests on the similar conflict of
Freedom to disorganize?
interest involving loyalty to the union or
YES. Just as no one should be denied the company, as well as of the undue advantage a
exercise of a right granted by law, no one party may obtain due to the access to
should be compelled to exercise such a confidential information of such employees.
conferred right.
May form labor organizations for their mutual
The right not to join, affiliate with, or assist any aid and protection: (1) ambulant, (2)
union, and to disaffiliate or resign from a labor intermittent, (3) itinerant, (4) self-employed, (5)
organization, is subsumed in the right to join, rural, and (6) those without definite employers.
affiliate, or assist any union, and to maintain (Art. 3, Const.)
membership therein.
Supervisors cannot join a labor union for the
rank-and-file employees but can form or join a
Covered Employees separate union for supervisors. Also called first-
line managers.
 Public sector employees have “limited
right” *One should not look at the position but rather
 All private sector employees of at the nature of the exercise function in
commercial, industrial, agricultural, determining whether the position is managerial,
religious, charitable, medical or supervisory, or rank-and-file
education, stock or non-stock, for profit
or not Bargaining Unit – group of employees of a given
 Regular, temporary, ambulant, employer comprised of all or less than all of the
intermittent and itinerant employees entire body of employees, consistent with
whether rank-and-file or supervisory equity to the employer, indicated to be the best
Public sector employees cannot strike and can suited to serve the reciprocal rights and duties
only have the right to picket during break time of the parties under the collective bargaining
or lunch hours. provisions of the law

Managerial employees and managerial staff Legitimate Labor Organization – registered and
cannot join unions; Managers are alter-egos of recognized labor organization by DOLE;
the employer. Managerial employees refers to legitimacy is conferred by the recognition from
middle and top managers of a company. The DOLE
rationale for such rule is due to conflict of Labor Union – can be not legitimate (not
interest concerning the loyalty of managerial registered in DOLE); cannot negotiate
employees to the union.
Labor Federation – composed of at least ten
Confidential employees are also ineligible to (10) labor organizations (association of unions)
join, form, or assist labor organizations.
Collective Bargaining Unit (CBU) – the benefits
of CBA extends to the employees in the CBU,
including those who do not belong to the  Certification Election – Petition filed by
chosen EBA a union: voting by secret ballot to
choose the EBA, but not union option is
Exclusive Bargaining Agent – any legitimate
always included (DOLE-initiated &
labor organization duly recognized or certified
implemented)
as the sole and EBA of all the employees in a
bargaining unit
Process of determining the sole and
exclusive representative of the
Union Registration employees in an appropriate bargaining
 Independent Labor Unions – unit for purposes of CB; ordered by
Application to be filed at Labor DOLE
Relations Division of DOLE Regional
Office  Consent Election – Contending unions
 Labor Federations or National Unions – agree to have certification election:
Applications to be filed at Bureau of voting by secret ballot to choose the
Labor Relations Division of DOLE EBA, but no union option is always
Regional Office included (Employer & LLO-initiated &
 General Requirements – Name of implemented)
officers and addresses; No. of
employees at workplace; Minutes of Process of determining the sole and
ratification; Minutes of organizational exclusive representative of the
meeting; Union Constitution and By- employees in an appropriate bargaining
Laws; Union members must be at least unit for purposes of CB; with or w/out
20% of employees to be represented; intervention by DOLE
Annual financial report, if any.
 Run-off Election – 3 or more contending
A labor federation or national union may unions: election between (2) LLOs
directly create a local chapter at any workplace receiving highest voted in CerE or ConE
by merely issuing a Charter Certificate. with at least 3 choice unions but none
of them received majority of valid votes
*No required minimum number of members
cast, provided the total votes for all
The local chapter shall have the rights and contending unions reached at least 50%
privilege of a legitimate labor organization upon of total votes cast. No union option is
submission to DOLE the names of chapter not included.
officers and addresses; chapter’s Constitution
Election Process
and By-Laws.
Representation issues at workplace:

 Unorganized Establishment
Recognition Process
Enterprise where there is no certified sole and
Modes in Determining Representation Status:
exclusive bargaining agent
 Voluntary Recognition – “unorganized”
employer recognizes as EBA its only 1
legitimate labor organization
Certification election is automatically conducted Failure to Bargain Collectively – refusal to meet
by Med-Arbiter upon petition by an LLO or LF or and confer promptly and expeditiously to
national union which issued a certificate to LLO. negotiate terms

 Organized Establishment Blue-sky Bargaining – Making exaggerated or

unreasonable CBA proposals
Enterprise where there exists a recognized or
certified sole and exclusive bargaining agent Featherbedding – Labor organization demands
pay from employer for services not performed
Petition for certification election must be
or attorney’s fees in order to have a
supported by at least 25% of all employees in
“sweetheart contract” (CBA)
the CBU; may be filled within the 60-day
freedom period before CBA expiration; Med- Fee to Settle Dispute – extortion/bribe vs.
Arbiter conducts the CE. Signing Bonus (gratuity)

Votes Required: “Double Majority Rule”

Collective Bargaining Agreement
 Majority of all eligible voters must cast
(CBA)
vote
 To be certified as EBA, LLO must receive Procedure for Collective Bargaining:
majority of valid votes cast
I. Requesting Party serves to the other
written notice to negotiate, together
with its proposals, while the Other Party
Unfair Labor Practice (ULP)
must reply thereto within 10 days from
 Any act which violates the right to self- receipt. Any dispute on notice and reply
organization by restraining, coercing, shall be resolved via conference which
discriminating or unduly interfering shall be held 10 days from request,
 Committed by either employer or labor otherwise, NCMB shall intervene.
union II. If not resolved, parties shall be referred
 Not all unfair actions are ULP: must be to Accredited Voluntary Arbitrators
violative of the right (AVA) of the NCMB.
 Criminal and civil in nature: requires
CBA Duration: 5 years
prior finding by a Labor Arbiter before
criminal prosecution could be made  Freedom Period of 60 days before
expiration to file CE [Representation
Yellow-Dog Contract – when the employer
Issue]
requires employees to undertake not to join,
 [Other Issues] Renegotiation begins not
remain or resign from a labor union
later than 3 years after CBA execution
Surface Bargaining – negotiating without any  Agreements entered into 6 months
legal intent to reach an agreement before CBA expiration retroact to the
date following such date. If entered
Economic Violation of the CBA – flagrant
into beyond 6 months or when CBA has
and/or malicious refusal to comply with CBA
expired, parties shall agree on duration
economic provisions
of retroactivity

Union Dues and Special Assessments

Rule on Negotiation Fees: Union Shop – all new regular employees are
required to join union within a certain period as
CBA negotiation fees and expenses, attorney’s
condition for continued employment
fees and similar expenses CAN only be charged
to UNION FUNDS but not from individual Maintenance of Membership Shop –
members. Any stipulation contrary is VOID employees who are union members as of
effective date of agreement, or who thereafter
Special Assessments:
become members, must maintain membership
Special assessments may be charged to as condition for continued employment [Note:
individual members only if authorized by a There is a reckoning period]
written resolution of MAJORITY of all members
Preference Shop – union members are given
at a general meeting called for the purpose
preference in hiring or promoting given all
“Check-Off” – process whereby the employer circumstances being equal, and must maintain
deducts union dues or agency fees from membership as condition for continued
employees, UPON: employment

1. Agreement between Employer and EBA; Agency Shop – while membership in union is
and not required, support from employees within
2. Prior written authorization from the CBU in the form of agency fees is condition
employees individually or collectively by for continued employment.
way of General Membership Meeting
Resolution. CBA Negotiations, Strategies, and
Processes
AND remits the same directly to the EBA.
Effective Techniques in Handling Disputes
“Substantial compliance is not sufficient”
(Mandatory Requirements)  Careful and Diligent Preparation
 Openness: willingness to negotiate (not
Agency Fees
impose!)
What about non-union members?  Full knowledge of the potential areas
for concessions on his/her side
If they accept the benefits of CBA, they are
 Equipped with the parameters of
likewise covered by reasonable special
his/her authority from superior to easily
assessments for union dues and other fees.
adjust negotiation positions
No need for individual written authorization.
DON’Ts in a Genuine Negotiation

Union Security “CBA” Clauses:  Sitting in a negotiating panel without

authority from superior to negotiate
Recognized by law to encourage “strong and  Without being equipped with the
effective unionism” parameters for adjusting negotiation
Closed Shop – only union members can be hired positions
and workers must remain union members in  Merely discussing without anything to
good standing as condition for continued bargain with, as negotiation involves a
membership give and take process
  Prejudicing broader, greater and more Tips on conducting CB negotiations (Coolidge
significant objective of one’s Wall, 2006; Craver, 2020)
negotiation side
Swing for the Fences – take time to fully
 By being unprepared and without
analyze the existing CBA and craft new
knowing exactly what he/she wants to
proposed contract language which eliminates
achieve
anything which puts you at a competitive
disadvantage or adds inefficiency. Scrub the
When deadlock in negotiations is inevitable to existing CBS to identify every provision which
happen, each party must ensure that it is not a you want to delete; Try to change everything
lose-lose situation as it is worse than a lose-win that gets in the way of your ability to succeed.
situation as some intangible effects on the
employer-employee relationship may Figure out what “they” want – try to come up
expectedly happen. The latter may be perceived with language which meets the union’s
by one party as altruism from the other which objectives and which does not unnecessarily
may rekindle good working relationship in the interfere with your ability to meet your goals.
future Best not to scramble to decide whether to
compromise with the union
How to handle and solve deadlocks?
Befriend the Devil – create a cooperative
 Try to understand the perspective of working arrangement. It’s a mistake to passively
the other allow antagonistic relationships to develop, It is
 Try to make some concessions on other important that when you sit down to negotiate,
points not covered by the deadlock to the greatest extent possible, you have a
 Make concessions on a set of small (mutual) respect for each other.
issues in exchange for a major issue
 Do not go back to unresolved issues and Don’t be a Pig – Negotiation is a mutual
disputes where sensitivities of the other process. You are not going to be able to destroy
party are involved the other side or force them into complete
capitulation
Genuine Negotiation is an important process in
handling disputes. It is where two or more Woody Hayes Approach – If you are saddled in
parties who have common and conflicting a very unbalanced CBS, it might take more than
interests come together and discuss matters one negotiation cycle to get it back into a
with a view of coming up with an agreement. In balanced shape
order to make negotiation work, it is essential OMG, what do we do now – It is crucial that
to highlight parties’ common interests and you can train the management team on their
downplay conflicts during the discussion. new rights and authority; ensure that the line
management is fully aware of their new powers
Effective Traits Needed in Handling Disputes
and insist that they exercise those powers once
 Flexibility: no firm rules of procedure the new contract is in place
 Honesty: no hidden selfish agenda
 Open Communication: talking, Grievance Machinery and
observing, and listening Government Interventions
III. Modes of Separation from Employers cannot not accept resignation,
otherwise it will amount to involuntary
Employment
servitude.
Voluntary Separation
 Resignation  Abandonment
Personal reasons cannot be sacrificed in favor of Also called AWOL or Absence Without Leave
the exigency of the service, and one has no
other choice but to dissociate oneself from Prescriptive period:
employment. (offer and acceptance) - If not paid salary and benefits: 3 years
An employee may resign with or without just - Illegal dismissal: 4 years
cause. If without cause, employee must give For abandonment to be established as a ground
thirty (30) days advance notice to employers. If for dismissal (Animus non revertendi), it must be
no notice was served, employer may hold proven that the employee has no intention to
employee liable for damages. If with just cause, return to work (even though the employee
the one-month advance notice is not necessary came back after 3 years)
Just causes:  Availment of Optional Retirement
- Serious insult by the employer or his Must have worked for the company for five
representative on the honor and person years and must be at least 60 years old
of the employee
- Inhuman and unbearable treatment  Expiration of Employment Contracts
accorded the employee by the
employer or his representative Involuntary Separation
- Commission of a crime or offense by the  Compulsory Retirement
employer of his representative against  Termination by the Employer
the person of the employee
- Other causes analogous to any of the Protocols in Handling Employees’
foregoing Discipline Infractions
Resignation Once Accepted may not be
Withdrawn Validity of Dismissal from
Employment
A resigned employee who desires to take his job
back has to re-apply therefore. If the employer
accepts withdrawal, employee retains his job. If Second illegal (no cause w/ dp)
not, the employee cannot claim illegal dismissal Third illegal (wala both)
for the employer has the right to determine Fourth valid dismissal (may cause no dp) pero
who his employees will be. may bayad sa employee (wala sa law)
Pldt v nlrc
--Transcript—

If wala acceptance from employer na

resignation is acknowledged, illegal dismissal
yun.