Labor Law Initial Draft As of Aug 6

UNIVERSITY OF MAKATI SCHOOL OF LAW
Centralized Bar Operations

Heron Notes: A Comprehensive Reviewer
Subject: LABOR LAW AND SOCIAL LEGISLATION
Commissioner:
Mabute, Mel Kenneth A. (until July 31, 2020 only, will be succeeded by the
Assistant Commissioner)
Assistant Commissioner:
Castanar, Maria Constancia Freyja Daryl
Labor Standards & Special Laws, Subject Head:

Lopez, Maria Alexis
Labor Relations, Subject Head:

Melevo, Eduard John David
Members:
1. Carpio
2. Ortega
3. Mabalay
4. Banaybanay
5. Jesoro
6. Macola
7. Handig-Mirabel
8. Manlogon
2021 University of Makati School of Law Centralized Bar Operations | 1

Table of Contents
PART I. LABOR LAW
PRELIMINARY TITLE
Chapter I – General Provisions

Chapter II – Emancipation of Tenants
BOOK ONE – PRE-EMPLOYMENT
TITLE I – RECRUITMENT AND PLACEMENT OF WORKERS

Chapter I – General Provisions
Chapter II – Regulation of Recruitment and Placement Activities
TITLE II – EMPLOYMENT OF NON-RESIDENT ALIENS
BOOK TWO – HUMAN RESOURCES DEVELOPMENT PROGRAM
TITLE I – NATIONAL MANPOWER DEVELOPMENT PROGRAM

Chapter I – National Policies and Administrative Machinery for Their
Implementation
TITLE II – TRAINING AND EMPLOYMENT OF SPECIAL WORKERS

Chapter I – Apprentices
Chapter II – Learners
Chapter III – Handicapped Workers
2 | University of Makati School of Law Centralized Bar Operations 2021

BOOK THREE – CONDITIONS OF EMPLOYMENT
TITLE I – WORKING CONDITIONS AND REST PERIODS

Chapter I – Hours of Work
Chapter II – Weekly Rest Periods
Chapter III – Holidays, Service Incentive Leaves, and Service Charges
TITLE II – WAGES
Chapter I – Preliminary Matters
Chapter II – Minimum Wage Rates
Chapter III – Payment of Wages
Chapter IV – Prohibitions regarding Wages
Chapter V – Wage Studies, Wage Agreements, and Wage Determination
Chapter VI – Administration and Enforcement
TITLE III- WORKING CONDITIONS FOR SPECIAL GROUPS OF EMPLOYEES
Chapter I – Employment of Women

Chapter II – Employment of Minors
Chapter III – Employment of House-helpers
Chapter IV – Employment of Homeworkers
Chapter V – Employment of Night Workers
BOOK FOUR – HEALTH, SAFETY, AND SOCIAL WELFARE BENEFITS
TITLE I – MEDICAL, DENTAL, AND OCCUPATIONAL SAFETY

Chapter I – Medical and Dental Services
Chapter II – Occupational Health and Safety
TITLE II – EMPLOYEES COMPENSATION AND STATE INSURANCE FUND

Chapter I – Policy and Definitions

Chapter II – Coverage and Liability
Chapter III – Administration
Chapter IV – Contributions
Chapter V – Medical Benefits
Chapter VI – Disability Benefits
Chapter VII – Death Benefits
Chapter VIII – Provisions Common to Income Benefits
Chapter IX – Records, Reports, and Penal Provisions
TITLE III – MEDICARE
TITLE IV- ADULT EDUCATION
BOOK FIVE – LABOR RELATIONS
TITLE I – POLICY AND DEFINITIONS

Chapter I – Policy
Chapter II – Definitions
TITLE II – NATIONAL LABOR RELATIONS COMMISSION

Chapter I – Creation and Composition
Chapter II – Powers and Duties
Chapter III – Appeal
TITLE III – BUREAU OF LABOR RELATIONS
TITLE IV – LABOR ORGANIZATIONS

Chapter I – Registration and Cancellation
Chapter II – Rights and Conditions of Membership
Chapter III – Rights of Legitimate Labor Organizations

TITLE V – COVERAGE
TITLE VI – UNFAIR LABOR PRACTICES

Chapter I – Concept
Chapter II – Unfair Labor Practices of Employers
Chapter III – Unfair Labor Practices of Labor Organizations
TITLE VII – COLLECTIVE BARGAINING AND ADMINISTRATION OF

AGREEMENTS
TITLE VII-A – GRIEVANCE MACHINERY AND VOLUNTARY ARBITRATION
TITLE VIII – STRIKE AND LOCKOUTS AND FOREIGN INVOLVEMENT IN

TRADE UNION ACTIVITIES
Chapter I – Strikes and Lockouts
Chapter II – Assistance to Labor Organizations
Chapter III – Foreign Activities
Chapter IV – Penalties for Violation
TITLE IX – SPECIAL PROVIONS
BOOK SIX – POST-EMPLOYMENT
TITLE I – TERMINATION OF EMPLOYMENT
TITLE II – RETIREMENT FROM THE SERVICE
BOOK SEVEN – TRANSITORY AND FINAL PROVISIONS

TITLE I – PENAL PROVISIONS AND LIABILITIES
TITLE II – PRESCRIPTION OF OFFENSES AND CLAIMS
TITLE III – TRANSISTORY ANF FINAL PROVISIONS
PART II. SOCIAL LEGISLATION
SOCIAL SECURITY LAW (RA 8282)
GSIS LAW (RA 8291)
GENERAL PRIMER ON RA 8291
LIMITED PORTABILITY LAW (RA 7699)
SOLO PARENTS
KASAMBAHAY LAW
AGRARIAN RELATIONS
EMPLOYEE COMPENSATION PROGRAM

PART I. LABOR LAW government fixes wage rates in order
to avoid abuses against the weaker
PRELIMINARY TITLE
party.
CHAPTER I – GENERAL Although in some aspects of
PROVISIONS labor relations, the government has
GENERAL PRINCIPLES no power of intervention at all. Check
The management and labor the Constitutional provisions on
relationship is like a bicycle with a voluntary modes of settling disputes.
third wheel. The third wheel is the In this case the government’s policy
government, which does not convert of regulation is not equivalent to
the bicycle into a tricycle, because it policy of intervention. An example of
does not intervene in the this is drawing up the CBA and
management-labor relationship. The modes of dispute resolution. In
government allows management and contrast, the government intervenes
labor to negotiate and determine the through issuance of permits to strike,
terms of the contractual relationship cease and desist orders or return to
– that is, the fixing of wages, et.al. work orders.
but government sets the minimum
standards. This is the only means by Constitution
which the government intervenes. Art. XIII, §3. The State shall afford full
However, the relationship between protection to labor, local and overseas,
management and labor is not merely organized and unorganized, and

promote full employment and equality of
contractual. Check the Civil Code
employment opportunities for all.
Arts. 1700-1703. This emphasizes
It shall guarantee the rights of all
that the relationship is so impressed
workers to self-organizations, and
with public interest. As such, the
peaceful concerted activities, including
third wheel only supports and assists the right to strike in accordance with
the relationship, not to change the law. They shall be entitled to security of
relationship but only to balance a tenure, humane conditions of work, and
relationship that is inherently a living wage. They shall also participate
imbalanced. An example is the in policy and decision-making processes

affecting their rights and benefits as may  State values the dignity of every
be provided by law. human person and guarantees
The State shall promote the full respect of human rights
principle of shared responsibility
 State recognizes the vital role of
between workers and employers and
the youth in nation building and
the preferential use of voluntary modes
shall protect their well-being
in settling disputes, including
conciliation, and shall enforce their  State recognizes the role of
mutual compliance therewith to foster women in nation-building and
industrial peace. shall ensure their equality before
The State shall regulate the the law
relations between workers and  State affirms labor as a primary
employers, recognizing the right of labor social economic force and shall
to its just share in the fruits of production
protect the rights of workers
and the right of enterprises to
 State recognizes the
reasonable returns on investments, and
indispensable role of the private
to expansion and growth.
sector, encourages private
Art. II, § 18. The State affirms labor as a
primary social economic force. It shall enterprise and provides
protect the rights of workers and incentives to needed investments
promote their welfare.
Art. III, § 8. The right of the people, Bill of Rights
including those employed in the public  Guarantee of due process and
and private sectors, to form unions, equal protection of the law
associations, or societies for purposes
 No law shall be passed abridging
not contrary to law shall not be
the freedom of speech, right to
abridged.
peaceably to assemble and
State Policies
petition the government for
 Promotion of a just social order
redress of grievances
and free the people from poverty,
 Right to information on matters of
promote full employment and an
public concern
improved quality of life for all

 Right to form unions, o Full protection of labor, local
associations and societies for and overseas, organized and
purposes not contrary to law unorganized
 Non-impairment of contracts o Promote full employment and
 Right to a speedy disposition of equality of employment
cases before all judicial, quasi- opportunities for all
judicial and administrative bodies  Guarantee the rights of workers
 No involuntary servitude in any to:
form shall exist except as a o self-organization
punishment for a crime whereof o collective bargaining and
the party shall have been duly negotiations
convicted o peaceful concerted activities
o security of tenure
Social Justice o humane working conditions
 Congress shall prioritize the o living wage
enactment of measures that
o participate in policy-making
protect and enhance the right of
decisions
all people to human dignity,
 State shall promote:
reduce social, political and
o shared responsibility between
economic inequalities, by
employers and workers
diffusing wealth and political
o preferential use of voluntary
power for the common good.
modes in settling disputes and
 State shall regulate the
shall enforce their mutual
acquisition, ownership, use and
compliance to foster industrial
disposition of property and its
peace
increments
 Regulation of worker-employer
 Commitment to create economic
relations end recognizing:
opportunities based on freedom
o right of labor to its just share
of initiative and self-reliance
in the fruits of production
 State shall afford:

o right of enterprises to  promote full employment,
reasonable returns on  ensure equal work opportunities
investments and growth regardless of sex, race or
 Establishment of an agency for creed,
disabled persons for their  and regulate the relations
rehabilitation, self-development between workers and
and self-reliance employers.
 Protection of working women;  The State shall assure the
considering their maternal rights of workers to:
functions a) self-organization,
b) collective bargaining,
LABOR CODE c) security of tenure, and
Art. 1. Name of Decree. — This d) just and humane
Decree shall be known as the “Labor conditions of work.
Code of the Philippines.”
Art. 4. Construction in favor of labor.

Art. 2. Date of effectivity. — This
— All doubts in the implementation and
Code shall take effect six (6) months
interpretation of the provisions of this
after its promulgation. (P.D. 442 was
Code, including its implementing rules
made effective on November 1, 1974)
and regulations, shall be resolved in
favor of labor.
Art. 3. Declaration of basic policy.
The State shall afford protection to
Art. 5. Rules and regulations. — The
labor, promote full employment, ensure
Department of Labor and Employment,
equal work opportunities regardless of
and other government agencies charged
sex, race or creed and regulate the
with the administration and enforcement
relations between workers and
of this Code or any of its parts shall
employers. The State shall assure the
promulgate the necessary implementing
rights of workers to self-organization,
rules and regulations. Such rules and
collective bargaining, security of tenure,
regulations shall become effective
and just and humane conditions of work.
fifteen (15) days after announcement of
The State shall:
 afford protection to labor,

their adoption in newspapers of general expeditious settlement of labor or
circulation. industrial disputes;
Art. 6. Applicability. — All rights and (f) To ensure a stable but dynamic
benefits granted to workers under this and just industrial peace; and
Code shall, except as may otherwise be (g) To ensure the participation of
provided herein, apply alike to all workers in decision and policy-
workers, whether agricultural or non- making processes affecting their
agricultural. rights, duties and welfare.
Art. 218. [211] Declaration of policy. B. To encourage a truly democratic

— method of regulating the relations
A. It is the policy of the State: between the employers and
(a) To promote and emphasize the employees by means of agreements
primacy of free collective freely entered into through collective
bargaining and negotiations, bargaining, no court or
including voluntary arbitration, administrative agency or official shall
mediation and conciliation, as have the power to set or fix wages,
modes of settling labor or industrial rates of pay, hours of work or other
disputes; terms and conditions of employment,
(b) To promote free trade unionism except as otherwise provided under
as an instrument for the this Code.
enhancement of democracy and
the promotion of social justice and Art. 290. [275] Tripartism and
development; tripartite conferences, and Tripartite
(c) To foster the free and voluntary Industrial Peace Councils. —
organization of a strong and united (a) Tripartism in labor relations is
labor movement; hereby declared a State policy.
(d) To promote: the enlightenment Towards this end, workers and
of workers concerning their rights employers shall, as far as
and obligations as union members practicable, be represented in
and as employees; decision and policy-making bodies
(e) To provide an adequate of the government.
administrative machinery for the (b) The Secretary of Labor and
Employment or his duly authorized

representatives may from time to
time call a national, regional, or Art. 1702. In case of doubt, all labor
industrial tripartite conference of legislation and all labor contracts shall
representatives of government, be construed in favor of the safety and
workers and employers for the decent living for the laborer.
consideration and adoption of
voluntary codes of principles Art. 1703. No contract which practically
designed to promote industrial amounts to involuntary servitude, under
peace based on social justice, or any guise whatsoever, shall be valid.
to align labor movement relations
with established priorities in Civil Code Provisions
economic and social development.  Abuse of Right Doctrine – Every
In calling such conference, the
person must, in the exercise of
Secretary of Labor and
his rights and in the
Employment may consult with
performance of his duties, act
accredited representatives of
with justice, give everyone his
workers and employers.
due and observe honesty and
CIVIL CODE good faith
Art. 1700. The relation between capital  Relation between capital and
and labor are not merely contractual. labor are not merely contractual
They are co impressed with public but is impressed with public
interest that labor contracts must yield to interest
the common good. Therefore, such  Labor contracts must yield to
contracts are subject to the special laws
the common good
on labor unions, collective bargaining,
 In case of doubt, all labor
strikes and lockouts, closed shop,
legislation and contracts shall
wages, working conditions, hours of
be construed in favor of the
labor and similar subjects.
safety and decent living for the
Art. 1701. Neither capital nor labor laborer

shall act oppressively against the other
or impair the interest or convenience of CASES
the public.

Phil. Blooming Mills Employees industrial unrest by encouraging and
Assoc. vs. PBM, 51 SCRA 189 protecting the exercise by
PBMEO wanted to stage a mass employees of their right to self-
demonstration at Malacanang, organization for the purpose of
against alleged police abuses. collective bargaining and for the
PBMEO informed the employer PBM promotion of their moral, social and
and told PBM that PBMEO did not economic well-being.”
intend to prejudice PBM. PBM The demonstration held by the
disagreed saying it would prejudice employees was against alleged
operations and said that at least one abuses of some Pasig policemen,
shift should be present on the day of not against their employer. Said
the rally. PBM warned that should demonstration was completely an
they fail to report, they would be exercise of their freedom of
dismissed because of the “no expression in general and of their
lockout-no strike” clause in the CBA. right of assembly and petition for
PBMEO went ahead with the rally redress of grievances in particular
and was thus charged with violation before the appropriate government
of the CBA. The CIR ruled in favor of agency. They exercised their civil
PBM. and political rights for their mutual
aid and protection from what they
Held: The CIR as an agency of the believed were police excesses. It
State is under obligation at all times was to the interest of the firm to
to give meaning and substance to protect the employees to rally to the
these constitutional guarantees in defense of and to take up the
favor of the working man; for cudgels for its employees so that
otherwise these constitutional they can report to work free from
safeguards would be merely a lot of harassment, vexation or peril and as
“meaningless constitutional patter”. a consequence perform more
Under the Industrial Peace Act, the efficiently their respective tasks to
CIR is enjoined to effect the policy of enhance its productivity as well as
the law. “to eliminate the causes of profits.

The primacy of human rights- let them participate in the review of
freedom of expression, of peaceful the Code.
assembly and of petition for redress
of grievances-over property rights, Held: The exercise of managerial
has been sustained. prerogatives is not unlimited. It is
circumscribed by limitations found in
law, the CBA, or general principles of
Philippine Airlines vs. NLRC, 225 fair play and justice. Al line must be
SCRA 301 drawn between management
Facts: In March 1985, PAL prerogatives regarding business
completely revised its Code of operations per se and those which
Discipline, which was circulated, affect the rights of employees. In
immediately implemented and treating the latter, mgt. should see to
caused the imposition of disciplinary it that its employees are at least
sanctions on some employees. properly informed of its decisions
PALEA filed a complaint with the and modes of action.
NLRC for unfair labor practice, PAL says that by signing the CBA,
because the Code was arbitrarily PALEA in effect recognized PAL’s
implemented without prior notice and exclusive right to make and enforce
discussion of such with the union. company rules and regulations to
PAL posits that it has the prerogative carry out the functions of
to prescribe rules and regulations management without having to
regarding employees conduct in discuss the same with PALEA, and
carrying out their functions. much less, the latter’s conformity
Labor Arbiter ruled not guilty of ULP thereto. Such provision in the CBA
but must provide all employees with may not be interpreted as a cession
the new Code to discuss any of employees’ rights to participate in
objectionable items. On appeal, the deliberation of matters which
NLRC said though adopting Rules of may affect their right s and the
Conduct is a mgt. prerogative, it can formulation of policies relative
no longer exclude labor, and so must thereto. And one such matter is the

formulation of a Code of Discipline. employment, as required by the
Industrial peace cannot be achieved regulations then in force.
if the employees are denied their just Employer insists he was a
participation in the discussion of probationary employee at the time
matters affecting their rights. The he was dismissed. It is also argued
attainment of a harmonious labor- that the regional director’s findings
mgt relationship and the then already should not be disturbed on appeal,
existing state policy of enlightening since he had direct access to the
workers concerning their rights as facts.
employees demand no less than the Held: Employee should be
observance of transparency in reinstated. It is shown that employee
managerial moves affecting continued working as usual way
employee’s rights. beyond the six-month period of
probation. Hence he was on
Cebu Royal Plant vs. Deputy permanent status at the time he was
Minister of Labor, 153 SCRA 38 dismissed. Also, the record does not
Facts: Ramon Pilones handled contain the certification as required
ingredients in the processing of soft by the Rules. The medical certificate
drinks. Later he was removed due to offered by the employer came from
“pulmonary tuberculosis minimal”. its own physician who was not a
He filed for illegal dismissal. competent public health authority,
Regional Director found in favor of and merely stated the employee’s
employer. However, on appeal, the disease without more.
Minister ordered reinstatement, as it We may surmise that if the required
was found that he was a permanent certification was not presented, it
employee, and that the ailment was was because the disease was not of
not certified as incurable within six such a nature or seriousness that it
months as to justify separation. Also, could not be cured within a period of
the Minister said that the employer six months even with proper
should have first obtained a treatment. The court reaffirms its
clearance for termination of concern for the lowly worker who,

often at the mercy of his employers, precious resource among our
must look up to the law for his people. But it is more than a slogan.
protection. It has become a battlecry
dramatizing the increasingly urgent
Chapter II – Emancipation of demand of the dispossessed for a
Tenants plot of earth as their place under the

sun.
ART. 7. STATEMENT OF
Recognizing this need, the
OBJECTIVES Inasmuch as the old
Constitution in 1935 mandated the
concept of land ownership by a few
policy of social justice to "insure the
has spawned valid and legitimate
well-being and economic security of
grievances that gave rise to violent
all the people," especially the less
conflict and social tension and the
privileged. In 1973, the new
redress of such legitimate
Constitution affirmed this goal,
grievances being one of the
adding specifically that "the State
fundamental objectives of the New
shall regulate the acquisition,
Society, it has become imperative to
ownership, use, enjoyment and
start reformation with the
disposition of private property and
emancipation of the tiller of the soil
equitably diffuse property ownership
from his bondage.
and profits." Significant also was the
LEGISLATIVE HISTORY
specific injunction to "formulate and
The Labor Code covers agrarian
implement an agrarian reform
reform in five articles only. It is a
program aimed at emancipating the
subject governed principally by R.A.
tenant from the bondage of the soil."
No. 6657 (Comprehensive Agrarian
The Constitution of 1987 also
Reform Law of 1988) which is better
adopted one whole and separate
studied as a separate book. What
article on Social Justice and Human
follows is only an essential
Rights containing provisions for the
backgrounder.
uplift of the common people, thus:
"Land for the landless" is a slogan
"The State shall, by law, undertake
that underscores the acute
an agrarian reform program founded
imbalance in the distribution of this

on the right of farmers and regular and to specify maximum retention
farmworkers, who are landless, to limits for landowners.
own directly or collectively the land On July 17,1987, President Corazon
they till or, in the case of other C. Aquino issued Executive Order
farmworkers, to receive a just share No. 228, declaring full land
of the fruits thereof. To this end, the ownership in favor of the
State shall encourage and undertake beneficiaries of Presidential Decree
the just distribution of all agricultural No. 27 and providing for the
lands, subject to such priorities and valuation of still unvalued lands
reasonable retention limits as the covered by the decree as well as the
Congress may prescribe, taking into manner of their payment. This was
account ecological, developmental, followed on July 22, 1987 by
or equity considerations, and subject Presidential Proclamation No. 131,
to the payment of just compensation. instituting a comprehensive agrarian
In determining retention limits, the reform program (CARP), and
State shall respect the right of small Executive Order No. 229, providing
landowners. The State shall further the mechanics for its
provide incentives for voluntary land- implementation.
sharing." Subsequently, the revived Congress
Earlier, Republic Act 3844, the of the Philippines took over
Agricultural Land Reform Code, had legislative power from the President
already been enacted in the and started its own deliberations,
Congress of the Philippines on including extensive public hearings,
August 8, 1963, in line with the on the improvement of the interests
above-stated principles. This was of farmers. It enacted Republic Act
substantially superseded by PD. No. 6657, the Comprehensive Agrarian
27, promulgated on October 21, Reform Law of 1988, which
1972, along with Martial Law, to President Aquino signed on June 10,
provide for the compulsory 1988. This law while changing the
acquisition of private lands for earlier mentioned enactments,
distribution among tenant-farmers nevertheless gives them

supplementary effect insofar as they The argument that Proclamation No.
are not inconsistent with its 131 and Executive Order No. 229
provisions. should be invalidated because they
The promulgation of Presidential do not provide for retention limits as
Decree No. 27 by President Marcos required by Article XIII, Section 4 of
in the exercise of his powers under the Constitution is no longer tenable.
Martial Law has already been Republic Act No. 6657 now provides
sustained in Gonzales vs. Estrella. for such limits in Section 6 of the
As for the power of President Aquino Law. It declares:
to promulgate Proclamation No. 131 Except as otherwise provided in
and Executive Orders No. 228 and this Act, no person may own or
229, the same was authorized under retain directly or indirectly, any
Section 6 of the Transitory public or private agricultural
Provisions of the 1987 Constitution. land, the size of which shall vary
ART. 8. TRANSFER OF LANDS TO according to factors governing a
TENANT-WORKERS Being a valid viable family-sized farm, such as
part of the labor force, tenant- commodity produced, terrain,
farmers on private agricultural lands infrastructure, and soil fertility as
primarily devoted to rice and corn determined by the Presidential
under a system of share crop or Agrarian Reform Council
lease tenancy whether classified as (PARC) created hereunder, but
landed estate or not shall be deemed in no case shall retention by the
owner of a portion constituting a landowner exceed five (5)
family-size farm of five (5) hectares if hectares. Three (3) hectares
not irrigated and three (3) hectares if may be awarded to each child of
irrigated. In all cases, the the landowner, subject to the
landowners may retain an area of following qualifications: (1) that
not more than seven (7) hectares if he is at least fifteen (15) years of
such landowner is cultivating such age; and (2) that he is actually
area or will now cultivate it. tilling the land or directly
RETENTION LIMITS managing the farm: Provided,

That landowners whose lands measure promulgated pursuant to
have been covered by the social justice precepts of the
Presidential Decree No. 27 shall Constitution. However, such
be allowed to keep the area contention cannot be invoked to
originally retained by them defeat the very purpose of the Public
thereunder: Provided further, Land Act or Commonwealth Act No.
That original homestead 141.
grantees or direct compulsory The Homestead Act has been
heirs who still own the original enacted for the welfare and
homestead at the time of the protection of the poor. The law gives
approval of this Act shall retain a needy citizen a piece of land where
the same areas as long as they he may build a modest house for
continue to cultivate said himself and family and plant what is
homestead. (Association of necessary for subsistence and for
Small Landowners of the the satisfaction of life's other needs.
Philippines, Inc. vs. Secretary of The right of the citizens to their
Agrarian Reform, G.R. No. homes and to the things necessary
78742, July 14, 1989; Acuna vs. for their subsistence is as vital as the
Arroyo, G.R. No. 79310; Pabico right to life itself. They have a right to
vs. Juico, G.R No. 79744; live with a certain degree of comfort
Manaay vs. Juico, G.R No. as becomes human beings, and the
79777, July 14, 1989.) State which looks after the welfare of
LANDS NOT COVERED the people's happiness is under a
Lands Obtained Through duty to safeguard the satisfaction of
Homestead Patent
this vital right.
Presidential Decree No. 27 The Philippine Constitution respects
decreeing the emancipation of the superiority of the homesteaders'
tenants from the bondage of the soil rights over the rights of the tenants
and transferring to them ownership guaranteed by the Agrarian Reform
of the land they till is a sweeping statute. Article XIII, Sec. 6 of the
social legislation, a remedial 1987 Philippine Constitution provides

that "the State shall apply the poultry and swine raising" in the
principles of agrarian reform or definition of "commercial farms" is
stewardship, whenever applicable in invalid, to the extent that the
accordance with law, in the aforecited agro-industrial activities
disposition or utilization of other are made to be covered by the
natural resources, including lands of agrarian reform program of the
public domain under lease or State. There is simply no reason to
concession suitable to agriculture, include livestock and poultry lands in
subject to prior rights, homestead the coverage of agrarian reform.
rights of small settlers, and the rights ART. 9. DETERMINATION OF
of indigenous communities to their LAND VALUE For the purpose of
ancestral lands." determining the cost of the land to be
The Comprehensive Agrarian transferred to the tenant-farmer, the
Reform Law of 1988 or Republic Act value of the land shall be equivalent
6657 supports the inapplicability of to two and one-half (2-1/2) times the
P.D. No. 27 to lands covered by average harvest of three (3) normal
homestead patents like those of the crop years immediately preceding
property in question. Thus, Sec. 6 of the promulgation of Presidential
Republic Act 6657 states: "Provided Decree No. 27 on October 21, 1972.
further, That original homestead The total cost of the land, including
grantees or their direct compulsory interest at the rate of six percent
heirs who still own the original (6%) per annum, shall be paid by the
homestead at the time of the tenant in fifteen (15) years of fifteen
approval of this Act shall retain the (15) equal annual amortizations. In
same areas as long as they continue case of default, the amortizations
to cultivate said homestead." due shall be paid by the farmers'
Livestock, Poultry and Swine cooperative in which the defaulting
Raising Lands tenant-farmer is a member, with the

cooperative having a right of
Section II of R.A. 6657 which
recourse against him. The
includes "private agricultural lands
government shall guarantee such
devoted to commercial livestock,

amortizations with shares of stock in  Promote and maintain a state of
government-owned and government- full employment through
controlled corporations. improved manpower training
ART. 10. CONDITIONS OF  Protect every citizen by
OWNERSHIP No tide to the land securing the best possible
acquired by the tenant-farmer under terms and conditions of
Presidential Decree No. 27 shall be employment
actually issued to him unless and  Facilitate a free choice of
until he has become a full-fledged available employment
member of a duly recognized  Facilitate and regulate the
farmers' cooperative. Tide to the land movement of workers
acquired pursuant to Presidential  Regulate the employment of
Decree No. 27 or the Land Reform aliens
Program of the Government shall not  Strengthen the network of
be transferable except by hereditary public employment offices
succession or to the Government in
 Insure careful selection of
accordance with the provisions of
Filipino workers for overseas
Presidential Decree No. 27, the
employment in order to protect
Code of Agrarian Reforms and other
the name of the Philippines
existing laws and regulations.
abroad
ART. 11. IMPLEMENTING AGENCY
The Department of Agrarian Reform
TITLE I – RECRUITMENT
shall promulgate the necessary rules AND PLACEMENT OF
and regulations to implement the WORKERS
provisions of this Chapter.
PRE- EMPLOYMENT
ART. 12. STATEMENT OF
OBJECTIVES (Pro2-Fac2-ReSI)
BOOK ONE – PRE-
EMPLOYMENT
It is the policy of the State:
State Policies (Art. 12, Labor
Code)

1) To promote and maintain a state good name of the Philippines
of full employment through abroad.
improved manpower training,
allocation and utilization; CHAPTER I – GENERAL
2) To protect every citizen desiring PROVISIONS
to work locally or overseas by
ART. 13. DEFINITIONS
securing for him the best possible
(a) “Worker” means any member of
terms and condition of
the labor force, whether employed
employment;
or unemployed.
3) To facilitate a free choice of
(b) “Recruitment and placement”
available employment by persons
refers to any act of canvassing,
seeking work in conformity with the
enlisting, contracting, transporting,
national interest;
utilizing, hiring or procuring
4) To facilitate and regulate the
workers, and includes referrals,
movement of workers in conformity
contract services, promising or
with the national interest;
advertising for employment, locally
5) To regulate the employment of
or abroad, whether for profit or not:
aliens, including the establishment
Provided, That any person or entity
of a registration and/o r work permit
which, in any manner, offers or
system;
promises for a fee employment to
6) To strengthen the network of
two or more persons shall be
public employment offices and
deemed engaged in recruitment
rationalize the participation of the
and placement.
private sector in the recruitment
(c) “Private fee-charging
and placement of workers, locally
employment agency” means any
and overseas, to serve national
person or entity engaged in the
development objectives;
recruitment and placement of
7) To insure careful selection of
workers for a fee which is charged,
Filipino workers for overseas
directly or indirectly, from the
employment in order to protect the
workers or employers or both.

(d) “License” means a document RECRUITMENT AND PLACEMENT
issued by the Department of Labor [Art. 13 (b)]
authorizing a person or entity to Recruitment and Placement refers to
operate a private employment any act of: (CETCHUP)
agency.  Canvassing
(e) “Private recruitment entity”  Enlisting
means any person or association  Transporting
engaged in the recruitment and  Contracting
placement of workers, locally or
 Hiring
overseas, without charging, directly
 Utilizing or
or indirectly, any fee from the
 Procuring workers
workers or employers.
(f) “Authority” means a document
And includes: (CRAP)
issued by the Department of Labor
 Contract services
authorizing a person or association
 Referrals
to engage in recruitment and
 Advertising for employment, locally
placement activities as a private
or abroad, whether for profit or not
recruitment entity.
 Promising
(g) “Seaman” means any person
Provided, That any person or entity
employed in a vessel engaged in
which, in any manner, offers or
maritime navigation.
promises for a fee employment to
(h) “Overseas employment”
two or more persons shall be
means employment of a worker
deemed engaged in recruitment and
outside the Philippines.
placement.
(i) “Emigrant” means any person,
worker or otherwise, who
RECRUITMENT & PLACEMENT
emigrates to a foreign country by
Recruitment and placement refers to
virtue of an immigrant visa or
any act provided in Art. 13(b) of the
resident permit or its equivalent in
Labor Code. As construed by the
the country of destination.
SC, it was intended neither to

impose a condition on the basic rule
not to provide an exception thereto ARTICLE 14. EMPLOYMENT
but merely to create a presumption. PROMOTION
The presumption is that the PROMITION OF EMPLOYMENT
individual or entity is engaged in In order to promote employment, the
recruitment and placement whenever Secretary of Labor and Employment
he or it is dealing with two or more has the authority and power to:
persons to whom in consideration of 1. Organize and establish new
a fee, an offer, or promise of employment offices in addition to
employment is made in the course of the existing employment offices
the canvassing, enlisting, under the DOLE as the need
contracting, transporting, utilizing, arises;
hiring or procuring of person. The 2. Organize and establish a
number of persons dealt with is not nationwide job clearance and
an essential ingredient of the act of information system to inform
recruitment and placement of applicants registering with a
workers. Any of the acts mentioned particular employment office of job
in Art. 13(b) will constitute opportunities in other parts of the
recruitment and placement even if country as well as job opportunities
only one prospective worker is abroad;
involved. 3. Develop and organize a program
that will facilitate occupational,
The proviso merely lays down a rule industrial and geographical mobility
of evidence that where a fee is of labor and provide assistance in
collected in consideration of a the relocation of workers from one
promise or offer of employment to area to another; and
two or more prospective workers, the 4. Require any person,
individual or entity dealing with them establishment, organization or
shall be presumed to be engaged in institution to submit such
the act of recruitment and employment information as may be
placement.

prescribed by the Secretary of Administration with list of
Labor. registered job applicants and job
openings.
PUBLIC EMPLOYMENT OFFICES
Public employment offices are PLACEMENT PROCEDURES
tasked to perform the following Applicants shall accomplish
functions: appropriate information sheets and
1. Provide free placement of workers submit such other documents as
applying for both domestic and may be prescribed by the Bureau for
overseas employment; the purpose. Any applicant
2. Provide adequate vocational registering for employment with a
guidance and testing services to public employment office shall be
persons seeking help in choosing interviewed to determine his
or changing an occupation; occupational qualifications. The
3. Classify registered applicants in public employment office shall refer
accordance with job titles and him to any appropriate job or
codes of Philippine Standard vacancy.
Classification;
4. Arranging for the training or SUBMISSION OF REPORTS
retraining of unemployed At the end of each month, an
applicants in occupations or trades employer with at least six (6)
where they are suitably qualified employees is required to the nearest
and have greater prospects of public employment office of the
employment; following:
5. Arrange for inter-area placements 1. List of existing job vacancies or
of unemployed workers through a opening;
nationwide job clearance and 2. List of new employees, if any;
information; 3. Termination, lay-off or retirement;
6. Furnish the Bureau of Local 4. Total number of employed worker
Employment or the Philippine for the period; and
Overseas Employment

5. Request for assistance, if needed 1. Private employment agencies;
to fill vacancies or openings. 2. POEA;
3. Construction contractors if
ARTICLE 15. BUREAU OF authorized to operate by the DOLE
EMPLOYMENT SERVICES. and the Construction Industry
BUREAU OF EMPLOYMENT Authority;
SERVICE ABOLISHED 4. Members of the diplomatic corps
The Bureau of Employment Services (but hiring must also go through
was abolished by virtue of E.O. 797 POEA)
promulgated and made affective on 5. Other persons or entities as may
May 1, 1982 creating the Philippine be authorized by the DOLE
Overseas Employment Secretary; and
Administration. The domestic 6. Shipping or manning agents or
employment functions of the Bureau representatives.
of Employment Services were
assumed by the Bureau of Local PURPOSE OF THE LAW
Employment, while its overseas The evil sought to be avoided user
functions were assumed by the this section is the commission of
Philippine Overseas Employment malpractices by fly-by-night or
Administration. private recruiters against
ARTICLE 16. PRIVATE unsuspecting workers who intend to
RECRUITMENT. work locally or overseas.
GENERAL RULE: No person or ARTICLE 17. OVERSEAS
entity other than public employment EMPLOYMENT DEVELOPMENT
offices shall engage in the BOARD.
recruitment and placement of The POEA is composed of a
workers. Governing Board, the Office of the
EXCEPTIONS: The following entities Administrator, the Office of the
are authorized to recruit and place Deputy Administrator and the Office
workers for local and overseas of the Director for each of the
employment.

principal subdivisions of its internal ARTICLE 18. BAN ON DIRECT-
structure. HIRING.
The functional structure of POEA is GENERAL RULE: Direct hiring of
established along the areas of Filipino workers for overseas
market development, employment, employment is not allowed.
welfare, licensing, regulation and
adjudication. EXCEPTIONS: The ban on direct
POEA shall have the power and hiring does not apply to the following:
duty: 1. Diplomatic corps;
1. To promote the overseas 2. International organizations;
employment of Filipino workers 3. Other employers as may be
through a comprehensive market allowed by DOLE; and
promotion and development 4. Name hire.
program;
2. To secure the best possible terms Name hire- is a worker who is able
and conditions of employment of to secure contract for employment
Filipino contract workers on a overseas on his own without the
government-to-government basis assistance or participation of any
and to ensure compliance agency. However, he should still
therewith; undergo processing by the POEA.
3. To recruit and place workers for
overseas employment on a PURPOSE OF THE BAN ON
government-to-government DIRECT HIRING
arrangement and in such other The name of the country can be best
sectors as policy may dictate; and protected with the careful processing
4. To act as secretariat for the Board of worker’s papers, thus, eliminating
of Trustees of the Welfare and misfit, poorly trained and
Training Fund for Overseas incompetent workers. The reasons
Workers. for the prohibition are as follows:

1. To assure the best possible terms reporting officers duly designated by
and conditions of work to the the Secretary of Labor and the
employee; Philippine diplomatic or consular
2. To assure the foreign employer officials concerned shall exercise the
that he hires only qualified Filipino power and duty:
workers; 1. To provide all Filipino workers
3. To insure compliance with the within their jurisdiction assistance
Labor Code provisions on the on all matters arising out of
solidary liability of private employment;
employment and recruitment 2. To insure that Filipino workers are
agencies with their foreign not exploited or discriminated
principal; and against;
4. The ban is a form of protection for 3. To verify and certify as requisite to
the Filipino workers, so that they authentication that the terms and
will not fall prey to unscrupulous conditions of employment in
and abusive foreign employers who contracts involving Filipino workers
might victimize them in absence of are in accordance with the Labor
government regulation. Code and rules and regulations of
the Overseas Employment
ARTICLE 19. OFFICE OF Development Board and National
EMIGRANT AFFAIRS. Seamen Board;
This is superseded by B.P. 79. 4. To make continuing studies or
researches and recommendations
ARTICLE 20. NATIONAL SEAMEN on the various aspects of the
BOARD. employment market within their
This is repealed by E.O. 797. jurisdiction;
5. To gather and analyze information
ARTICLE 21. FOREIGN SERVICE on the employment situation and its
ROLE AND PARTICIPATION. probable trends, and to make such
In order to provide ample protection information available; and
to Filipino workers abroad, the labor

6. To perform such other duties as suspended/excluded from the list of
may be required of them from time eligible workers for overseas
to time. employment. In case of subsequent
violations, they will be repatriated at
PURPOSE OF THE LAW their own expense or their
The object is to inform the home employer’s expense.
country of the status of workers
employed in their respective areas of EXCEPTIONS TO MANDATORY
assignment. REMITTANCE
Remittance is not mandatory in the
ARTICLE 22. MANDATORY following instances:
REMITTANCE OF FOREIGN 1. Where the worker’s immediate
EXCHANGE EARNINGS. family members, dependents, or
Mandatory remittance- is the beneficiaries are residing with him
amount or portion of the basic salary abroad;
of Overseas Filipino workers 2. Filipino servicemen working in the
required under existing laws and U.S. military installation;
regulations to be remitted by the 3. Immigrants and Filipino
workers to their beneficiaries in the professionals and employees
Philippines and sold for pesos to the working with the UN agencies or
Philippine banking system. specialized bodies.
MANDATORY OBLIGATION TO AMOUNT OF REMITTANCE

REMIT The amount of remittance shall be as
It is mandatory for all overseas follows:
Filipino workers to remit a portion of
their foreign exchange earnings to
their families, dependents, and/or Nature of Job Foreign
Exchange
beneficiaries in the country through
Remittance
the BSP and DOLE authorized (% of basic
salary)
agents. Otherwise, they will be
Seamen or 80%

mariners OBLIGATIONS OF RECRUITMENT
Workers of 70% AGENCIES
Filipino
contractors and Recruitment agencies shall cause
construction the inward remittance of foreign
companies
Doctors, 70% exchange payments resulting from
Engineers, their overseas transactions, such as
Teachers,
Nurses, and service fees, airfares and others.
other
professional
workers ARTICLE 23. COMPOSITION OF
Other 50% THE BOARDS.
professionals
whose This article has been repealed.
employment
contracts do not
provide for free ARTICLE 24. BOARDS TO ISSUE
board and RULES AND COLLECT FEES.
lodging
Domestic and 50% This article has been repealed.
other service
workers
All other workers 50% CHAPTER II – REGULATION
falling under the
aforementioned OF RECRUITMENT AND
categories. PLACEMENT ACTIVITIES
A. Recruitment and placement of
FAILURE TO REMIT
local and migrant workers
Workers who fail to comply with the
(Labor Code and RA 8042, as
mandatory remittance requirements
amended by RA 10022)
shall be suspended or excluded from
RA 8042 – Migrant Workers Act
the list of eligible workers for
 Establishes a higher standard of
overseas employment. Subsequent
protection of migrant workers, their
violations shall warrant his
families and of OFW's in distress
repatriation from the job site at the
expense of the employer or at his  Declares the policy that the State
expense. does not promote overseas

employment as a means to sustain
economic growth.

 State shall continuously create o promising or advertising for
local employment opportunities employment locally or abroad,
whether for profit or not
RA 10022 – Amendments to RA  Any person or entity which offers or
8042 promises employment for a fee to
 Extended the protection of the law two or more persons shall be
to all OFW's whether documented/ deemed engaged in recruitment
regular or undocumented/ irregular  The number of persons dealt with
 Expanded definition of OFW – is NOT the determinative factor in
“who is to be engaged, is engaged considering whether or not an act
or has been engaged in a constitutes as recruitment – the
remunerated activity in a state of number of persons merely laws
which he or she is not a citizen or down a rule of evidence
on board a vessel navigating the (presumptions)
foreign seas other than a
government ship or on an Name Hires and Direct Hires
installation located offshore or on  Direct Hiring is when a foreign
the high seas” employer engages the services of
Recruitment and Placement the Filipino agency directly or
 Any act of: without going through a legitimate
o canvassing employment agency
o enlisting  General Rule: Direct hiring is
o contracting prohibited Exception: When done
o transporting by members of the diplomatic
o utilizing corps, international organizations

and other employers allowed by
o hiring
the DOLE
o procuring workers
 Name Hiring is when an individual
 Includes:
worker is able to secure contracts
o referrals
for overseas employment on their
o contact services

own efforts without the assistance  Minimum wage standard set
of any agency in a bilateral agreement or
 Name Hiring is not a prohibited international convention
practice thus it is another exception  Minimum wage in the
to Art. 18 Philippines
(Ban on Direct Hiring), however, their 2. Free food and accommodation
employment must be processed and or offsetting benefit
registered with the POEA 3. Free transportation to and from
POEA and NLRC work site, or offsetting benefit
 Employer-employee relation cases 4. Just/authorized causes for
are under the jurisdiction of the termination of contract
NLRC 5. Stipulations of the labor
 POEA jurisdiction: contract should not contradict
1. Cases which are administrative Philippine law, public policy and
in character morals
2. Violations of rules relating to
licensing and registration of OWWA
recruitment agencies  Functions: Provide to OFW's:
3. Disciplinary action cases, which  Social and welfare services
are administrative in character,  Legal assistance
involving employers, principals,  Insurance coverage
contracting partners and  Placement assistance
OFW's.
 Remittance services
 Repatriation
POEA Minimum Employment
Conditions
Repatriation
1. Guaranteed wages based on
General Rule: All costs shall be
(whichever is highest):
borne by or charged to the agency
 Prescribed minimum wage
and/or its principal
in host country
Exception: If termination is due to
the sole fault of the employee, the

principal or agency shall not be  License or authority is non-
responsible for the repatriation transferable. Any transfer is subject
 Automatic repatriation of to prior approval of DOLE
underage or minor workers  All applicants for license or
 Responsibility of repatriation authority shall post bonds to
falls on the agency/principal, ensure compliance with recruitment
but it may be undertaken by the procedures
OWWA without prejudice to  Direct hiring of Filipino workers is
reimbursement by the prohibited except through entities
principal/agency concerned authorized by the DOLE
 Repatriation bond is abolished  Exception on the ban on direct
hiring: hiring by diplomatic corps,
international organizations and
CHAPTER III. other employers allowed by DOLE
MISCELLANEOUS
Illegal Recruitment
PROVISIONS
 Act of recruitment (under Art.
13(b)), including the prohibited acts
RECRUITMENT REGULATIONS
under Art. 34 undertaken by a non-
 Travel agencies and sales
license or non- holder of authority
agencies of airline companies are
(Labor Code)
prohibited from engaging in the
 RA 8042 – expanded the offenders
business of recruitment and
liable for illegal recruitment. It holds
placement of workers, whether for
even licensed persons or holders
profit or not
of authority, who committed the
 Only Filipino Citizens or juridical
prohibited acts, liable for the crime.
entities at least 75% of voting
 Illegal recruitment is malum
capital stock is Filipino owned shall
prohibita: intent is not an element
be allowed in the recruitment of
 Active and conscious participation
workers
of the accused must be shown for
him to be held liable as a principal

 Syndicated Illegal Recruitment: E. To influence/ attempt to influence
o If carried out by a group of 3 or any person not to employ any
more persons conspiring in worker who has not applied
carrying out the offense through his agency
o Considered as economic F. Recruitment of workers in jobs
sabotage harmful to public health, morality

or to the dignity of the Republic
Large Scale Illegal Recruitment: G. Obstruct inspection by the
 If committed against 3 or more Secretary of Labor
persons individually or as a group H. Failure to file reports in the status
 Considered as economic sabotage of employment, placement,

vacancies or other matters and
Prohibited Acts information as may be required
A. To charge or accept any amount by the Secretary of Labor
greater than the allowable fees I. Substitute or alter employment
prescribed by Secretary of Labor contracts without the approval of
B. Publish false information or the Secretary of Labor (but the
notice or document inn relation to alteration must be prejudicial to
recruitment the employee)
C. Give any false information, J. To be an officer or member of the
testimony, document or do any Board
act of misrepresentation for K. of any travel agency corporation
purposes of securing a license or or be directly or indirectly
authority engaged in the management of a
D. To induce/ attempt to induce a travel agency
worker already employed to quit L. To withhold or deny travel
his employment in order to offer documents from applicant
him another, EXCEPT when the workers for monetary
transfer is designed to liberate considerations other than what is
the worker from the oppressive authorized by the Code
conditions of his work

M. Failure to actually deploy a  What law governs the relationship
contracted worker without valid of the employer and employee –
reason local or foreign laws?
N. Failure to reimburse expenses  The party invoking the application
incurred by worker in connection of a foreign law has the burden of
with his deployment, in cases proving the same
where deployment does not take  If foreign law is not pleaded or
place without the worker's fault. proved it is presumed that
O. To allow a non-Filipino citizen to Philippine law is the same as the
head or manage a licensed foreign law, thus Philippine law is
recruitment agency applied
• Prohibitions A-K – from the labor South Eastern Shipping v. Navarra

code  For benefit claims to prosper,
• Prohibitions L-M – from RA 8042 seafarer's death or injury must
• Prohibition N – from RA 10022 occur during the period of his
contract or employment
PRESCRIPTIVE PERIODS  Burden of proof lies on the party
QUICKIE CASE DOCTRINES asserting that the disease/injury
Sunace v. NLRC – Theory of occurred during the course of the
Imputed Knowledge employment or it increased the risk
 Knowledge of the agent is of the injury
knowledge to the principal, thus
binding to the latter Catan v. NLRC
 However, knowledge to the  Liability of the principal and agent
principal is NOT knowledge to the over the employee is dependent on
agent the term of the employment
contract and NOT on the agency
EDI Staff Builders v. NLRC – contract between the agent and
Presumed Identity Approach principal.

 Employment contract is not with Illegal Recruitment in large
coterminous with the agency scale. They represented
contract themselves to have the capacity to
 Even if the agency contract is contract, enlist and transport
terminated, the solidary liability Filipino workers for employment
over the employee still subsists abroad for a fee recruit without the
since the employment or necessary license or authority from
recruitment contract has not POEA.
expired yet.  Maritess claimed that she merely
assisted complainants in their
Illegal Recruitment - Estafa applications with the recruitment
People v. Maritess Martinez agency, “JH Imperial Organization
DOCTRINE: An individual who Placement Corp.”
illegally recruits another for ISSUE: Whether Maritess Martinez
employment abroad shall be meted is guilty of illegal recruitment in large
the penalty of life imprisonment and scale.
fined and could also be held liable HELD: Yes, she is guilty. The
for the crime of Estafa. elements of the crime of illegal
FACTS: recruitment: (a) offender has no valid
 Maritess Martinez and her license or authority required by law
daughter, Jenilyn, were charged to enable him to lawfully engage in
with seven counts of Estafa. recruitment and placement of
 Maritess falsely represented workers; (b) offender undertakes any
herself to have capacity to send of the activities within the meaning of
complainants as factory workers in “recruitment and placement” under
South Korea; that said Article 13b of the Labor Code or any
complainants parted with their of the prohibited practices under
money as payment for placement Article 34 (now Sec. 6 of RA 8042);
and processing fees. and (c) offender committed the same
 Together with her son, Julius, the against three or more persons,
three of them were also charged individually or as a group. Here, the

prosecution satisfactorily established Double jeopardy could not result
that Maritess was not a licensee or from prosecuting and convicting the
holder of authority to deploy workers accused-appellant for both crimes
abroad. By this fact alone, she is considering that they were distinct
deemed to have engaged in illegal from each other not only from their
recruitment and the same was being punished under different
committed in large scale because it statutes but also from their elements
was carried out against the four being different.
complainants.
Although JH Imperial was a holder of Liability of Local Recruitment
a valid license to deploy workers Agency and foreign employer
abroad, there was no evidence that a. Solidary Liability
the agency authorized Maritess to A recruitment agency is
act as its agent. solidarily liable for the unpaid
Maritess was also guilty of four salaries of a worker it
counts of estafa. The elements of recruited for employment
which are: (a) the accused overseas.
defrauded another by abuse of  -Even if the recruiter and the
confidence or by means of deceit; principal had already severed
and (b) the offended party suffered their agency agreement at the
damage or prejudice capable of time employee was injured,
pecuniary estimation. the recruiter may still be sued
for a violation of the
People vs. Marissa Bayker employment contract because
An illegal recruiter can be liable for no notice of the agency
the crimes of illegal recruitment agreement's termination was
committed in large scale and estafa given to the employee
without risk of being put in double
jeopardy, provided that the accused b. Theory of Imputed Knowledge
has been charged under separate  Imputed knowledge means
informations. the knowledge attributed to a

party because of his/her They may also impose reasonable
position, or his/her rules to ensure that the employees
relationship with or comply with these standards...”
responsibility for another “…This prerogative, however, should
party. Such knowledge is not be abused. It is "tempered with
attributed for the reason that the employee’s right to security of
the facts in issue were open tenure."63 Workers are entitled to
to discovery and it was that substantive and procedural due
person's duty to apprise process before termination. They
him/her of such facts. For may not be removed from
instance, if the stairway employment without a validor just
leading to a rental house is cause as determined by law and
defective and if any person is without going through the proper
injured on the stairway, the procedure...”
house owner cannot evade “…This public policy should be borne
liability for such person’s in mind in this case because to allow
injury by denying knowledge foreign employers to determine for
of the defect. Reason being and by themselves whether an
that the house owner is overseas contract worker may be
subject to a duty to discover dismissed on the ground of illness
and rectify the defect in an would encourage illegal or arbitrary
area known to be used by the pretermination of employment
public. Hence, knowledge of contracts...”
the defect is imputed to the “…In case of termination of overseas
house owner. employment without just, valid or
authorized cause as defined by law
Termination of contract of migrant or contract, the workers shall be
worker without just or valid cause entitled to the full reimbursement of
“…Indeed, employers have the his placement fee with interest of
prerogative to impose productivity twelve (12%) per annum, plus his
and quality standards at work.58 salaries for the unexpired portion of

his employment contract or for three
(3) months for every year of the BAN ON DIRECT HIRING
unexpired term, whichever is less…”  Employers cannot directly hire
“…established is the rule that lex loci workers for overseas employment
contractus (the law of the place except through authorized entities
where the contract is made) governs see (enumeration below).
in this jurisdiction. There is no  Entities authorized to engage in
question that the contract of recruitment and placement
employment in this case was
perfected here in the Philippines. Public Employment Offices
Therefore, the Labor Code, its o Philippine Overseas
implementing rules and regulations, Employment Administration
and other laws affecting labor apply (POEA)
in this case.Furthermore, settled is o private recruitment entities
the rule that the courts of the forum o private employment agencies
will not enforce any foreign claim o shipping or manning agents or
obnoxious to the forum’s public
representatives
policy. Herein the Philippines,
o such other persons or entities
employment agreements are more
as may be authorized by the
than contractual in nature. The
DOLE Secretary
Constitution itself, in Article XIII,
o construction contractors
Section 3, guarantees the special
protection of workers, to wit:
 The reason for the ban is to ensure
The State shall afford full protection
full regulation of employment in
to labor, local and overseas,
order to avoid exploitation.
organized and unorganized, and
promote full employment and
equality of employment opportunities
TITLE II – EMPLOYMENT OF NON-
for all…” [Sameer Overseas
RESIDENT ALIENS
Placement Agency Inc. v. Cabiles,
Requisites for Employment of
August 5, 2014]
Non-Resident Aliens

1. Working permit from DOLE been determined by the Sec. of
2. Certification that there is no Labor to be beneficial to national
available Filipino willing and interest.
competent to do the job for the
employer Duration of Permit
3. Alien must train at least two  Valid for 1 year from date of
Filipino understudies for such issuance, unless sooner revoked
undertaking by the Secretary of Labor
4. FOR ENTERPRISES  Renewable upon showing of
REGISTERED IN PREFERRED good cause
AREAS OF INVESTMENT –  Non-transferable
employment permit issued upon
recommendation of government Other Prohibitions
agency charged with the  Aliens shall not transfer to
supervision of said registered another job or change his
enterprise employer without prior approval
of the secretary of labor
Exemption from Permit  Non-resident alien shall not take
1. All members of Diplomatic up employment in violation of the
Services and foreign government provisions of the Code.
officials accredited with the Phil.
Government
2. Members of international BOOK TWO – HUMAN
organizations with which the Phil. RESOURCES DEVELOPMENT
Government is a cooperating PROGRAM
member (i.e. ADB, IRRI)
3. Missionaries actually engaged in TITLE I – NATIONAL MANPOWER
missionary work DEVELOPMENT PROGRAM
4. All aliens granted exemption by Chapter I – National Policies and
special laws and all those whose Administrative Machinery for
employment in the Phil. have Their Implementation

TITLE II – TRAINING AND Social Legislation – the
EMPLOYMENT OF SPECIAL promotion of the welfare of all
WORKERS the people, the adoption by the
Chapter I – Apprentices government of measures
Chapter II – Learners calculated to ensure economic
Chapter III – Handicapped stability of all the component
Workers elements of society thru the
maintenance of proper economic
and social equilibrium in the
BOOK THREE – CONDITIONS OF interrelations of the members of the
EMPLOYMENT community, constitutionally, thru the
adoption of measures legally
TITLE I – WORKING CONDITIONS justifiable, or extra-constitutionally,
AND REST PERIODS thru the exercise of powers
Chapter I – Hours of Work underlying the existence of all
General Principles governments on the time honored
Labor Standards – sets out the principle of salus populi esta
minimum terms, conditions, and suprema lex [Calalang v.
benefits of employment that Williams,02 December 1940]
employers must provide or comply
with and to which employees are
entitled as a matter of legal right. What are the distinctions
between Labor Relations and
Labor Relations – defines the Labor Standards?
status, rights and duties, as well as "Labor Standards Law" is that part
the institutional mechanisms that of labor law which prescribes the
govern the individual and minimum terms and conditions of
collective interactions between employment which the employer is
employers, employees and their required to grant to its employees
representatives.

"Labor Relations Law" is that part The following are excluded from the
of labor law which deals with coverage of the law on labor
unionism, collective bargaining, standards:
grievance machinery, voluntary a. Government employees;
arbitration, strike, picketing and b. Managerial employees;
lockout. c. Other officers or members of a
Labor relations and labor managerial staff;
standards law are not d. Domestic workers or
mutually exclusive. They kasambahay and persons in
are complementary to, and closely the personal service of
interlinked with each other. For another;
instance, the laws on collective e. Workers paid by results;
bargaining, strikes and lockouts f. Non-agricultural field personnel;
which are covered by labor relations and
law necessarily relate to the laws on g. Members of the family of
working conditions. the employer.
Hours of Work
A. CONDITIONS OF Principles in Determining Hours
EMPLOYMENT Worked
Scope (Coverage) What are compensable hours

Who are covered by the worked?
labor standards provisions of the The following shall be
Labor Code? considered as compensable hours
Employees in ALL establishments, worked:
whether operated for profit or not, a. All time during which an
are covered by the law on labor employee is required to be on
standards. duty or to be at the employer's
premises or at a prescribed
Who are excluded? workplace; and

b. All time during which an What are flexible working hours?
employee is suffered or "Flexible work arrangements"
permitted to work. refer to alternative arrangements
or schedules other than the
"Fair day's wage for a fair traditional or standard work hours,
day's labor," remains the basic workdays and workweek. The
factor in determining the effectivity and implementation of
employees' wages and backwages. any of the flexible work
arrangements should be temporary
Normal Hours of Work in nature.
What is the total normal hours
of work per day? Under R.A. No. 8972, otherwise
Eight (8) hours daily. known as "The Solo Parents' Welfare
Act of 2000," solo parents are
What is overtime work? allowed to work on a flexible
Any work in excess of said eight (8) schedule. The phrase "flexible work
normal hours is considered overtime schedule" is defined in the same law
work. as the right granted to a solo
parent employee to vary his/her
May normal working hours be arrival and departure time without
reduced? affecting the core work hours as
Yes, provided that no corresponding defined by the employer.\
reduction is made on the
employee's wage or salary Compressed Work Week
equivalent to an 8-hour work day. What is compressed work week?
In instances where the number of "Compressed Workweek" or "CWW"
hours required by the nature of refers to a situation where the
work is less than 8 hours, such normal workweek is reduced to less
number of hours be regarded as than six (6) days but the total
the employee's full working day. number of work hours of 48 hours
per week remains. The normal

workday is increased to more than b. Brown-outs running for more
eight (8) hours but not to exceed than twenty (20) minutes may
twelve (12) hours, without not be treated as hours worked
corresponding overtime premium. provided any of the following
This concept can be adjusted conditions are present:
accordingly in cases where the 1. The employees can leave
normal workweek of the firm is five their workplace or go
(5) days. elsewhere, whether within
or without the work
What are the conditions for its premises; or
validity? 2. The employees can use
The CWW scheme is undertaken as the time effectively for
a result of an express and voluntary their own interest.
agreement of the majority of the c. In each case, the employer
covered employees of their duly may extend the working hours
authorized representatives. of his employees outside the
regular schedules to
compensate for the loss of
Power Interruptions/Brownouts productive man-hours without
What are the effects being liable for overtime pay.
of power
interruptions/brownouts? Meal Break (Article 85, Labor Code)
The following are the effects of work What is the rule on time-off for
interruption due to brownouts: regular meal? Every employer is
a. Brown-outs of short duration required to give his employees,
but not exceeding twenty (20) regardless of sex, not less than one
minutes shall be treated as (1) hour (or 60 minutes) time-off for
worked or compensable hours regular meals.
whether used productively by
the employees or not. Is meal break compensable?

Being time-off, it is not compensable excess of the regular eight (8)
hours worked. In this case, the working hours.
employee is free to do anything he
wants, except to work. If he is How is Night Shift
required, however, to work while Differential Pay computed?
eating, he should be compensated 1. Where night shift (10 p.m. to
therefor. 6:00 a.m.) work is regular
work.
Night-Shift Differential a. On an ordinary day: Plus
(Article 86, Labor Code) 10% of the basic hourly rate
or a total of 110% of the
How is it reckoned and basic hourly rate.
computed? b. On a rest day, special day
Night shift differential is equivalent to or regular holiday: Plus
10% of employee's regular wage for 10% of the regular hourly
each hour of work performed rate on a rest day, special
between 10:00 p.m. and 6:00 a.m. day or regular holiday or
the following day. total of 110% of the regular
hourly rate
What is the distinction between
night shift differential pay and 2. Where night shift (10 p.m. to
overtime pay? 6:00 a.m.) work is overtime
When the work of an employee falls work.
at night time, the receipt of overtime a. On an ordinary day. Plus
pay shall not preclude the right to 10% of the overtime
receive night differential pay. The hourly rate on an
reason is the payment of night ordinary day or a total of
differential pay is for the work done 110% of the overtime
during the night; while the payment of hourly rate on an ordinary
the overtime pay is for work in day.

b. On a rest day or special (Article 87, Labor Code)
day or regular holiday.
Plus 10% of the overtime What are some basic principles
hourly rate on a rest day or on overtime work?
special day or regular 1. Work rendered after normal
holiday. eight (8) hours of work is
called "overtime work."
3. For overtime work in the night 2. In computing overtime work,
shift. "regular wage" or "basic
Since overtime work is not salary" means "cash"
usually eight (8) hours, the wage only without
compensation for overtime deduction for facilities
night shift work is also provided by the employer.
computed on the basis of the 3. "Premium pay" means
hourly rate. the additional
compensation required by
law for work performed
a. On an ordinary day. Plus within eight hours on non-
10% of 125% of basic working days, such as
hourly rate or a total of regular holidays, special
110% of 125% of basic holidays and rest days.
hourly rate. 4. "Overtime pay" means the
b. On a rest day or special additional compensation for
day or regular holiday. work performed beyond eight
Plust 10% of 130% of hours.
regular hourly rate on said 5. Illustrations on how
days or a total of 110% of overtime is computed:
130% of the applicable a. For overtime work
regular hourly rate. performed on an
ORDINARY DAY, the
Overtime

overtime pay is plus 25% e. For overtime work
of the basic hourly rate. performed on a REST
b. For overtime work DAY WHICH FALLS ON
performed on a REST A REGULAR HOLIDAY,
DAY OR ON A SPECIAL the overtime pay is plus
DAY, the overtime pay is 30% of the basic hourly
plus 30% of the basic rate which includes 160%
hourly rate which includes additional compensation.
30% additional
compensation as What is the distinction between
provided in Article 93 (a) PREMIUM PAY and OVERTIME
of the Labor Code. PAY?
c. For overtime work "Premium pay" refers to the
performed on a REST additional compensation required
DAY WHICH FALLS ON by law for work performed within the
A SPECIAL DAY, the eight (8) normal hours of work on
overtime pay is plus 30% non-working days, such as rest days
of the basic hourly rate and regular and special holidays.
which includes 50%
additional compensation
as provided in Article 93 "Overtime pay" refers to the
(c) of the Labor Code. additional compensation for work
d. For overtime work performed beyond eight (8) normal
performed on a hours of work on a given day. An
REGULAR HOLIDAY, the employee is entitled to both
overtime pay is plus premium pay and overtime pay if he
30% of the basic hourly works on a non-working day and
rate which includes 100% renders overtime work on the same
additional compensation day
as provided in Article 94
(b) of the Labor Code. What is built-in overtime pay?

In case the employment contract safety due to actual or
stipulates that the compensation impending emergency in the
includes built-in overtime pay and locality caused by serious
the same is duly approved by the accident, fire, floods,
DOLE, the non-payment by the typhoons, earthquake,
employer of any overtime pay for epidemic or other disasters or
overtime work is justified and valid. calamities;
3. When there is urgent work to
What is emergency overtime be performed on machines,
work? (Article 89, Labor Code). installations or equipment, or
a. General rule. The general rule in order to avoid serious loss
is that no employee may be or damage to the employer or
compelled to render overtime some other causes of similar
work against his will. nature;
The reason is that this will 4. When the work is necessary
constitute involuntary servitude. to prevent loss or damage to
b. Exceptions when employee perishable goods:
may be compelled to render 5. When the completion or
overtime work: continuation of work started
before the 8th hour is
necessary to prevent serious
1. When the country is at war or obstruction or prejudice to the
when any other national or business or operations of the
local emergency has been employer; and
declared by the National 6. When overtime work is
Assembly or the Chief necessary to avail of
Executive; favorable weather or
2. When overtime work is environmental conditions
necessary to prevent loss of where performance or quality
life or property or in case of of work is dependent thereon.
imminent danger to public

May an employee validly refuse to deductible therefrom, since if they
render overtime work under any of are not so furnished, the laborer
the afore-said circumstances? would spend and pay for them just
No. When an employee refuses to the same.
render emergency overtime work
under any of the foregoing What are supplements?
conditions, he may be dismissed on The term "supplements" means
the ground of insubordination or extra remuneration or special
willful disobedience of a lawful order privileges or benefits given to or
of the employer. received by the laborers over and
above their ordinary earnings or
Can overtime pay be waived? wages.
No. The right to claim overtime pay is
not subject to a waiver. Such right is What are the distinctions between
governed by law and not merely by facilities and supplements?
the agreement of the parties. The benefit or privilege given to the
employee which constitutes an extra
Facilities versus Supplements remuneration over and above his
What are facilities? basic or ordinary earning or wage is
The term "facilities" includes articles supplement; and when said benefit
or services for the benefit of the or privilege is made part of the
employee or his family but does not laborer's basic wage, it is a facility.
include tools of the trade or articles The criterion is not so much with the
or services primarily for the benefit of kind of the benefit or item (food,
the employer or necessary to the lodging, bonus or sick leave) given
conduct of the employer's business. but its purpose. Thus, free meals
They are items of expense supplied by the ship operator to
necessary for the laborer's and his crew members, out of necessity,
family's existence and subsistence cannot be considered as facilities
which form part of the wage and but supplements which could not be
when furnished by the employer are reduced having been given not as

part of wages but as a necessary The rest day must not necessarily be
matter in the maintenance of the on a Sunday or holiday. All
health and efficiency of the crew establishments and enterprises may
during the voyage. operate or open for business on
Sundays and holidays provided that
What is the rule on deductibility the employees are given the weekly
of facilities and supplements? rest day and the benefits provided
Facilities are deductible from wage under the law. (IRR OF THE LABOR
but not supplements. CODE, SEC. 2)
Preference of the Employee

Chapter II – Weekly Rest Periods GR. The employer shall determine
Purpose of the Law and schedule the weekly rest day of
A human being is not a machine. his employees subject to collective
When machines get defective, they bargaining agreement and to such
will always have spare parts. rules and regulations as the
However, if a human develops Secretary of Labor and Employment
sickness or if the human body may provide. (LABOR CODE, ART.
malfunctions, there is no such thing 91)
as “human parts” supply. [POQUIZ, XPN. The employer shall respect the
2018] preference of employees as to their
weekly rest day when such
Right to Weekly Rest Day preference is based on religious
Every employer shall give his grounds.
employees a rest period of not less XPN to the XPN. The employer may
than twenty-four (24) consecutive schedule the weekly rest day of their
hours after every six (6) consecutive choice for at least 2 days in a month
normal work days. (LABOR CODE, when:
ART. 91) a) The choice of the employee,
based on religious grounds, will
inevitably result in serious

prejudice or obstruction to the d) In cases of Urgent work to be
operations of the undertaking; performed on the machinery,
and equipment, or installation, to avoid
b) The employer cannot normally serious loss which the employer
be expected to resort to other would otherwise suffer;
remedial measures. (IRR OF e) In case of Actual or impending
THE LABOR CODE, SEC. 4) emergencies Caused by serious
accident, fire, flood, typhoon,
Work on a Rest Day (LABOR earthquake, epidemic or other
CODE, ART. 92) disaster or calamity to prevent loss
GR. Work on a rest day is a of life and property, or imminent
voluntary undertaking, hence, the danger to public safety; and
employer may not require such. f) Under Other circumstances
(POQUIZ, 2018) analogous or similar to the
XPN. The employer may require his foregoing as determined by the
employees to work on any day: Secretary of Labor and
(PANU-AcO) Employment.
a) To Prevent loss or damage to
perishable goods; Compensation for rest day,
b) In the event of Abnormal Sunday or Holiday Work
pressure of work due to special Premium Pay – or differential
circumstances, where the compensation, is an additional pay
employer cannot ordinarily be granted to a covered employee for
expected to resort to other services rendered on holidays or rest
measures; days. (POQUIZ, 2018)
c) Where the Nature of the work
requires continuous operations and Note: Sunday is an ordinary working
the stoppage of work may result in day. Hence, an employee is entitled
irreparable injury or loss to the to premium pay on a Sunday only
employer; when it is his established rest day.
(POQUIZ, 2018)

Although a worker is forced to
Art. 93 – Rate of Premium Pay take a rest, he earns what he should
DAY PREMIUM PAY earn, that is, his holiday pay. (JOSE
Work on RIZAL COLLEGE v. NLRC, GR. No.
30% of regular
scheduled rest 65482, DECEMBER, 1987)
wage
day
Work performed
Purpose of the Law
on Sunday only
30% of regular The purpose of holiday pay is to
when it is his
wage secure payment of undiminished
established rest
monthly income undisturbed by any
day
Employee has 30% of regular work interruption. (JRC v. NLRC,
no regular wage for work IBID.)
workdays and performed on
no regular rest Sundays and Right to Holiday Pay
days holidays GR. Every worker shall be paid his
Work on any 30% of regular regular daily wage during regular
special holiday wage holidays.
Holiday work
50% of regular XPN. Retail and service
also falls on the
wage establishments regularly employing
rest day
CBA or other less than ten (10) workers. (LABOR
contract 70% of regular CODE, ART. 94)
provides for wage

higher premium The employer may require an
employee to work on any holiday but
Chapter III – Holidays, Service such employee shall be paid a
Incentive Leaves, and Service compensation equivalent to twice his
Charges regular rate. (LABOR CODE, ART.
Holiday Pay – is a form of premium 94)
accorded to an employee who does
not work on regular holidays. List of Holidays
REGULAR DATE

HOLIDAY
New Year’s Day January 1 Regular Holiday v. Special Holiday
Maundy
Movable date REGULAR SPECIAL
Thursday
Good Friday Movable date HOLIDAY HOLIDAY
Araw ng
April 9
Kagitingan UNWORKED UNWORKED
Labor Day May 1 Paid 100% of Not entitled to
Independence
July 12 his regular compensation;
Day
National Heroes Last Monday wage. no work, no pay.
Day of August
Bonifacio Day November 30 WORKED WORKED
Christmas Day December 25 Entitled to Entitled to
Rizal Day December 30
200% of his premium pay
SPECIAL regular wage; provided under

DATE double pay. Art. 93, LABOR
HOLIDAY
Chinese New CODE.
February 16
Year
EDSA Monthly-paid v. Daily-paid
February 25
Anniversary Employees
Black Saturday March 31
Monthly-paid employees are those
Ninoy Aquino
August 21 whose salary includes payments for
Day
All Saint’s Day November 1 everyday of the month although he
Last Day of the
December 31 does not regularly work on his rest
Year
days, Sundays, regular and special
Feast of the
holidays. On the other hand, a daily-
Immaculate December 8
paid employee is one who is paid on
Conception
Additional the day he actually worked except
November 2
Special non- unworked regular holidays when he
December 24
working days is present or on leave of absence
NATIONAL with pay on the working day
DATE
HOLIDAY immediately preceding the legal
Eidul Fitr Movable date
Eidul Adha Movable date holiday. (IN RE UNITED SOUTH

DOCKHANDLERS, NOVEMBER Absences on Holiday Pay
1987) a) Employee is on leave of absence
with pay – entitled to holiday pay.
Monthly-paid employees or b) Employee is on leave of absence
employees who are uniformly paid without pay on the day immediately
by the month are not excluded from preceding the regular holiday – not
the benefits of holiday pay. (IRR OF entitled to holiday pay.
THE LABOR CODE, SEC. 2) c) Day immediately preceding the
holiday is a non-working day or the
Employees not Entitled to Holiday scheduled rest day of an employee –
Pay not considered to be on leave of
a) Government employees including absence on that day and shall be
GOCCs with original charters; entitled to holiday pay if he worked
b) Employees of retail and service on the day immediately preceding
establishments regularly employing the non-working day or rest day.
less than 10 workers; d) Two successive regular holidays –
c) Domestic helpers; not entitled to holiday pay for both
d) Managerial employees; holidays if he absents himself from
e) Officers and members of a work without pay on the day
managerial staff; immediately preceding the first
f) Field personnel and other regular holiday. But if he works on
employees whose time is the first holiday, he is entitled to
unsupervised by the employer; holiday pay on the second holiday.
g) Workers who are paid by results; (IRR OF THE LABOR CODE, SEC.
h) Members of the family of the 6 and 10, Rule IV.)
employer who are dependent upon
him for support; Double Holiday Pay
i) Persons in the personal service of If two regular holidays fall on the
another. (IRR OF THE LABOR same day (e.g. Good Friday falling
CODE, ART. 82, SEC. 1) on Araw ng Kagitingan which is April
9), the employees should be paid

400% of the basic wage for both as authorized by the Secretary of
holidays provided he worked on that Labor may not be paid by the
day or was on leave of absence with employer. (IRR OF THE LABOR
pay or was on authorized absence CODE, SEC. 6 and 10, Rule IV.)
on the day prior to the regular
holiday. Holiday pay is a statutory Holiday Pay of Certain Types of
benefit demandable under the law. Employees (IRR OF THE LABOR
Since a worker is entitled to the CODE, SEC. 8, Rule IV.)
enjoyment of ten paid regular TYPE OF
HOLIDAY PAY
holidays (LABOR CODE, ART. 94), EMPLOYEE
the fact that two holidays fall on the Not paid for
same date should not operate to regular
reduce to nine the ten holiday pay holidays during
benefits a worker is entitled to semestral
receive. (ASIAN TRANSMISSION breaks, but
CORP v. CA, G.R. No 144664, shall be paid
MARCH 2004) for regular

holidays during
Private school
Effects of Business Closure on Christmas
teachers and
Holiday Pay vacation.
faculty members
a) In cases of temporary or periodic
shutdown and temporary cessation Faculty
of work of an establishment, as when members paid
a yearly inventor/ or when the repair per hour are
or cleaning of machineries and not entitled to
equipment is undertaken, the regular holiday pay.
holidays falling within the period shall (JRC v. NLRC,
be compensated. ID.)
Employee paid His holiday pay
b) The regular holiday during the
by results or shall not be
cessation of operation of an
output less than his
enterprise due to business reverses
average daily

earnings for company contract or policy provides
the last 7 for it. (POQUIZ, 2018)
actual working
days preceding 13TH Month Pay
the regular It is a form of monetary benefit
holiday. equivalent to the monthly basic
May not be compensation received by an
paid the employee, computed pro-rata
Seasonal required according to the number of months
workers holiday pay within a year that the employee has
during off- rendered service to the employer,
season. (DOLE's BWC issues Q & A on 13th
Workers who Shall be
month pay)
have no regular entitled to the
working days benefits.
Nature – Such is in the nature of
Right to Service Incentive Leave additional income granted to
Employees who have rendered at employees who are not receiving the
least 1 year of service are allowed a same. (AGABON v. NlRC, G.R. No.
five-day incentive leave with pay 158693, NOVEMBER 2004)
which may be used as vacation or
sick leave. If unused at the end of 14th Month Pay
the year, this benefit is convertible to GR. The granting of a 14th month pay
its cash equivalent based on the is a management prerogative and is
salary rate at the date of not legally demandable. It is
commutation. (IN RE MAXIM’S TEA basically a bonus arid is gratuitous in
HOUSE, MARCH 1988) nature. (KAMAYA POINT HOTEL v.
NLRC, G.R. No. 75289, AUGUST
Note: The grant of vacation leave 1989)
and its benefits is not mandatory on XPN. A bonus becomes a
the part of the management. It only demandable or enforceable
becomes a matter of right when the obligation when it is made part of the

wage or salary or compensation of of board, lodging, or other facilities
the employee. customarily furnished by the
XPN to the XPN. Where it is not employer to the employee. (LABOR
payable to all but only to some CODE, ART. 97)
employees and only when their labor
becomes more efficient or more Attributes of Wages
productive, it is only an inducement a) Cash wage takes the form of
for efficiency, a · prize therefore, not ready money paid by the employer
a part of the wage. (METRO for services rendered by the
TRANSIT ORGANIZATION, INC. v. employee.
NLRC, G.R. No. 116008, JULY b) Facilities are articles or services
1995) customarily given for the benefit of
the employee and are voluntarily
accepted by him.
TITLE II – WAGES
Chapter I – Preliminary Matters Principle of "No Work, No Pay”
Wage means the remuneration or GR. If there is no work performed by
earnings, however designated, the employee, without the fault of the
capable of being expressed in terms employer, there can be no wage or
of money, whether fixed or pay. Burden-of economic loss
ascertained on a time, task, piece, or suffered by employee shall not be'
commission basis, or other fixed shifted to the employer.
method of calculating the same, XPN. When the laborer was able,
which is payable by an employer to willing and ready towork but was:
an employee under a written or a) Prevented by management;
unwritten contract of employment for b) Illegally locked out;
work done or to be done, or for c) Illegally suspended;
services rendered or to be rendered d) Illegally dismissed; or
and includes the fair and reasonable e) Illegally prevented from working.
value, as determined by the (AKLAN ELECTRIC COOP. v. NlRC,
Secretary of Labor and Employment, G.R. No. 129246, JANUARY 2000)

week, month or office.
Principle of “Equal Pay for Equal season:
Work” Considerable Suggestive of a
Persons who work with substantially pay for a lower larger and more
equal qualifications, skill, effort and and less permanent or
responsibility, under similar responsible fixed
conditions, should be paid similar character of compensation
salaries. employment. for more

important
Employees holding the same service,

Generally not Subject to
position and rank are presumed to
subject to execution.
be performing equal work. The rule
execution,
equal pay for equal work applies
except as to
whether the employee is hired locally
debts incurred
or abroad. (INTERNATIONAL
for food, shelter,
SCHOOL ALLIANCE OF
clothing and
EDUCATORS v. QUISUMBING,
medical
G.R. No. 128845, JUNE 2000)
attendance.
Wage v. Salary Facilities v. Wages

WAGE SALARY a) Facilities as part of wages –
Compensation Paid to "white-
Facilities include those articles or
for manual labor collared
services of benefit to the employee
(skilled or workers" and
and his family such as rice ration,
unskilled) also denotes a
housing, recreational facilities,
known as "blue- higher degree of
medical treatment to dependents,
collared employment or
school facilities, cost of light, water,
workers," paid a superior grade
fuel, meals or snacks. (MAYON
at stated times of services and
HOTEL v. ADANA, C.R. No. 157634,
and measured implies a
MAY 2005)
by the day, position or
b) Supplements not part of wages –

Supplements are extra
remunerations or benefits given to or Statutory Minimum Wage is the
received by laborers over and above lowest wage rate fixed by law that an
their ordinary earnings or wages. employer can pay his workers. (IRR
E.g. vacation leave pay, overtime OF RA 6727)
pay in excess of the legal rate, profit-
sharing benefits, sick pension, Person Entitled to Minimum Wage
retirement and death benefits, family a. Kasambahay in accordance with
allowances, Christmas bonus, war- RA 10361;
risk or cost-of-living bonuses or other b. Those paid by results under the
bonuses other than those paid as Labor Code; and
reward for extra output or time spent c. Apprentices, Learners and
on the jobs. (ATOK BIG WEDGE Persons with Disability in
MINING CO. v. ATOK BIG WEDGE accordance with RAs 9442 and
MUTUAL BENEFIT ASSOC., G.R. 10524.
No. L-7349, JULY 1955)
Coverage of Minimum Wage
The increase under RA 6727 applies
Chapter II – Minimum Wage Rates to all workers and employees in the
Basic Wage means all remuneration private sector regardless of their
or earnings paid by an employer to a position, designation or status, and
worker for services rendered on irrespective of the method by whuch
normal working days and hours but their wages are paid. (IRR OF R.A.
does not include cost-of-living 6272, SEC. 1)
allowances, profit sharing payments,
premium payments, 13th month pay Person Exempted from Minimum
or other monetary benefits which are Wage Coverage
not considered as part of or a. Household or domestic helpers,
integrated into the regular salary of including family drivers and
the workers on the date the Act workers in the personal services
became effective. (IRR OF RA 6727) of another;

b. Workers and employees in b. Contingent benefit or conditional
retail/service establishments bonus
regularly employing not more c. Wage order compliance
than 10 workers; and d. Benefits on reimbursement basis
c. Employees of “Barangay Micro e. Reclassification of position
Business Enterprises.” (R.A. f. Negotiated benefits
9178, SEC. 8) g. Productivity incentives
Minimum Wage is Non-Negotiable Applicability of the Rule on Non-

The minimum wage fixed by law is Diminution of Benefits
mandatory; thus, it is non-waivable It is applicable if it is shown that:
and non-negotiable. The enactment a. Grant of benefit is based on a
is compulsory in nature in order to policy· or has ripened into a
insure decent living conditions. (PAM practice over a long period;
CO v. PAMEA-FFW, 51 SCRA 98) b. Practice is consistent and
deliberate;
Non-diminution of Benefits c. Practice is not due to an error in
GR. Nothing in the Labor Code shall the construction or application of
be construed to eliminate or in any a doubtful or difficult question of
way diminish supplements, or other law: and
employee benefits being enjoyed at d. It is done unilaterally by the
the time of the promulgation of the employer.
Code. (LABOR CODE, Art 100)
Benefits being given to employees Purpose of Non-Diminution of
cannot be taken back or reduced Benefits
unilaterally by the employer because The philosophy behind the law is to
the benefit has become part of the prohibit employers from reducing
employment contract, whether benefits already enjoyed by
written or unwritten. employees. A contrary rule will
XPN. corrupt the employer's mind to abuse
a. Correction of error and exploit employees, prostituting

the social justice and protection to and loyalty. (METRO TRANSIT
labor clauses enshrined in the ORG., INC. v. NLRC, G.R.
fundamental charter. No.116008, JULY, 1995)
An agreement reducing certain labor
standards benefits such as overtime GR. The payment of bonus is a
and premium pay" violates Art. 100. management function, not a
Provisions of existing laws are demandable and enforceable
deemed part of a contract. obligation, which cannot be enforced
(REPUBLIC PLANTERS BANK v. upon the employer who may not be
NLRC, 266 SCRA 141) obliged to assume the onerous
However, if there is an impelling burden of granting bonuses or other
reasonable justification of the benefits aside from the employee's
diminution or reduction because of basic salaries or wages.
an emergency or exigency, or (PHILIPPINE NAT’L
business losses, such diminution or CONSTRUCTION CORPORATION
reduction would be valid, provided it v. NLRC, G.R. No.128345, MAY
is duly approved by the Secretary of 11999)
· Labor and Employment or his duly
authorized representative pursuant XPN. Bonuses can be demanded as
to Art. 233. (POQUIZ, 2018) a matter of right if:
a. Given without any condition;

Bonus
hence, part of the wage or salary,
Refers to the payment in excess of
(ATOK BIG WEDGE MINING
regular or guaranteed wages. It is
CO., ID);
granted to an employee for his
b. Grant thereof is a result of an
tangible contribution to the success
agreement such as the CBA
of the employer's business, without
(GERY v. INSULAR LUMBER,
which the employer may not realize
93 Phil. 807);
bigger profits. The contribution may
be in the form of an employee's
commitment to the job, his industry

c. Given on account of company
policy or practice (CLAPAROIS v. It includes those who are paid on
CIR, 65 SCRA 613); or piece work, "takay" or task basis,

who shall be entitled to receive not
d. Grant is mandated by law.
less than the prescribed statutory
minimum wage for an eight-hour
Bonus Treated Not Part of Wages work or a proportion thereof for less
Bonus is not considered part of than eight hours work. {Art. 124,
wages if it is paid only upon infra.)
realization of profits or amount of
production or output. (ATOK BIG Categories of Workers Paid by
WEDGE MINING CO., ID) Results
1) As to Presence of Control
Where the bonus is not payable to all a) Supervised (Piece-rate worker) –
but only to some employees and works directly under the supervision
only when their labor becomes more of the employer.
efficient or more productive, it is only b) Unsupervised (Takay or Pakyaw)
an inducement for efficiency, a prize – works away from the employer's
therefore, not a part of the wage. premises.
(POQUIZ, 2018)
2) As to Rate of Payment
Payment by Results a) Those who are paid piece rates
Workers paid by result are paid which are prescribed in Piece Rate
based on the work completed and Orders issued by DOLE – Wages or
not on the time spent in working. earnings are determined by simply
multiplying the number of pieces
Pay of these workers is calculated produced by the rate per piece.
not on the basis of time spent on the b) Those who are paid output rates
job but of the quantity and quality or which are prescribed by the
the kind of work they turn out. employer and are not yet approved
(AZUCENA, 2016) by the DOLE – The number of

pieces produced is multiplied by the g. Any object other than legal
rate per piece as determined by the tender.
employer:
i. If resulting amount is XPN. Payment of wages by check or
equivalent to· or more than money order shall be allowed if:
the applicable statutory a. It is customary on the date of
minimum rate in relation to the the effectivity of the Code;
number of hours worked, b. Necessary because of special
worker will receive such circumstances as specified in
amount; the regulation issued by the
ii. If the amount is less than the SLE; or
applicable legal rate, c. Stipulated in the CBA; (LABOR
employer is required by law to CODE, Art 102)
pay the difference between d. Where the following conditions
the resulting amount and the are met:
applicable legal minimum i. There is a bank or other
rate. (AZUCENA, 2016) facility for encashment within
a radius of one (1) kilometer
Chapter III – Payment of Wages from the workplace;
Forms of Payment of Wages ii. The employer or any of his
GR. The laborer's wages shall be agents or representatives
paid in legal currency. (NCC, ART. does not receive any
1705) pecuniary benefit directly or
No employer shall pay the wages of indirectly from the
an employee by means of: arrangement;
a. Promissory notes; iii. The employees are given
b. Vouchers; reasonable time during
c. Coupons: banking hours to withdraw
d. Tokens; their wages from the bank
e. Tickets; which time shall be
f. Chits; or considered as compensable

hours worked if done during i. That payments are made at
working hours; and intervals not exceeding
iv. The payment by check is with sixteen (16) days, in
the written consent of the proportion to the amount of
employees concerned if there work completed;
is no collective agreement ii. That final settlement is
authorizing the payment of made upon' completion of
wages by bank checks. (IRR the work. (LABOR CODE,
OF THE LABOR CODE, SEC. Art 103)
2, Rule V.)
Place of Payment
Time of Payment GR. At or near the place of
GR. Wages shall be paid: undertaking.
a. At least once every two (2) XPN.
weeks, or, a. When payment cannot' be
b. Twice a month at intervals not effected at or near the place of
exceeding sixteen (16) days. work by reason of the
deterioration of peace and order
XPN. conditions, or by reason of actual
a. On account of force majeure or or impending emergencies
circumstances beyond the caused by fire, flood, epidemic or
employer's control, payment shall other calamity rendering payment
be made immediately after such thereat impossible;
force majeure or circumstances b. When the employer provides free
have ceased; transportation to the employees
b. If engaged to perform a task back and forth; and
which cannot be completed in c. Under any other analogous
two (2) weeks shall be subject to circumstances; Provided, that the
the following conditions, in the time spent by the employees in
absence of a CBA or arbitration collecting their wages shall be
award:

considered as compensable amount prescribed under the
hours worked. Labor Code, as amended;
d. There is a bank or ATM facility
Note. No employer shall pay his within a radius of one (1)
employees in any bar, night or day kilometer to the place of work;
club, drinking establishment, e. Upon request of the concerned
massage clinic, dance hall, or other employees, the employer shall
similar places or in places where issue a record of payment of
games are played with stakes of wages, benefits and deductions
money or things representing money for a particular period;
except in the case of persons f. There shall be an additional
employed in said places. (IRR OF expenses and no diminution of
THE LABOR CODE, SEC. 4, RULE benefits and privileges as a result
VIII) of the ATM system of payment:
and
Requisites of Payments through g. The employer shall assume
ATM responsibility in case the wage
a. The ATM system of payment is protection provisions of law and
with the written consent of the regulations are not complied with
employees concerned; under the arrangement. (DOLE
b. The employees are given LABOR ADVISORY, SERIES OF
reasonable time to withdraw their 1996)
wages from the bank facility
which time, if done during Requisites of Payments through
working hours, shall be Banks
considered compensable hours a. Shall be made upon written
worked; permission of the majority of the
c. The system shall allow workers to employees or workers
receive their wages within the concerned;
period or frequency and in the b. With twenty five (25) or more
employees; and

c. Located within one (1) kilometer individual employees concerned;
radius to a commercial, savings (LABOR CODE, 105) or
or rural bank. (R.A. 6727, SEC. d. In case of death of the employee
7) the employer may pay the wages
to the heirs without the necessity
Direct Payment of Wages of intestate proceedings. Heirs
GR. Wages shall be paid directly to shall:
the workers to whom they are due. i. Execute an affidavit
XPN. attesting to their relationship
a. Payment through another person to the deceased and the fact
may be made in cases of force that they are his heirs to the
majeure which renders the exclusion of all other
payment impossible, provided persons.
that such person is under written ii. In case any of the heirs is a
authority given by the worker for minor, such affidavit shall be
the purpose; executed in his behalf by his
b. Where the employer is authorized natural guardian or next of
in writing by the employee to pay kin.
his wages to a member of his iii. Upon presentation of the
family; affidavit to the employer, he
c. Where payment to another shall make payment to the
person of any part of the heirs as representative of
employee's wages is authorized the Secretary of Labor and
by existing law, including Employment. (IRR OF THE
payments for the insurance LABOR CODE, SEC. 6,
premiums of the employee and RULE VII)
union dues where the right to
check-off has been recognized by Chapter IV – Prohibitions
the employer in accordance with regarding Wages
a collective agreement or Non-Interference in Disposal of
authorized in writing by the Wages

The employer shall not limit or or other articles belonging to the
interfere with the freedom of any laborer.
employee to dispose of his wages.
He shall not force, compel or oblige Prohibition on Wage Deduction
his employees to purchase GR. No employer, ln his own behalf
merchandise, commodities or other or in behalf of any person, shall
property from any other person, or make any deduction from the wages
otherwise make use of any store of his employees. (LABOR CODE,
services of such employer or any ART. 113)
other person. (LABOR CODE, ART.
112) XPN.
a. Where the worker is Insured with
Non-interference in Disposal of his consent by the employer; and,
Wages under the NCC b. For union dues, in cases where
a. Art. 1705. The laborer's wages the right of the worker or his
shall be paid in legal currency. union to check off has been
b. Art. 1706. Withholding of the recognized by the employer or
wages, except for a debt due, authorized in writing by the
shall not be made by the individual worker concerned.
employer. (LABOR CODE, ART. 113)
c. Art. 1707. The laborer's wages c. In cases where the employer is
shall be a lien on the goods authorized by law or regulations
manufactured or the work done, issued by the SLE:
d. Art. 1708. The laborer's wages i. Deductions for value of
shall not be subject to execution meals and facilities freely
or attachment, except for debts agreed upon; (AZUCENA,
incurred for food, shelter, clothing 2016)
and medical attendance. ii. In case where the employee
e. Art. 1709. The employer shall is indebted to the employer
neither seize nor retain any tool where such indebtedness
has become due and

demandable; (NCC, OF THE LABOR
ART.1706) SECRETARY
iii. In court awards, wages may ix. Agency fees. (LABOR
be subject of execution or CODE, ART. 259[e])
attachment, but only for
debts incurred for food, The law prohibits the employer from
shelter, clothing, and making deductions from the wages
medical attendance; (NCC, of an employee. The evil sought to
ART 1703) be prevented is to forestall the
iv. Taxes withheld pursuant to commission of unwarranted
the Tax Code; e. Salary practices of employers by making
deduction of a member of a unnecessary deductions without
legally established employee's knowledge or
cooperative; (R.A. 6938, authorization. (GALVADORES v
SEC. 59) TRAJANO, 144 SCRA 138)
v. Deductions for SSS,
PhilHealth and Pagibig Check-off
premiums; Check-off is a system by which union
vi. Deductions for loss or dues and other assessments are
damage; (LABOR CODE, deducted from the employee's wage
ART. 114) by the employer upon authorization
vii. Deductions made with the from the worker or by mandate of the
written authorization of the law. (POQUIZ, 2018)
employee for payment to a
third person; (IRR OF THE The employees' check-off
LABOR CODE) authorization even if declared
viii. Deductions as disciplinary irrevocable, is good only as the
measures for habitual employees remain members of the
tardiness; (OPINION union concerned, because as such
DATED MARCH 10, 1975 members they were obliged to pay

the corresponding dues and a. Withholding of wages from a
assessments to their union. worker through inducement,
force, stealth, intimidation, threat
The moment they are separated or by any other means without his
from and left the union and joined consent;
another labor organization, they b. To make deductions from wages
were no longer obliged _to pay said for the benefit of the employer or
dues and assessments. There would his representative as
13e no longer any reason or consideration of a promise of
occasion for the company to Employment or retention in
continue making deductions. (PHIL. employment;
FEDERATION OF PETROLEUM c. Refusal by employer to pay or
WORKERS v. CIR, l-26346, reduce wages or benefits in
FEBRUARY 1971) discrimination of any employee
who has filed any complaint or
Compulsory Check-off instituted any proceedings under
Check-off may be enforced with the the code or has testified or about
consent of the employer or by to testify; or
authority in writing by the employees. d. Unlawful for any person to make
any statement, report, or record
When the union and the employer filed or kept pursuant to the Code
agree, the attitude of the employees knowing such statement, report
is immaterial. When the employees or record to be false in any
duly authorize the check-off, the material aspect.
employer's consent is unnecessary
and its recognition of the right is Chapter V – Wage Studies, Wage
obligatory. (A.L. AMMEN TRANS. Agreements, and Wage
CO. v BITEMAA, 91 Phil 649) Determination
Wage Order
Other Prohibitions This is an order issued by the
RTWPB whenever conditions in the

region so warrant after investigating A Wage Order shall take effect 15
and studying all pertinent facts and days after its publication in at least
based on the standards and criteria one (1) newspaper of general
prescribed by the Labor Code. circulation in the region.
It establishes the minimum wage Methods of Minimum Wage

rates to be paid by employers in the Adjustment
region, which shall in no case be a. Salary Ceiling Method – A
lower than the applicable statutory method of minimum wage
minimum wage rates. adjustment whereby the wage
adjustment is applied to
Frequency of Wage Order employees receiving a certain
G.R. Any wage order issued by the denominated salary ceiling. In
RTWPB may not be disturbed for a other words, workers already
period of 12 months from its being paid more than the existing
effectivity, and no petition for wage minimum wage are also to be
increase shall be entertained within given a wage increase. (ECOP v.
the said period. NWCP, G.R. No. 96169,
SEPTEMBER 1991)
XPN. Supervening condltions, e.g. b. Floor Wage Method – It involves
extraordinary increase in prices of the fixing of a determinate
petroleum products and basic amount to be added to the
goods/services, demand a review of prevailing statutory minimum
the minimum wage rates as wage rates.
determined by the Board. The Board
shall proceed to exercise its wage Two Basic Methods of Payment
fixing function even before the a. Time wages – refer to pay by
expiration of the said period, (NCWP the hour, day or month, without
Guidelines No. 001-95) specifying the amount of work
to be done.
Effectivity of Wage Order

b. Production wages – refer to pay j. The equitable distribution of
related to the amount of work income and wealth along the
the individual or group performs imperatives of economic and
regardless of the time involved social development. (LABOR
in its performance. This applies CODE, ART. 124)
to workers paid by result.
(POQUIZ, VOL. I) Persons Exempted from the
Coverage of Fixing a Minimum
Standards or Criteria for Minimum Wage
Wage Setting a. Household or domestic helpers,
In the determination of such regional including family drivers and
minimum wages, the Regional Board persons in the personal service
shall, among other relevant factors of another;
consider the following: b. Homeworkers engaged in
a. The demand for living wages; needle-work;
b. Wage adjustment vis-a-vis the c. Workers employed in any
consumer price index; establishment duly registered
c. The cost of living and changes or. with the National Cottage
increases therein: Industries and Development
d. The needs of workers and their Authority, provided that such
families; workers perform the work in
e. The need to induce industries to their respective homes;
invest in the countryside; d. Employees of retail/service
f. Improvements in standards of establishment employing not
living; more than 10 workers provided
g. The prevailing wage levels; that they file an application for
h. Fair return on the capital invested exemption before the Regional
and capacity to pay by employer; Wage Board; (R.A. 6727,
i. Effects on employment SEC.4)
generation and family income; e. Workers in a duly registered
cooperative when so

recommended by the Bureau of
Cooperative Development and The elements of Wage Distortion
upon approval of the SLE; (IRR are:
THE LABOR CODE, SEC. 2, a. An existing hierarchy of
RULE VII) positions with corresponding
f. Workers of a barangay micro salary rates.
business enterprise (R.A. 9178) b. A significant change or increase
g. Additional exemptions provided in the salary rate of a lower pay
in NWPC Guidelines on class without a corresponding
Exemptions such as distressed increase in the salary rate of a
establishment, new business higher one;
enterprises and enterprises c. The elimination of the
adversely affected by natural distinction between the 2
calamities; groups or classes; and
h. Wage Orders issued by wage d. The WD exists in the same
boards may provide for region of the country.
additional exemptions. (ALLIANCE TRADE UNIONS v.
NLRC, G.R. No. 140689,
Wage Distortion or Rectification FEBRUARY 2004)
A situation where an increase in
wage results in the elimination or Causes of Wage Distortions
severe contraction of intentional a. Government decreed increases
quantitative differences in wage or in minimum wages;
salary rates between and among- b. Merger of two companies (with
the employee-groups in an differing classifications of
establishment as to effectively employees and different wage
obliterate the distinctions embodied rates) where the surviving
in such wage structure based on company absorbs all the
skills, length of service or other employees of the dissolved
logical bases of differentiation. corporation;
(LABOR CODE, ART. 124)

c. Wage distortion arose because through a NCMB.
the effectivity dates of wage grievance
increases given to each of the procedure
two classes of employees under the CBA.
(rank-and-file and supervisory) If it remains If it remains
had not been synchronized in unresolved, it unresolved
their respective CBAs. (METRO shall be': dealt within 10 days it
TRANSIT ORG., INC. v NLRC, with through shall be referred
67 SCRA 477) voluntary to the NLRC.

arbitration.
The dispute will The NLRC shall
Settlement of Wage Distortion
be resolved conduct
The application of wage increases
within 10 days continuous
brought about by Wage Orders
from the time hearings and
issued by the Board may result in
the dispute was decide the
distortions in the wage structure
referred to dispute within
within the establishment. The
voluntary 20 days from
employer and the workers are
arbitration. the time the
mandated by law to resolve such
same was
wage distortion problems in the
referred.
following manner:
ORGANIZED UNORGANIZED Use of Divisor
ESTABLISHMEN ESTABLISHMEN
The divisor assumes an important
T T
role in determining whether or not
(WITH UNION) (NO UNION)
The employer The employer holiday pay is already included ln the
and the union and the workers monthly paid employee's salary and
shall negotiate shall endeavor in the computation of his daily rate.
to correct to correct the (CHARTERED BANK EMPLOYEES
distortion. distortion. ASSOCIATION v. OPIE, G.R. No. L·

Any dispute Any dispute 44717, AUGUST 1985)
shall be shall be settled
resolved through the NO. OF TIMES HOLIDAYS PAID

DIVISOR IS labor standards or may aid in the
USED enforcement of this Code and of any
All the 12 holidays,
365 (days in a labor law, wage order or rules and
52 Sundays, and 52
year) regulations issued pursuant thereto.
Saturdays are paid.
12 holidays and 52 (LABOR CODE, SEC. 128)
313
Sundays (or b) Enforcement Power
(365 – 52 = 313)
Saturdays are paid. This refers to the power to issue
All the 12 holidays compliance orders to give effect to
261 are paid excluding the labor standards provisions of this
(313 - 52 = 261) the Saturdays and Code and other labor legislation
Sundays.
based on the findings of labor
249 The 12 holidays are
employment and enforcement
(261-12 = 249) not paid.
officers or industrial safety engineers
made in the course of inspection. .
Chapter VI – Administration and (LABOR CODE, SEC. 128)
Enforcement
Visitorial and Enforcement Power Nature of Visitorial and
The Labor Code provides two Enforcement Power
complementary powers conferred The visitorial and enforcement power
upon the DOLE Secretary or his duly granted to the DOLE Secretary is in
authorized representatives: the nature of a quasi-judicial power
a) Visitorial Power or administrative adjudicatory power
This refers to the power to have which is the right to adjudicate the
access to employer’s records and rights of persons before it. (DOLE
premises at any time of the day or PHILS., INC., v. ESTEVA, GR. No.
night whenever work is being 161115, NOVEMBER 2006)
undertaken therein, and the right to
copy therefrom, to question any Conditions to Exercise
employee and investigate any fact, Enforcement Power
condition or matter which may be
necessary to determine violation of

The following conditions must concur imminent danger to the health and
in the exercise of power to order safety of the workers which cannot
compliance or enforcement power: be corrected. (RULES ON THE
a. That the employer-employee DISPOSITION OF LABOR
relationship still exists; STANDARDS, SEC. 4, RULE VI)
(MATERNITY CHILDREN’S
HOSPITAL v. SEC. OF LABOR, Limitations on the Enforcement
G.R. No. 78909, JUNE 1989) Power
b. That the findings of the labor The enforcement power cannot be
regulation officers or industrial exercised in the following instances:
safety engineers were made in a. The enforcement order will not
the course of inspection; apply where there is no longer an
(POLICY INSTRUCTION No. 37, employer-employee relationship;
DOLE) and (MATERNITY CHILDREN’S
c. The employer does not contest HOSPITAL, I.D.)
such findings nor raise issues b. The power to order compliance
which cannot be resolved without with labor standards provisions
considering evidentiary matters may not be exercised where the
that are not verifiable in the employer contests or questions
normal course of inspection. the findings of labor enforcement
(SSK PARTS CORP. v. CAMUS, officers and raises issues which
G.R. No. 85934, JANUARY cannot be determined without
1990) taking into consideration
evidentiary matters that are not
Enforcement Power on Health and verifiable in the normal course of
Safety of Workers inspection. (BROKENSHIRE v.
Stoppage of work or suspension of HON. MINISTER OF LABOR
operations of any unit or department AND EMPLOYMENT, G.R. No.
of any establishment may be ordered 74621, FEBRUARY 1990)
if there exists in the workplace a
condition that poses grave and

Power to Review Enforcement adjudicatory powers, that is, the
Order power to try and decide, or hear or
The Sec. of Labor, at his own determine any claim for recovery of
initiative or upon request of the wages, simple (small) money claims,
employer, may review the order of and other benefits. (BROKENSHIRE
the Regional Director. (IRR OF THE v. HON. MINISTER OF LABOR AND
LABOR CODE, SEC. 4, RULE X) EMPLOYMENT, I.D.)
Interference, Injunctions Requisites of Exercise of

Prohibited Adjudicatory Powers
It is unlawful for any person or entity a. The claim is filed by an employee
to obstruct, impede, delay or or person employed in domestic
otherwise render ineffective the or household service, or a
exercise of enforcement power by domestic worker;
the Sec. of Labor or his duly b. The claim arises from employer-
authorized representatives. employee relations;
c. The claimant, no longer being
Inferior courts or entities are likewise employed, does not seek
prohibited from issuing temporary or reinstatement; and
permanent injunctions or TRO’s, and d. The aggregate money claim,
from assuming jurisdiction over any including legal interest, of each
case involving enforcement orders employee or domestic worker
issued in accordance with the Labor does not exceed P5,000.
Code. (IRR OF THE LABOR CODE, (GUIANG PLANTATION v. SEC.
SEC. 5, RULE X) OF LABOR, G.R. No. 99294,
AUGUST 1992)
Adjudicatory Power of the Prescriptive Period for Filing
Regional Director Money Claims
The Regional Director of the Money claims arising from employer-
Department of Labor and employee relationship accruing
Employment is conferred with during te effectivity of the Labor

Code shall be filed within 3 years institutions, except to the Government
from the time the cause of action and to government-owned or controlled
accrues, otherwise, they shall be corporations and to employers of

household helpers and persons in their
barred forever. (R.A. 6715, ART,
personal service insofar as such
306)
workers are concerned.
TITLE III- WORKING

A. DISCRIMINATION
CONDITIONS FOR SPECIAL Art. 133. Discrimination
GROUPS OF EMPLOYEES prohibited. – It shall be unlawful for
any employer to discriminate against
Chapter I – Employment of any woman employee with respect to

terms and conditions of employment
Women
solely on account of her sex.
Sec. 14, Art. II, 1987 Constitution. The
State recognizes the role of women in
The following are acts of
nation-building, and shall ensure the
fundamental equality before the law of discrimination:
women and men. 1. Payment of a lesser
compensation, including wage,
Sec. 14, Art. XIII, 1987 Constitution. salary or other form of
The State shall protect working women remuneration and fringe benefits,
by providing safe and healthful working to female employees as against a
conditions, taking into account their male employee, for work of equal
maternal functions, and such facilities
value; and
and opportunities that will enhance their
2. Favoring a male employee over a
welfare and enable them to realize their
female employee with respect to
full potential in the service of the nation.
promotion, training opportunities,
study and scholarship grants
Sec. 1, Rule XII, Book III, IRR. General
solely on account of their sexes.
Statement on Coverage. – This Rule
shall apply to all employers, whether a. Person guilty of committing
operating for profit or not, including these acts are criminally
educational, religious and charitable

liable under Arts. 288-289 of instruments consistent with Philippine
the Labor Code. law. The State shall accord women the
b. That the Institution of any rights, protection, and opportunities

available to every member of society.
criminal action under this
provision shall not bar the
Sec. 12, Magna Carta of Women.
aggrieved employee from
Equal Treatment Before the Law. - The
filing an entirely separate
State shall take steps to review and,
and distinct action· for
when necessary, amend and/or repeal
money claims, which may existing laws that are discriminatory to
include claims for damages women within three (3) years from the
and other affirmative reliefs. effectivity of this Act.
The actions hereby
authorized shall proceed B. STIPULATION AGAINST
independently of each other. MARRIAGE [Art. 134; Sec. 13(e),
3. Favoring a male applicant with rule XII]
respect to hiring where the It shall be unlawful for an employer
particular job can equally be to:
handled by a woman; and 1. require as a condition of
4. Favoring a male employee over a employment or continuation of
female employee with respect to employment that a woman
dismissal of personnel employee shall not get married,
or
Par. 2, Sec. 2, Magna Carta of 2. stipulate expressly or tacitly that
Women. – The State condemns upon getting married a woman
discrimination against women in all its
employee shall be deemed
forms and pursues by all appropriate
resigned or separated or
means and without delay the policy of
3. actually dismiss, discharge,
eliminating discrimination against
discriminate or otherwise
women in keeping with the Convention
prejudice a woman employee
on the Elimination of All Forms of
Discrimination Against Women merely by reason of her
(CEDAW) and other international marriage. [Art. 134] [Duncan

Assoc of Detailman – PTGWO v. already employed by the
Glaxo Wellcome, G.R. No. company.
162994 (2004)] b. In case of two of our employees
(both singles [sic], one male
Jurisprudence: Stipulations on and another female) developed
Marriage a friendly relationship during the
1. Philippine Telegraph and course of their employment and
Telephone Company v. NLRC then decided. to get married,
(G.R, No. 118978, 1997). It was one of them should resign to
declared here that the company preserve the policy stated
policy of not accepting or considering above.
as disqualified from work any woman
worker who contracts marriage runs 3. Duncan Association of
afoul of the test of, and the right Detailman-PTGWO ~· Glaxo
against, discrimination afforded all Welcome Philippines, Inc (G.R.
women workers by our labor laws No. 162994, Sept. 17, 2004). In this
and by no less than the Constitution. case, the prohibition against
marriage embodied in the following
2. Star Paper Corp. v. Simbol, stipulation in the employment
{G.R. No. 164774, 2006). The contract was held as valid: "10. You
following policies were struck down agree to disclose to management
as invalid for violating the standard any existing or future relationship
of reasonableness which is being you may have, either by
followed in our jurisdiction, otherwise consanguinity or affinity with co-
called the "Reasonable Business employees or employees of
Necessity Rule": competing drug companies. Should it
a. New applicants will not be pose a possible conflict of interest in
allowed to be hired if in case management discretion, you agree
he/she has [a] relative, up to to resign voluntarily from the
[the) 3rd degree of relationship, Company as a matter of Company
policy?”

The Supreme Court ruled that reason for it. It forces Cadiz to marry
the dismissal based on this for economic reasons and deprives
stipulation in the employment her of the freedom to choose her
contract is a valid exercise of status, which is a privilege that
management prerogative. The inheres in her as an intangible and
prohibition against personal or inalienable right. While a marriage or
marital relationships with employees no-marriage qualification may be
of competitor companies upon its justified as a "bona fide occupational
employees was held reasonable qualification," Brent must prove two
under the circumstances because factors necessitating its imposition,
relationships of that nature might viz: (1) that the employment
compromise the interests of the qualification is reasonably related to
company. In laying down the the essential operation of the job
assailed company policy, the involved; and (2) that there is a
employer only aims to protect its factual basis for believing that all or
interests against the possibility that a substantially all persons meeting the
competitor company will gain access qualification would be unable to
to its secrets and procedures. properly perform the duties of the
With particular regard to job. Brent has not shown the
women, Republic Act No. 9710 or presence of neither of these factors.
the Magna Carta of Women protects Perforce, the Court cannot uphold
women against discrimination in all the validity of said condition [Capin-
matters relating to marriage and Cadiz v. Brent Hospital and
family relations, including the right to Colleges, Inc., G.R. No. 187417
choose freely a spouse and to enter (2016)].
into marriage only with their free and
full consent. Weighed against these Bona fide occupational
safeguards, it becomes apparent qualification exception
that Brent's (employer) condition is When the employer can prove that
coercive, oppressive, and the reasonable demands of the
discriminatory. There is no rhyme or business require a distinction based

on marital status and there is no of Labor and Employment, shall be
better available or acceptable policy considered as an employee of such
which would better accomplish the establishment for purposes of labor
business purpose, an employer may and social legislation. (Labor Code,
discriminate against an employee Art. 138)
based in the identity of the EE’s
spouse. [Star Paper Corp. v. Simbol, C. PROHIBITED ACTS [Art. 135]
G.R. No. 164774 2006] 1. Discharge to prevent
enjoyment of benefits. To deny
The Court sustained the validity of any woman employee the
employer policy prohibiting an benefits provided for in this
employee from having a personal or Chapter or to discharge any
marital relationship with an employee woman employed by him for the
of a competitor. The prohibition was purpose of preventing her from
reasonable under the circumstances enjoying any of the benefits
because relationships of such nature provided under this Code. [Art.
might compromise the interests of 135 (1)]
the company. [Duncan Association
of Detailmen v. Glaxo Wellcome, 2. Discharge on account of
G.R. No. 162994, 2004] pregnancy.
To discharge such woman on
Classification of Certain Women account of her pregnancy, while
Workers on leave or in confinement due to
Any woman who is permitted or her pregnancy. [Art. 135 (2)]
suffered to work, with or without
compensation, in any night club, 3. Discharge or refusal the
cocktail lounge, massage clinic, bar admission of work. To
or similar establishments under the discharge or refuse the
effective control or supervision of the admission of such woman upon
employer for a substantial period of returning to her work for fear that
time as determined by the Secretary

she may again be pregnant. [Art. Sec. 3, RA 7877. Work, Education
137 (3)]. or Training - Related, Sexual
Harassment Defined. – Work,
4. Discharge on account of education or training-related sexual
testimony. harassment is committed by an
To discharge any woman or child employer, employee, manager,
or any other employee for having supervisor, agent of the employer,
filed a complaint or having teacher, instructor, professor, coach,
testified or being about to testify trainor, or any other person who,
under the Code [Sec. 13 (d), Rule having authority, influence or moral
XII, Book III, IRR] ascendancy over another in a work
or training or education environment,
5. Expulsion of women demands, requests or otherwise
faculty/female student due to requires any sexual favor from the
pregnancy outside of marriage other, regardless of whether the
Expulsion and non-readmission demand, request or requirement for
of women faculty due to submission is accepted by the object
pregnancy outside of marriage of said Act.
shall be outlawed. No school
shall turn out or refuse admission Forms of Sexual Harassment
to a female student solely on the 1. Employment or Work Related
account of her having contracted a. The sexual favor is made as a
pregnancy outside of marriage condition
during her term in school. [Sec. i. in the hiring or in the
13(c), RA 9710] employment, reemployment
or continued employment of
D. SEXUAL HARASSMENT [RA said individual or
7877 - Anti-Sexual Harassment ii. in granting said individual
Act of 1995] favorable compensation,
terms, conditions,
promotions, or privileges, or

iii. in the refusal to grant the of a passing grade, or the
sexual favor results in granting of honors and
limiting, segregating or scholarships, or the payment of
classifying the EE which in a stipend, allowance or other
any way would discriminate, benefits, privileges, or
deprive or diminish considerations; or
employment opportunities or d. When the sexual advances
otherwise adversely affect result in an intimidating, hostile
said employee; or offensive environment for the
b. The above acts would either: result, trainee or apprentice.
i. impair the employee’s rights
or privileges under existing Persons who may be liable
labor laws; or 1. Any employer, employee,
ii. result in an intimidating, manager, supervisor, agent of the
hostile, or offensive employer, teacher, instructor,
environment for the professor, coach, trainer or any
employee. other person, regardless of
whether the demand, request for
2. Education or Training requirement for submission is
environment. In an education or accepted by the object of said act
training environment, sexual having authority, influence or
harassment is committed: moral ascendancy over
a. Against one who is under the another in a work or training or
care, custody or supervision of education environment, who
the offender demands, requests or
b. Against one whose education, otherwise requires any sexual
training, apprenticeship or favor from another,
tutorship is entrusted to the 2. Any person who directs or
offender; induces another to commit any
c. When the sexual favor is act of sexual harassment as
made a condition to the giving herein defined. OR

3. Any person who cooperates in It is also not essential that the
the commission by another demand, request, or requirement be
without which it would NOT have made as a condition for continued
been committed, shall also be employment or for promotion to a
held liable under this Act [Sec. 3, hinher position. It is enough that the
RA 7877] offender's acts result in creating an
intimidating, hostile, or offensive
It is not necessary that the demand, environment for the employee.
request or requirement of a sexual (Domingo v. Rayala, G.R. No.
favor be articulated in a categorical 155831, 2008)
oral or written statement. It may be
discerned, with equal certitude, from Work-Related/Employment
the acts of the offender. [Domingo v. Environment, Sexual Harassment
Rayala, G.R. No. 155831 (2008)] Committed When
1. The sexual favor is made as a
How Committed condition:
Person liable demands, requests, or a. In hiring or ln the employment,
otherwise requires any sexual favor reemployment or continued
from the other, · regardless of employment of said individual
whether the demand, request or b. In granting said individual
requirement for submission is favorable compensation, terms,
accepted by the latter. conditions, promotions or
It is not necessary that a privileges
demand, request or requirement of c. The refusal to grant the
sexual favor be articulated in a sexual favor results in limiting,
categorical oral or written statement. segregating or classifying the
It may be discerned, with equal employee which in any way ·
certitude; from acts of the offender. would discriminate, deprive or
(Domingo v. Rayala, G.R. No. diminish employment
155831, 2008). opportunities or otherwise
adversely affect said employee

2. The above acts would impair the Sec. 5, RA 7877. – He shall be
employee's rights or privileges solidarily liable for damages:
under existing labor laws; 1. if he is informed of such acts by
3. The above acts would result in an the offended party; and
intimidating, hostile or offensive 2. no immediate action is taken
environment for the employee. thereon.
(Sec. 3[a])
Independent Action for Damages
Education or Training Sec. 6, RA 7877. – The victim of
Environment, Sexual Harassment work, education or training-related
Committed When sexual harassment can institute a
1. The sexual favor is made as a separate and independent action for
condition: damages and other affirmative relief.
2. The above acts would impair the
employee's rights or privileges Sanctions
under existing labor laws. Criminal: imprisonment of 1 month to
3. The above acts would result in an mos. Or fine of P10k to P20k or both
intimidating, hostile or offensive
environment for the employee. Prescription of such action is in 3
(Sec: 3[a]) years.
Role of the employer or Head of Termination

Office As a managerial employee,
Sec. 4, RA 7877. – The Employer or petitioner is bound by more exacting
Head of Office shall have the duty: work ethics. When such moral
1. to prevent the commission of perversity is perpetuated against his
such acts and subordinate, he provides a justifiable
2. to lay down the procedure for the ground for his dismissal for lack of
resolution, settlement or trust and confidence. It is the right,
prosecution of committed acts. nay the duty of every employer to
protect its employees from

oversexed superiors. [Sec. 7, RA them as mere occupational hazards.
7877] [Libres v. NLRC, G.R. No. [Phil. Aelous Automotive United
1237371999] Corp. v. NLRC, G.R. No. 124617
The gravamen of the offense (2000)]
in sexual harassment is not the
violation of the employee's sexuality Facilities for Women
but the abuse of power by the The DOLE Secretary may require
employer. Any employee, male or employers to:
female, may rightfully cry "foul"  Provide seats proper for women
provided the claim is well and permit them to use such seats
substantiated. Strictly speaking, when they are free from work and
there is no time period within which during working hours, provided
he or she is expected to complain they can perform their duties in this
through the proper channels. The position without detriment to
time to do so may vary depending efficiency
upon the needs, circumstances, and  Establish separate toilet rooms and
more importantly, the emotional lavatories for men and women and
threshold of the employee. provide at least a dressing room for
Not many women are made of women
the stuff that can endure the agony  Establish a nursery in a workplace
and trauma of a public, even for the benefit of the women
corporate, scandal. If petitioner- employees therein
corporation had not issued the third  Determine appropriate minimum
memorandum that terminated the age and other standards for
services of private respondent, we retirement or termination in special
could only speculate how much occupations such as those of flight
longer she would keep her silence. attendants and the like (Labor
Perhaps, to private respondent's Code, Art. 132)
mind, for as long as she could outwit
her employer's ploys she would Family Planning Services;
continue on her job and consider Incentives for Family Planning

Employers who habitually employ General Rule: Children below 15
more than 200 workers in any shall NOT be employed.
locality shall provide free family: Exception (Employment of Children)
planning services to their employees Children below fifteen (15) years of
and their spouses which shall age shall not be employed except:
include but not limited to, the a. When a child works directly under
application or use of contraceptives the sole responsibility of his/her
(Labor Code, Art. 134) parents or legal guardian and
where only members of his/her
family are employed: Provided,
however, That his/her
Chapter II – Employment of employment neither endangers
Minors his/her life, safety, health, and

morals, nor impairs his/her
Relevant Laws: RA 7610 (Special
normal development: Provided,
Protection of Children Against
further, That the parent or legal
Abuse, Exploitation and
guardian shall provide the said
Discrimination Act), RA 9231
child with the prescribed primary
(Special Protection of Children
and/or secondary education; or
Against Child Abuse, Exploitation
b. Where a child's employment or
and Discrimination Act), Art. 137(a).
participation in public
entertainment or information
Constitutional basis
through cinema, theater, radio,
The State recognizes the vital role of
television or other forms of media
the youth in nation-building and shall
is essential: Provided, That the
promote and protect their physical,
employment contract is
moral, spiritual, intellectual, and
concluded by the child's parents
social wellbeing. It shall inculcate in
or legal guardian, with the
the youth patriotism and nationalism,
express agreement of the child
and encourage their involvement in
concerned, if possible, and the
public and civic affairs. [Sec. 13, Art.
approval of the Department of
II, 1987 Constitution]

Labor and Employment: shall ensure observance of the
Provided, further, That the above requirements.
following requirements in all For purposes of this Article,
instances are strictly complied the term "child" shall apply to all
with: persons under eighteen (18) years of
i. The employer shall ensure the age. [Sec 2, RA 9231]
protection, health, safety,
morals and normal Children - refers to any person
development of the child; under 18 years of age or those over
ii. The employer shall institute but are unable to fully take care of
measures to prevent the themselves or protect themselves
child's exploitation or from abuse, neglect, cruelty,
discrimination taking into exploitation or discrimination
account the system and level because of a physical or mental
of remuneration, and the disability or condition. [Sec. 2, RA
duration and arrangement of 7610]
working time; and
iii. The employer shall formulate Child labor - refers to any work or
and implement, subject to the economic activity performed by a
approval and supervision of child that subjects him/her to any
competent authorities, a form of exploitation or is harmful to
continuing program for his/her health and safety or physical,
training and skills acquisition mental or psychosocial development.
of the child.
In the above-exceptional cases Working child - refers to any child
where any such child may be engaged as follows:
employed, the employer shall first a. when the child is below eighteen
secure, before engaging such child, (18) years of age, in work or
a work permit from the Department economic activity that is not child
of Labor and Employment which labor as defined in the

immediately preceding b. Child’s employment or
subparagraph; and participation in public
b. when the child is below fifteen entertainment or information
(15) years of age, in work where through cinema, theater, radio or
he/she is directly under the television is essential, provided
responsibility of his/her parents or that [Sec. 12 of RA 7610, as
legal guardian and where only amended by RA 7658]:
members of the child ‘s family are i. employment does NOT
employed; or in public involve ads or commercials
entertainment or information. promoting alcohol, tobacco
[Sec. 3, D.O. No. 65-04] and its by-products or
violence [Sec. 14, RA 7610]
Exceptions ii. the employment contract is
a. Child works directly under the concluded by the child’s
sole responsibility of his parents parents or guardian, and
or legal guardian and where only approved by DOLE
members of the employer’s family iii. The ER shall ensure the
are employed, provided: protection, health, safety and
i. his employment does NOT morals of the child
endanger his life, safety, iv. The ER shall institute
health and morals, measures to prevent the
ii. nor impairs his normal child’s exploitation or
development, and discrimination taking into
iii. the parent or legal guardian account the system and level
shall provide the said minor of remuneration, and the
child with the prescribed duration and arrangement of
primary and/or secondary working time
education; [Sec. 12 of RA v. The ER shall formulate and
7610, as amended by RA implement, subject to the
7658] approval and supervision of
competent authorities, a

continuing program for a. All forms of slavery, as defined
training and skills acquisition under the "Antitrafficking in
of the child. [Sec. 12 of RA Persons Act of 2003", or
7610, as amended by RA practices similar to slavery such
7658] as sale and trafficking of children,
debt bondage and serfdom and
Employment of Children from 15 forced or compulsory labor,
to 18 including recruitment of children
Employment is allowed even without for use in armed conflict; or
permit but restricted to non- b. The use, procuring, offering or
hazardous work. exposing of a child for
prostitution, for the production of
Non-hazardous work shall mean pornography or for pornographic
any work or activity in which the EE performances; or
is not exposed to any risk which c. The use, procuring or offering of
constitutes an imminent danger to a child for illegal or illicit activities,
his safety and health. [Sec. 3, Rule including the production and
XII, Book III, IRR] trafficking of dangerous drugs
and volatile substances
The Secretary of Labor shall from prohibited under existing laws; or
time to time publish a list of d. Work which, by its nature or the
hazardous work and activities in circumstances in which it is
which persons 18 years of age and carried out, is hazardous or likely
below cannot be employed [Sec. 3, to be harmful to the health, safety
Rule XII, Book III, IRR] or morals of children, such that it:
i. Debases, degrades or
The following are HAZARDOUS demeans the intrinsic worth
workplaces: DO 149-16 as and dignity of a child as a
amended by DO 149-A-17, Sec. 6 human being; or
Worst Forms of Child Labor ii. Exposes the child to physical,
emotional or sexual abuse, or

is found to be highly stressful vii. Is performed under
psychologically or may particularly difficult conditions;
prejudice morals; or or
iii. Is performed underground, viii. Exposes the child to biological
underwater or at dangerous agents such as bacteria,
heights; or fungi, viruses, protozoans,
iv. Involves the use of dangerous nematodes and other
machinery, equipment and parasites; or
tools such as power-driven or ix. Involves the manufacture or
explosive power-actuated handling of explosives and
tools; or other pyrotechnic products
v. Exposes the child to physical [Sec. 12-D, RA 9231 as
danger such as, but not amended].
limited to the dangerous feats
of balancing, physical strength Working Hours of a Child
or contortion, or which Quantity
requires the manual transport Age Daily Weekly
of heavy loads; or Bracket Max Max
vi. Is performed in an unhealthy Below 15 4 hrs. 20 hrs.
15 to 8 hrs. 40 hrs.
environment exposing the below 18
child to hazardous working
conditions, elements, Night work prohibition
substances, co-agents or Age Prohibited Hours
processes involving ionizing, Bracket

Below 15 8 pm to 6 am (10
radiation, fire, flammable hrs.)
substances, noxious 15 to 10 pm to 6 am (8
below 18 hrs.)
components and the like, or to
extreme temperatures, noise Discrimination
levels, or vibrations; or No employer shall discriminate
against any person in respect to

terms and conditions of employment or laundry person. [Sec 4(d), RA
on account of his age. [Art. 138] 10361]
Chapter III – Employment of The term domestic worker or
House-helpers “kasambahay” excludes any person

who performs domestic work only
Relevant Law: RA 10361 (Batas
occasionally or sporadically and not
Kasambahay or Domestic Worker’s
on an occupational basis. [Sec.4(d),
Act)
RA 10361]
Note: RA 10361 has expressly
repealed Chapter III, “Employment of
Note: IRR, Sec. 2 does not include
Househelpers”, Title III, Book III of
family drivers. See previous
the Labor Code
discussion on domestic workers.
See also discussion under III. A. 1.
Domestic work - This refers to work
e. Domestic workers.
performed in or for a household or
households. [Sec 4(c)., RA 10361]
Minimum wage
Sec. 24, RA 10361. Minimum
Household - refers to the immediate
Wage. – The minimum wage of
members of the family or the
domestic workers shall not be less
occupants of the house that are
than the following:
directly provided services by the
a. P2,500 a month for those
domestic worker. [Sec 4(f), RA
employed in NCR
10361]
b. P2,000 a month for those
employed in chartered cities and
Domestic worker or
first class municipalities
“Kasambahay” - Refers to any
c. P1,500 a month for those
person engaged in domestic work
employed in other municipalities
within an employment relationship
such as, but not limited to, the
Within one year from the effectivity of
following: general househelp,
the Act, and periodically thereafter,
nursemaid or “yaya”, cook, gardener,

the Regional Tripartite and Respect for the privacy of the
Productivity Wage Boards shall domestic worker shall be guaranteed
review, and if proper, determine and at all times and shall extend to all
adjust the minimum wage rates of forms of communication and
domestic workers. personal effects [Sec. 7, RA 10361]
Standard of Treatment Access to Outside

The employer or any member of the Communication
household shall not subject a The employer shall grant the
domestic worker or “kasambahay” to domestic worker access to outside
any kind of abuse nor inflict any form communication during free time:
of physical violence or harassment Provided, That in case of
or any act tending to degrade the emergency, access to
dignity of a domestic worker. [Sec. 5, communication shall be granted
RA 10361] even during work time. [Sec. 8, RA
10361]
Board, Lodging and Medical
Attendance Education and Training
The employer shall provide for the The employer shall afford the
basic necessities of the domestic domestic worker the opportunity to
worker to include at least three (3) finish basic education and may allow
adequate meals a day and humane access to alternative learning
sleeping arrangements that ensure systems and, as far as practicable,
safety and shall provide appropriate higher education or technical and
rest and assistance to the domestic vocational training. [Sec. 9, RA
worker in case of illnesses and 10361]
injuries sustained during service
without loss of benefits. [Sec. 6, RA Social and Other Benefits
10361] A domestic worker who has
rendered at least one (1) month of
Privacy service shall be covered by the

Social Security System (SSS), the Prior to the execution of the
Philippine Health Insurance employment contract, the employer
Corporation (PhilHealth), and the may require the following from the
Home Development Mutual Fund or domestic worker:
Pag-IBIG, and shall be entitled to all a. Medical certificate or a health
the benefits in accordance with the certificate issued by a local
pertinent provisions provided by law. government health officer;
b. Barangay and police clearance;
Leave Benefits c. National Bureau of Investigation
A domestic worker who has (NBI) clearance; and
rendered at least one (1) year of d. Duly authenticated birth
service shall be entitled to an annual certificate or if not available, any
service incentive leave of five (5) other document showing the age
days with pay [Sec. 29, RA 10361] of the domestic worker such as
voter’s identification card,
Rest Periods baptismal record or passport.
Daily Rest Period: 8 hours However, Sec. 12(a), (b), (c) and (d)
Weekly Rest Period: at least 24 shall be standard requirements when
consecutive hours. The employer the employment of the domestic
and employee may agree to: worker is facilitated through the PEA.
a. Offsetting a day of absence with The cost of the foregoing shall be
a particular rest day; borne by the prospective employer
b. Waiving a particular rest day in or agency, as the case may be. [Sec.
return for an equivalent daily rate 12, RA 10361]
of pay;
c. Accumulating rest days not Pre-Employment Prohibition
exceeding five (5) days; or Regardless of whether the domestic
d. Other similar arrangements. [Sec. worker was hired through a private
20,21, RA 10361] employment agency or a third party,
no share in the recruitment or
Pre-Employment Requirement finder’s fees shall be charged

against the domestic worker by the than the cash wage as provided for
said private employment agency or under this Act. [Sec. 25, RA 10361]
third party. [Sec. 13, RA 10361]
Pay slip
It is unlawful for the employer or any The employer shall at all times
other person to require a domestic provide the domestic worker with a
worker to make deposits from which copy of the pay slip containing the
deductions shall be made for the amount paid in cash every pay day,
reimbursement of loss or damage to and indicating all deductions made, if
tools, materials, furniture and any. The copies of the pay slip shall
equipment in the household. [Sec. be kept by the employer for a period
14, RA 10361] of three (3) years. [Sec. 26, RA
It shall be unlawful for the employer 10361]
or any person acting on behalf of the
employer to place the domestic Wage Prohibitions
worker under debt bondage. [Sec. It shall be unlawful for the original
15, RA 10361] employer to charge any amount from
the said household where the
Time and Manner of Payment service of the domestic worker was
Payment of wages shall be made on temporarily performed. [Sec. 23, RA
time directly to the domestic worker 10361]
in cash at least once a month and
unless allowed by the domestic Other than that which is mandated
worker through a written consent, by law, the employer shall make no
employer shall make no deductions deductions from the wages unless
from the wages other than that which allowed by the domestic worker
is mandated by law. No employer through a written consent. [Sec. 25,
shall pay the wages of a domestic RA 10361]
worker by means of promissory
notes, vouchers, coupons, tokens, Other Prohibited Acts
tickets, chits, or any object other

a. Interference in employee’s wage Employment Certification: ER shall
disposal [Sec. 27, RA 10361] give the househelper a written
b. Direct or indirect withholding of statement of the nature and duration
wages by the employer [Sec. 28, of the service and his or her work
RA 10361] performance as househelper upon
c. Payment in forms other than cash severance. [Sec. 35, RA 10361]
[Sec. 25, RA 10361]
Termination
Right against assignment to non- a. Initiated by the domestic
household work at a wage rate worker
lower than that mandated for The domestic worker may
agricultural or non-agricultural terminate the employment
enterprises depending on the case. relationship at any time before
[Sec. 22, RA 10361] the expiration of the employment
contract for any of the following
Employment Age of Domestic causes:
Workers: Unlawful to employ any i. Verbal or emotional abuse of
person below fifteen (15) years of the domestic worker by the
age as a domestic worker [Sec. 16, employer or any member of
RA 10361] the household;
ii. Inhuman treatment including
Persons between 15-18 years old physical abuse of the
should only be employed in non- domestic worker by the
hazardous work. [D.O. No. 4-99 Sec. employer or any member of
4] the household;
iii. Commission of a crime or
Daily Rest Period: Aggregate of offense against the domestic
eight (8) hours per day. [Sec. 20, RA worker by the employer or any
10361] member of the household;
iv. Violation by the employer of
the terms and conditions of

the employment contract and iv. Commission of a crime
other standards set forth or offense by the
under this law; domestic worker
v. Any disease prejudicial to the against the person of
health of the domestic worker, the employer or any
the employer, or member/s of immediate member of
the household; and the employer’s family;
vi. Other causes analogous to v. Violation by the
the foregoing. [Sec. 33, RA domestic worker of the
10361] terms and conditions of
the employment
b. Initiated by the employer contract and other
An employer may terminate the standards set forth
services of the domestic worker under this law;
at any time before the expiration vi. Any disease prejudicial
of the contract, for any of the to the health of the
following causes: domestic worker, the
i. Misconduct or willful employer, or member/s
disobedience by the domestic of the household; and
worker of the lawful order of vii. Other causes
the employer in connection analogous to the
with the former’s work; foregoing. [Sec. 34, RA
ii. Gross or habitual 10361]
neglect or inefficiency
by the domestic worker Employment Certification
in the performance of Upon the severance of the
duties; employment relationship, the
iii. Fraud or willful breach employer shall issue the domestic
of the trust reposed by worker within five (5) days from
the employer on the request a certificate of employment
domestic worker; indicating the nature, duration of the

service and work performance [Sec. Notice to end the working
35, RA 10361]. relationship If the duration of the
domestic service is not determined
Unjust dismissal either in stipulation or by the nature
Neither the domestic worker nor the of the service, the employer or the
employer may terminate the contract domestic worker may give notice to
before the expiration of the term end the working relationship five (5)
except for grounds provided in Secs. days before the intended termination
33 and 34 of RA 10361. of the service.
The domestic worker and the
If the domestic worker is unjustly employer may mutually agree upon
dismissed, the domestic worker shall written notice to pre-terminate the
be paid the compensation already contract of employment to end the
earned plus the equivalent of 15 employment relationship. [Sec. 32,
days work by way of indemnity [Sec. RA 10361]
32, RA 10361].
Leaving without justifiable reason

by the domestic worker Chapter IV – Employment of
a. any unpaid salary due not Homeworkers
exceeding the equivalent 15 days
Note: D.O. No. 5, DOLE (February 4,
work shall be forfeited AND
1992), is now Rule XIV, Book III of
b. the employer may recover from
the IRR.
the domestic worker the costs
incurred related to the
Homeworker applies to any person
deployment expenses, if any:
who performs industrial homework
Provided, that the service has
for an employer, contractor or
been terminated within 6 months
subcontractor
from the domestic worker’s
employment [Sec. 32, RA 10361].
Industrial homework

a. Is a system of production under fabricated in or about a home and
which work for an employer or then rebuys them after. [Art. 153]
contractor is carried out by a Note: Sec. 2(d), Rule XIV, Book III is
homeworker at his/her home. substantially similar to the above.
Materials may or may not be
furnished by the employer or Rights and benefits accorded
contractor. homeworkers
b. Decentralized form of production, a. Right to form, join or assist
where there is ordinarily very little organizations [Sec. 3, Rule XIV,
supervision or regulation of Book III, IRR]
methods of work. [Sec. 2(a), Rule b. Right to acquire legal personality
XIV, Book III, IRR] and the rights and privileges
granted by law to legitimate labor
Industrial Homeworker - a worker organizations upon issuance of
who is engaged in industrial the certification of registration
homework [Sec. 4, Rule XIV, Book III, IRR]
c. Immediate payment upon
Employer means any natural or employer’s receipt of finished
artificial person who goods or articles [Sec. 6, Rule
a. Acts as a contractor or XIV, Book III, IRR]
subcontractor – delivers or d. SSS, MEDICARE and ECC
causes to be delivered any premium contributions shall be
goods, articles, or materials to be deducted from their pay and shall
processed or fabricated in or be remitted by
about a home and thereafter to ER/contractor/subcontractor to
be returned or to be disposed of the SSS [Sec. 6, Rule XIV, Book
or distributed in accordance with III, IRR]
employer’s direction; OR
b. Sells any goods, articles, or Liability of Employer
materials to be processed or a. Employer may require
homeworker to redo work

improperly executed without substances. [Sec. 13, Rule XIV,
additional pay [Sec. 9(a), Rule Book III, IRR]
XIV, Book III, IRR]
b. Employer need not pay Deductions
homeworker for any work done No deduction from the homeworker’s
on goods or articles not returned earnings for the value of materials
due to homeworker’s fault [Sec. lost, destroyed or damaged unless:
9(b), Rule XIV, Book III, IRR] a. Homeworker is clearly shown to
c. If subcontractor/contractor fails to be responsible for loss or
pay homeworker, employer is damage
jointly and severally liable with b. Reasonable opportunity to be
the former to the homeworker for heard
his/her wage [Sec . 11, Rule XIV, c. Amount of deduction is fair and
Book III, IRR] reasonable, and does not exceed
d. Employer shall assist the actual loss or damage
homeworkers in the maintenance d. Deduction does not exceed 20%
of basic safe and healthful of homeworker’s weekly earnings
working conditions at the [Sec. 8, Rule XIV, Book III, IRR]
homeworkers’ place of work.
[Sec. 11, Rule XIV, Book III, IRR]
Regional Office shall provide Chapter V – Employment of
technical assistance to registered Night Workers
homeworkers’ organizations [Sec.
Night worker
14, Rule XIV, Book III, IRR]
Any employed person whose work
requires performance of a
Prohibited Homework
substantial number of hours of night
a. explosives, fireworks and articles
work which exceed a specified limit.
of like character;
This limit shall be fixed by the Sec of
b. drugs and poisons; and
Labor after consulting the workers’
c. other articles, the processing of
representatives/labor organizations
which requires exposure to toxic

and employers. [Art. 154, as to applicable company policies. [Art.
amended by RA 10151] 155, as amended by RA 10151; Sec.
Any employed person whose 3, Rule XV, Book III, IRR, through
work covers the period from 10 D.O. No. 119-12]
o’clock in the evening to 6 o’clock
the following morning, provided that Mandatory Facilities
the worker performs no less than 7 Mandatory facilities shall be made
consecutive hours of work. [Sec. 2, available for workers performing
Rule XV, Book III, Rule XV, Sec. 2, night work, which include the
IRR, through D.O. No. 119-12] following:
a. Suitable first-aid and emergency
Health Assessment facilities
At the worker’s request, they shall b. Lactation station in required
have the right to undergo a health companies pursuant to RA 10028
assessment without charge and to c. Separate toilet facilities for men &
receive advice on how to reduce or women d. Facility for eating w/
avoid health problems associated potable drinking water; AND
with their work: d. Facilities for transportation and/or
a. Before taking up an assignment properly ventilated temporary
as a night worker sleeping or resting quarters,
b. At regular intervals during such separate for male and female
an assignment workers, shall be provided except
c. If they experience health where any of the ff.
problems during such an circumstances is present:
assignment i. There is an existing company
guideline, practice or policy,
With the exception of a finding of CBA, or any similar
unfitness for night work, the findings agreement providing for an
of such assessments shall be equivalent or superior benefit;
confidential and shall NOT be used or
to their detriment, subject, however,

ii. Start or end of the night work public health authority, they shall
does NOT fall within 12 mn - 5 be granted the same benefits as
am; or other workers who are unable to
iii. Workplace is located in an work due to illness.
area that is accessible 24 c. If workers are certified as
hours to public transportation; temporarily unfit to render night
or work for a period of less than 6
iv. Number of employees does months, they shall be given the
NOT exceed a specified same protection against
number as may be provided dismissal or notice of dismissal
for by the SOLE in as other workers who are
subsequent issuances [Art. prevented from working for health
156, as amended by RA reasons. [Art. 157, as amended
10151; Sec. 4, Rule XV, Book by RA 10151; Sec. 5, Rule XV,
III, IRR, through D.O. No. Book III, IRR, through D.O. No.
119-12] 119-12]
Transfer Women Night Workers

If night worker is unfit for night work Employers shall ensure that
due to health reasons as certified by measures shall be taken to ensure
competent physician, s/he shall be: that an alternative to night work for
a. Transferred in good faith to a job pregnant and nursing employees
for which they are fit to work who would otherwise be called upon
whenever practicable, which to perform such work. Such
must be similar and equivalent measures may include:
position; a. Transfer to day work – As far as
b. If transfer is not practicable, or practicable, pregnant or nursing
workers are unable to render employees shall be assigned to
night work for a continuous day work, before and after
period of not less than 6 months childbirth, for a period of at least
upon certification of a competent sixteen (16) weeks, which shall

be divided between the time Sec. 6, Rule XV, Book III, IRR,
before and after childbirth; through D.O. No. 119-12]
Medical certificate issued by
competent physician CBA provision vis-a-vis overtime
(OB/Gyne/Pedia) is necessary for work
the grant of: CSA may stipulate higher overtime
1. additional periods of pay rate.
assignment to day work The basis of computation of
during pregnancy or after overtime pay beyond · that required
childbirth, provided that such by Art. 87 of the Labor Code must be
shall not be more than 4 the collective agreement, It is not for
weeks or for a longer period the court to impose upon· the parties
as may be agreed upon by anything beyond· what they have
employer and worker; agreed upon which is not tainted with
2. extension of maternity leave; illegality. On the other hand, where
and the parties fail to come to an
3. clearance to render night agreement, on a matter not legally
work. required, the court abuses its
b. Provision of social security discretion when it obliges any of
benefits - in accordance with them to do more than what is legally
provisions of Act No 8282 (Social obliged. (PNB v. PNB Employee's
Security Act of 1997) and other Assoc., G.R. No~ L-30279, 1982)
existing company policy or
collective bargaining agreement. Pregnant Women
c. Extension of maternity leave – Measures shall be taken to ensure
where transfer to day work is not that an alternative to night work is
possible, but requires available to women workers who
recommendation by competent would otherwise be called upon to
physician; without pay or using perform such work –
earned leave credits, if any [Art. 1. Before or after childbirth, for a
158, as amended by RA 10151; period of at least 16 weeks,

which shall be divided between render night, work, and specify the
the time before and after period of the pregnancy that they
childbirth; can safely work.
2. For additional periods in respect The 'measures referred to in
of which a medical certificate is this article may include transfer to
produced stating that said day work where this is possible, the
additional periods are necessary provision of social security benefits
for the health of the mother or the or an extension of maternity leave.
child - a. During pregnancy b. The provisions of this article shall not
Determined by DOLE after have the effect of reducing the
consultation with employer and protection and benefits connected
labor representatives with maternity leave under existing
laws.
During the periods referred to in this
article: MIGRANT WORKERS (R.A. NO.
a. A woman worker shall not be 8042 OR THE MIGRANT
dismissed or given notice of WORKERS AND OVERSEAS
dismissal, except for just or FILIPINOS ACT OF 1995, AS
authorized causes provided for in AMENDED BY R.A. NO. 10022)
this Code that are not connected a) Claims for Compensability of
with pregnancy, childbirth and Work-Related Death, Sickness, or
childcare responsibilities. Disability
b. A woman worker shall not lose Protection against dismissal and
the benefits regarding her status, loss of benefits attached to
seniority, and access to employment status, seniority, and
promotion which may attach to access to promotion
her regular night work position. Where no alternative work can be
Pregnant women are allowed provided to a woman employee who
to work at night only if a competent is not in a position to render night
physician other than the company work, she shall be allowed to go on
physician shall certify their fitness to leave or on extended maternity

leave, using her earned leave illness suffered by a worker during
credits. employment, irrespective of whether
A woman employee shall or not such injury or illness is work-
NOT be dismissed for reasons of connected, before a more extensive
pregnancy, childbirth and childcare medical and/or dental treatment can
responsibilities as defined under this be secured [IRR of Labor Code,
Rule. She shall NOT lose the Book IV, Rule I, Sec. 2(a)]
benefits regarding her employment First-Aider is any person
status, seniority, and access to trained and duly certified as qualified
promotion which may attach to her to administer first-aid by the
regular night work position. [Sec. 8, Philippine National Red Cross or by
Rule XV, Book III, IRR, through D.O. any other organization accredited by
No. 119-12] the former [IRR of Labor Code, Book
IV, Rule I, Sec. 2(c)].
BOOK FOUR – HEALTH, Hazardous Workplaces
SAFETY, AND SOCIAL 1. Where the nature of the work

exposes the workers to
WELFARE BENEFITS
dangerous environmental
elements, contaminants or work
TITLE I – MEDICAL, DENTAL,
conditions including ionizing
AND OCCUPATIONAL radiations, chemicals, fire,
SAFETY flammable substances, noxious
Chapter I – Medical and components and the like;
Dental Services 2. Where the workers are engaged

in construction work, logging, fire-
Article 162: FIRST AID
fighting, mining, quarrying,
TREATMENT
blasting, stevedoring, dock work,
First Aid Treatment refers to an
deep sea fishing and mechanized
adequate, immediate and necessary
farming.
medical and dental attention or
remedy given in case of injury or

3. Where the workers are engaged a. Full-time registered nurse;
in the manufacture or handling of b. Part-time physician;
explosives and other pyrotechnic c. Part-time dentist; and
products. d. Emergency clinic
4. Where the workers use or are 4. 301 and above
exposed to heavy or power- a. Full-time physician;
driven machinery or equipment; b. Full-time dentist;
and c. Full-time registered nurses;
5. Where the workers use or are d. Dental clinic; and
exposed to power-driven tools. e. Infirmary or emergency
hospital with one bed
The Bureau of Labor Standards with capacity for every 100
the approval of the Secretary of employees [IRR of the Labor
Labor shall from time to time issue a Code, Book IV, Rule I, Sec.
detailed list of hazardous workplaces 4]
for purposes of this rule [IRR of the Note: The above provision has been
Labor Code, Book IV, Rule I, Sec.8] amended by D.O. No.198-18
effective December 8, 2018 as
ARTICLE 163: EMERGENCY follows:
MEDICAL AND DENTAL
SERVICES Health Personnel
Emergency Medical and Dental 1. 1-50 Workers
Services Low Risk: 1 First Aider
1. 10-50 Employees Medium to High Risk: 1 First
a. Graduate first-aider Aider
2. 51-200 Employees
a. Hazardous workplace – full- 2. 51-99 Workers
time registered nurse Low Risk: 1 First Aider
b. Non-hazardous workplace – Medium to High Risk
Graduate first-aider a. 1 First Aider
3. 201-300 Employees b. 2 Part-time Nurses

b. 1 Full-time Nurse
3. 10-199 Workers c. 1 Part-time Dentist
Low Risk: d. 2 Part-time Physicians or 1
a. 2 First Aiders Full-time Physician
b. 2 Part-time Nurses
Medium to High Risk: 6. More than 2000 Workers
a. 2 First Aiders Low Risk to High Risk
b. 1 Full-time Nurse a. more than 20 First Aiders
c. 1 Part-time Dentist b. 1 Full-time Nurse per shift
d. 1 Part-time Physician c. Full-time Dentist
d. 2 Part-time Physicians and
4. 200-500 Workers 1 Full-time Physician
Low Risk:
a. 3-5 First Aiders The following additional health
b. 1 Full-time Nurse personnel shall be available for:
c. 1 Part-time Dentist 1. Every 100 workers or a fraction
d. 1 Part-time Physician thereof – 1 First Aider
Medium to High Risk: 2. Every 250 workers or a fraction
a. 3-5 First Aiders thereof – 1 Full-time Nurse
b. 1 Full-time Nurse 3. Every 500 workers or a fraction
c. 1 Part-time Dentist thereof – 1 Full-time Dentist and
d. 2 Part-time Physicians 1 Full-time or 4 Part-time
Physician
5. 501-2000 Workers
Low Risk: For occupational dentist,
a. 6-20 First Aiders establishments can enter into a
b. 1 Full-time Nurse Memorandum of Agreement for
c. 1 Part-time Dentist dental services for workers, provided
d. 2 Part-time Physicians that the requirements for dental
Medium to High Risk: facilities are met.
a. 6-20 First Aiders

Health Establishments a. Additional 1 First aid
1. 1-50 Workers treatment room for every 50
Low Risk to High Risk: 1 First workers or a fraction thereof
aid treatment room b. 2 Beds clinics
2. 51-99 Workers 5. 251-500 Workers

Low Risk: Low Risk:
a. 1 First aid treatment room a. Additional 1 First aid
b. 1 Bed clinic treatment room for every 10
workers or a fraction thereof
3. 100-199 Workers b. 2 Beds clinic
Low Risk: Medium to High Risk
a. Additional 1 First aid a. Additional 1 First aid
treatment room for every treatment room for every 50
100 workers or a fraction workers or a fraction thereof
thereof b. 2 Beds clinics
b. 1 Bed clinic
Medium to High Risk: 6. 501-750 Workers
a. additional 1 First aid Low Risk:
treatment room for every 50 a. Additional 1 First aid
workers or a fraction thereof treatment room for every
b. 2 Beds clinics 100 workers or a fraction
thereof
4. 200-250 Workers b. Additional 1 Bed clinic for
Low Risk: every 250 worker or a
a. Additional 1 First aid fraction thereof, Full time
treatment room for every Medium to High Risk:
100 workers or a fraction a. Additional 1 First and
thereof treatment room for every 50
b. 2 beds clinics workers or a fraction thereof
Medium to High Risk:

b. Additional 1 Bed clinic, for b. Additional 1 Bed clinic for
every 100 worker or a every 250 worker or a
fraction thereof, Full time fraction thereof, Full time
9. c.1 Bed hospital
7. 751-1000 Workers Medium to High Risk:
Low Risk: a. Additional 1 First aid
a. Additional 1 First aid treatment room for every 50
treatment room for every workers or a fraction thereof
100 workers or a fraction b. Additional 1 Bed clinic for
thereof every 100 worker or a
b. Additional 1 Bed clinic for fraction thereof, Full time
every 100 worker or a c. 1 Bed hospital (D.O. No.
fraction thereof, Full time 198 series of 2018; Sec. 15)
c. 1 Bed hospital
Medium to High Risk: Article 164: WHEN EMERGENCY
a. Additional 1 First aid HOSPITAL OR DENTAL CLINIC
treatment room for every 50 NOT REQUIRED
workers or a fraction thereof 1. There is a hospital or dental clinic
b. Additional 1 Bed clinic for within five (5) kilometers from the
every 100 worker or a workplace if situated in any urban
fraction thereof, Full time area or is accessible by motor
d. 1 bed hospital vehicle within 25-minute travel, if
situated in a rural area;
8. 1001-2000 Workers 2. The employer makes for the
Low Risk: reservation therein of the
a. Additional 1 First aid necessary beds and dental
treatment room for every facilities for the use of his
100 workers or a fraction employees.
thereof 3. The employer must provide for
the transport of the worker to the
hospital or clinic in case of

emergency (IRR of the Labor dependents, in the event of work-
Code, Book Iv, Rule I, Sec. 5, connected disability or death, may
D.O. No. 198 series of 2018, Sec. promptly secure adequate income
15). benefit and medical related benefits.
Note: The employer shall enter into a Workmen’s compensation is a

written contract with the hospital or general and comprehensive term
dental clinic for the use thereof in the applied to those laws providing for
treatment of workers in case of compensation for loss resulting from
emergency (IRR of the Labor Code, the injury, disablement, or death of
Book IV, Rule I, Sec. 5) workmen through industrial accident,
casualty, or disease.
Chapter II – Occupational
Health and Safety Difference between the
compensation under workmen’s
The employer is required to observe
compensation and compensation
safety standards and provide safety
under compensatory damages
devices. On the part of the employee
 In workmen’s compensation, it is
proper use of these safeguards and
the money relief afforded according
devices is required (IRR of Labor
to the scale established under the
code, Book IV, Rule II, Sec. 2)
statute
 In compensatory damages, it is
TITLE II – EMPLOYEES
recoverable in an action at law for
COMPENSATION AND
breach of contract or for a tort.
STATE INSURANCE FUND
Chapter I – Policy and How is the amount of
Definitions compensation determined?
Art. 166. Policy. The State shall A. In accordance with a definite
promote and develop a tax-exempt schedule
employees’ compensation program B. Based upon the loss of earning
whereby employees and their power

C. The usual provision being for the A. To improve the economic status
payment of a specified amount at of the workers
regular intervals over a definite B. To obviate the uncertainties,
period delay, expense, and hardship
attendant upon the enforcement
Workmen’s compensation act of court remedies
 Primary purpose: To provide C. To transfer from the worker to the
compensation for disability or death industry in which he is employed,
resulting from occupational injuries and ultimately to the consuming
or diseases, or accidental injury to, public, a greater proportion of the
or death of, employees. It is for the economic loss due to industrial
benefit of injured employees and accidents and injuries
not injured employers. It is not a D. To improve the relations between
charity but a moral duty and the employers and employees by
erection of it into a legal obligation avoiding or reducing the friction
of the public to compensate incident to litigation
reasonably those who are injured E. To provide, not only for
while in the employment of others. employees a remedy which is
 The theory of negligence as the both expeditious and
basis of liability is discarded, and in independent of proof of fault, but
general, a right to compensation is also for employers a liability
given for all injuries incident to the which is limited and determinate
employment, with certain
exceptions, the amount of which is Sources of compensation
limited and determined in It may be divided into two classes:
accordance with a definite A. Direct payment. Provides for the
schedule. payment of the compensation by
the employer directly to the
General purposes of workmen’s employee
compensation B. Insurance statutes. Require the
employer to take out insurance

either with an insurance bureau in certain cases, notice to the
operated by the state or with a employer is not required. Within five
private company, or to contribute days after making the entry, the
to a compensation fund, and if an employer reports to the SSS (in
employee is injured the private sector) or the GSIS (in public
compensation is paid by the sector) the sickness, injury or death
insurer or from the compensation that he deems work connected. In
fund. effect, therefore, the employer
decides initially whether the injury or
The Labor Code adopts the sickness is work related or not.
compensation fund type
All covered employers are required P.D. No. 626 and its effectivity
to remit to a common fund a monthly date
contribution equivalent to one P.D. No. 626 applies only
percent of the monthly salary credit prospectively. Because it took effect
of every covered employee. The on January 1, 1975, it applies to
employee pays no contribution to the illnesses contracted on or after that
fund. The employers’ contribution date. For those contracted before
makes up the State Insurance Fund that date, the applicable law is the
(SIF). From the SIF comes the previous workmen’s compensation
compensation to be paid to claimant act. The old Workmen’s
employee or employee’s dependent Compensation Commission was
in case the employee suffers from a finally abolished on March 31, 1976.
work connected injury or disease.
Validity of P.D. No. 626
When does a claim start? The new law discarded the concepts
A claim starts when a work-related of “presumption of compensability”
injury or disease befalls an and “aggravation” to restore what the
employee. Within five days, he must law believes is a sensible equilibrium
notify his employer who, in turn, between the employer’s obligation to
must enter the notice in a logbook or pay workmen’s compensation and

the employees’ right to receive Social Insurance
reparation for work connected death Employees ‘compensation is based
or disability. on social security principles. All
The new law establishes a covered employers throughout the
slate insurance fund built up by the country are required by law to
contribution of employers based on contribute fixed and regular
the salaries of their employees. The premiums or contributions to a trust
injured worker does not have to fund for their employees. Benefits
litigate his right his right to are paid from this trust fund.
compensation. No employer
opposes his claim. On the other Workmen’s compensation act
hand, the employer’s duty is only to distinguished from employees’
pay the regular monthly premiums to compensation law
the scheme. It does not look for 1. On one hand, Worker’s
insurance companies to meet Compensation Act, there was
sudden demands for compensation presumption of compensability in
demands. which the burden of proof that
illness did not arise out of
Trust Fund employment fell on the
It is now the trust fund and not the employer’s shoulder and the
employer which suffers if benefits employee had no duty to show
are paid to claimants who are not causation. On the other hand, the
entitled under the law. The employer present Labor Code abolished
joins the employee in trying to have the presumption of
their claims approved. compensability and the rule on
It is the government institution aggravation of illness caused by
which protects the stability and the nature of employment in
integrity of the State Insurance Fund order to restore a sensible
(SIF) against the payment of non- equilibrium between the
compensable claims. employer’s obligation to pay
workmen’s compensation and the

employee’s right to receive proof that the risk of contracting
reparation for work connected the same is increased by working
death or disability. conditions.
2. On one hand, the previous law,
the employer should controvert or Presumptive Compensability for
dispute the claim for AFP Members and Policemen
compensation within 14 days Resolution No. 3906 states: “This
from the date of disability or board resolves, as it hereby
within 10 days after he acquired resolves, to approve the adoption of
knowledge. On the other hand, a policy that the moment an AFP
the present Labor Code, the member suffers a contingency, the
employer does not have to presumption is that it is because of
controvert the claim because the the nature of his work; provided
employee’s claim is directed that the evidentiary details of his
against the SIF. injury, or death, are clearly
3. On one hand, the previous law, established through duly issued
the balance was tilted unduly in medical certifications on his injury or
favor of the workmen since it was injuries, or death, by the attending
possible to stretch the work- physician or duly authorized
related nature of an ailment representatives of the hospital where
beyond seemingly rational limits. he is brought for medical treatment.
On the other hand, the present
Labor Code, in order for Interpretation of the law
employee to be entitled to A workmen’s compensation case
sickness or death resulting should be decided not from a
therefrom must be, or must have sympathetic point of view which the
resulted from either (a) any working class well deserves, but in
illness definitely accepted as an accordance with the proven facts
occupational disease listed by the and the law applicable thereto.
Commission, or (b) any illness Where there is doubt, that the
caused by employment subject to deceased was an employee or

laborer, and there is not even a employing the services of the
contractual or judicial relation employee.
between the parties, the claim for g. “Employee” means any
compensation should be denied. person compulsorily covered by
the GSIS under Commonwealth
Art. 167. Definition of terms. Act Numbered One hundred
As used in this Title, unless the eighty-six, as amended, including
context indicates otherwise: the members of the Armed
a. “Code” means the Labor Forces of the Philippines, and
Code of the Philippines instituted any person employed as casual,
under Presidential Decree emergency, temporary, substitute
Numbered four hundred forty- or contractual, or any person
two, as amended. compulsorily covered by the SSS
b. “Commission” means the under Republic Act Numbered
Employees’ Compensation Eleven hundred sixty-one, as
Commission created under this amended.
Title. h. “Person” means any
c. “SSS” means the Social individual, partnership, firm,
Security System created under association, trust, corporation or
Republic Act Numbered Eleven legal representative thereof.
hundred sixty-one, as amended. i. “Dependent” means the
d. “GSIS” means the legitimate, legitimated or legally
Government Service Insurance adopted or acknowledged natural
System created under child who is unmarried, not
Commonwealth Act Numbered gainfully employed, and not over
One hundred eighty-six, as twenty-one (21) years of age or
amended. over twenty-one (21) years of age
e. “System” means the SSS or provided he is incapacitated and
GSIS, as the case may be. incapable of self-support due to a
f. “Employer” means any physical or mental defect which is
person, natural or juridical, congenital or acquired during

minority; the legitimate spouse Commission, or any illness
living with the employee and the caused by employment subject to
parents of said employee wholly proof that the risk of contracting
dependent upon him for regular the same is increased by working
support. conditions. For this purpose, the
j. “Beneficiaries” means the Commission is empowered to
dependent spouse until he/she determine and approve
remarries and dependent occupational diseases and work-
children, who are the primary related illnesses that may be
beneficiaries. In their absence, considered compensable based
the dependent parents and on peculiar hazards of
subject to the restrictions employment.
imposed on dependent children,
the illegitimate children and m. “Death” means loss of life
legitimate descendants, who are resulting from injury or sickness.
the secondary beneficiaries: n. “Disability” means loss or
Provided, That the dependent impairment of a physical or
acknowledged natural child shall mental function resulting from
be considered as a primary injury or sickness.
beneficiary when there are no o. “Compensation” means all
other dependent children who are payments made under this Title
qualified and eligible for monthly for income benefits and medical
income benefit. or related benefits.
k. “Injury” means any harmful p. “Income benefit” means all
change in the human organism payments made under this Title
from any accident arising out of to the providers of medical care,
and in the course of the rehabilitation services and
employment. hospital care.
l. “Sickness” means any illness q. “Medical benefit” means all
definitely accepted as an payments made under this Title
occupational disease listed by the to the providers of medical care,

rehabilitation services and respectively, except that part in
hospital care. excess of Three Thousand
r. “Related benefit” means all Pesos.
payments made under this Title x. “Monthly salary credit” means
for appliances and supplies. the wage or salary base for
s. “Appliances” means crutches, contributions as provided in
artificial aids and other similar Republic Act Numbered Eleven
devices. hundred sixty-one, as amended,
t. “Supplies” means medicine or the wages or salary.
and other medical, dental or y. “Average monthly salary
surgical items. credit” in the case of the SSS
u. “Hospital” means any medical means the result obtained by
facility, government or private, dividing the sum of the monthly
authorized by law, an active salary credits in the sixty-month
member in good standing of the period immediately following the
Philippine Hospital Association semester of death or permanent
and accredited by the disability by sixty (60), except
Commission. where the month of death or
v. “Physician” means any doctor permanent disability falls within
of medicine duly licensed to eighteen (18) calendar months
practice in the Philippines, an from the month of coverage, in
active member in good standing which case, it is the result
of the Philippine Medical obtained by dividing the sum of
Association and accredited by the all monthly salary credits paid
Commission. prior to the month of contingency
w. “Wages” or “Salary”, insofar by the total number of calendar
as they refer to the computation months of coverage in the same
of benefits defined in Republic period.
Act No. 1161, as amended, for z. “Average daily salary credit” in
SSS and Presidential Decree No. the case of the SSS means the
1146, as amended, for GSIS, result obtained by dividing the

sum of the six (6) highest monthly quotient obtained by dividing
salary credits in the twelve-month three hundred by the sum of
period immediately preceding the three hundred forty and the
semester of sickness or injury by average monthly salary credit.
one hundred eighty (180), except dd. “Credited years of service” –
where the month of injury falls For a member covered prior to
within twelve (12) calendar January, 1975, nineteen hundred
months from the first month of seventy-five minus the calendar
coverage, in which case it is the year of coverage, plus the
result obtained by dividing the number of calendar years in
sum of all monthly salary credits which six or more contributions
by thirty (30) times the number of have been paid from January,
calendar months of coverage in 1975 up to the calendar year
the period. In the case of the containing the semester prior to
GSIS, the average daily salary the contingency. For a member
credit shall be the actual daily covered on or after January,
salary or wage, or the monthly 1975, the number of calendar
salary or wage divided by the years in which six or more
actual number of working days of contributions have been paid
the month of contingency. from the year of coverage up to
aa. “Quarter” means a period of the calendar year containing the
three (3) consecutive months semester prior to the
ending on the last days of March, contingency.
June, September and December. ee. “Monthly income benefit”
bb. “Semester” means a period of means the amount equivalent to
two consecutive quarters ending one hundred fifteen percent of
in the quarter of death, the sum of the average monthly
permanent disability, injury or salary credit multiplied by the
sickness. replacement ratio, and one and a
cc. “Replacement ratio” – The half percent of the average
sum of twenty percent and the monthly salary credit for each

credited year of service in excess Meaning of “Arising out of” and
of ten years: Provided, That the “in the course of” the employment
monthly income benefit shall in  The words “arising out of refer to
no case be less than two hundred the origin or cause of the
fifty pesos. accident and are descriptive of its
character, while the words “in the
Compensable Work-Related Injury course of” refer to the time, place,
 What is compensated is not the and circumstances under which
injury or disease itself but the the accident takes place.
attendant loss or impairment of  It has been stated that an
earning capacity. accident arises out of the
employment if it ensues from a
Rule III, Section 1(a) reads: risk reasonably incident to the
(a) For the injury and the resulting employment and if it is in some
disability or death to be sense due to the employment.
compensable, the injury The view has been taken that an
must be the result of an injury arises out of the
employment accident satisfying all employment if the employment is
of the following grounds: one of the contributing causes
1. the employee must have been without which the accident which
injured at the place where his actually happened would not
work requires him to be; have happened.
2. the employee must have been  It may be stated that an injury
performing his official functions; occurs in the course of the
and employment when it takes place
3. if the injury is sustained within the period of the
elsewhere, the employee must employment, at a place where
have been executing an order the employee reasonably may be
for the employer. in the performance of his duties,
and while he is fulfilling those
duties or engaged in doing

something incidental thereto, or, court states that the condition of
as sometimes stated, where he is the classroom floor caused Mrs.
engaged in the furtherance of the Belarmino to slip and fall and
employer’s business. suffer injury as a result. The fall
 An injury to be regarded as precipitated the onset of recurrent
having arisen out of or in the abdominal pains which
course of the employment, that it culminated in the premature
should have occurred during termination of her pregnancy with
hours of active labor, or on tragic, consequences to her. Her
premises within the control of the fall on the classroom floor
employer; that “the employment” brought about her premature
includes not only the actual doing delivery which caused the
of the work, but also a development of septicemia post-
reasonable margin of time and partum which resulted in death.
space necessary to be used in Her fall was the proximate or
passing to and from the place responsible cause that set in
where the work is to be done, motion an unbroken chain of
where the latter is expressly or events, leading to her demise.
impliedly included in the terms of Mrs. Belarmino’s fall was the
employment. primary injury that arose in the
course of her employment as a
Proximate Cause classroom teacher; hence, all the
 It is the sufficient cause which medical consequences flowing
sets the others in motion. from it, her recurrent abdominal
 All the medical consequences pains, the premature delivery of
and sequels that flow from the her baby, her septicemia post-
primary injury are compensable. partum, and death, are
 An example of case showing compensable.
proximate cause is Belarmino vs.

Employees’ Compensation Case: Arising out or in the course
Commission. The ruling of the of employment a death occurred

In the case of Hinoguin vs. ECC, with respect to claims for death
Employee Compensation benefits, namely:
Commission, the ruling of the court a. That the employee must be at the
states that the death of Sgt. Hinoguin place where his work requires
that resulted from his being hit by an him to be;
accidental discharge of his b. That the employee must have
companion’s rifle arose out of and in been performing his official
the course of his employment as a functions;
soldier on active duty status in the c. That if the injury is sustained
Armed Forces of the Philippines and, elsewhere, the employee must
hence, compensable. The concept of have been executing an order for
workplace cannot always be literally the employer.
applied to a soldier on an active duty Obviously, the matter SP02 Alegre
status. A soldier must go where his was attending to at the time he met
company is stationed. A soldier his death, that of ferrying passengers
should be presumed to be on official for a fee, was intrinsically private and
duty unless he is shown to have unofficial in nature proceedings as it
clearly and unequivocally put aside did from no particular directives or
that status or condition temporarily permission of his superior officer.in
by, e.g., going on an approved the absence of such prior authority
vacation leave. Even vacation leave as in the case of Hinoguin and
may be predetermined by superior Nitura, or peacekeeping nature of
officers. the act attended to by policeman at
the time he died even without the
Case: 24 Hour Duty Doctrine and explicit permission or directives of a
its qualifications; Moonlighting superior officer, as in the case of
policeman P/Sgt. Alvaran, here is no
In the case of GSIS vs. CA and justification for holding that SP02
Alegre, taking together jurisprudence Alegre met the requisites set forth in
and the pertinent guidelines of the the ECC guidelines. That he may be
called upon at any time to render

police work as he is considered to be In the case of Valeriano vs.
on a round-the-clock duty and was Employees’ Compensation
not on an approved vacation leave Commission and Government
will not change the conclusion Service Insurance System, the court
arrived at considering that he was ruled that Petitioner Valeriano was
not placed in situation where he was not able to demonstrate solidly how
required to exercise his authority and his job as a firetruck driver was
duty as a policeman. In fact, he was related to the injuries he had
refusing to render one, pointing out suffered. That he sustained the
that he already complied with duty injuries after pursuing a purely
detail. At any rate, the 24-hour duty personal and social function- having
doctrine, as applied to policemen dinner with some friends- is clear
and soldiers, serves more as an from the records of the case. His
after-the-fact validation of their acts injuries were not acquired at his
to place them within the scope of the workplace; nor were they sustained
guidelines rather than a blanket while he was performing an act
license to benefit them in all within the scope of his employment
situations that may give rise to their or in pursuit of an order of his
deaths. In other words, the 24-hour superior. Thus, his injuries and
duty doctrine should not be consequent disability were not work-
sweepingly applied to all acts and connected and thus not
circumstances causing the death of compensable. The 24-hour doctrine
a police officer but only to those would not apply because he was not
which, although not on official line doing an act within his duty and
duty, are nonetheless, basically authority as a firetruck driver, or any
police service in character. other act of such nature, at the time
he sustained his injuries. There is
Case: 24 Hour Duty Doctrine no reasonable connection between
requires work connection; Police his injuries and his work as a
Service Activities firetruck driver.

Case: Ingress-Egress/ Proximity We address ourselves particularly to
Rule an examination and consideration of
In the case of IDECO vs. WCC, the the second exception, i.e., injuries
court ruled the general rule in sustained off the premises of the
workmen’s compensation law known employer, but while using a
as the “going and coming rule,” customary means of ingress and
simply stated, is that “in the absence egress. This exception known as the
of special circumstances, an proximity rule in which the employee
employee injured in, going to, or was injured being immediately
coming from, his place of work is proximate to his place of work thus
excluded from the benefits of the assault arose out of the
workmen’s compensation acts.” This employment.
rule, however, admits four well
recognized exceptions: Going to or coming from work rule
a. Where the employee is Resolution No. 3914-A provides that
proceeding to or from his work on an injury or death of a covered
the premises of his employer member in an accident while he is
b. Where the employee is about to going to, or coming from, the
enter or about to leave the workplace, shall henceforth be duly
premises of his employer by way considered provided the following
of the exclusive or customary conditions are established
means of ingress and egress definitively:
c. Where the employee is charged,
while on his way to or from his a. The act of the employee of going
place of employment or at his to, or coming from, the
home, or during his employment, workplace, must have been a
with some duty or special errand continuing act, that is, he had not
connected with his employment, been diverted therefrom by any
provides the means of other activity, and he had not
transportation to and from the departed from his usual route to,
place of employment. or from, his workplace; and

b. An employee on a special errand, Injury at place of employment not
the special errand must have necessary element of
been official and in connection compensability
with his work. The general rule is that the accident
should have occurred at the place of
Accident on the way to work work and this is known as the “direct
In the case of Alano vs. ECC, the premise rule.” But there are
court ruled that Filomeno was on his exceptions. The coming-and-going
way to his place of work when he rule and the ingress-egress/proximity
met the accident. His death, rule are just two of the exceptions.
therefore is compensable under the
law as an employee accident. Incidents of employment
1. Acts of personal ministration for
Accident on the way home the comfort or convenience of the
In the case of Lazo vs. Employees’ employee
Compensation Commission, the 2. Acts for the benefit of the
court ruled that the claim is employer
compensable. Here, Lazo left his 3. Acts done to further the goodwill
station at the Central Bank several of the business
hours after his regular time off, 4. Slight deviation from work, from
because the reliever did not arrive, curiosity or otherwise
and so he was asked to go on 5. Acts in emergencies
overtime. After permission to leave
was given, he went home. There is Act of ministration
no evidence that he deviated from
his usual, regular homeward route or  Such acts as are reasonably
that interruptions occurred in the necessary to the health and
journey. comfort of an employee while at
work, such as satisfaction of his
thirst, hunger, or other physical
demands, or protecting himself

from excessive cold, are incidental working hours are not within the
to the employment, and injuries course of employment. However,
sustained in the performance of an injury sustained by an employee
such acts are generally held to be outside his regular working hours
compensable as arising out and in or during a temporary stoppage or
the course of the employment. cessation of work may,
 Resting generally depends upon nevertheless, under some
whether such resting, in view of all circumstances, be compensable as
the circumstances, is reasonably arising out of and in the course of
incident to the employment. the employment and is generally
 An injury to an employee during he\d to be so where the employee
meal hours is not compensable if it was at the time engaged in the
results from an independent act of performance of some service for
the employee having no connection the benefit of the employer in
with his work or his meal, or if the connection with his usual duties.
employee at the time was in a  Injuries sustained by an employee
place where he had no right to be at his own home or upon his own
but there are exceptions. premises, in connection with the
 It has been held that an injury performance of the duties of his
received at a union meeting held employment, are generally held to
during a lunch period at the plant be compensable but not where it is
for the purpose of electing a shop there performed voluntarily by the
steward, the shop steward system employee for his own convenience
being recognized by the employer or benefit.
in its contract with the union, was
not an injury arising out of and in Acts during emergency
the course of his employment. An act outside the scope of his usual
duties where such act was
Acts for the benefit of employer reasonably necessary or incidental
 The general rule is that injuries to his regular work, particularly if an
occurring before or after regular emergency existed, and although no

emergency or reasonable necessity While living, boarding, or lodging
existed calling for the performance of on premises of employer, or at
an act outside of the employee’s working place
usual duty, a workman is sometimes The mere fact that an employee was
allowed compensation for an injury living on the employer’s premises at
received in the performance of such the time of injury does not ordinarily,
act, if it was done in the furtherance of itself, render such injury
of the employer’s business or in compensable as arising out of or in
pursuance of a habit or custom. the course of the employment where
such residence on the employer’s
Extra-premises rule premises is merely permissive and
 It is also called the “shuttle bus” not required, or where the injury
rule. results from a risk or danger which is
 The company which provides the not reasonably incidental to the
means of transportation in going to employment.
and coming from the place of work
is liable for the injury sustained by While traveling
employees while on board since a The course of the employment of a
company vehicle is an extension of traveling salesman, for the purposes
its premises. of workmen’s compensation, covers
both the time and place of the
Special errand rule traveling as well as of the selling of
An injury sustained by an employee goods.
outside the company premises is
compensable if his being out is Where employee uses own vehicle
covered by an office order or a which he also uses in
locator slip or a pass for official performance of duties
business. An employee was using his own
vehicle at the time he was injured in
an accident while going to or from
work, and that he used such vehicle

in the performance of his duties to case is that if the work of the
his employer, it was held that his employee tends to create necessity
injuries arose out of and in the for travel, he or she is deemed in
course of the employment. the course of employment, albeit
the employee serves at the same
Effects of deviation from route, time some personal purpose. The
schedule, or mode of travel requirement is that the service of
Whether a deviation by a traveling the employer is at least a
employee from his usual or concurrent cause of the trip of the
prescribed route, schedule, or mode employee.
of travel constitutes such a departure
from the scope or course of his Employer- sponsored activities
employment as to deprive him of the Recreational activities fall under the
right to compensation for an injury so called “special engagement rule”
sustained during or as the result of which is one of the exceptions to the
such deviation depends ordinarily “direct premises rule.” This exception
upon the extent, purpose or effect covers field trips, intramurals,
thereof. outings, and picnic when initiated or
sanctioned by the employer.
Effect of mingling of purposes of Accidents befalling employees on
employer and employee; Dual those occasions are compensable.
Purpose Doctrine
 The dual purpose doctrine, Acts of God or Force majeure
considers as compensable an The generally accepted doctrine is
injury that an employee sustains that the employer is not responsible
while on a trip undertaken for the for accidents arising from force
benefit of the employer even if in majeure or an act of God, as it is
the course thereof the employee usually called, when the employee
pursues also a personal purpose. has not been exposed to a greater
 The test that is ordinarily employed danger than usual. However, this
for determining liability in such a general rule recognizes an exception

in the so called “positional and local the link or connection between
risks” doctrine so that if an the injury and the employment.
employee, by reason of his duties, is
exposed to a special or peculiar Increased Risk Jobs
danger from the elements, the injury 1. Jobs having to do with keeping
constitutes an accident arising out of the peace or guarding property
and in the curse of the employment. 2. Jobs having to do with keeping or
carrying of money which subject
Assault the employee to the risk of
The bases that death is assault because of the increased
compensable: temptation to robbery
1. Once it is proved that the 3. Jobs which expose the employee
employee died in the course of to direct contact with lawless and
the employment in which the irresponsible members of the
incident arose out of the community, like that of a
workman’s employment bartender
2. Doubt as to rights to 4. Work as bus driver, taxi driver, or
compensation are resolved in street car conductor.
favor of the employee and his
dependents NPA victims; presumptive
3. The commissioner’s declaration compensability
on the work connection might be In the case of Quebec vs. GSIS, the
binding on the court death of the deceased P/Lt. Quebec
4. There are employments, which was a result of an accident arising
increase the risk of assault on the out of and in the course of
person of the employee and it is employment. Police officers, like any
that sense that an injury or harm other military men are targets of the
sustained by the assaulted New People’s Army (NPA) hitmen
worker arises out of the and Agaw Armas Gang. It has been
employment, because the observed lately that policemen and
increased risk to assault supplies military personnel were killed for no

other reason than the fact that they 3. Where the violation was not
are military personnel and intentional but due to
policemen. carelessness or negligence
Presumptive compensability not Acts that are not compensable

applicable It will be seen under Article 172 that
In the case of Jahuran vs. GSIS, the the disability or death is not
court ruled that the presumption compensable if it is caused by:
cannot apply because of the 1. Employee’s intoxication
absence of qualifying circumstances. 2. Willful intention to injure or kill
The resolution covers a situation himself or another
where members of the AFP are killed 3. Notorious negligence
by insurgents or lawless elements 4. If otherwise excluded from the
because of the mere fact that they coverage of law
are soldiers. The deceased was not
killed by insurgents but by another Compensable disease
member of the Philippine Section 1 (b), Rule III of the
Constabulary thus the presumption Amended Rules on Employees’
will not lie. Compensation further amplifies
“sickness” thus: “For the sickness
Acts within the sphere of and the resulting disability or death
employment but carried out in to be compensable, the sickness
violation of some employer- must be the result of an occupational
promulgated rules are disease listed under Annex A of
compensable these Rules with the conditions set
1. Where the violation of the rule therein satisfied; otherwise, proof
itself did not bring about the must be shown that the risk of
cause of the accident contracting the disease is increased
2. Where there was serious doubt by the working conditions.”
that the prohibition was known to
the employees injured Case: Occupational Disease

In the case of Menez vs. Employees’ examination of all prospective
Compensation Commission, the employees and to provide periodic
court ruled that even if rheumatoid medical examination of employees
arthritis and pneumonitis are not exposed to occupational diseases.
occupational diseases, there is
ample proof that petitioner Cases: Increased Risk Shown
contracted such ailments by reason In the case of Clemente vs. GSIS,
of her occupation as a public high the court ruled that as a janitor of the
school teacher due to her exposure clinic, he was exposed to different
to the adverse working conditions carriers of viral and bacterial
like heavy pollution and congestion. diseases. The working condition
Petitioner contracted pneumonitis increased the risk of his contracting
and/or bronchiectasis with the ailments, i.e., nephritis, leprosy,
hemoptysis and rheumatoid arthritis etc.
on January 27, 1975 after being In the case of Narazo vs.
drenched and the consequent Employees’ Compensation
chilling during the course of Commission, the court ruled that
employment which are permanent delayed excretion may permit the
and recurring in nature and work retention and survival of
connected. Petitioner’s ailments thus microorganism which multiply
become compensable under the rapidly, and infect the urinary tract.
New Labor Code since under Rule These are predisposing factors to
III, Section 1c of its Implementing pyelonephritis and uremia. Thus,
Rules, only sickness or injury which while we may concede that these
occurred on or after January 1975 illnesses are not directly caused by
and the resulting disability or death the nature of the duties of a teacher,
shall be compensable under these the risk of contracting the same is
rules. aggravated by their working habits
Under Rule III, Sec. 2 of the necessitated by demands of job
Amended ECC Rules, the employer efficiency.
is bound to require pre-employment

Cases: Increased Risk Not Shown employment or that her working
conditions increased the risk of her
In the case of Debation vs. GSIS, the contracting the fatal illness.
court ruled that since peptic ulcer is However, the allegation of the
not included in the list of petitioner is mere conjecture thus
occupational diseases as drawn up parotid carcinoma is not caused by
by the commission, the claimant has employment condition of the
the burden of proving. From the deceased.
undisputed fact, the deceased is a In the case of Casumpang vs.
very coffee drinker, which was his Employees’ Compensation
way of warding off sleepiness. Being Commission, the court ruled that the
a heavy coffee drinker may have claimant, JC's widow, failed to
aggravated his peptic ulcer, but establish that JC's ailment was the
aggravation of an illness is no longer direct result of his occupation or
a ground for compensation under the employment as prison guard. The
present law. Thus, the Supreme doctrine of presumptive
Court ruled that this case is not compensability which was then
peculiar to the work mentioned. expressly provided under the old
Many employees are equally Workmen's Compensation Act (Act
exposed to similar conditions but 3428) is not recognized under
have not been victim of peptic ulcer. Presidential Decree No. 626.
In the case of Sarmiento vs.
ECC, the court ruled that parotid Specific Diseases/ Ailments
carcinoma or cancer of the salivary  Adenocarcinoma of the ileocaecal
glands is not an occupational junction is not listed in Annex “A”
disease considering the deceased's as an occupational disease.
employment as accounting clerk and  Asbestosis is added to the list of
later as manager of the budget compensable diseases but there
division. The petitioner must, are guidelines to be observed.
therefore, prove that his wife's  The real cause of bangungot is
ailment was caused by her unknown and undetermined, the

requirement of proof of causal link illnesses in Annex “A” of the
between the ailment and the Amended Rules.
working conditions should be  Chronic Osteomylitis is not an
liberalized. occupational disease.
 Bells Palsy, Anxiety Neurosis,  Chronic Pylonephritis, Diabetes
Peripheral Neuritis are not among Mellitus, Anemia, Pulmonary
those listed as occupational Metastases are not occupational
diseases under Annex “A” of PD diseases under the New Labor
626. Code.
 Cancer is a disease of still  Peptic ulcer is not included in the
unknown origin which strikes list of occupational diseases as
people in all walks of life, employed drawn up by the Commission.
or unemployed.  Rheumatoid Arthritis is not an
 Cancer of the stomach is occupational disease but claimant
considered occupational only can show proof that the risk of
among wood-workers, loggers, contracting the disease was
carpenters and employees in increased by his working
plywood, pulp and paper mills as conditions.
stated in employees’ compensation  Senile Cataract is not a listed
commission resolution no. 247-A. occupational disease since it is due
 Carcinoma of the breast with to degenerative changes
metastases to the gastrointestinal accompanying the aging process.
tract and lungs is not listed by the  Tuberculosis is an occupational
Commission as an occupational disease or work connected in such
disease except for workers in pulp occupation as that of a teacher,
and paper mills and plywood mills. laborer, driver, land inspector and
 Cardiovascular disease is listed as other similar occupations; hence
a work related disease. compensable.
 Chronic Glomerulonephritis is not
among the listed compensable Evidence; Degree of Proof

If the disease is listed in the Table of
Occupational Diseases embodied in Art. 169. Foreign employment. The
Annex “A” of the rules on Commission shall ensure adequate
Employees’ Compensation, no proof coverage of Filipino employees

employed abroad, subject to regulations
of causation is required. However, if
as it may prescribe.
it is not so listed, the employee, this
time assisted by his employer, is
Art. 170. Effective date of
required to prove a positive
coverage. Compulsory coverage of the
proposition, that is, that the risk of employer during the effectivity of this
contracting the disease is increased Title shall take effect on the first day of
by the working conditions. The his operation, and that of the employee,
degree of proof required is merely on the date of his employment.
substantial evidence, which has
been held to be such relevant Art. 171. Registration. Each employer
evidence as a reasonable mind and his employees shall register with

the System in accordance with its
might accept as sufficient to support
regulations.
a conclusion.
Coverage of employees’
compensation law
Chapter II – Coverage and
 Applies to all employers, public or
Liability
private, and to all employees,
Art. 168. Compulsory
public or private, including casual,
coverage. Coverage in the State
emergency, temporary or substitute
Insurance Fund shall be compulsory
employees.
upon all employers and their employees
 Filipino working abroad for
not over sixty (60) years of age:
Provided, that an employee who is over employers doing business in the
(60) years of age and paying Philippines are covered by the
contributions to qualify for the retirement employees’ compensation law.
or life insurance benefit administered by
the System shall be subject to Art. 172. Limitation of liability. The
compulsory coverage. State Insurance Fund shall be liable for

compensation to the employee or his example of this is when a driver
dependents, except when the disability injured by collision while over
or death was occasioned by the speeding on a descending slope
employee’s intoxication, willful intention
approaching a curve with the
to injure or kill himself or another,
front view obstructed by
notorious negligence, or otherwise
vegetation, was held
provided under this Title.
notoriously negligent. Rule IV,
Section 1, of PD No. 626, which
Exclusion
expressly states that no
A. Intoxication or Drunkenness. A
compensation shall be allowed to
person who is intoxicated is not
the employee or his dependents
entirely himself or so his
when the injury, sickness,
judgement is impaired and his
disability or death was
act, words, or conduct is visibly
occasioned by his notorious
impaired.
negligence.
B. Self-inflicted injuries. It
contemplates a deliberate intent
When is suicide compensable?
on the part of the employee.
According to American authorities,
When the death of the employee
suicide is compensable in the
resulted from a deliberate or
following cases:
willful act on his own life, and it is
a. When it results from insanity
directly attributable to the
resulting from compensable work
seaman, such death is not
injury or disease
compensable.
b. When it occurs during a delirium
C. Notorious Negligence. It
resulting from compensable
signifies a deliberate act of the
disease.
employee to disregard his own
Self-destruction is not presumed.
personal safety. Disobedience to
The laborer is presumed to take
rules does not in itself constitute
necessary precaution to avoid injury
notorious negligence, if no
to himself.
intention can be attributed to the
injured to end his life. An

Art. 173. Extent of liability. Unless Workmen's Compensation Act] with
otherwise provided, the liability of the the regular courts on the basis of
State Insurance Fund under this Title negligence of the employer
shall be exclusive and in place of all
pursuant to the Civil Code.
other liabilities of the employer to the
 Another view, enunciated in the
employee, his dependents or anyone
Robles case, is that the remedy of
otherwise entitled to receive damages
an employee for work-connected
on behalf of the employee or his
dependents. The payment of injury or accident is exclusive in
compensation under this Title shall not accordance with Section 5 of the
bar the recovery of benefits as provided WCA.
for in Section 699 of the Revised  A third view is that the action is
Administrative Code, Republic Act selective and the employee or his
Numbered Eleven hundred sixty-one, as heirs have a choice of availing
amended, Republic Act Numbered
themselves of the benefits under
Forty-eight hundred sixty-four as
WCA or of suing in the regular
amended, and other laws whose
courts under the Civil Code for
benefits are administered by the System
higher damages from the employer
or by other agencies of the government.
(As amended by Presidential Decree by reason of his negligence. But
No. 1921). once the election has been

exercised, the employee or his
Does the compensation remedy heirs are no longer free to opt for
under the Workmen’s the other remedy.
Compensation Act for work
connected death or injuries Recovery under the Labor Code
exclude other remedies under the and the Social Security Law
Civil Code? Simultaneous recovery of benefits
 One view is that the injured under the employees' compensation
employee or his heirs, in case of program of the Labor Code and
death, may initiate an action to under the Social Security law is
recover damages [not allowed. The PD. No. 1921 which
compensation under the lifted the ban against double

recovery of benefits took effect in the employer shall be maintained and
continued to be enjoyed by their employees.
1984 and is deemed to be
prospective in operation, in the
absence of an express provision
giving it retroactive effect.
Art. 174. Liability of third party/ies. Chapter III – Administration
a. When the disability or death is Art. 176. Employees’ Compensation
caused by circumstances creating a Commission.
legal liability against a third party, a. To initiate, rationalize, and
the disabled employee or the coordinate the policies of the
dependents, in case of his death, employees’ compensation program,
shall be paid by the System under the Employees’ Compensation
this Title. In case benefit is paid Commission is hereby created to be
under this Title, the System shall be composed of five ex-officio
subrogated to the rights of the members, namely: the Secretary of
disabled employee or the Labor and Employment as
dependents, in case of his death, in Chairman, the GSIS General
accordance with the general law. Manager, the SSS Administrator, the
b. Where the System recovers from Chairman of the Philippine Medical
such third-party damages in excess Care Commission, and the
of those paid or allowed under this Executive Director of the ECC
Title, such excess shall be delivered Secretariat, and two appointive
to the disabled employee or other members, one of whom shall
persons entitled thereto, after represent the employees and the
deducting the cost of proceedings other, the employers, to be
and expenses of the System. appointed by the President of the
Art. 175. Deprivation of the Philippines for a term of six years.
benefits. Except as otherwise provided The appointive member shall have
under this Title, no contract, regulation or at least five years experience in
device whatsoever shall operate to deprive workmen’s compensation or social
the employee or his dependents of any part
security programs. All vacancies
of the income benefits and medical or
shall be filled for the unexpired term
related services granted under this Title.
only. (As amended by Section 19 [c],
Existing medical services being provided by
Executive Order No. 126)

b. The Vice Chairman of the amended by Section 2, Presidential
Commission shall be alternated Decree No. 1368)
each year between the GSIS
General Manager and the SSS Art. 177. Powers and duties. The
Administrator. The presence of four Commission shall have the following
members shall constitute a quorum. powers and duties:
Each member shall receive a per a. To assess and fix a rate of
diem of two hundred pesos for every contribution from all employers;
meeting that is actually attended by b. To determine the rate of
him, exclusive of actual, ordinary contribution payable by an employer
and necessary travel and whose records show a high
representation expenses. In his frequency of work accidents or
absence, any member may occupational diseases due to failure
designate an official of the institution by the said employer to observe
he serves on full-time basis as his adequate safety measures;
representative to act in his c. To approve rules and regulations
behalf. (As amended by Section 2, governing the processing of claims
Presidential Decree No. 1368) and the settlement of disputes
arising therefrom as prescribed by
c. The general conduct of the the System;
operations and management d. To initiate policies and programs
functions of the GSIS or SSS under toward adequate occupational health
this Title shall be vested in its and safety and accident prevention
respective chief executive officers, in the working environment,
who shall be immediately rehabilitation other than those
responsible for carrying out the provided for under Article 190
policies of the Commission. hereof, and other related programs
d. The Commission shall have the and activities, and to appropriate
status and category of a government funds therefor; (As amended by
corporation, and it is hereby deemed Section 3, Presidential Decree No.
attached to the Department of Labor 1368)
and Employment for policy e. To make the necessary actuarial
coordination and guidance. (As studies and calculations concerning
the grant of constant help and

income benefits for permanent amended by Section 3, Presidential
disability or death and the Decree No. 1921)
rationalization of the benefits for h. To have the power to administer
permanent disability and death oath and affirmation, and to issue
under the Title with benefits payable subpoena and subpoena duces
by the System for similar tecum in connection with any
contingencies: Provided, That the question or issue arising from
Commission may upgrade benefits appealed cases under this Title;
and add new ones subject to i. To sue and be sued in court;
approval of the President: and j. To acquire property, real or
Provided, further, That the actuarial personal, which may be necessary
stability of the State Insurance Fund or expedient for the attainment of the
shall be guaranteed: Provided, purposes of this Title;
finally, That such increases in k. To enter into agreements or
benefits shall not require any contracts for such services and as
increases in contribution, except as may be needed for the proper,
provided for in paragraph (b) efficient and stable administration of
hereof; (As amended by Section 3, the program;
Presidential Decree No. 1641) l. To perform such other acts as it
f. To appoint the personnel of its may deem appropriate for the
staff, subject to civil service law and attainment of the purposes of the
rules, but exempt from WAPCO law Commission and proper
and regulations; enforcement of the provisions of this
g. To adopt annually a budget of Title. (As amended by Section 18,
expenditures of the Commission and Presidential Decree No. 850)
its staff chargeable against the State
Insurance Fund: Provided, That the Art. 178. Management of funds. All
SSS and GSIS shall advance on a revenues collected by the System under
quarterly basis, the remittances of this Title shall be deposited, invested,
allotment of the loading fund for the administered and disbursed in the same
Commission’s operational expenses manner and under the same conditions,
based on its annual budget as duly requirements and safeguards as
approved by the Department of provided by Republic Act Numbered
Budget and Management; (As eleven hundred sixty-one, as amended,

with regard to such other funds as are Art. 180. Settlement of claims. The
thereunder being paid to or collected by System shall have original and exclusive
the SSS and GSIS, respectively: jurisdiction to settle any dispute arising
Provided, That the Commission, SSS from this Title with respect to coverage,
and GSIS may disburse each year not entitlement to benefits, collection and
more than twelve percent of the payment of contributions and penalties
contribution and investment earnings thereon, or any other matter related
collected for operational expenses, thereto, subject to appeal to the
including occupational health and safety Commission, which shall decide
programs, incidental to the carrying out appealed cases within twenty (20)
of this Title. working days from the submission of the
evidence.
Art. 179. Investment of funds.
Provisions of existing laws to the Art. 181. Review.
contrary notwithstanding, all revenues Decisions, orders or resolutions of the
as are not needed to meet current Commission may be reviewed on
operational expenses under this Title certiorari by the Supreme Court on
shall be accumulated in a fund to be question of law upon petition of an
known as the State Insurance Fund, aggrieved party within ten (10) days
which shall be used exclusively for from notice thereof.
payment of the benefits under this Title,
and no amount thereof shall be used for Art. 182. Enforcement of decisions.
any other purpose. All amounts accruing a. Any decision, order or resolution
to the State Insurance Fund, which is of the Commission shall become
hereby established in the SSS and final and executory if no appeal is
GSIS, respectively, shall be deposited taken therefrom within ten (10) days
with any authorized depository bank from notice thereof. All awards
approved by the Commission, or granted by the Commission in cases
invested with due and prudent regard for appealed from decisions of the
the liquidity needs of the System. (As System shall be effected within
amended by Section 4, Presidential fifteen days from receipt of notice.
Decree No. 1368) b. In all other cases, decisions,
orders and resolutions of the
Commission which have become

final and executory shall be enforced The ECC is the policy-making body
and executed in the same manner of the Employees' Compensation
as decisions of the Court of First Program and also the appeal body.
Instance, and the Commission shall
have the power to issue to the city or
ECC program has three thrusts or
provincial sheriff or to the sheriff
components:
whom it may appoint, such writs of
1. Preventive Thrust – to minimize
execution as may be necessary for
the enforcement of such decisions,
and control hazards in the
orders or resolutions, and any working environment. Two

person who shall fail or refuse to agencies are involved: (1) Bureau
comply therewith shall, upon of Working Conditions of the
application by the Commission, be Department of Labor and (2)
punished by the proper court for Employment and the
contempt. Occupational Safety and Health
Center.
Structure and Functions of 2. Compensative Thrust- the heart
Employees’ Compensation of the Employees’ Compensation
Commission Program. In case of death, the
Chairman: Secretary of Labor and benefits are given to the
Employment beneficiaries.
Ex- officious members: (1) SSS 3. Curative Thrust – the treatment of
Administrator, (2) GSIS President sickness or injury that a worker
and General Manager, (3) ECC may suffer in line of duty as well
Executive Director, and (4) Medicare as the rehabilitation of those who
Chairman are disabled.
Appointive members (6 years term):
(1) representing the employer and Two Separate Funds
(2) representing the employee Article 178 and 179 of the Labor
Code provides for the manner in
which the amount collected by the
Systems (GSIS and SSS) for the

Employees’ Compensation Program thereof from the wages or salaries of
shall be managed and invested. the employees shall be null and
There are two State Insurance void.

d. When a covered employee dies,
Funds and that the two are separate.
becomes disabled or is separated
One for the employees in the private
from employment, his employer’s
sector and another for the
obligation to pay the monthly
employees in the government.
contribution arising from that
employment shall cease at the end
of the month of contingency and
Chapter IV – Contributions during such months that he is not
receiving wages or salary.
Art. 183. Employers’ contributions. Art. 184. Government guarantee. The
a. Under such regulations as the Republic of the Philippines guarantees
System may prescribe, beginning as the benefits prescribed under this Title,
of the last day of the month when an and accepts general responsibility for
employee’s compulsory coverage the solvency of the State Insurance
takes effect and every month Fund. In case of any deficiency, the
thereafter during his employment, same shall be covered by supplemental
his employer shall prepare to remit appropriations from the national
to the System a contribution government.
equivalent to one percent of his Amended Rules on Employees’
monthly salary credit. Compensation
b. The rate of contribution shall be  Specifies ten brackets of monthly
reviewed periodically and subject to salary credits on which to base the
the limitations herein provided, may
one percent contribution to ECC
be revised as the experience in risk,
 It provides penalties to the
cost of administration and actual or
employer who is delinquent in
anticipated as well as unexpected
paying ECC contributions. The
losses, may require.
c. Contributions under this Title penalties include imprisonment
shall be paid in their entirety by the and/or fine and a three percent
employer and any contract or device penalty per month from the date
for the deductions of any portion the contribution fall due until paid.

injury or sickness shall, on demand, be
made available to the employee or the
System. No information developed in
Chapter V – Medical Benefits
connection with treatment or
Art. 185. Medical services.
examination for which compensation is
Immediately after an employee
sought shall be considered as privileged
contracts sickness or sustains an injury,
communication.
he shall be provided by the System
during the subsequent period of his
Art. 188. Refusal of examination or
disability with such medical services and
treatment.
appliances as the nature of his sickness
If the employee unreasonably refuses to
or injury and progress of his recovery
submit to medical examination or
may require, subject to the expense
treatment, the System shall stop the
limitation prescribed by the Commission.
payment of further compensation during
such time as such refusal continues.
Art. 186. Liability.
What constitutes an unreasonable
The System shall have the authority to
refusal shall be determined by the
choose or order a change of physician,
System which may, on its own initiative,
hospital or rehabilitation facility for the
determine the necessity, character and
employee, and shall not be liable for
sufficiency of any medical services
compensation for any aggravation of the
furnished or to be furnished.
employee’s injury or sickness resulting
from unauthorized changes by the
Art. 189. Fees and other charges.
employee of medical services,
All fees and other charges for hospital
appliances, supplies, hospitals,
services, medical care and appliances,
rehabilitation facilities or physicians.
including professional fees, shall not be
higher than those prevailing in wards of
Art. 187. Attending physician.
hospitals for similar services to injured
Any physician attending an injured or
or sick persons in general and shall be
sick employee shall comply with all the
subject to the regulations of the
regulations of the System and submit
Commission. Professional fees shall
reports in prescribed forms at such time
only be appreciably higher than those
as may be required concerning his
prescribed under Republic Act
condition or treatment. All medical
Numbered sixty-one hundred eleven, as
information relevant to the particular

amended, otherwise known as the 1. Medical services, appliances
Philippine Medical Care Act of 1969. and supplies
2. Rehabilitation services
Art. 190. Rehabilitation services.
B. Cash Income Benefit or Pension
a. The System shall, as soon as
due to:
practicable, establish a continuing
1. Temporary total disability
program, for the rehabilitation of
2. Permanent total disability
injured and handicapped employees
3. Permanent partial disability
who shall be entitled to rehabilitation
services, which shall consist of 4. Death
medical, surgical or hospital C. Funeral benefit

treatment, including appliances if
they have been handicapped by the Medical Benefit
injury, to help them become The medical services, appliances
physically independent. and supplies shall be provided to the
b. As soon as practicable, the afflicted employee beginning on the
System shall establish centers
first day of injury or sickness, during
equipped and staffed to provide a
the subsequent period of his
balanced program of remedial
disability, and as the progress of his
treatment, vocational assessment
recovery may require. The employee
and preparation designed to meet
is entitled to the benefits only for the
the individual needs of each
handicapped employee to restore ward services of an accredited
him to suitable employment, hospital and accredited physician.
including assistance as may be
within its resources, to help each Duration of Medical liability
rehabilitee to develop his mental, The obligation to provide medical
vocational or social potential. services last for as long as the
employee is sick because the liability
Three kinds of Employees’ for medical care lasts during the
Compensation: “period of disability.” Acts not
A. Services containing any limitation as to the
period during which the employer

may furnish or pay for medical,
surgical, or hospital services have CHAPTER VI – DISABILITY
been construed as imposing liability BENEFITS
on the employer as long as such
Disability refers to a loss or
services are required to cure or
impairment of earning capacity
relieve the injured employee from the
because of actual absence from
effect of his injury.
work due to the injury or illness
arising out of and in the course of
Reimbursement of Medical
employment. Art.167 (n) defines
Expenses
disability as the loss or impairment of
The employee’s right of
a physical or mental function
reimbursement for medical expenses
resulting from injury or sickness.
is not extinguished upon his death.
The reimbursable medical expenses
Basis of Compensation: Reduction
are not only those incurred for the
of earning power.
primary illness but even those for its
complications even if the
No disability: If an employee suffers
complications developed after the
a service-connected injury or illness
employee’s retirement.
as long as he goes on working
without any reduction in his earning
Three Stages of Rehabilitation:
capacity.
a. Physical rehabilitation – this
involves physical therapy
Total disability means disablement
b. Vocational assessment – this
of an employee to earn wages in the
involves evaluation by guidance
same kind of work, or a work of
psychologist of the ECC
similar nature, that was trained for or
c. Vocational placement – this
accustomed to perform, or any kind
involves job placement by
of work which a person of his
Employment Service Officer to
mentality and attainment could do. It
help him become independent
may either be temporary or
and gainfully
permanent.

credit subject to the following
Object of law in allowing conditions:
compensation during temporary 1. Daily income benefit shall
disability: To compensate the not be less than P10 or
laborer or employee for what he more than P90 nor paid
might have earned during the period longer than 120 days for the
of the treatment of his injury. same disability, unless the
injury or sickness requires
Object of law in granting more extensive treatment
compensation for permanent that lasts beyond 120 days
disability: To compensate the but not exceed 240 days
injured laborer or employee for the from the onset of disability.
actual and permanent loss of a
member of the body, or the use 2. Monthly income benefit shall
thereof. be suspended if the
employee fails to submit a
Categories of Disability monthly medical report
A. Temporary total disability: As certified by its attending
the result of the injury or physician.
sickness, the employee is unable
to perform any gainful occupation Maximum for daily income
for a continuous period not benefit: P200, 000
exceeding 120 days, except as
otherwise provided in Rule X of Period of Entitlement:
these Rules. Beginning on the first day of such
disability.
Amount of Benefits: Any person
entitled for the benefit of If caused by injury or sickness:
temporary total disability shall be It shall not be paid longer than
paid an income benefit equivalent 120 consecutive days except
to 90% of his average salary such injury or sickness requires

medical attendance beyond 120 employee is unable to perform
days but not to exceed 240 days any gainful occupation for a
from onset of disability. However, continuous period exceeding 120
the system may declare that the days except as otherwise
total and permanent statues at provided for in Rule X of the ECC
any time after 120 days of Rules.
continuous temporary total
disability. Under Art.192, the following
total disabilities are considered
Relapse: After an employee has permanent:
fully recovered from an illness as 1. Temporary total disabilities
duly certified by the attending lasting continuously for more
physician, the period covered by than 120 days, except as
any relapse he suffers or otherwise provided for in
recurrence of his illness, which Rule X hereof;
results in disability, shall be 2. Complete loss of sight of
considered independent of, and both eyes;
separate from the period covered 3. Loss of two limbs at or
by the original disability in the above the ankle or wrist;
computation of his income benefit 4. Permanent complete
for temporary total disability. paralysis of two limbs;
After the period of 5. Brain injury resulting in
temporary total disability had incurable imbecility and
ceased, an employee was found insanity; and
to be suffering a permanent 6. Such cases as determined
partial disability, he is entitled to by the System and approved
an award based upon partial by the Commission.
disability permanent in character.
Period of entitlement: Five (5)
B. Permanent total disability: As a years guaranteed full monthly
result of the injury or sickness the income benefit for all

compensable months of defined in Sec. 9(a), Rule VI of
disability, except as otherwise these Rules.
provided by other laws, decrees,
orders or letters of instructions. Number of months of paid
coverage: The number of
The Permanent temporary monthly contributions remitted to
disability benefit shall be the System including
suspended in the following contributions other than the
conditions: Employees’ Compensation if paid
1. Failure of employee to before March 31, 1975. Full
present himself for monthly income shall be paid for
examination at least once a all compensable months of
year upon notice by the disability.
System;
2. Failure to submit a quarterly To be considered for the
medical report certified by purposes of computing the
his attending physician as monthly income benefit for
required under Sec. 5 of Permanent total disability: The
Rule IV hereof; first day proceeding the semester
3. Complete or full recovery of temporary total disability.
from his permanent
disability; or Amount benefit for dependent
4. Upon being gainfully children: Each dependent child,
employed. but not exceeding five (5),
counted from the youngest shall
Amount of benefits: be entitled to 10% monthly
In case of SSS: Any person income benefit of the employee.
entitled to Permanent total However, these Rules shall not
disability shall be paid by the be applicable to causes of action
System a monthly income benefit accrued before May 1, 1978.

Aggregate monthly benefit may pay income benefit in lump
payable: In GSIS, it shall not sum or in monthly pension.
exceed the monthly wage or
salary actually received by the Effect of Gainful Employment:
employee as of the date of his For the purposes of income
permanent total disability, except benefits of Permanent partial
the benefit to dependent children disability, a covered employee
under Sec.4 of this Rule. shall continue to receive the
benefits provided.
Disability of seafarers is
discussed under Art.17. Permanent Permanent
partial total disability
C. Permanent partial disability: As disability
a result of the injury or sickness Occurs when an Results in an
the employee suffers a employee loses employee's loss
permanent partial loss of the use the use of any of work or
of any part of his body. The body particular inability to
parts and corresponding period anatomical part perform his
equivalent disability specified in of his body usual work.
Art.193. which disables

him to continue
Amount of Benefits: Any person with his former
entitled to Permanent partial work.
disability shall be paid by the

PERMANENT TOTAL DISABILITY
System a monthly income benefit
ILLUSTRATION:
for the numbers of months
Orlino vs. Employees’
indicated in Art.193. If it exceeds
Compensation, et al
twelve (12) months, the income
Facts: Petitioner was suffering from
benefit shall be paid in monthly
mental lapses which made him unfit
pensions. Otherwise, the System
to work thus he forced to seek early
retirement at the age of 55 years old.

Ruling: Claimant’s approval of gainful occupation for a continuous
optional retirement of disability is an period exceeding 120 days.
indication of his physical incapacity
to render further efficient service. Test to determine whether the
In disability compensation, it is the employee suffers from permanent
incapacity to work resulting in the total disability: The employee’s
impairment of one’s capacity which capacity to continue performing his
is compensated. work notwithstanding the disability
In earlier decision, the court held that he incurred.
weakened bodily condition due to
illness contracted in the course of Conversion from Permanent
employment should be given partial disability to Permanent
compensation due inability to work total disability
during the remaining days before the GSIS vs. Court of Appeals and R.
scheduled retirement, aside from the Balais
benefits received by the employee. Facts: Private respondent was
diagnosed to be suffering from
Vicente vs. ECC Subarachnoid Hemorrhage
Facts: Petitioner’s application for Secondary to Ruptured Aneurysm
optional retirement on the basis of and after undergoing craniotomy,
his ailments had been approved at she was discharged. She was forced
the age of 45. to retire as a cashier as she could
Ruling: The approval of his optional not perform her work due to her
retirement proves that he was no illness. GSIS denied for the
longer fit to continue his conversion of the classification of her
employment. The fact that the disability benefits from permanent
petitioner was granted benefits partial disability to permanent total
amounting to the equivalent of disability on the ground that she had
twenty-three months shows that the already been awarded the benefits
petitioner was unable to perform any commensurate to the degree of her

physical condition at the time of her as Workmen's Compensation
retirement. Commissioner and L. Alia)
Ruling: "A person's disability may
not manifest fully at one precise Knoxville Knitting Mills vs. Galyon
moment in time but rather over a Facts: An employee lost his three
period of time. It is possible that an (3) fingers of his left hand nineteen
injury which at first was considered (19) years before he entered the
to be temporary may later on service of his present employer and
become permanent or one who thereafter, he lost his left hand while
suffers a partial disability becomes performing his duties. The employer
totally and permanently disabled contended that the value of the three
from the same cause." (3) fingers previously lost should be
There is nothing in the law that deducted.
prohibits the conversion of Ruling: It is well-settled that no such
permanent partial disability benefit to deduction can be made, unless the
permanent total disability benefit if it law so provides, and there is no such
is shown that the employee's ailment provision in our laws.
qualifies as such. Chapter VII – Death Benefits
The formula for death benefit under
Earning capacity after being Para of Art.194 is an amount
impaired from his previous work equivalent to his monthly income
Employee’s new employment with a benefit plus 10% for each dependent
higher salary following his cessation child.
due to his temporary total disability
does not necessarily affect his claim DEPENDENTS AND DEPENDENCY
for compensation for a permanent Test of Dependency means
disability, since the amount of such whether or not the claimant looked
wages or earnings may be affected up to and relied on the contribution
by various extraneous matters or of the decedent in whole or in part,
factors. (Central Azucarera Don as a means of supporting and
Pedro vs. C. de Leon, in his capacity maintaining herself in accordance

with her station in life. A person may In case the second wife had
be dependent although able to contracted marriage in good faith
maintain himself without any with the decent during the
assistance from the decedent. subsistence of his marriage with the
first wife, the Court has generally
Spouse as dependent sought and applied a just and
Status of dependency of spouse: equitable solution and division of the
Arise from the fact that a marriage decedent's estate among the two
exists even if the spouse is gainfully innocent surviving parties.
employed as long as there is still a (Consuegra vs. GSIS)
need for financial support.
A widow of the deceased whose Two (2) Muslim Wives
marriage occurred after the accident Ahmad vs. GSIS
as well as the posthumous child was Facts: A. Akmad, the deceased, was
within the meaning of the Workmen’s an officer of the Philippine army who
Compensation Act as at the time of died due to cardio-respiratory arrest.
the death of her spouse, she was Finding the claim compensable,
already married to him. GSIS gave the benefits to the
deceased’s first wife and her five (5)
Two (2) wives as claimants minor children and thereafter, the
The legal wife is entitled as second wife contended that she and
dependent under Sec.9of the Act to her minor child should be paid half
the compensation. However, under the said benefits by virtue of P.D.
Sec.8 of the Act, the Commission No. 1083 or Code of Muslim
may act as an arbiter between the Personal Law. GSIS asserted that
two (2) claimants and help them the first marriage of a Muslim male
reach a mutually acceptable should be considered the valid
compromise agreement. (Samar marriage for the purposed of
Mining Co., Inc. vs. Workmen's adjudicating the benefits under the
Compensation Commission) compensation law.

Ruling: The second wife is also No Primary beneficiaries: Their
entitled to compensation benefits secondary beneficiaries shall share
under the above-mentioned decree. equally in the income benefits.
The law permits a Muslim male to
have more than one wife but not Separated Spouse
more than four at a time, provided he A spouse who is legally separated or
can deal with them with equal separated de facto from the
companionship and just treatment as deceased employee may be held
enjoined by the Islamic Law. Hence, entitled to compensation benefits if
appellant herein is entitled to the the separation occurred owing to any
benefits being enjoyed by the first of the following circumstances, to
wife considering that under the wit:
Muslim Law, she is also considered 1. Refusal of the covered employee
a primary beneficiary. to continue living with the
surviving spouse; or the
Suppletory Rules as to the employee's abandonment of the
distribution of the monthly income said spouse, without justifiable or
benefits to the qualified valid cause;
beneficiaries: 2. Attempt of the covered employee
Monthly income shares – Shared against the life of the surviving
equally by all primary beneficiaries spouse, common child/children of
including the dependent children. the spouse;
Upon the emancipation of a 3. Commission of an act of sexual
dependent pension child, only 10% abuse against the surviving
shall be deducted from the benefits spouse, common child/children or
and the remaining shall be once child/children of the spouse by
again be divided equally by the the covered employee;
qualified primary beneficiaries. 4. The covered employee's
recurrent commission of physical
violence, or grossly abusive
conduct, against the surviving

spouse, common child/children or child/children of the spouse to be
child/children of the spouse; subjected to acts of
5. The covered employee's infliction lasciviousness; and
of physical violence, or imposition 12. The covered employee's
of moral duress, to compel the contraction of serious sexually
surviving spouse, common child/ transmitted disease extra-
children or child/children of the maritally.
spouse to change their religious
or political affiliation; Parents as dependents
6. Attempt of the covered employee If the deceased employee is the
to corrupt, or induce the surviving adulterous child of the wife, the
spouse, common child/children or husband cannot claim as a
child/children of the spouse to dependent of the deceased
engage in prostitution, or to make employee in the same manner that
them connive with the employee he is not duty-bound to support the
in such an act of corruption or deceased employee.
inducement; The parent, no matter how financially
7. Drug addiction or habitual desperate, cannot claim
alcoholism of the covered compensation if the deceased
employee; employee is an abandoned child
8. Lesbianism or homosexuality of since the abandonment of the child
the covered employee; by the parent is the cause for
9. Contraction of bigamous ceasing of the obligation of the
marriage by the covered former to support the latter.
employee, whether in the
Philippines or abroad; Death benefit and beneficiaries
10. Sexual infidelity or perversion of Death benefits are paid in the form of
the covered employee; cash monthly pension:
11. The covered employee's act of a. Primary beneficiaries:
allowing the surviving spouse, Guaranteed for five (5) years;
common child/children or

b. Secondary beneficiaries in when he was an assistant professor.
case there are no primary He died after his compulsory
beneficiaries: Not more than 60 retirement due to total disability
months caused by cardiovascular attack or
c. The total benefit shall not be less myocardial infraction. The
than P15, 000 Employees’ Compensation
Commission denied Petitioner’s
Beneficiaries: claim because the cause of death
1. Primary beneficiaries: came from four and half (4 1/2) years
a. Dependent spouse until after his retirement thus the cause of
he/she remarries; the deceased death was not caused
b. Dependent children by a work-oriented cause.
(legitimate, legitimated, Ruling: The cause of his compulsory
natural-born, or legally retirement due to paralysis arising
adopted). from cardiovascular accident is
2. Secondary beneficiaries: closely related to the cause of his
a. Illegitimate children and death, which was also a
legitimate descendants; cardiovascular attack or myocardial
b. Parents, grandparents, infarction.
grandchildren. The death benefits must be granted
to the primary beneficiaries of the
No beneficiaries: The death benefit decedent to help the family of a
shall accrue to the Employees’ permanent and totally disabled
Compensation Fund. person who was so disabled
because of causes that are work-
Death benefit after retirement oriented. The rule applies all the
Manuzon vs. ECC more when the disabled person later
Facts: During the employment of the dies because of the same cause or
deceased, he suffered a stroke thus related cause.
he has to retire due to paralysis Article 194(b) applies to a retired
caused by the cardiovascular attack person as contemplated in Article

194(b) which allows for funeral the five (5) year guaranteed period
benefits upon the death of a covered costs the GSIS 408 million per year.
employee or permanently totally
disabled pensioner. Chapter VIII – Provisions
Common to Income Benefits
Benefits for death of pensioner
All questions of relationship and
Death benefit shall be paid to the
dependency: It shall be determine
beneficiaries if an employee while
as of the time of death. (Art.195)
receiving permanent total disability
benefit dies.
Delinquent contributions (Art.196):
1. An employer who is delinquent
Art.194 is not applicable: If a
in his contribution: It shall be
member under permanent partial
liable to the System for the
disability dies during the period he is
benefits which may have been
receiving monthly income benefits.
paid to the System to his
employees or their depends, and
Period of entitlement of death
any benefit and expenses to
benefit
which such employer is liable
Under first par. of Art.194, that death
shall constitute a lien on all his
benefit shall be guaranteed and
property, real or personal which
thereafter, Employees’
is hereby declared to be
Compensation Commission by five
preferred to any credit, except
(5) years which shall begin at the
taxes. The payment by the
month of death and shall continue to
employer of the lump sum
be paid for as long as the
equivalent of such liability shall
beneficiaries is entitled thereto.
absolve him from the payment of
However, GSIS later suspended the
the delinquent contribution and
payment of death benefit beyond five
penalty thereon with respect to
(5) years from death of a covered
the employee concerned.
employee as the payment beyond

2. Failure or refusal of the ASSIGNMENT OF BENEFITS
employer to pay or remit the (ART.198)
contributions herein No claim for compensation under
prescribed: It shall not prejudice this Title is transferable, or liable to
the right of the employee or his tax, attachment, garnishment, levy or
dependents to the benefits under seizure by or under any legal
this Title. If the sickness, injury, process whatsoever, either before or
disability or death occurs before after receipt by the person or
the System receives any report of persons entitled thereto, except to
the name of his employee, the pay any debt of the employee to the
employer shall be liable to the System.
System for the lump sum
equivalent to the benefits to Benefits are not transferable and
which such employee or his exempt from creditor’s claim as an
dependents may be entitled. exercise of the police power of the
State. Art. 198 is intended to secure
SECOND INJURIES (ART.197) the right of the injured worker, or his
Employee under permanent partial surviving dependents. Otherwise, it
disability suffers another injury would defeat the purpose of the law
which results in a compensable as a social legislation.
disability greater than the
previous injury: The State EARNED BENEFITS (ART.199)
Insurance Fund shall be liable for the Income benefits in any period of
income benefit of the new disability. disability shall be payable in
accordance with this Title to an
When new disability is related to employee who is entitled to receive
the previous disability: the System wages, salaries or allowance for
shall be liable only for the difference holidays, vacation or sick leaves,
in income benefits. and an award of benefit under a
collective bargaining or other
agreement.

earning capacity, not from the time
SAFETY DEVICE (ART.200) the illness was discovered.
In case of employee’s injury or death However, the Supreme Court
due to: would also tell us that a
1. Failure of the employer to comply compensation claim may be filed
with any law, or beyond three years but before the
2. To install and maintain safety lapse of the tenth year from accrual
devices, or of the cause of action, applying
3. Take other precautions for the Article 1144 of the Civil Code.
prevention of injury
Employer shall pay to the State Constructive Filing: The law
Insurance Fund a penalty of twenty- provides that the claim must be
five percent of the lump sum made in writing, the following acts
equivalent of the income benefit have been held as equivalent to filing
payable by the System to the a claim with the employer as
employee. required by the Women’s
All employers, especially Compensation Act:
those who should have been paying 1. A verbal request for medical and
a rate of contribution higher than hospitalization expenses made to
required of them under this Title, are the corporate employer through
enjoined to undertake and its treasurer.
strengthen measures for the 2. Request for financial aid in behalf
occupational health and safety of of the family of the deceased
their employee. worker made by the president of
his union.
Prescriptive period to file a claim
for compensation: Three (3) years Under Resolution No. 2127 of the
from the time the cause of action ECC, the following are deem to
accrued. (Art.201) have been filed for purposes of
The three years have to be counted determining the applicability of
from the time the employee lost his the prescriptive period:

1. When the System itself receives In all three (3) cases, the
from the concerned employee, or claimant shall be required, if
his duly authorized necessary, to submit additional
representatives, or his employer, supporting documents or papers to
a written notice giving information establish compensability. Otherwise,
on the occurrence of a certain noncompliance for unreasonable
contingency, which may be held period of time shall be deemed as
compensable under any of the abandonment of claims and
laws that the System administers; subsequent claims shall not be
2. When a pertinent and authentic entertained on the ground of laches.
document evidencing a particular ECC Resolution on constructive filing
contingency that befalls an is not applicable if causes of action
employee is submitted to and accrued on or after June 1, 1984.
received by the System, for the
purpose of initiating payment of Mailing date of claim considered
whatever benefits that may duly date of filing
accrue to the employee, in The date of mailing of motions,
accordance with any of the laws pleadings, or any other papers, as
that the System administers; and shown by the post-office registry
3. When the concerned employee, receipts, shall be considered as the
or any of his legal beneficiaries, date of their filing thus applying this
or duly authorized principle, the admitted mailing date
representative/s, files a formal of the claim for compensation should
claim with the System for life, be considered as the date of its filing
retirement and/or other insurance with the defendant.
benefits because of disability or
death, which may be also held Suanes vs. Workmen's
compensable under the new Compensation Commission
Employees' Compensation Facts: The employee died on June
Program; 21, 1973, and the claim for
compensation was filed on March 5,

1975 to the wrong employer, who file a claim for compensation for
was impleaded 12 years later. himself or herself and in behalf of
Ruling: Such original claim to the those non sui juris under the
wrong employer should be regarded Workmen's Compensation Act and
as having effectively tolled the under the present Law on
running of the prescriptive period. Employees' Compensation.
Notice in any form by the employee
or employer to the System of any ERRONEOUS PAYMENT:
compensable contingency within (ART.202)
three years from accrual of the 1. If the system in good faith pays
cause of action suspends the income benefit who is inferior
running of the prescriptive period. in right to another or another
dependent is entitled, such
Period to file claim of minors and payment shall discharge the
the mentally deficient system shall be discharge from
No minors who have no legal liability, unless and until such
guardian: the prescriptive period of other dependent notifies the
ten (10) years begins to run from the System of his claim prior to the
time they reach the age of majority payments.
For non compos mentis: the 2. In case of doubt as to
prescriptive period begins to run respective rights of rivals
from the moment a legal guardian claimants, the System is
has been appointed. empowered to determine as to
whom payment should be made
Under Art.225 of the Family Code, in accordance with such
the father and mother as the regulations as the Commission
guardian of the mentally may approved.
incapacitated child or of the
dependent minor child and without a If money is payable to a minor or
need for securing judicial incompetent, payment shall be to a
appointment as legal guardian can person as it may consider to be the

best qualified to take care and from any tax, fee, charge, levy, or
dispose the same. customs or import duty, and no law
hereafter enacted shall apply to the
State Insurance Fund unless it is
PROHIBITION: (ART.203)
provided therein that the same is
As to Attorney’s fee, the intent of
applicable by expressly stating its name.
Art.203 is to free the award from any
liability or charge so that claimant
Chapter IX – Records,
may enjoy and use it to the fullest.
The defaulting government agency Reports, and Penal
remains liable as to the said Provisions
attorney’s fee because the claimant RECORD OF DEATH OR
is compelled to employ the services DISABILITY (ART.205)
of counsel by unjustly refusing to 1. All employers shall keep a
recognize the validity of petitioner’s logbook to record chronologically
claim. the sickness, injury or death of
their employees, setting forth
Parties. It is not fatal to a claim for therein their names, dates and
compensation that GSIS was not places of the contingency, nature
impleaded as a party defendant of the contingency and absences.
because GSIS is a proper party in Entries in the logbook shall be
employees’ compensation cases. made within five days from notice
The law and the rules refer to said or knowledge of the occurrence
System in all aspects of employee of the contingency. Within five
compensation including enforcement days after entry in the logbook,
of decisions. the employer shall report to the
System only those contingencies
EXEMPTION FROM LEVY, TAX, he deems to be work-connected.
ETC. (ART.204) 2. All entries in the employer's
Art.204. All laws to the contrary logbook shall be made by the
notwithstanding, the State Insurance employer or any of his authorized
Fund and all its assets shall be exempt officials after verification of the

contingencies or the employee's party to the fraud, such employer
absences for a period of a day or shall reimburse the System the
more. Upon request by the full amount of the Compensation
System, the employer shall paid
furnish the necessary certificate
regarding information about any Notice to employer of sickness,
contingency appearing in the injury or death
logbook, citing the entry number, Under Art.206, it is required that the
page number and date. Such employee, his dependents or
logbook shall be made available anybody on his behalf, give the
for inspection to the duly notice of sickness, injury or death to
authorized representatives of the the employer within five (5) days
System. from the occurrence of the
3. Should any employer fail to contingency.
record in the logbook an actual Purpose:
sickness, injury or death of any of 1. To establish the employee's right
his employees within the period to compensation
prescribed herein, give false 2. To enable the employer to
information or withhold material comply with its duty under the
information already in his rules that of entering the
possession, he shall be held contingency in the logbook and of
liable for fifty percent of the lump giving also due notice to the
sum equivalent of the income System if the injury, sickness or
benefit to which the employee death is deemed work-
may be found to be entitled, the connected.
payment of which shall accrue to
the State Insurance Fund. Under Art.206 when notice to
4. In case of payment of benefits for employer is not needed: When the
any claim which is later employer or his agent or
determined to be fraudulent and representative is aware of the
the employer is found to be a

contingency that gives rise to the c. The specific circumstances of
claim for compensation. the occurrence of the
contingency have been such
Under ECC Resolution No. 2127 that the employer can be
when notice to employer not reasonably presumed to have
needed as to the sickness or readily known it soon
death of the employee: thereafter; and
1. When the employee suffers the d. Any other circumstances that
contingency within the employer's may give rise to a reasonable
premises; presumption that the
2. When the employee officially files employer has been aware of
an application for leave of the contingency.
absence by reason of the
contingency from which he Delay or failure to give the
suffers; employer notice of compensable
3. When the employer provides illness or injury within the
medical services and/or medical prescribed period does not bar a
supplies to the employee who claim for compensation if it shown
suffers from the contingency; and that the latter, his agent or
4. When the employer can be representative knows of such injury
reasonably presumed to have or illness or that he suffered no
knowledge of the employee's damage by reason of such delay or
contingency, in view of the lack of notice.
following circumstances:
a. The employee was performing "Representatives" or "Agents"
an official function for the whose knowledge is deemed
employer when the knowledge of their employers
contingency occurred; include the following:
b. The employee's contingency 1. Project engineer in charge of the
has been publicized through work
mass media outlets; or

2. Captain of the vessel in which the Penal provisions of R.A. No. 1161,
employee worked as amended, and C.A. No. 186, as
3. Foreman amended, with regard to the funds
4. Assistant manager being paid to, collected or disbursed
5. Superintendent of transport by the System, shall be applicable to
operation the collection, administration and
disbursement of the Fund under this
Damage or Prejudice means the Title. The penal provisions on
employer/ System, by reason of the coverage shall also be applicable.
failure to receive the required notice,
has been made less able to resist Fine of not less than P500, 000
the claim. and imprisonment for not less
than 6 months nor more than 1
Usual forms of prejudice to year, at the discretion of the court:
employer due to lack of timely To any person, who for the purpose
notice: of securing entitlement to any benefit
1. The difficulty of the employer or or payment under this Title or the
insurer to procure evidence at a issuance of any certificate or
time remote from the injury, and document for any purpose
2. Failure of the employee to be connected with this Title, whether for
treated medically promptly after him or for some other person,
the injury commits fraud, collusion,
If the employer or his insurer was not falsification, misrepresentation of
misled or prejudiced by the failure of facts or any other kind of anomaly.
the employee to give, or the delay in
giving the required notice of the Imprisonment of not less than 1
injury, such failure or delay is year: If the act penalized by this
excused and the right to Article is committed by any person
compensation is not barred. who has been or is employed by the
Commission or System, or a
PENAL PROVISIONS (ART.207) recidivist.

made by the employers was only
Additional penalty of partial compliance with the said
disqualification from the practice decision. The employer contends
of his profession: If committed by a that full payment was already made
lawyer, physician or other thus the obligation was already
professional. extinguished.
Ruling: Despite the execution of
Additional penalty of dismissal said release document, the petitioner
with prejudiced to reemployment herein did not file any motion to
in the government office: If dismiss its appeal or to have said
committed by any official, employee appealed case declared terminated
or personnel of the Commission, due to the alleged satisfaction of the
System or any government agency. judgment. This omission negates an
inference that the parties had
Effect of quitclaim actually agreed that the payment of
Philippine International Shipping the P18, 000 would be equivalent to
Corp. vs. NLRC a full satisfaction of the award and/or
Facts: Brigado Samson (Samson) a waiver of the balance of the award.
filed a claim for disability In MRR Yard Crew Union vs.
compensation benefits against his Philippine National Railways the
former employer, Petitioner herein. Supreme Court held that, the fact
Petitioner appealed from the that the employee "has signed a
decision of National Seamen’s Board satisfaction receipt does not result in
(NSB) ordering the said employer to waiver; the law does not consider as
pay Samson. Petitioner’s offer in the valid any agreement receive less
amount of P18, 000 was accepted compensation than what the worker
and thereafter, they executed a is entitled to recover."
release document. NLRC affirmed
NSB’s decision and after the said Philippine International Shipping
decision became final, NSB issued a Corp. vs. NLRC, et al
writ of execution as the payment

Facts: Josefina is a widow of The release is from any claim
Abelardo, who was an engineer of a against PSTSI, Chuan Hup is not a
vessel of Singaporean registry party to it. He cannot be considered
owned by Chuan Hup, the principal covered by the release.
of Philippine-Singapore Transport That Josefina received P7, 000 only
Service, Inc. (PSTSI). Abelardo should not be taken to mean as a
contracted a serious illness which waiver of her right.
resulted in his death thus Josefina Even if the quitclaim had foreclosed
filed a complaint against PSTSI for Josefina's right over the death
the payment of death compensation benefits of her husband, the fact that
benefits. While the said case was the consideration given was very
pending, the parties entered into a much less than the amount she is
compromise agreement and claiming renders the quitclaim null
thereafter, Josefina executed a and void for being contrary to public
release and quitclaim in favor of policy.
PSTSI in the amount of P7, 000.
Thereafter, Josefina filed another Evidence
claim against PSTSI including Chuan Facts: The Commission denied
Hup. The POEA dismissed the said Petitioners’ claim on the ground that
claim on the ground of Res judicata the Petitioners had failed to establish
which was likewise affirmed by the their relationship with the deceased.
NLRC. Petitioner attached her affidavit and
Ruling: The compromise agreement several documents to support her
in favor of PSTSI was not intended claim, such as, medical certificate,
to totally foreclose Josefina's right baptismal certificate of Petitioners,
over the death benefits of her marriage certificate to the deceased
husband, because the release was and her motion for reconsideration.
without prejudice as regards Chuan Ruling: The totality of this evidence
Hup. The second complaint was filed is sufficient to establish petitioner's
to enforce the joint and several relationship to the deceased.
liabilities of PSTSI and Chuan Hup.

A doctor's certification as to the Board (NSB) Format. Thereafter,
nature of the claimant's disability Joseph died as a result of accident
may be given credence as he which befell him while working on the
normally would not make a false vessel thus his father filed a claim for
certification. death benefits computed at the rate
of 36 months times seaman’s
Physician’s Report monthly salary plus 10% thereof in
Petitioner’s claim for disability accordance with the Workmen’s
should be granted: If physician's Compensation Law of Singapore.
report of sickness established not Philmare contended that its liability
only the causal relation between was limited only to P40, 000 under
claimant's work and his complained Sec.D(1) of the NSB Standard
sickness but also his permanent and Format.
total disability. Ruling: Crew Agreement stated that
the insurance benefits shall be "as
Not binding to Supreme Court: per NSB Standard Format" in the
Findings of doctors and the Chief of event "of death of the seaman during
Medical Officer of GSIS and ECC as the term of his contract, over and
they are not considered experts. And above the benefits for which the
also, the opinions of Medical Rating Philippine Government is liable
Officer who did not examine the under Philippine law."
claimant cannot be relied upon.
Foreign Currency
Foreign law Compensation benefits may be paid
Atienza vs. Philimare Shipping in foreign currency.
and Equipment Supply
Facts: Joseph was an agent of Appeal
Trans Ocean Liner of Germany Siliman University vs. L. Benarao,
based on Singapore. The Crew Workmen's Compensation
agreement provided for insurance Commission
benefit as per National Seaman’s

1. No necessity of filing a motion P.D. 626: If the application does not
for reconsideration before state when the claimant contracted
certiorari could be availed of: the disease and the claim if filed
In case of a final order or under P.D. 626 which took effect on
judgment, a motion for January 1, 1975.
reconsideration, prior to taking an
appeal, is not always required
2. Theory of exhaustion of
administrative remedies is not TITLE III – MEDICARE
applicable. Philippine Health Insurance Program
was created to carry out the program
Applicable law of the law which also later rendered
In workmen's compensation cases, Art.209 medical care inoperative.
the governing law is determined by
the date on which the claimant
contracted his illness. TITLE IV- ADULT
EDUCATION
Governing law
Every employer shall render
Workmen’s Compensation Act: If
assistance in the establishment and
the ailment supervened before the
operation of adult education
Labor Code took effect. If the claim
programs for their workers and
is filed under Workmen’s
employees as prescribed by
Compensation, the claimant is
regulations jointly approved by the
entitled to presumption of
Department of Labor and the
compensability.
Department of Education and
Culture
New law on Employees’
Compensation: If the ailment
occurred after January 1, 1975.

BOOK FIVE – LABOR g. To ensure the participation of
workers in decision and policy-
RELATIONS
making processes affecting their
TITLE I – POLICY AND rights, duties and welfare.
DEFINITIONS B. To encourage a truly democratic
Chapter I – Policy method of regulating the relations

between the employers and
Art. 218. Declaration of Policy.
employees by means of agreements
A. It is the policy of the State:
freely entered into through collective
a. To promote and
bargaining, no court or
emphasize the primacy of free
administrative agency or official shall
collective bargaining and
have the power to set or fix wages,
negotiations, including voluntary
rates of pay, hours of work or other
arbitration, mediation and
terms and conditions of employment,
conciliation, as modes of settling
except as otherwise provided under
labor or industrial disputes;
this Code.
b. To promote free trade unionism
as an instrument for the
enhancement of democracy and Nature of Labor Relations
the promotion of social justice The government labor relations
and development;
policy, declared in Art. 218, is a
c. To foster the free and voluntary
focused elaboration of the basic
organization of a strong and
labor policy announced in Art. 3
united labor movement;
which, in turn, echoes constitutional
d. To promote the enlightenment of
workers concerning their rights
mandates (see Sec. 3 of Article XIII
and obligations as union of the 1987 Constitution).

members and as employees; Labor relations is essentially
e. To provide an adequate inter-party, which means that,
administrative machinery for the basically, the employer and
expeditious settlement of labor employees themselves must deal
or industrial disputes; with their problems in a manner that
f. To ensure a stable but dynamic
mutually suits them best. This is the
and just industrial peace; and
reason the policy promotes “free”

bargaining and negotiation between b. “Bureau” means the Bureau of
employers and employees. Labor Relations and/or the Labor
Free agreement between the Relations Divisions in the regional

offices established under
parties is the rule; government
Presidential Decree No. 1, in the
intervention, the exception.
Department of Labor.
(Azucena, 2007)
c. “Board” means the National
Conciliation and Mediation Board
Worker’s Participation established under Executive Order
The policy about worker’s No. 126.
participation in policy making was d. “Council” means the Tripartite
applied by the Supreme Court in Voluntary Arbitration Advisory
ruling that employees or their union Council established under Executive
should be allowed to participate in Order No. 126, as amended.
the formulation of the code of e. “Employer” includes any person

acting in the interest of an employer,
discipline which the employees will
directly or indirectly. The term shall
be told to observe
not include any labor organization or
any of its officers or agents except
Labor Education
when acting as employer.
Enlightenment of workers concerning f. “Employee” includes any person
their rights and obligations is State in the employ of an employer. The
Policy. The Labor Code provides that term shall not be limited to the
both employees and employers must employees of a particular employer,
be enlightened of such rights. unless the Code so explicitly states.
(Azucena, 2007) It shall include any individual whose

work has ceased as a result of or in
Chapter II – Definitions connection with any current labor
dispute or because of any unfair
Art. 219. Definitions
a. “Commission” means the labor practice if he has not obtained
any other substantially equivalent
National Labor Relations
Commission or any of its divisions, and regular employment.
g. “Labor organization” means any
as the case may be, as provided
under this Code. union or association of employees

which exists in whole or in part for prerogatives to lay down and
the purpose of collective bargaining execute management policies and/or
or of dealing with employers to hire, transfer, suspend, lay-off,
concerning terms and conditions of recall, discharge, assign or discipline
employment. employees. Supervisory employees
h. “Legitimate labor organization” are those who, in the interest of the
means any labor organization duly employer, effectively recommend
registered with the Department of such managerial actions if the
Labor and Employment, and exercise of such authority is not
includes any branch or local thereof. merely routinary or clerical in nature
i. “Company union” means any but requires the use of independent
labor organization whose formation, judgment. All employees not falling
function or administration has been within any of the above definitions
assisted by any act defined as unfair are considered rank-and-file
labor practice by this Code. employees for purposes of this
j. “Bargaining representative” Book.
means a legitimate labor n. “Voluntary Arbitrator” means any
organization whether or not person accredited by the Board as
employed by the employer. such or any person named or
k. “Unfair labor practice” means designated in the Collective
any unfair labor practice as Bargaining Agreement by the parties
expressly defined by the Code. to act as their Voluntary Arbitrator, or
l. “Labor dispute” includes any one chosen with or without the
controversy or matter concerning assistance of the National
terms and conditions of employment Conciliation and Mediation Board,
or the association or representation pursuant to a selection procedure
of persons in negotiating, fixing, agreed upon in the Collective
maintaining, changing or arranging Bargaining Agreement, or any
the terms and conditions of official that may be authorized by the
employment, regardless of whether Secretary of Labor and Employment
the disputants stand in the proximate to act as Voluntary Arbitrator upon
relation of employer and employee. the written request and agreement of
m. “Managerial employee” is one the parties to a labor dispute.
who is vested with the powers or

o. “Strike” means any temporary entrance to and exit from said
stoppage of work by the concerted establishment
action of employees as a result of an
industrial or labor dispute.
Chapter II – Definitions
p. “Lockout” means any temporary
refusal of an employer to furnish
work as a result of an industrial or TITLE II – NATIONAL LABOR
labor dispute. RELATIONS COMMISSION
q. “Internal union dispute” includes
Chapter I – Creation and
all disputes or grievances arising
Composition
from any violation of or
disagreement over any provision of Chapter II – Powers and
the constitution and by laws of a Duties
union, including any violation of the
Chapter III – Appeal
rights and conditions of union
Art. 224. [217] Jurisdiction of the Labor
membership provided for in this
Arbiters and the Commission.
Code.
a. Except as otherwise provided under
r. “Strike-breaker” means any
this Code, the Labor Arbiters shall
person who obstructs, impedes, or
have original and exclusive
interferes with by force, violence,
jurisdiction to hear and decide,
coercion, threats, or intimidation any
within thirty (30) calendar days after
peaceful picketing affecting wages,
the submission of the case by the
hours or conditions of work or in the
parties for decision without
exercise of the right of self-
extension, even in the absence of
organization or collective bargaining.
stenographic notes, the following
s. “Strike area” means the
cases involving all workers, whether
establishment, warehouses, depots,
agricultural or non-agricultural:
plants or offices, including the sites
1. Unfair labor practice cases;
or premises used as runaway shops,
2. Termination disputes;
of the employer struck against, as
3. If accompanied with a claim for
well as the immediate vicinity
reinstatement, those cases that
actually used by picketing strikers in
workers may file involving
moving to and fro before all points of
wages, rates of pay, hours of

work and other terms and to the grievance machinery and
conditions of employment; voluntary arbitration as may be
4. Claims for actual, moral, provided in said agreements. (As
exemplary and other forms of amended by Section 9, Republic Act
damages arising from the No. 6715, March 21, 1989)
employer-employee relations;
5. Cases arising from any BASED ON THE LABOR CODE
violation of Article 264 of this Art. 225. [218] Powers of the
Code, including questions Commission. The Commission shall
involving the legality of strikes have the power and authority:
and lockouts; and (a) To promulgate rules and regulations
6. Except claims for Employees governing the hearing and
Compensation, Social Security, disposition of cases before it and its
Medicare and maternity regional branches, as well as those
benefits, all other claims pertaining to its internal functions
arising from employer- and such rules and regulations as
employee relations, including may be necessary to carry out the
those of persons in domestic or purposes of this Code; (As amended
household service, involving an by Section 10, Republic Act No.
amount exceeding five 6715, March 21, 1989)
thousand pesos (P5,000.00) (b) To administer oaths, summon the
regardless of whether parties to a controversy, issue
accompanied with a claim for subpoenas requiring the attendance
reinstatement. and testimony of witnesses or the
(b) The Commission shall have production of such books, papers,
exclusive appellate jurisdiction over contracts, records, statement of
all cases decided by Labor Arbiters. accounts, agreements, and others
(c) Cases arising from the interpretation as may be material to a just
or implementation of collective determination of the matter under
bargaining agreements and those investigation, and to testify in any
arising from the interpretation or investigation or hearing conducted in
enforcement of company personnel pursuance of this Code;
policies shall be disposed of by the
Labor Arbiter by referring the same

(c) To conduct investigation for the A person guilty of
determination of a question, matter misbehavior in the presence of or so
or controversy within its jurisdiction, near the Chairman or any member
proceed to hear and determine the of the Commission or any Labor
disputes in the absence of any party Arbiter as to obstruct or interrupt the
thereto who has been summoned or proceedings before the same,
served with notice to appear, including disrespect toward said
conduct its proceedings or any part officials, offensive personalities
thereof in public or in private, toward others, or refusal to be
adjourn its hearings to any time and sworn, or to answer as a witness or
place, refer technical matters or to subscribe an affidavit or
accounts to an expert and to accept deposition when lawfully required to
his report as evidence after hearing do so, may be summarily adjudged
of the parties upon due notice, direct in direct contempt by said officials
parties to be joined in or excluded and punished by fine not exceeding
from the proceedings, correct, five hundred pesos (P500) or
amend, or waive any error, defect or imprisonment not exceeding five (5)
irregularity whether in substance or days, or both, if it be the
in form, give all such directions as it Commission, or a member thereof,
may deem necessary or expedient in or by a fine not exceeding one
the determination of the dispute hundred pesos (P100) or
before it, and dismiss any matter or imprisonment not exceeding one (1)
refrain from further hearing or from day, or both, if it be a Labor Arbiter.
determining the dispute or part The person adjudged in
thereof, where it is trivial or where direct contempt by a Labor Arbiter
further proceedings by the may appeal to the Commission and
Commission are not necessary or the execution of the judgment shall
desirable; and be suspended pending the
resolution of the appeal upon the
(d) To hold any person in contempt filing by such person of a bond on
directly or indirectly and impose condition that he will abide by and
appropriate penalties therefor in perform the judgment of the
accordance with law. Commission should the appeal be
decided against him. Judgment of

the Commission on direct contempt be committed and will be
is immediately executory and continued unless restrained, but
unappealable. Indirect contempt no injunction or temporary
shall be dealt with by the restraining order shall be issued
Commission or Labor Arbiter in the on account of any threat,
manner prescribed under Rule 71 of prohibited or unlawful act, except
the Revised Rules of Court; and (As against the person or persons,
amended by Section 10, Republic association or organization
Act No. 6715, March 21, 1989) making the threat or committing
the prohibited or unlawful act or
(e) To enjoin or restrain any actual or actually authorizing or ratifying
threatened commission of any or all the same after actual knowledge
prohibited or unlawful acts or to thereof;
require the performance of a
particular act in any labor dispute 2. That substantial and irreparable
which, if not restrained or performed injury to complainant’s property
forthwith, may cause grave or will follow;
irreparable damage to any party or
render ineffectual any decision in 3. That as to each item of relief to
favor of such party: Provided, That be granted, greater injury will be
no temporary or permanent inflicted upon complainant by the
injunction in any case involving or denial of relief than will be
growing out of a labor dispute as inflicted upon defendants by the
defined in this Code shall be issued granting of relief;
except after hearing the testimony of
witnesses, with opportunity for 4. That complainant has no
cross-examination, in support of the adequate remedy at law; and
allegations of a complaint made
under oath, and testimony in 5. That the public officers charged
opposition thereto, if offered, and with the duty to protect
only after a finding of fact by the complainant’s property are
Commission, to the effect: unable or unwilling to furnish
1. That prohibited or unlawful acts adequate protection.
have been threatened and will

Such hearing shall be held after issuance of such order or injunction,
due and personal notice thereof has including all reasonable costs, together
been served, in such manner as the with a reasonable attorney’s fee, and
Commission shall direct, to all known expense of defense against the order or
persons against whom relief is sought, against the granting of any injunctive
and also to the Chief Executive and relief sought in the same proceeding
other public officials of the province or and subsequently denied by the
city within which the unlawful acts have Commission.
been threatened or committed, charged The undertaking herein
with the duty to protect complainant’s mentioned shall be understood to
property: Provided, however, that if a constitute an agreement entered into by
complainant shall also allege that, the complainant and the surety upon
unless a temporary restraining order which an order may be rendered in the
shall be issued without notice, a same suit or proceeding against said
substantial and irreparable injury to complainant and surety, upon a hearing
complainant’s property will be to assess damages, of which hearing,
unavoidable, such a temporary complainant and surety shall have
restraining order may be issued upon reasonable notice, the said complainant
testimony under oath, sufficient, if and surety submitting themselves to the
sustained, to justify the Commission in jurisdiction of the Commission for that
issuing a temporary injunction upon purpose. But nothing herein contained
hearing after notice. Such a temporary shall deprive any party having a claim or
restraining order shall be effective for no cause of action under or upon such
longer than twenty (20) days and shall undertaking from electing to pursue his
become void at the expiration of said ordinary remedy by suit at law or in
twenty (20) days. No such temporary equity: Provided, further, That the
restraining order or temporary injunction reception of evidence for the application
shall be issued except on condition that of a writ of injunction may be delegated
complainant shall first file an by the Commission to any of its Labor
undertaking with adequate security in an Arbiters who shall conduct such
amount to be fixed by the Commission hearings in such places as he may
sufficient to recompense those enjoined determine to be accessible to the parties
for any loss, expense or damage and their witnesses and shall submit
caused by the improvident or erroneous thereafter his recommendation to the

Commission. (As amended by Section 16, Batas Pambansa Bilang 130, August
10, Republic Act No. 6715, March 21, 21, 1981)
1989)
Art. 228. [221] Technical rules not
Art. 226. [219] Ocular inspection. The binding and prior resort to amicable
Chairman, any Commissioner, Labor settlement. In any proceeding before
Arbiter or their duly authorized the Commission or any of the Labor
representatives, may, at any time during Arbiters, the rules of evidence prevailing
working hours, conduct an ocular in courts of law or equity shall not be
inspection on any establishment, controlling and it is the spirit and
building, ship or vessel, place or intention of this Code that the
premises, including any work, material, Commission and its members and the
implement, machinery, appliance or any Labor Arbiters shall use every and all
object therein, and ask any employee, reasonable means to ascertain the facts
laborer, or any person, as the case may in each case speedily and objectively
be, for any information or data and without regard to technicalities of
concerning any matter or question law or procedure, all in the interest of
relative to the object of the investigation. due process. In any proceeding before
the Commission or any Labor Arbiter,
Art. 227. [220] Compulsory the parties may be represented by legal
arbitration. The Commission or any counsel but it shall be the duty of the
Labor Arbiter shall have the power to Chairman, any Presiding Commissioner
ask the assistance of other government or Commissioner or any Labor Arbiter to
officials and qualified private citizens to exercise complete control of the
act as compulsory arbitrators on cases proceedings at all stages.
referred to them and to fix and assess Any provision of law to the
the fees of such compulsory arbitrators, contrary notwithstanding, the Labor
taking into account the nature of the Arbiter shall exert all efforts towards the
case, the time consumed in hearing the amicable settlement of a labor dispute
case, the professional standing of the within his jurisdiction on or before the
arbitrators, the financial capacity of the first hearing. The same rule shall apply
parties, and the fees provided in the to the Commission in the exercise of its
Rules of Court.] (Repealed by Section original jurisdiction. (As amended by

Section 11, Republic Act No. 6715, (c) If made purely on questions of law;
March 21, 1989) and/or
(d) If serious errors in the findings of
BASED ON THE 2011 NLRC facts are raised which, if not
RULES OF PROCEDURE corrected, would cause grave or
RULE VI irreparable damage or injury to the
APPEALS appellant.
SECTION 1. PERIODS OF APPEAL. -

Decisions, resolutions or orders of the SECTION 3. WHERE FILED. - The
Labor Arbiter shall be final and appeal shall be filed with the respective
executory unless appealed to the Regional Arbitration Branch or the
Commission by any or both parties Regional Office, where the case was
within ten (10) calendar days from heard and decided.
receipt of such decisions, resolutions or

orders of the Labor Arbiter and in case SECTION 4. REQUISITES FOR
of a decision of the Regional Director PERFECTION OF APPEAL. –
within five (5) calendar days from receipt (a) The Appeal shall be filed within the
of such decisions, resolutions, or orders. reglementary period as provided in
If the 10th or 5th day, as the case may Section 1 of this Rule; shall be
be, falls on a Saturday, Sunday or a verified by appellant himself in
holiday, the last day to perfect the accordance with Section 4, Rule 7 of
appeal shall be the next working day. the Rules of Court, with proof of
payment of the required appeal fee
SECTION 2. GROUNDS. - The appeal and the posting of a cash or surety
may be entertained only on any of the bond as provided in Section 6 of this
following grounds: Rule; shall be accompanied by
(a) If there is prima facie evidence of memorandum of appeal in three (3)
abuse of discretion on the part of the legibly typewritten copies which shall
Labor Arbiter or Regional Director; state the grounds relied upon and
(b) If the decision, resolution or order the arguments in support thereof;
was secured through fraud or the relief prayed for; and a statement
coercion, including graft and of the date when the appellant
corruption; received the appealed decision,

resolution or order and a certificate

of non-forum shopping with proof of
service on the other party of such SECTION 6. BOND. - In case the
appeal. A mere notice of appeal decision of the Labor Arbiter or the
without complying with the other Regional Director involves a monetary
requisites aforestated shall not stop award, an appeal by the employer may
the running of the period for be perfected only upon the posting of a
perfecting an appeal. cash or surety bond. The appeal bond
(b) The appellee may file with the shall either be in cash or surety in an
Regional Arbitration Branch or amount equivalent to the monetary
Regional Office where the appeal award, exclusive of damages and
was filed, his answer or reply to attorney’s fees.
appellant's memorandum of appeal, In case of surety bond, the
not later than ten (10) calendar days same shall be issued by a reputable
from receipt thereof. Failure on the bonding company duly accredited by the
part of the appellee who was Commission or the Supreme Court, and
properly furnished with a copy of the shall be accompanied by:
appeal to file his answer or reply (a) a joint declaration under oath by the
within the said period may be employer, his counsel, and the
construed as a waiver on his part to bonding company, attesting that the
file the same. bond posted is genuine, and shall be
(c) Subject to the provisions of Article in effect until final disposition of the
218, once the appeal is perfected in case.
accordance with these Rules, the (b) a copy of the indemnity agreement
Commission shall limit itself to between the employer-appellant and
reviewing and deciding specific bonding company; and
issues that were elevated on appeal. (c) a copy of security deposit or
collateral securing the bond.
SECTION 5. APPEAL FEE. -The A certified true copy of the bond
appellant shall pay an appeal fee of one shall be furnished by the appellant to the
hundred fifty pesos (P150.00) to the appellee who shall verify the regularity
Regional Arbitration Branch or Regional and genuineness thereof and
Office, and the official receipt of such immediately report to the Commission
payment shall be attached to the any irregularity.
records of the case.

Upon verification by the SECTION 9. TRANSMITTAL OF
Commission that the bond is irregular or RECORDS OF CASES ON APPEAL. -
not genuine, the Commission shall Within forty-eight (48) hours after the
cause the immediate dismissal of the filing of the appeal, the records of the
appeal. case, with a corresponding index of
No motion to reduce bond shall contents thereof, together with the
be entertained except on meritorious memorandum of appeal and the reply or
grounds and upon the posting of a bond answer thereto, if any, proofs of service,
in a reasonable amount in relation to the if available, proof of payment of the
monetary award. appeal fee, and the appeal bond posted,
The filing of the motion to reduce shall be officially transmitted by the
bond without compliance with the office of origin to the Commission.
requisites in the preceding paragraph
shall not stop the running of the period SECTION 10. PERFECTION OF
to perfect an appeal. APPEAL; EFFECT. - Without prejudice
to the provisions of Section 3, Rule VIII
SECTION 7. NO EXTENSION OF of these Rules, once an appeal is filed,
PERIOD. - No motion or request for the Labor Arbiter loses jurisdiction over
extension of the period within which to the case. All motions/pleadings
perfect an appeal shall be allowed. pertaining thereto shall thereafter be
addressed to and filed with the
SECTION 8. RECORDS OF CASES ON Commission.
APPEAL. - The records of a case shall
contain, among others, the original copy SECTION 11. FRIVOLOUS OR
of the complaint; pleadings; minutes of DILATORY APPEALS. - To discourage
the proceedings; notices, transcripts of frivolous or dilatory appeals, the
stenographic notes, if any, Commission may impose appropriate
decisions/orders/resolutions; proof of sanction upon the erring parties.
service of the decision, if available;
order or computation of the award; and SECTION 12. APPEALS FROM
evidence submitted, which shall be DECISION OF OTHER AGENCIES. -
chronologically arranged and paged The rules provided herein governing
prominently. appeals from the decisions or orders of
Labor Arbiters shall apply to appeals to

the Commission from decisions or heard by any other Division whose
orders of the other offices or agencies docket allows the additional
appealable to the Commission workload and such transfer will not
according to law. expose litigants tonunnecessary
additional expense.
RULE VII (c) Divisions. - Unless otherwise
PROCEEDINGS BEFORE THE provided by law, the Commission
COMMISSION shall exercise its adjudicatory and all
SECTION 1. JURISDICTION OF THE other powers, functions and duties
COMMISSION. - The Commission shall through its five (5) Divisions. Each
exercise exclusive, original, and Division shall consist of one member
appellate jurisdiction in accordance with from the public sector who shall act
law. as the Presiding Commissioner and
one member each from the workers
SECTION 2. COMPOSITION/ and employers sectors, respectively.
INTERNAL FUNCTIONS OF THE Of the five (5) Divisions, the
COMMISSION EN BANC AND ITS First, Second and Third Divisions
DIVISIONS. - shall have exclusive territorial
(a) Composition. -Unless otherwise jurisdiction over appeals of cases
provided by law, the Commission coming from Luzon; Fourth Division,
shall be composed of the Chairman appealed cases from Visayas
and of fourteen (14) Commissioners. Region; and the Fifth Division,
(b) Commission En Banc. - The appealed cases from Mindanao
Commission shall sit en banc only including those from the
for purposes of promulgating rules Autonomous Region for Muslim
and regulations governing the Mindanao.
hearing and disposition of cases (d) Headquarters, Branches and
before its Divisions and Regional Provincial Extension Units. - As
Arbitration Branches, and for the provided by law, the Commission
formulation of policies affecting its and its First, Second and Third
administration and operations. It Divisions shall have their main office
may, on temporary or emergency in the National Capital Region, and
basis, allow cases within the the Fourth and Fifth Divisions in the
jurisdiction of any Division to be

cities of Cebu and Cagayan de Oro, (b) Quorum. - The presence of a
respectively. majority of all the members of the
Commission shall be necessary to
SECTION 3. THE CHAIRMAN. - The constitute a quorum. The vote or
Chairman shall preside over all sessions concurrence of the majority of the
of the Commission en banc. He is the members constituting a quorum shall
Presiding Commissioner of the First be the decision or resolution of the
Division. In case of the effective Commission en banc.
absence or incapacity of the Chairman, (c) Division. - The presence of at least
the Presiding Commissioner of the two (2) Commissioners of a Division
Second Division shall be the Acting shall constitute a quorum. The
Chairman. concurrence of two (2)
The Chairman, aided by the Commissioners of a Division shall be
Executive Clerk of the Commission, necessary for the pronouncement of
shall have administrative supervision a judgment or resolution.
over the Commission and its Regional Whenever the required
Branches and all its personnel including membership in a Division is not
the Executive Labor Arbiters and Labor complete and the concurrence of
Arbiters. two (2) Commissioners to arrive at a
judgment or resolution cannot be
SECTION 4. SESSION EN obtained, the Chairman shall
BANC/QUORUM AND VOTE. – designate such number of additional
(a) Commission en banc. - The Commissioners from the other
Chairman shall call the Commission Divisions as may be necessary from
to a session en banc at least twice a the same sector.
year, preferably first week of June (d) Role of Chairman in the Division. -
and first week of December to The Chairman of the Commission
deliberate on and decide any matter may convene and preside over the
before it. However, a majority of all session of any Division to consider
the members of the Commission any case pending before it and
may call a special en banc session participate in its deliberations, if in
to discuss and decide on urgent and his judgment, his presence therein
vital matters which need immediate will best serve the interests of labor
action. justice. He shall not however,

participate in the voting by the However, any Commissioner may inhibit
Division, except when he is acting as himself from the consideration and
Presiding Commissioner of the resolution of any case/matter before the
Division in the absence of the Division and shall so state in writing the
regular Presiding Commissioner. legal or justifiable grounds therefor. In
the event that a member inhibits himself,
SECTION 5. CONSULTATION. - The the case shall be raffled by the
conclusions of a Division on any Executive Clerk or Deputy Executive
case/matter submitted to it for decision Clerk to either of the two (2) remaining
shall be reached in consultation before Commissioners. In case two (2)
the case is assigned to a member for Commissioners in a Division inhibit
the writing of the opinion. It shall be themselves in a case or matter before it,
mandatory for the Division to meet for the Chairman shall as far as practicable
the purpose of the consultation ordained appoint two Commissioners from other
herein. Divisions representing the sector of the
A certification to this effect Commissioners who inhibited
signed by the Presiding Commissioner themselves.
of the Division shall be issued and a
copy thereof attached to the record of SECTION 8. ABSTENTION. - In such
the case and served upon the parties. an event and the concurrence of two
Commissioners to arrive at a judgment
SECTION 6. DISSENTING OPINION. - or resolution cannot be obtained,
Should any member indicate his Section 4 (c), par. 2 of this Rule shall
intention to write a dissenting opinion, apply.
he may file the same within the period
prescribed for deciding or resolving the SECTION 9. CONSOLIDATION OF
appeal; otherwise, such written CASES. - Appealed cases involving the
dissenting opinion shall not be same parties/issues and/or related
considered part of the records of the questions of facts or of law shall be
case. consolidated before the Commissioner
to whom the case with the lowest
SECTION 7. INHIBITION. - No motion number is assigned. Notice of the
to inhibit the entire division of the consolidation shall be given by the
Commission shall be entertained.

Executive Clerk to the other members of SECTION 12. ROLE OF THE LABOR
the Division. ARBITER ASSIGNED TO THE
COMMISSION. - In the resolution of
SECTION 10. TECHNICAL RULES cases on appeal, and those mentioned
NOT BINDING. - The rules of procedure in Rules IX and XI, the Commission
and evidence prevailing in courts of law shall be assisted by the Labor Arbiter
and equity shall not be controlling and who may be directed to study, review,
the Commission shall use every and all hear and receive evidence and submit
reasonable means to ascertain the facts reports thereto.
in each case speedily and objectively,
without regard to technicalities of law or SECTION 13. FORM OF
procedure, all in the interest of due DECISION/RESOLUTION/ORDER.
process. -The decision/resolution/order shall
In any proceeding before the state clearly and distinctly the findings of
Commission, the parties may be facts, issues and conclusions of law on
represented by legal counsel but it shall which it is based and relief granted, if
be the duty of the Chairman, any any. If the decision or resolution/order
Presiding Commissioner or involves monetary awards, the same
Commissioner to exercise complete shall contain the specific amount
control of the proceedings at all stages. awarded as of the date the decision is
rendered.
SECTION 11. DUTY TO CONCILIATE
AND MEDIATE. - In the exercise of its SECTION 14. FINALITY OF DECISION
exclusive, original and appellate OF THE COMMISSION AND ENTRY
jurisdiction, the Commission shall exert OF JUDGMENT. –
all efforts towards the amicable (a) Finality of the Decisions, Resolutions
settlement of a labor dispute. or Orders of the Commission.
The settlement of cases on Except as provided in Rule XI,
appeal, to be valid and binding between Section 9, the decisions, resolutions
the parties, shall be made before the or orders of the Commission/Division
Commissioner or his authorized shall become executory after ten
representative. (10) calendar days from receipt of
the same.

(b) Entry of Judgment. - Upon the further, that only one such motion from
expiration of the ten (10) calendar the same party shall be entertained.
day period provided in paragraph (a) Should a motion for
of this section, the reconsideration be entertained pursuant
decision/resolution/order shall, as far to this section, the resolution shall be
as practicable, be entered in a book executory after ten (10) calendar days
of entries of judgment. from receipt thereof.
(c) Allowance for Delay of Mail in the
Issuance of Entries of Judgment. - In RULE VIII
issuing entries of judgment, the EXECUTION PROCEEDINGS
Executive Clerk of Court or the SECTION 1. PRE-EXECUTION
Deputy Executive Clerk, in the CONFERENCE. - Within two (2)
absence of a return card or working days from receipt of the motion
certification from the post office for the issuance of a writ of execution
concerned, shall determine the and subject to Section 2, paragraph b,
finality of the decision by making the Labor Arbiter shall schedule a pre-
allowance for delay of mail, execution conference/hearing to thresh
computed sixty (60) calendar days out matters relevant to execution.
from the date of mailing of the
decision, resolution or order. SECTION 2. ISSUANCE OF A WRIT. –
(a) Execution shall issue upon a
SECTION 15. MOTIONS FOR decision, resolution or order that
RECONSIDERATION. - Motion for finally disposes of the actions or
reconsideration of any proceedings after the counsel of
decision/resolution/order of the record and the parties shall have
Commission shall not be entertained been furnished with copies of the
except when based on palpable or decision in accordance with these
patent errors, provided that the motion is Rules but only after the expiration of
under oath and filed within ten (10) the period of appeal if no appeal has
calendar days from receipt of been duly filed.
decision/resolution/order, with proof of (b) No motion for execution shall be
service that a copy of the same has entertained nor a writ be issued
been furnished, within the reglementary unless the Labor
period, the adverse party, and provided Arbiter/Commission is in possession

of the records of the case which computation of the decision, resolution
shall include an Entry of Judgment in or order is necessary, no execution shall
case of appeal except that, as issue until after computation shall have
provided for in Section 10 of Rule VI, been approved by the Labor Arbiter in
and in those cases where partial an order after the parties shall have
execution is allowed by law, the been duly notified and heard thereon.
Labor Arbiter shall retain duplicate
original copies of the decision to be SECTION 6. EFFECT OF FILING OF
implemented and proof of service PETITION FOR CERTIORARI ON
thereof for the purpose of its EXECUTION. - A petition for certiorari
immediate enforcement. with the Court of Appeals or the
Supreme Court shall not stay the
SECTION 3. ISSUANCE OF PARTIAL execution of the assailed decision
WRIT PENDING APPEAL. - In case the unless a temporary restraining order is
decision includes an order of issued by the Court of Appeals or the
reinstatement, the Labor Arbiter shall Supreme Court.
immediately issue a partial writ of
execution even pending appeal directing SECTION 7. ENFORCEMENT OF
the employer to immediately reinstate WRIT. - In executing an order,
the dismissed employee either resolution or decision, the sheriff or
physically or through payroll and to pay other authorized officer acting as such,
the corresponding salaries as a shall be guided strictly by the Sheriff's
consequence of the reinstatement. Manual (NLRC Manual on Execution of
Judgment) which shall form part of
SECTION 4. EFFECT OF these Rules, and in the absence of
PERFECTION OF APPEAL ON applicable rules, the revised Rules of
EXECUTION. - The perfection of appeal Court, as amended.
shall stay the execution of the decision
of a Labor Arbiter on appeal except SECTION 8. RESOLUTION OF
partial execution for reinstatement MOTION TO QUASH. - A motion to
pending appeal. quash shall be resolved by the Labor
Arbiter within ten (10) days from
SECTION 5. COMPUTATION DURING submission of said motion for resolution.
EXECUTION. - Where further

SECTION 9. RESOLUTION OF THIRD compliance with the decisions,
PARTY CLAIM. - Should a third party resolutions or orders of the Commission
claim be filed during execution of the and those of Labor Arbiters, including
judgment award, the third party claimant the imposition of administrative fines
shall execute an affidavit stating his title which shall not be less than P500.00 nor
to property or possession thereof with more than P10,000.00.
supporting evidence and shall file the
same with the sheriff and copies thereof RULE IX
served upon the Labor Arbiter or proper CERTIFIED CASES
officer issuing the writ. Upon receipt of SECTION 1. POLICY AND PURPOSE.
the third party claim, all proceedings, - It is the declared policy and purpose of
with respect to the execution of the certification of labor disputes for
property subject of the third party claim, compulsory arbitration to ensure and
shall automatically be suspended. The maintain industrial peace based on
Labor Arbiter who issued the writ may social justice and national interest by
require the third party claimant to having a full and complete settlement or
adduce additional evidence in support of adjudication of all labor disputes
his third party claim and to post a cash between the parties, as well as issues
or surety bond equivalent to the amount that are relevant to or incidents of the
of his claim, as provided for in Section 6, certified issues.
Rule VI, without prejudice to the posting
by the prevailing party of a supersedeas SECTION 2. CERTIFIED LABOR
bond in an amount equivalent to that DISPUTES. - Certified labor disputes
posted by the third party claimant, and are cases certified to the Commission
resolve the propriety of such claim for compulsory arbitration under Article
within ten (10) working days from 263 (g) of the Labor Code.
submission of the claim for resolution.
SECTION 10. DESIGNATION OF SECTION 3. EFFECTS OF

SPECIAL SHERIFFS AND CERTIFICATION. –
IMPOSITION OF FINES. - The (a) Upon certification, the intended or
Chairman of the Commission may impending strike or lockout is
designate special Sheriffs and take any automatically enjoined,
measure, under existing laws to ensure notwithstanding the filing of any

motion for reconsideration of the Whenever a certified labor
certification order nor the non- dispute involves a business entity with
resolution of any such motion which several workplaces located in different
may have been duly submitted to the regions, the Division having territorial
Office of the Secretary of Labor and jurisdiction over the principal office of
Employment. If a work stoppage has the company shall acquire jurisdiction to
already taken place at the time of decide such labor dispute; unless the
the certification, all striking or locked certification order provides otherwise.
out employees shall immediately
return to work and the employer SECTION 4. EFFECTS OF DEFIANCE.
shall immediately resume operations - Non-compliance with certification order
and readmit all workers under the of the Secretary of Labor and
same terms and conditions Employment or a return to work order of
prevailing before the strike or the Commission shall be considered an
lockout. illegal act committed in the course of the
(b) All cases between the same parties, strike or lockout and shall authorize the
except where the certification order Commission to enforce the same under
specifies otherwise the issues pain of loss of employment status or
submitted for arbitration which are entitlement to full employment benefits
already filed or may be filed, and are from the locking-out employer or
relevant to or are proper incidents of backwages, damages and/or other
the certified case, shall be positive and/or affirmative reliefs, even
considered subsumed or absorbed to criminal prosecution against the liable
by the certified case, and shall be party/ies.
decided by the appropriate Division The Commission may also seek
of the Commission. the assistance of law enforcement
The parties to a certified case, agencies to ensure
under pain of contempt, shall inform compliance/enforcement of its
their counsels and the Division orders/resolutions.
concerned of all cases pending with the
Regional Arbitration Branches and SECTION 5. EXECUTION OF
Voluntary Arbitrators relative or incident CERTIFIED CASE. - The Commission
to the certified case before it. shall issue an order of execution upon

motion of the parties and upon receipt of from notice of the judgment, appeal the
entry of judgment. same to the Commission and the
execution of said judgment shall be
RULE X suspended pending resolution of the
CONTEMPT appeal upon the filing by said person of
SECTION 1. DIRECT CONTEMPT. - a bond on condition that he will abide by
The Chairman or Commissioner/s or and perform the judgment should the
any Labor Arbiter may summarily appeal be decided against him. A
adjudge guilty of direct contempt any judgment of the Commission on direct
person committing any act of contempt shall be immediately
misbehavior in the presence of or so executory and inappealable.
near the Chairman or any
Commissioner or Labor Arbiter as to SECTION 2. INDIRECT CONTEMPT. -
obstruct or interrupt the proceedings The Commission or any Labor Arbiter
before the same, including disrespect may also cite any person for indirect
toward said officials, offensive acts contempt upon the following grounds:
toward others, or refusal to be sworn or (a) Misbehaviour of an employee or any
to answer as a witness or to subscribe officer in the performance of his
to an affidavit or deposition when official duties or in his official
lawfully required to do so. If the offense transaction;
is committed against the Commission or (b) Disobedience or resistance of a
any member thereof, the same shall be lawful writ, order or decision;
punished by a fine not exceeding five (c) Any abuse of, or any unlawful
hundred pesos (P500.00) or interference with the processes or
imprisonment not exceeding five (5) proceedings not constituting direct
days, or both; and, if the offense is contempt;
committed against any Labor Arbiter,
the same shall be punished by a fine not (d) Any improper conduct, direct or
exceeding one hundred pesos indirect, to impede, obstruct or
(P100.00) or imprisonment not degrade the administration of justice;
exceeding one (1) day, or both. (e) Assuming to be an attorney or a
Any person adjudged guilty of representative of party without
direct contempt by a Labor Arbiter may, authority;
within a period of five (5) calendar days

(f) Failure to obey a subpoena duly be determined by the Commission to
served; answer for any damage that may be
(g) Other grounds analogous to the suffered by the party enjoined, if it is
foregoing. finally determined that the petitioner is
Any person adjudged guilty of not entitled thereto.
indirect contempt shall observe the
same procedure as provided for in SECTION 2. INJUNCTION IN STRIKES
second paragraph of Section 1 hereof. OR LOCKOUTS. - A temporary or
permanent injunction may be granted by
RULE XI the Commission only after hearing the
INJUNCTION testimony of witness/es and with
SECTION 1. INJUNCTION IN opportunity for cross-examination in
ORDINARY LABOR DISPUTES. - A support of the allegations of the
preliminary injunction or restraining complaint or petition made under oath,
order may be granted by the and testimony by way of opposition
Commission through its Divisions thereto, if offered, and only after a
pursuant to the provisions of paragraph finding of fact by the Commission:
(e) of Article 218 of the Labor Code, as (a) That prohibited or unlawful acts have
amended, when it is established on the been threatened and will be
basis of the sworn allegations in the committed and will be continued
petition that the acts complained of unless restrained, but no injunction
involving or arising from any labor or temporary restraining order shall
dispute before the Commission, which, if be issued on account of any threat,
not restrained or performed forthwith, prohibited or unlawful act, except
may cause grave or irreparable damage against the person or persons,
to any party or render ineffectual any association or organization making
decision in favor of such party. the threat or committing the
A certification of non-forum prohibited or unlawful act or actually
shopping shall accompany the petition authorizing or ratifying the same
for injunction. after actual knowledge thereof.
The writ of preliminary injunction (b) That substantial and irreparable
or temporary restraining order shall injury to complainant's property will
become effective only upon posting of follow;
the required cash bond in the amount to

(c) That as to each item of relief to be city within which the unlawful acts have
granted, greater injury will be been threatened or committed charged
inflicted upon the complainant by the with the duty to protect complainant's
denial of relief than will be inflicted property.
upon defendants by the granting of
relief; SECTION 7. CASH BOND. - No
(d) That complainant has no adequate temporary restraining order or
remedy at law; and temporary injunction shall be issued
(e) That the public officers charged with except on condition that petitioner shall
the duty to protect complainant's first file an undertaking to answer for the
property are unable or unwilling to damages and post a cash bond in the
furnish adequate protection. amount not less than thirty thousand
SECTION 3. TEMPORARY pesos (P30,000.00) or as may be
RESTRAINING ORDER; REQUISITES. determined by the Commission, to
- If the petitioner shall also allege that, recompense those enjoined for any loss,
unless a temporary restraining order expense or damage caused by the
shall be issued without notice, a improvident or erroneous issuance of
substantial and irreparable injury to such order or injunction, including all
complainant's property will be reasonable costs, together with a
unavoidable, such a temporary reasonable attorney's fee, and expense
restraining order may be issued upon of defense against the order or against
testimony under oath, or by affidavits of the granting of any injunctive relief
the petitioner's witnesses, sufficient, if sought in the same proceeding and
sustained, to justify the Commission in subsequently denied by the
issuing a temporary injunction. Commission.
SECTION 4. HEARING; NOTICE SECTION 8. EFFECTIVITY OF THE

THEREOF. - Such hearing shall be held TEMPORARY RESTRAINING ORDER.
after due and personal notice thereof - A temporary restraining order shall be
has been served, in such manner as the effective for no longer than twenty (20)
Commission shall direct, to all known days and shall become void at the
persons against whom relief is sought, expiration of said twenty (20) days.
and also to the Chief Executive and During the said period, the parties shall
other public officials of the province or be required to present evidence to

substantiate their respective positions in the inscription, running from left to right
the main petition. on the upper outside edge, the words
NATIONAL LABOR RELATIONS
SECTION 9. EFFECTS OF DEFIANCE. COMMISSION, and the lower outside
- The order or resolution enjoining the edge, the words REPUBLIC OF THE
performance of illegal acts shall be PHILIPPINES, with a design at the
immediately executory in accordance center containing the coat of arms of the
with the terms thereof. Non-compliance Department of Labor and Employment.
with such order or resolution, the
Commission shall impose such SECTION 2. THE EXECUTIVE CLERK.
sanctions and shall issue such orders as - The Executive Clerk shall assist the
may be necessary to implement the said Commission when sitting en banc and,
Order or Resolution, including the when acting thru the First Division, shall
enlistment of law enforcement agencies perform such similar or equivalent
having jurisdiction over the area for the functions and duties as are discharged
purpose of enforcing the same. by the Clerk of Court of the Court of
Appeals.
SECTION 10. ORDINARY REMEDY IN
LAW OR IN EQUITY. - Nothing in this SECTION 3. DEPUTY EXECUTIVE
Rule shall deprive any party having a CLERKS. - The Deputy Executive
claim or cause of action under or upon Clerks for the Second, Third, Fourth and
such undertaking from electing to Fifth Divisions shall assist the
pursue his ordinary remedy by suit at Commission when acting thru its
law or in equity. Division and shall perform similar
functions and duties as discharged by
RULE XII the Deputy Clerks of Court of the Court
COMMISSION SEAL AND RECORDS, of Appeals and as enumerated herein
AND POWERS AND DUTIES OF as functions of the Executive Clerk
COMMISSION OFFICIALS relative to their respective Divisions.
SECTION 1. SEAL OF THE SECTION 4. DUTIES AND

COMMISSION. - The seal of the FUNCTIONS OF THE EXECUTIVE
National Labor Relations Commission CLERK/DEPUTY EXECUTIVE
shall be of standard size, circular, with CLERKS. –

(a) Custody of Seal and Books. He Commission/Division calendars of
shall keep in his care and custody sessions, attend such sessions
the Seal of the Commission, personally and immediately prepare
together with all the books the Minutes thereof. For this
necessary for the recording of the purpose, he shall keep a Minutes
proceedings of the Commission, Book;
including the records, files and (f) General Docket. - The Executive
exhibits; Clerk shall keep a General Docket
(b) Filing of Pleadings. - He shall for the Commission, each page of
receive and file all cases/pleadings which shall be numbered and
and documents indicating thereon prepared for receiving all the entries
the date and time filed. All pleadings in a single page, and shall enter
shall be filed in three (3) legibly therein all original and appealed
typewritten copies in legal size; cases before it, numbered
(c) Raffle/Assignment of Cases. - He consecutively in the order in which
shall assign appealed cases for they were received and, under the
study/report strictly by raffle or as heading of each case, the date and
directed by the Chairman. In this hour of each pleading filed, of each
connection, the raffle of cases for order, decision or resolution entered,
study/report must be attended by the and of each other step or action
duly designated representative of taken in the case; so that, by
the Members of the appropriate reference to any single page, the
Division; history of the case may be known;
(d) Service of Processes, Orders, (g) Promulgation/Promulgation Book.
Decisions. - He shall serve parties He shall promulgate Decisions/Final
and counsel processes, notices of Resolutions on the same date the
hearings, copies of same is filed with his office and
Decisions/Resolutions/Orders issued indicate the date and time of
by the Commission by mail or by promulgation and attest the same by
personal service and immediately his signature on the first page
attach the returns thereof to the thereof. He shall immediately furnish
records; the Chairman with a copy of such
(e) Commission Calendar/Minutes decision/resolution/order with a
Book. - He shall prepare the summary of the nature thereof and

the issue involved therein. He shall (k) Other functions. - He shall perform
keep a Promulgation Book which other functions as directed by the
indicates the date and time of Chairman or the Commission en
promulgation, the case number, title banc.
of the case, the ponente, the nature
of the Decision/Final Decision and SECTION 5. ISSUANCE OF
the action taken by the Commission CERTIFIED COPIES. - Unless
by quoting the dispositive portion otherwise restricted by Section 7 hereof,
thereof. Notices of said the Executive Clerk/Deputy Executive
Decisions/Resolutions/Orders shall Clerk shall prepare, for any person
be sent in sealed envelopes to asking for the same, a certified copy,
parties/counsel within forty-eight (48) under the Seal of the Commission, of
hours from promulgation; any paper, record, decision, resolution,
(h) Entry of Judgment. - He shall keep order or entry by and in his office,
a Book of Entries of Judgment, proper to be certified, after payment of
Decisions, Resolutions, Orders the standard fees to the Commission
containing in chronological order the duly receipted for; provided, that a
entries of all final Orders, Decisions, pauper litigant, as defined by law, shall
Resolutions of the Commission; be exempted from paying any fee for
(i) Disposition/Remand of Records. - certified copies of any document,
Upon entry of judgment, he shall including transcripts of stenographic
immediately remand the records of notes.
the case to the Arbitration Branch of
origin, Regional Director or his duly SECTION 6. POWER TO ADMINISTER
authorized officer, as the case may OATH. - The Chairman, Members of the
be. The Records Section shall Commission, the Executive Clerk, the
immediately post said records Deputy Executive Clerks, the Executive
without delay within two (2) working Labor Arbiters, the Labor Arbiters, and
days; other persons designated or
(j) Monthly Accomplishment commissioned by the Chairman of the
Reports. He shall submit a Monthly Commission, shall have the power to
Accomplishment Report of the administer oath on all matters or
Commission/Division not later than proceedings related to the performance
the 7th day of the following month; of their duties.

courts as the appropriate forum
SECTION 7. ACCESS TO for the relief desired.
COMMISSION RECORDS. - All official Apropos to this directive that
records of the Commission shall be
resort to the higher courts should
open to the public during regular office
be made in accordance with their
hours, except those kept by it in the
hierarchical order, this
nature of confidential reports, records or
pronouncement in Santiago vs.
communications which cannot be
divulged without violating private rights
Vasquez, et al. should be taken
or prejudicing the public interest. into account:

Minutes of hearings/sessions may not One final observation. We
be divulged until after promulgation of discern in the proceedings in this
the Decision/Resolution. case a propensity on the part of
petitioner, and, for that matter,
JUDICIAL REVIEW OF LABOR the same may be said of a
RULINGS number of litigants who initiate
As discussed in the St. Martin recourses before us, to disregard
Funeral Home VS NLRC and the hierarchy of courts in our
Bienvenido Aricayos case: judicial system by seeking relief
Therefore, all references in directly from this Court despite
the amended Section 9 of B.P. the fact that the same is available
No. 129 to supposed appeals in the lower courts in the exercise
from the NLRC to the Supreme of their original or concurrent
Court are interpreted and hereby jurisdiction, or is even mandated
declared to mean and refer to by law to be sought therein. This
petitions for certiorari under Rule practice must be stopped, not
65. Consequently, all such only because of the imposition
petitions should henceforth be upon the precious time of this
initially filed in the Court of Court but also because of the
Appeals in strict observance of inevitable and resultant delay,
the doctrine on the hierarchy of intended or otherwise, in the
adjudication of the case which

often has to be remanded or 3. Occupational safety and health
referred to the lower court as the violation;
proper forum under the rules of 4. Registration of unions and
procedure, or as better equipped cancellation thereof, cases filed
to resolve the issues since this against unions and other labor
Court is not a trier of facts. We, relations related cases;
therefore, reiterate the judicial 5. Complaints against private
policy that this Court will not recruitment and placement
entertain direct resort to it unless agencies for local employment;
the redress desired cannot be and
obtained in the appropriate courts 6. Cases submitted to them for
or where exceptional and voluntary arbitration in their
compelling circumstances justify capacity as Ex- Officio Voluntary
availment of a remedy within and Arbitrators under Department
calling for the exercise of our Order No. 83 - 07, Series of
primary jurisdiction. 2007.
DOLE REGIONAL DIRECTORS B. Recovery and Adjudicatory

A. Original and Exclusive Powers of DOLE Regional
Jurisdiction Directors
The Dole Regional Directors have 1. Money claims falling
original and exclusive jurisdiction under the jurisdiction of
over the following cases: the DOLE Regional
1. Labor standards enforcement Directors
cases under Article 128; Under Art. 129 of the LC,
2. Small money claims cases the RDs or any of the duly
arising from labor standards authorized hearing officers
violations in the amount not of DOLE have jurisdiction
exceeding P5,000.00 and not over claims for recovery of
accompanied with a claim or wages, simple money claims
reinstatement under Article 129;

and other benefits, provided summary proceeding and
that: after due notice, to hear and
a. The claim must arise decide cases involving
from Employer- recovery of wages and other
Employee relationship; monetary claims and
b. The claimant does not benefits, including legal
seek reinstatement; and interests.
c. The aggregate money
claim of each employee DOLE SECRETARY
does not exceed Php A. Visitorial Powers and
5,000.00. Enforcement Powers
NOTE: In the absence of The DOLE issued D.O. No. 57-04,
any of the above requisites, also called the Labor Standards
it is the LA who shall have Enforcement Framework (LSEF).
the jurisdiction over the The framework comprises three
claims arising from approaches:
Employer-Employee  Self-assessment;
relations, except claims for  Inspection;
Employee’s compensation,  Advisory service.
SSS, PhilHealth, and
maternity benefits, pursuant 1. Visitorial power
to Art.217 of the LC. It constitutes of:
The proceedings before the a. Access to Employer’s
Regional Office shall be records and premises at
summary and non-litigious in any time of the day or
nature. night, whenever work is
2. Adjudicatory power of the being undertaken
Regional Director (RD) b. To copy from said records
The RD or any of his duly c. Question any Employee
authorized hearing officers and investigate any fact,
is empowered through condition or matter which

may be necessary to c. Conduct industrial safety
determine violations, or inspections of
which may aid in the establishments (Art. 165).
enforcement of the LC and d. Inquire into the financial
of any wage order, or activities of LLO and
rules and regulation examine their books of
issued pursuant thereto. accounts upon the filing of
the complaint under oath
2. Instances where the and duly supported by the
visitorial power of the written consent of at least
Secretary of Labor and 20% of the total
Employment may be membership of the LO
exercised under the LC concerned.
Power to:
a. Inspect books of accounts 3. Enforcement power
and records of any person It is the power of the SOLE to:
or entity engaged in a. Issue compliance orders
recruitment and b. Issue writs of execution for
placement, require it to the enforcement of their
submit reports regularly on orders, except in cases
prescribed forms and act where the Employer
in violations of any contests the findings of the
provisions of the LC on labor officer and raise
recruitment and placement issues supported by
(Art. 37). documentary proof which
b. Have access to were not considered in the
Employer’s records and course of inspection
premises to determine c. Order stoppage of work or
violations of any provisions suspension of operation
of the LC on recruitment when non-compliance with
and placement (Art. 128). the law or implementing

rules and regulations 4. Violations under Art. 128 of
poses grave and imminent the LC
danger to health and a. Obstruct, impede, delay or
safety of workers in the otherwise render
workplace ineffective the orders of
d. Require Employers to the SOLE or his
keep and maintain such authorized representatives
employment records as b. Any government employee
may be necessary in aid to found guilty of, or abuse of
the visitorial and authority, shall be subject
enforcement powers to administrative
e. Conduct hearings within investigation and summary
24 hours to determine dismissal from service.
whether:
i. An order for stoppage 5. Limitations to other courts
of work or suspension In relation to enforcement orders
of operations shall be issued under Art. 128 of the LC,
lifted or not; and no inferior court or entity shall:
ii. Employer shall pay a. Issue temporary or
the concerned permanent injunction or
Employees their restraining order; or
salaries in case the b. Assume jurisdiction over
violation is any case
attributable to his
fault (as amended by 6. Instances when
RA 7730); (Guico v. Enforcement power may not
Secretary, G.R. No. be used
131750, November a. Case does not arise from
16, 1998). the exercise of visitorial
power

b. When Employer-Employee implementation of a mass layoff [LC,
relationship ceased to Art. 277(b)].
exist at the time of the
inspection NOTE: Art. 277 (b) of LC is
c. If Employer contests the applicable on suspension of the
finding of the Labor effects of termination if there is a
Regulation Officer and showing that the termination may
such contestable issue is cause serious labor dispute within
not verifiable in the normal the company while Art. 263 (g) of LC
course of inspection on assumption of jurisdiction is
The Supreme Court revisited the applicable in cases of strike in
Bombo Radyo ruling of 2009 and establishments affecting national
modified it in March 2012 through interest, not just the company.
an en banc resolution. The Court
now concedes that DOLE has the Reinstatement Pending
authority to determine the Resolution of the Termination
existence of an employer- Dispute
employee relationship, “subject to Suspension of the effects of
judicial review, not review by termination will necessarily result in
NLRC.” the immediate reinstatement of the
terminated employees. An order of
B. Power to Suspend Effects of reinstatement pending resolution of
Termination the case may thus be issued by the
The DOLE Secretary may suspend SOLE pursuant to this power.
the effects of the termination pending
resolution of the dispute in the event C. Assumption of Jurisdiction
of a prima facie finding by the 1. SOLE can assume
appropriate official of the DOLE jurisdiction over a labor
before whom such dispute is Dispute
pending that the termination may When there is a labor dispute
cause serious labor dispute or is in causing or likely to cause a

strike affecting national 2. Assumption of jurisdiction
interest, the SLE, on his own can be exercised without
initiative or upon petition by the necessity of prior notice
any of the parties, may either or hearing given to any of
assume jurisdiction or certify the party disputants
the dispute to the NLRC for The rationale for the DOLE
compulsory arbitration. Secretary’s assumption of
jurisdiction can justifiably rest
NOTE: Art. 263(g) of the LC is both on his own consideration of
an extraordinary and a pre-emptive the exigency of the situation in
power to address an extraordinary relation to the national
situation (a strike or lockout in an interests (Capitol Medical
industry indispensable to the national Center v. Trajano, G.R. No.
interest). As the term “assume 155690, June 30, 2005).
jurisdiction” connotes the intent of
the law is to give the SOLE full D. Remedies
authority to resolve all matters within 3. Cases within the appellate
the dispute that gave rise to or which jurisdiction of the DOLE
arose out of the strike or lockout—it Secretary
includes and extends to all questions a. Appeal from and adverse
and controversies arising from or decision of the POEA
related to the dispute, including (2003 POEA Rules and
cases over which the Labor Arbiter Regulations, Rule V, Part
has exclusive jurisdiction (Bagong VII, Sec. 1; Eastern
Pagkakaisa ng Manggagawa ng Mediterranean Maritime
Triumph International v. Secretary of Ltd. And Agemar Manning
the Department of Labor and Agency Inc., v. Surio et.
Employment, G.R. No. 167401, July al., G.R. No. 154213,
5, 2010). August 23, 2012)
b. Appeal the order or results
of a certification election

on the ground that the i. The first situation
Rules and Regulations or involves a petition for
parts thereof established cancellation of union
by the SLE for the conduct registration which is
of election have been filed with a Regional
violated (LC, Art. 259). Office. A decision of a
c. A review of cancellation Regional Office
proceedings decided by cancelling a union's
the BLR in the exercise of certificate of
its exclusive and original registration may be
jurisdiction (Abbott appealed to the BLR
Laboratories Philippines, whose decision on
Inc. v. Abbott Laboratories the matter shall be
Employees Union, G.R. final and
No.131374, January 26, unappealable.
2000). ii. The second situation
NOTE: The SOLE has no involves a petition for
jurisdiction over decisions cancellation of
of the BLR rendered in the certificate of union
exercise of its appellate registration which is
power to review the filed directly with the
decision of the RD in a BLR. A decision of
petition to cancel the the BLR cancelling a
union's certificate of union's certificate of
registration, said decisions registration may be
being final and appealed to the SLE
unappealable (Ibid.). whose decision on
Secs. 7 to 9 of Rule II, the matter shall be
Book V of the IRR of the final and
LC provides for two unappealable (Ibid.).
situations:

NOTE: The certificate 120270, June 16,
of registration of any 1999).
legitimate labor
organization including Powers of SOLE regarding
labor federations or voluntary arbitration
national unions may be The SOLE may authorize any official
cancelled by the to act as Voluntary Arbitrator upon
Bureau or the Regional the written request and agreement of
Office on any of the the parties to a labor dispute (Art.
following grounds: 212 (n), Labor Code). He shall also
o Violation of Articles approve, upon recommendation of
234, 237 and 239 of the NCMB the guidelines in
the Code; administering the Voluntary
o Failure to comply Arbitration Fund (Art. 276 (f), Labor
with Article 238 of Code)
the Code; and
o Violation of any of
the provisions of TITLE III – BUREAU OF
Article 241 of the LABOR RELATIONS
Code.
DOLE Secretary has BUREAU OF LABOR RELATIONS
no appellate jurisdiction Art. 232. [226] Bureau of Labor
over decisions of RD Relations. The Bureau of Labor
involving petitions for Relations and the Labor Relations
examinations of union Divisions in the regional offices of the
accounts. It is the BLR Department of Labor, shall have original

and exclusive authority to act, at their
which exercises
own initiative or upon request of either
appellate jurisdiction in
or both parties, on all inter-union and
such case (Barles v.
intra-union conflicts, and all disputes,
Bitonio, G.R. No.
grievances or problems arising from or
affecting labor-management relations in

all workplaces, whether agricultural or entertain only cases endorsed to him for
non-agricultural, except those arising compulsory arbitration by the Bureau or
from the implementation or by the Regional Director with a written
interpretation of collective bargaining notice of such indorsement or non-
agreements which shall be the subject indorsement. The indorsement or non-
of grievance procedure and/or voluntary indorsement of the Regional Director
arbitration. may be appealed to the Bureau within
The Bureau shall have fifteen ten (10) working days from receipt of the
(15) working days to act on labor cases notice.
before it, subject to extension by The parties may, at any time, by
agreement of the parties. (As amended mutual agreement, withdraw a case
by Section 14, Republic Act No. 6715, from the Conciliation Section and jointly
March 21, 1989). submit it to a Labor Arbiter, except
deadlocks in collective bargaining.]
Art. 233. [227] Compromise (Repealed by Section 16, Batas
agreements. Any compromise Pambansa Bilang 130, August 21, 1981)
settlement, including those involving
labor standard laws, voluntarily agreed Art. 235. [229] Issuance of
upon by the parties with the assistance subpoenas. The Bureau shall have the
of the Bureau or the regional office of power to require the appearance of any
the Department of Labor, shall be final person or the production of any paper,
and binding upon the parties. The document or matter relevant to a labor
National Labor Relations Commission or dispute under its jurisdiction, either at
any court, shall not assume jurisdiction the request of any interested party or at
over issues involved therein except in its own initiative.
case of non-compliance thereof or if
there is prima facie evidence that the Art. 236. [230] Appointment of bureau
settlement was obtained through fraud, personnel. The Secretary of Labor and
misrepresentation, or coercion. Employment may appoint, in addition to
the present personnel of the Bureau and
Art. 234. [228] Indorsement of cases the Industrial Relations Divisions, such
to Labor Arbiters. number of examiners and other
Except as provided in paragraph (b) of assistants as may be necessary to carry
this Article, the Labor Arbiter shall out the purpose of the Code. (As

amended by Section 15, Republic Act upon the application for registration of
No. 6715, March 21, 1989) such Collective Bargaining Agreement
within five (5) calendar days from receipt
Art. 237. [231] Registry of unions and thereof. The Regional Offices shall
file of collective bargaining furnish the Bureau with a copy of the
agreements. The Bureau shall keep a Collective Bargaining Agreement within
registry of legitimate labor organizations. five (5) days from its submission.
The Bureau shall also maintain a file of The Bureau or Regional Office
all collective bargaining agreements and shall assess the employer for every
other related agreements and records of Collective Bargaining Agreement a
settlement of labor disputes and copies registration fee of not less than one
of orders and decisions of voluntary thousand pesos (P1,000.00) or in any
arbitrators. The file shall be open and other amount as may be deemed
accessible to interested parties under appropriate and necessary by the
conditions prescribed by the Secretary Secretary of Labor and Employment for
of Labor and Employment, provided that the effective and efficient administration
no specific information submitted in of the Voluntary Arbitration Program.
confidence shall be disclosed unless Any amount collected under this
authorized by the Secretary, or when it provision shall accrue to the Special
is at issue in any judicial litigation, or Voluntary Arbitration Fund.
when public interest or national security The Bureau shall also maintain a
so requires. file and shall undertake or assist in the
Within thirty (30) days from the publication of all final decisions, orders
execution of a Collective Bargaining and awards of the Secretary of Labor
Agreement, the parties shall submit and Employment, Regional Directors
copies of the same directly to the and the Commission. (As amended by
Bureau or the Regional Offices of the Section 15, Republic Act No. 6715,
Department of Labor and Employment March 21, 1989)
for registration, accompanied with
verified proofs of its posting in two Art. 238. [232] Prohibition on
conspicuous places in the place of work certification election. The Bureau shall
and ratification by the majority of all the not entertain any petition for certification
workers in the bargaining unit. The election or any other action which may
Bureau or Regional Offices shall act disturb the administration of duly

registered existing collective bargaining performs preventive mediation and
agreements affecting the parties except conciliation functions. It administers
under Articles 253, 253-A and 256 of the voluntary arbitration program;
this Code. (As amended by Section 15,
maintains/updates a list of voluntary
Republic Act No. 6715, March 21, 1989)
arbitrators; compiles arbitration
awards and decisions; and provides
Art. 239. [233] Privileged
counseling and preventive mediation
communication. Information and
statements made at conciliation
assistance particularly in the
proceedings shall be treated as administration of collective

privileged communication and shall not agreements.
be used as evidence in the Commission. It is with the NCMB that
Conciliators and similar officials shall not Notices of Strike or Lockout are filed.
testify in any court or body regarding
any matters taken up at conciliation
proceedings conducted by them.
TITLE IV – LABOR
ORGANIZATIONS
NATIONAL CONCILIATION AND
MEDIATION BOARD Chapter I – Registration and
Executive Order No. 251 which Cancellation
created the National Conciliation and Art. 240. [234] Requirements of
Mediation Board (NCMB) ordains registration. A federation, national
that the conciliation, mediation and union or industry or trade union center
or an independent union shall acquire
voluntary arbitration functions of the
legal personality and shall be entitled to
Bureau of Labor Relations (BLR)
the rights and privileges granted by law
shall be absorbed by NCMB. It is an
to legitimate labor organizations upon
attached agency under the
issuance of the certificate of registration
administrative supervision of the
based on the following requirements
Secretary of Labor and Employment. a. Fifty pesos (P50.00) registration fee;
The NCMB has jurisdiction b. The names of its officers, their
over conciliation, mediation and addresses, the principal address of
voluntary arbitration cases. It the labor organization, the minutes
of the organizational meetings and

the list of the workers who Registration of a labor organization
participated in such meetings; is necessary for it to acquire legal
c. In case the applicant is an personality and enjoy the rights and
independent union, the names of all
privileges enumerated in Art. 242 of
its members comprising at least
the Labor Code.
twenty percent (20%) of all the
employees in the bargaining unit
Legal Personality of Labor
where it seeks to operate;
d. If the applicant union has been in
Organizations
existence for one or more years, A labor organization acquires legal

copies of its annual financial reports; personality and attains the status of
and legitimacy upon the issuance in its
e. Four (4) copies of the constitution name of a Certificate of Registration.
and by-laws of the applicant union, An unregistered labor
minutes of its adoption or ratification, organization can acquire legal
and the list of the members who
personality and attain the status of
participated in it.
legitimacy by affiliating with a duly
registered Federation or National
Notes:
Union; becomes a Chartered Local.
The twenty percent initial
A Chartered Local, therefore,
membership is required only if the
need not be independently
applicant is an independent union,
registered.
not a chapter created by a federation
Effect of Incorporation
Purpose of Registration
A labor union organized under the
To protect both labor and public
Corporation Law merely gives it
against abuses, fraud or impostors
juridical personality before the
who pose as organizers, although
regular courts, but it will not entitle
not truly accredited agents of the
such union to the rights and
union they purport to represent.
privileges accorded by law to
legitimate labor organizations.
Significance of Registration

Registration with the DOLE independent labor unions and
makes a labor organization workers’ associations;
legitimate. (b) Regional Office of the DOLE that
Registration of Registration of issued the Certificate of Creation
Independent Workers’ of Chartered Local – in case of
Union Association chartered locals; or
a labor An organization (c) Bureau of Labor Relations – in
organization of workers case of federations or national
operating at the created for the unions.
enterprise level mutual aid and
whose legal protection of its Effect of Merger
personality is members for The legal existence of the absorbed
derived through any legitimate labor organization ceases, while the
independent purpose other legal existence of the absorbing
registration. than collective labor organization subsists.
bargaining. All rights, interests and
To register an To register a
obligations of the absorbed labor
independent workers’
organizations are transferred to the
union, an association, an
absorbing organization.
application for application
registration should be filed
Effect of Consolidation
should be filed with the
The legal existence of the
with the Regional Office
consolidating labor organization shall
Regional Office of the DOLE
cease and a new labor organization
of the DOLE where it
is created.
where it principally
principally operates.
Art. 241. [235] Chartering and
operates.
Creation of a Local Chapter
A duly registered federation or national
(a) Regional Office of the DOLE that
union may directly create a local chapter
issued the Certificate of
by issuing a charter certificate indicating
Registration – in case of
the establishment of the local chapter.

The chapter shall acquire legal
personality for purposes of filing a “Labor Organization” refers to any
petition for certification election from the union or association of employees in
date it was issued a charter certificate.
the private sector which exists in
The chapter shall be entitled to all
whole or in part for the purpose of
other rights and privileges of a legitimate
collective bargaining or for dealing
labor organization only upon the
with employers concerning terms
submission of the following documents
in addition to its charter certificate;
and conditions of employment.
a. The names of the chapter’s officers,

their addresses, and the principal “Worker’s Association” refers to
office of the chapter; and an association of worker’s organized
b. The chapter’s constitution and by- for the mutual aid and protection of
laws: Provided, That where the its members or for any legitimate
chapter’s constitution and by-laws purpose other than collective
are the same as that of the
bargaining
federation or the national union, this
fact shall be indicated accordingly.
“Legitimate Workers’
The additional supporting requirements
Association” means any worker’s
shall be certified under oath by the
secretary or treasurer of the chapter and association which is duly registered
attested by its president. with the department.
Notes: The existence of employer-employee

The worker’s right to self- relationship is essential for the
organization is guaranteed under the exercise of self-organization for
Constitution and the Labor Code. It purposes of collective bargaining.
is defined in Article 246. Every Absence of such relationship affects
employee, even temporary ones, the legality of the union itself (La
except as provided in Article 245, is Suerte Cigar & Cigarette Factory v.
eligible for union membership Director, Bureau of Labor Relations
beginning on the employee’s first [1983])
day of work.

Legitimate Labor Organization
Not every labor organization is a Independent National Union
union; for instance, a worker’s Union /Local or Federation
association is not a union. So also, chapter
not every union is a legitimate labor Operates at the Operates in
organization (LLO). enterprise level more than one
It is the fact of being region
registered with the Department of

Applies for Applies for
Labor and Employment that makes a
registration at registration
labor organization “legitimate” in the
the DOLE directly with the
sense that it is clothed with legal
Regional Office Bureau of Labor
personality to deal with the employer
where the union Relations which
in representation of its members.
principally is a national
operates office (even
Art. 242. [236] Action on application.
though the
The Bureau shall act on all applications
application is
for registration within thirty (30) days
from filing. received at
All requisite documents and DOLE regional
papers shall be certified under oath by office)
the secretary or the treasurer of the
organization, as the case may be, and If denied by If denied by
attested to by its president Regional BLR, may
Director, may appeal to DOLE
Art. 243. [237] Denial of registration; appeal to the Secretary (then
appeal. The decision of the Labor BLR director CA, if needed)
Relations Division in the regional office (then CA, if
denying registration may be appealed
needed)
by the applicant union to the Bureau
within ten (10) days from receipt of An independent union or local
notice thereof.
chapter operates at the enterprise
level, it applies for registration at the
Notes:

DOLE Regional Office where the Under D.O. No. 40-03 the reason for
union principally operates. If its registering a federation or national
application is denied by the regional union is similar to that for a local
director, the denial may be appealed union, namely, to bargain or to deal
to the Bureau of Labor Relations. If with employers about employment
still denied by the latter, it is conditions. In addition, since it
appealable directly to the Court of operates on large scale, a national
Appeals. union or federation may participate in
the formulation of “social and
Art. 244. [238] Additional employment policies, standards, and
Requirements for Federations or programs”
National Unions. Subject to Article 238,
if the applicant for registration is a
Chartered Local
federation or a national union, it shall, in
The local union created in an
addition to the requirements of the
enterprise is thus called a “chartered
preceding Articles, submit the following:
a. Proof of the affiliation of at least ten
local or a chapter.” To facilitate the
(10) locals or chapters, each of growth of locals, their creation must

which must be a duly recognized be a simple and easy; hence, unlike
collective bargaining agent in the an independent union, a chartered
establishment or industry in which it local can be registered even without
operates, supporting the registration the twenty percent minimum
of such applicant federation or membership.
national union; and
b. The names and addresses of the
Revocation of Charter
companies where the locals or
The federation or national union may
chapters operate and the list of all
revoke the charter issued to the local
the members in each company
involved. or chapter. The revocation is done
by serving on the local or chapter, a
Notes: verified notice of revocation, copy
Federation or National Union furnished the Bureau of Labor
Relations, on the ground of disloyalty

or such other grounds as may be national or local, shall be cancelled by
specified in the constitution and by- the Bureau, after due hearing, only on
laws of the federation, national union the grounds specified in Article 239
hereof.
or workers’ association.
Art. 246. [240] Effect of a Petition for

Affiliation
Cancellation of Registration
Affiliation by a duly registered union
A petition for cancellation of union
with a national union or federation registration shall not suspend the
does not cause the local union to proceedings for certification election nor
lose its legal personality. Despite shall it prevent the filing of a petition for
affiliation, the local union remains the certification election.
basic unit free to serve the common In case of cancellation, nothing
interest of all its members. herein shall restrict the right of the union
to seek just and equitable remedies in
the appropriate courts.
Substitutionary Doctrine
This doctrine holds that the
Art. 247. [241] Grounds for
employees cannot revoke the validly
Cancellation of Union Registration.
execute collective bargaining
The following shall constitute grounds
contract with their employer by the for cancellation of union registration:
simple expedient of changing their a. Misrepresentation, false statement
bargaining agent. The new agent or fraud in connection with the
must be respect the contract. The adoption or ratification of the
employees, thru their new bargaining constitution and by-laws or
agent, cannot renege on the amendments thereto, the minutes of
collective bargaining contract, except ratification and the list of members

who took part in the ratification;
to negotiate with management the
b. Misrepresentation, false statements
shortening thereof.
or fraud in connection with the
election of officers, minutes of the
Art. 245. [239] Cancellation of
election of officers, and the list of
registration.
voters;
The certificate of registration of any
legitimate labor organization, whether

c. Voluntary dissolution by the The following are the rights and
members. conditions of membership in a labor
Art. 248. [242] Voluntary Cancellation organization:
of Registration a. No arbitrary or excessive initiation
The registration of a legitimate labor fees shall be required of the
organization may be cancelled by the members of a legitimate labor
organization itself: Provided, That at organization nor shall arbitrary,
least two-thirds of its general excessive or oppressive fine and
membership votes, in a meeting duly forfeiture be imposed;
called for that purpose to dissolve the b. The members shall be entitled to full
organization: Provided, further, That an and detailed reports from their
application cancel registration is officers and representatives of all
thereafter submitter by the board of the financial transactions as provided for
organization, attested to by the in the constitution and by-laws of the
president thereof. organization;
c. The members shall directly elect
Art. 249. Equity of the Incumbent their officers in the local union, as
All existing federations and national well as their national officers in the
unions which meet the qualifications of a national union or federation to which
legitimate labor organization and none they or their local union is affiliated,
of the grounds for cancellation shall by secret ballot at intervals of five (5)
continue to maintain their existing years. No qualification requirement
affiliates regardless of the nature of the for candidacy to any position shall
industry and the location of the affiliates. be imposed other than membership
in good standing in subject labor
organization. The secretary or any
Chapter II – Rights and other responsible union officer shall
Conditions of Membership furnish the Secretary of Labor and
Employment with a list of the newly-
Art. 250. Rights and Conditions of
elected officers, together with the
Membership in a Labor
appointive officers or agents who are
Organization.
entrusted with the handling of funds
within thirty (30) calendar days after
the election of officers or from the

occurrence of any change in the list shall be evidenced by a receipt
of officers of the labor organization; signed by the officer or agent
d. The members shall determine by making the collection and entered
secret ballot, after due deliberation, into the record of the organization to
any question of major policy be kept and maintained for the
affecting the entire membership of purpose;
the organization, unless the nature
of the organization or force majeure i. The funds of the organization shall
renders such secret ballot not be applied for any purpose or
impractical, in which case, the board object other than those expressly
of directors of the organization may provided by its constitution and by-
make the decision in behalf of the laws or those expressly authorized
general membership; by written resolution adopted by the
e. No labor organization shall majority of the members at a general
knowingly admit as members or meeting duly called for the purpose;
continue in membership any j. Every income or revenue of the
individual who belongs to a organization shall be evidenced by a
subversive organization or who is record showing its source, and every
engaged directly or indirectly in any expenditure of its funds shall be
subversive activity; evidenced by a receipt from the
f. No person who has been convicted person to whom the payment is
of a crime involving moral turpitude made, which shall state the date,
shall be eligible for election as a place and purpose of such payment.
union officer or for appointment to Such record or receipt shall form
any position in the union; part of the financial records of the
g. No officer, agent or member of a organization.
labor organization shall collect any Any action involving the funds of
fees, dues, or other contributions in the organization shall prescribe after
its behalf or make any disbursement three (3) years from the date of
of its money or funds unless he is submission of the annual financial
duly authorized pursuant to its report to the Department of Labor
constitution and by-laws; and Employment or from the date
h. Every payment of fees, dues or the same should have been
other contributions by a member submitted as required by law,

whichever comes earlier: Provided, l. The treasurer of any labor
That this provision shall apply only to organization and every officer
a legitimate labor organization which thereof who is responsible for the
has submitted the financial report account of such organization or for
requirements under this Code: the collection, management,
Provided, further, that failure of any disbursement, custody or control of
labor organization to comply with the the funds, moneys and other
periodic financial reports required by properties of the organization, shall
law and such rules and regulations render to the organization and to its
promulgated thereunder six (6) members a true and correct account
months after the effectivity of this Act of all moneys received and paid by
shall automatically result in the him since he assumed office or
cancellation of union registration of since the last day on which he
such labor organization; rendered such account, and of all
k. The officers of any labor bonds, securities and other
organization shall not be paid any properties of the organization
compensation other than the entrusted to his custody or under his
salaries and expenses due to their control.
positions as specifically provided for The rendering of such account
in its constitution and by-laws, or in a shall be made:
written resolution duly authorized by
a majority of all the members at a (1) At least once a year within thirty
general membership meeting duly (30) days after the close of its
called for the purpose. The minutes fiscal year;
of the meeting and the list of (2) At such other times as may be
participants and ballots cast shall be required by a resolution of the
subject to inspection by the majority of the members of the
Secretary of Labor or his duly organization; and
authorized representatives. Any (3) Upon vacating his office.
irregularities in the approval of the The account shall be duly
resolutions shall be a ground for audited and verified by affidavit and
impeachment or expulsion from the a copy thereof shall be furnished the
organization; Secretary of Labor.

m. The books of accounts and other p. It shall be the duty of any labor
records of the financial activities of organization and its officers to inform
any labor organization shall be open its members on the provisions of its
to inspection by any officer or constitution and by-laws, collective
member thereof during office hours; bargaining agreement, the prevailing
n. No special assessment or other labor relations system and all their
extraordinary fees may be levied rights and obligations under existing
upon the members of a labor labor laws.
organization unless authorized by a For this purpose, registered
written resolution of a majority of all labor organizations may assess
the members in a general reasonable dues to finance labor
membership meeting duly called for relations seminars and other labor
the purpose. The secretary of the education activities.
organization shall record the minutes Any violation of the above rights
of the meeting including the list of all and conditions of membership shall
members present, the votes cast, be a ground for cancellation of union
the purpose of the special registration or expulsion of officers
assessment or fees and the recipient from office, whichever is appropriate.
of such assessment or fees. The At least thirty percent (30%) of the
record shall be attested to by the members of a union or any member
president. or members specially concerned
o. Other than for mandatory activities may report such violation to the
under the Code, no special Bureau. The Bureau shall have the
assessments, attorney’s fees, power to hear and decide any
negotiation fees or any other reported violation to mete the
extraordinary fees may be checked appropriate penalty.
off from any amount due to an Criminal and civil liabilities
employee without an individual arising from violations of above
written authorization duly signed by rights and conditions of membership
the employee. The authorization shall continue to be under the
should specifically state the amount, jurisdiction of ordinary courts.
purpose and beneficiary of the
deduction; and Rights of Members

A labor union is supposed to be an disbursements; the right to
instrument of industrial democracy. It require adequate records of
has to be an exemplar of honest and income and expenses and the
democratic and responsible right of access to financial
leadership. It is conceived upon the records; the right to vote on
principle of inverted pyramid whose officers’ compensation; the right
base, consisting of the member, is to vote on proposed special
above the officers. The officers’ assessments and be deducted a
authority, even their tenure in office, special assessment only with the
as well as the policy and major member’s written authorization.
decisions of the organization, all are 4. Right to information – the
passed upon by the membership. member’s right to be informed
about the organization’s
The rights and conditions of constitution and by-laws and the
membership laid down in Art. 241 collective bargaining agreement
may be summarized as follows: and about labor laws.
1. Political right – the member’s
right to vote and be voted for, Union Officers
subject to lawful provisions on The Implementing Rules require that
qualifications and within sixty (60) days before the
disqualifications expiration of the term of the
2. Deliberative and decision- incumbent officers, the president of
making right – the member’s the labor organization or workers’
right to participate in deliberations association shall constitute a
on major policy questions and committee on election. It should be
decide them by secret ballot composed of at least three (3)
3. Rights over money matters – members who are not running for
the member’s right against any position in the election. If there
excessive fees; the right against are identifiable parties within the
unauthorized collection of organization or association, each
contributions or unauthorized

party shall have equal representation profit and loss statement, within
in the committee. thirty (30) calendar days from the
The election of union officers date of receipt of the request, after

the union has been duly recognized
should be held in accordance with
by the employer or certified as the
the provisions of the union’s
sole and exclusive bargaining
constitution and by-laws (CBL).
representative of the employees in
the bargaining unit, or within sixty
Fees (60) calendar days before the
Attorney’s fees may not be deducted expiration of the existing collective
or checked-off from any amount due bargaining agreement, or during the
to an employee without his written collective bargaining negotiation;
consent except for mandatory d. To own property, real or personal,
activities under the Labor Code. for the use and benefit of the labor
organization and its members;
e. To sue and be sued in its registered
Chapter III – Rights of
name; and
Legitimate Labor f. To undertake all other activities
Organizations designed to benefit the organization
Art. 251. Rights of Legitimate Labor and its members, including
Organizations. cooperative, housing, welfare and
A legitimate labor organization shall other projects not contrary to law.
have the right: Notwithstanding any provision of a
a. To act as the representative of its general or special law to the contrary,
members for the purpose of the income and the properties of
collective bargaining; legitimate labor organizations, including
b. To be certified as the exclusive grants, endowments, gifts, donations
representative of all the employees and contributions they may receive from
in an appropriate bargaining unit for fraternal and similar organizations, local
purposes of collective bargaining; or foreign, which are actually, directly
c. To be furnished by the employer, and exclusively used for their lawful
upon written request, with its annual purposes, shall be free from taxes,
audited financial statements, duties and other assessments. The
including the balance sheet and the exemptions provided herein may be

withdrawn only by a special law A. RIGHT TO SELF-
expressly repealing this provision. ORGANIZATION
Right to self-organization refers to
Authority of the Union the right of workers and employees
A registered labor union has the to form, join or assist unions,
requisite personality to sue on behalf organizations or associations for
of its members for their individual purposes of collective bargaining
money claims. and/or for mutual aid and protection,
A judgment based on a including the right to engage in
compromise agreement authorized peaceful concerted activities and
by the members does not bind the participate in policy-decision making
individual members or complainants processes affecting their rights and
who are not parties to it. benefits.
Union Registration Unclear Extent of the right to self-

In one case, it is not clear from the organization
record whether the union is a It includes at least two rights:
registered organization. But 1. The right to form, join or assist
considering that it filed a petition for labor organization; and
certification election and such 2. The right to engage in lawful
petition was granted on appeal by concerted activities.
the labor undersecretary, the Court
ruled that the union had the Basis of Right
personality to sue in its own name to 1. 1987 Constitution
challenge the ULP acts committed Sec. 8, Art. III. – The right of the people,
by the employer. The union action including those employed in the public
could institute the action in its and private sectors, to form unions,
representative capacity. associations, or societies for purposes
not contrary to law shall not be
abridged.
TITLE V – COVERAGE

Sec. 3, Art. XIII – The state shall afford under the Corporation Code shall have
full protection to labor, local and the right to organize and to bargain
overseas, organized and unorganized, collectively with their respective
and promote full employment and employers. All other employees in the
equality of opportunities for all. civil service shall have the right to form
It shall guarantee the rights of all associations for purposes not contrary
workers to self-organization, collective to law. (As amended by Executive Order
bargaining and negotiations, and No. 111, December 24, 1986)
peaceful concerted activities, including
the right to strike in accordance with Scope of right to self-organization
law. [...] 1. Right to form, join or assist labor
organizations of their own
2. Labor Code choosing for the purpose of
Art. 243. Coverage and employees’
collective bargaining through
right to self-organization. All persons
representatives of their own
employed in commercial, industrial and
choosing (Art. 257);
agricultural enterprises and in religious,
2. Right to engage in lawful
charitable, medical, or educational
institutions, whether operating for profit
concerted activities for the same
or not, shall have the right to self- purpose (collective bargaining) or

organization and to form, join, or assist for their mutual aid and protection
labor organizations of their own (Art. 257)
choosing for purposes of collective 3. The right of any person to join an
bargaining. Ambulant, intermittent and organization also includes the
itinerant workers, self-employed people, right to leave that organization
rural workers and those without any
and join another one. [Heritage
definite employers may form labor
Hotel Manila v. PIGLAS-Heritage,
organizations for their mutual aid and
G.R. No. 177024 (2009)]
protection. (As amended by Batas
4. The right to form or join a labor
Pambansa Bilang 70, May 1, 1980)
organization necessarily includes
Art. 244. Right of employees in the the right to refuse or refrain from
public service. Employees of exercising said right. It is self-
government corporations established evident that just as no one should

be denied the exercise of a right Employees Association, G.R. No.
granted by law, so also, no one L-25094 (1969)]
should be compelled to exercise 7. Recognition of the tenets of the
such a conferred right. The fact sect ... should not infringe on the
that a person has opted to basic right of self-organization
acquire membership in a labor granted by the [C]onstitution to
union does not preclude his workers, regardless of religious
subsequently opting to renounce affiliation. [Kapatiran sa Meat and
such membership. [Reyes v. Canning Division v. Calleja, G.R.
Trajano, G.R. No. 84433 (1992)] No. 82914 (1988)]
5. The right of the employees to
self-organization is a compelling B. COVERAGE
reason why their withdrawal from 1. All employees
the cooperative must be allowed. 2. Government employees of
As pointed out by the union, the corporations created under the
resignation of the member- Corporation Code
employees is an expression of 3. Supervisory Employees
their preference for union 4. Aliens with valid working permits
membership over that of 5. Security personnel
membership in the cooperative.
[Central Negros Electric (a) All Employees
Cooperative v. SOLE, G.R. No. All persons employed in commercial,
94045 (1991)] industrial and agricultural enterprises
6. Their freedom to form and in religious, charitable, medical
organizations would be rendered or educational institutions, whether
nugatory if they could not choose operating for profit or not, shall have
their own leaders to speak on the right to self-organization and to
their behalf and to bargain for form, join or assist labor
them. [Pan-American World organizations of their own choosing
Airways, Inc v. Pan-American for purposes of collective

bargaining. (Presumes an 2. Government employees of
employer-employee relationship) corporations created under the
Ambulant, intermittent and Corporation Code
itinerant workers, self-employed The right to self-organization shall
people, rural workers and those not be denied to government
without any definite employers may employees. [Sec. 2(5), Art. IX-B,
form labor organizations for their Constitution]
mutual aid and protection. [Art. Employees of government
243] corporations established under the
Any employee, whether Corporation Code shall have the
employed for a definite period or not, right to organize and to bargain
shall, beginning on his first day of collectively with their respective
service, be considered an employee employers.
for purposes of membership in any All other employees in the civil
labor union. [Art. 292(c)] service shall have the right to form
Employee […] shall include associations for purposes not
any individual whose work has contrary to law. [Art. 254]
ceased as a result of or in All government employees
connection with any current labor can form, join or assist employees’
dispute or because of any unfair organizations of their own choosing
labor practice if he has not obtained for the furtherance and protection of
any other substantially equivalent their interests. They can also form, in
and regular employment. [Art. 219(f)] conjunction with appropriate
Employees of non-profit government authorities, labor-
organizations are now permitted to management committees, work
form, organize or join labor unions of councils and other forms of workers’
their choice for purposes of collective participation schemes to achieve the
bargaining [FEU-Dr. Nicanor Reyes same objectives. [EO 180 Sec. 2
Medical Foundation Inc. v. Trajano, (1987)]
G.R. No. 76273 (1987)]
3. Supervisory Employees

Supervisory employees are those collective bargaining, provided the
who, in the interest of the employer, following requisites are fulfilled:
effectively recommend such a. With valid working permits
managerial actions if the exercise of issued by the DOLE; and
such authority is not merely routinary b. They are nationals of a country
or clerical in nature but requires the which grants the same or
use of independent judgment. [Art. similar rights to Filipino workers
219 (m)] [Art. 284].
What is essential is the nature i. As certified by DFA; or
of the employee’s function and not ii. Has ratified either ILO
the nomenclature or title given to the Conventions No. 87 and
job which determines whether the 98 [Sec. 2, Rule II, Book
employee has rank-and-file or V, IRR]
managerial status or whether he is a
supervisory employee. [Tagaytay 5. Security personnel
Highlands International Golf Club, The security guards and other
Inc. v. Tagaytay Highlands personnel employed by the security
Employees Union-PTGWO, G.R. service contractor shall have the
142000 (2003)] right:
a. To form, join, or assist in the
4. Aliens with valid working formation of a labor
permits organization of their own
General Rule: All aliens, natural or choosing for purposes of
juridical, […] are strictly prohibited collective bargaining and
from engaging directly or indirectly in b. To engage in concerted
all forms of trade union activities. activities which are not contrary
[Art. 284] to law including the right to
Exception: Aliens may exercise the strike. [D.O. No. 14 Series of
right to self-organization and join or 2001 Guidelines Governing the
assist labor unions for purposes of Employment and Working
Conditions of Security Guards

and Similar Personnel in the employees. Managerial employees are
Private Security Industry) not eligible to join, assist or form any
labor organization. Supervisory
employees shall not be eligible for
On Dec. 24, 1986, President C.
membership in a labor organization of
Aquino issued EO No. 111 which
the rank-and-file employees but may
eliminated the provision which made
join, assist or form separate labor
security guards ineligible to join any
organizations of their own. (As amended
labor organization. In 1989, by Section 18, Republic Act No. 6715,
Congress passed RA 6715 which March 21, 1989)
also did not impose limitations on the
ability of security guards to join labor Who Cannot Form, Join or Assist
organizations. Thus, security guards Labor Organizations
“may now freely join a labor 1. Managerial employees
organization of the rank-and-file or 2. Confidential employees
that of the supervisory union, 3. Non-employees
depending on their rank.” [Manila 4. Member-employee of a
Electric Co. v. SOLE, G.R. No. cooperative
91902 (1991)] 5. Employees of international
organizations
Note: The right to organize cannot 6. High-level government
be bargained away (Southern employees
Philippines Federation of Labor v. 7. Members of the AFP, police
Calleja, G.R. No. 80882, 1989) officers, policemen, firemen and
jail guards
C. INELIGIBILITY OF
MANAGERIAL EMPLOYEES; 1. Managerial Employees
RIGHTS OF SUPERVISORY Managerial employee is one who is
EMPLOYEES vested with powers or prerogatives
Art. 245. Ineligibility of managerial to lay down and execute
employees to join any labor
management policies and/or to hire,
organization; right of supervisory
transfer, suspend, lay-off, recall,

discharge, assign or discipline act in a confidential capacity to, or
employees. [Art. 219 (m)] have access to confidential matters
Managerial employees are not of, persons who exercise managerial
eligible to join, assist or form any functions in the field of labor
labor organization. […] [Art. 255] relations.
Managerial functions refer “to
powers and prerogatives to lay down Requisites
and execute management policies The employee must:
and/or to hire, transfer, suspend, a. Assist or act in a confidential
layoff, recall, discharge or dismiss capacity, AND
employees”. [San Miguel b. To persons who formulate,
Corporation Supervisors and Exempt determine, and effectuate
Union v. Laguesma, G.R. No. management policies in the field
110399 (1997)] of labor relations
High Level/Managerial Stated differently

Government Employees a. the confidential relationship must
High-level employees of the exist between the employees and
government whose functions are his supervisor, and
normally considered as policy- b. the supervisor must handle the
making or managerial or whose prescribed responsibilities
duties are of a highly confidential relating to labor relations. [San
nature shall not be eligible to join the Miguel Supervisors and Exempt
organization of rank-and-file Union v. Laguesma, G.R. No.
government employees. [Sec. 3, 110399 (1997)]
E.O. 180]
Rationale of Exclusion of
2. Confidential Employees Confidential Employees
Nature of Access Test While Art. 245 [now 255] of the
Confidential employees, by the Labor Code singles out managerial
nature of their functions, assist and employees as ineligible to join, assist

or form any labor organization, under information of the company’s
the doctrine of necessary implication, position with regard to contract
confidential employees are similarly negotiations, the disposition of
disqualified…If confidential grievances, or other labor relations
employees could unionize in order to matters. [San Miguel Supervisors
bargain for advantages for and Exempt Union v. Laguesma,
themselves, then they could be G.R. No. 110399 (1997)]
governed by their own motives rather The disqualification of managerial
than the interest of the employers. and confidential employees from
Moreover, unionization of joining a bargaining unit for rank and
confidential employees for the file employees is already well-
purpose of collective bargaining entrenched in jurisprudence. While
would mean the extension of the law Art. 245 [now 255] of the Labor Code
to persons or individuals who are limits the ineligibility to join, form and
supposed to act in the interest of the assist any labor organization to
employers. It is not far-fetched that in managerial employees,
the course of collective bargaining, jurisprudence has extended this
they might jeopardize that interest prohibition to confidential employees
which they are duty bound to protect. or those who by reason of their
[Metrolab Industries Inc. v. Roldan- positions or nature of work are
Confessor, G.R. No. 108855 (1996)] required to assist or act in a fiduciary
Employees should not be manner to managerial employees
placed in a position involving a and hence, are likewise privy to
potential conflict of interests. sensitive and highly confidential
Management should not be required records. [Standard Chartered Bank
to handle labor relations matters Employees Union v SCB, G.R. No.
through employees who are 161933 (2008)]
represented by the union with which
the company is required to deal and Function Test: Nomenclature is
who in the normal performance of not controlling
their duties may obtain advance

The mere fact that an employee is much a part thereof as that which is
designated “manager” does not ipso expressed. [Metrolab Industries Inc.
facto make him one. Designation v. Roldan-Confessor, G.R. No.
should be reconciled with the actual 108855 (1996)]
job description of the employee.
[Paper Industries Corp. of the 3. Supervisory Employees
Philippines. v. Laguesma, G. R. Supervisory employees may not join
No.101738 (2000)] rank-and-file union
Supervisory employees shall not be
Confidential information: Must eligible for membership in the
relate to labor relations and not collective bargaining unit of the rank-
from a business standpoint and-file employees but may join,
An employee must assist or assist or form separate collective
act in a confidential capacity and bargaining units and/or labor
obtain confidential information organizations of their own. [Art. 255]
relating to labor relations policies.
Exposure to internal business Rationale: Supervisory employees,
operations of the company is not per while in the performance of
se a ground for the exclusion in the supervisory functions, become the
bargaining unit. [Coca-Cola Bottlers alter ego of the management in the
v. IPTEU, G.R. No. 193798 (2015)] making and the implementing of key
decisions at the sub-managerial
Doctrine of Necessary Implication level. Certainly, it would be difficult to
While Art. 245 [now 255] of the find unity or mutuality of interests in
Labor Code singles out managerial a bargaining unit consisting of a
employees as ineligible to join, assist mixture of rank-and-file and
or form any labor organization, under supervisory employees. [Toyota
the doctrine of necessary implication, Motor Phil. Corp. v. Toyota Motor
confidential employees are similarly Phil. Corp. Labor Union, G.R. No.
disqualified. This doctrine states that 121084 (1997)]
what is implied in a statute is as

Supervisor and Rank and File [Persons who] are not employees of
Union Affiliation [a company] are not entitled to the
The rank and file union and the constitutional right to join or form a
supervisors’ union operating within labor organization for purposes of
the same establishment may join the collective bargaining. […]The
same federation or national union. question of whether employer-
[Art. 255] employee relationship exists is a
primordial consideration before
Note also: Prior to the enactment of extending labor benefits under the
RA 9481, which inserted a new workmen's compensation, social
provision (Art. 245-A, now Art. 256), security, Medicare, termination pay
the Court held in De La Salle and labor relations law. [Singer
University v. Laguesma that a local Sewing Machine Co. v. Drilon, G.R.
supervisors’ union is not allowed to No. 91307, 1991].
affiliate with a national federation of But employees of the
unions of rank and file employees] contractor can still form a labor
only where two conditions concur: union. The labor union can be
First, the rank-and-file employees 12 established to bargain with the
are directly under the authority of contractor but not with the principal
supervisory employees. Second, the employer. [Prof. Battad]
national federation is actively
involved in union activities in the b. Employee-member of a
company. [De La Salle University Cooperative
Medical Center and College of General Rule: An employee of a
Medicine v. Laguesma, G.R. No. cooperative who is a member and
102084 (1998)] co-owner thereof cannot invoke the
right to collective bargaining for
4. Other People Who Cannot certainly an owner cannot bargain
Form, Join or Assist Labor with himself or his co-owners.
Organizations [Batangas-I Electric Cooperative
a. New Employees

Labor Union v. Romeo A. Young, Immunity […] is granted to avoid
G.R. No. 62386 (1988)] interference by the host country in
Irrespective of the degree of their internal workings. The
their participation in the actual determination [by the executive
management of the cooperative, all branch] has been held to be a
members thereof cannot form, assist political question conclusive upon
or join a labor organization for the the Courts in order not to embarrass
purpose of collective bargaining. a political department of
[Benguet Electric Cooperative v. Government. [Hence], a certification
Ferrer-Calleja, G.R. No. 79025 election cannot be conducted in an
(1989)] international organization to which
the Philippine Government has
Exception: Employees who granted immunity from local
withdrew their membership from the jurisdiction. [International Catholic
cooperative are entitled to form or Migration Commission v. Calleja,
join a labor union for the negotiations G.R. No. 85750 (1990)]
of a Collective Bargaining
Agreement. [Central Negros Electric d. Members of the AFP,
Cooperative, Inc. v. DOLE, G.R. No. Policemen, Police Officers,
94045 (1991)] Firemen, and Jail Guards
Members of the AFP, Policemen,
c. Employees of International Police Officers, Firemen and Jail
Organizations Guards are expressly excluded by
International organizations are EO 180, Sec. 4 from the coverage of
endowed with some degree of the EO 180 which provides
international legal personality. They guidelines for the exercise of the
are granted jurisdictional immunity, right to organize of government
as provided in their organization’s employees.
constitutions, to safeguard them from
the disruption of their functions. D. NON – ABRIDGEMENT

Art. 257. [246] Non-abridgment of organization, its officers, agents or
right to self-organization. It shall be representatives:
unlawful for any person to restrain,
coerce, discriminate against or unduly a. To restrain or coerce employees in
interfere with employees and workers in the exercise of their right to self-
their exercise of the right to self- organization. However, a labor
organization. Such right shall include the organization shall have the right to
right to form, join, or assist labor prescribe its own rules with respect
organizations for the purpose of to the acquisition or retention of
collective bargaining through membership;
representatives of their own choosing b. To cause or attempt to cause an
and to engage in lawful concerted employer to discriminate against an
activities for the same purpose for their employee, including discrimination
mutual aid and protection, subject to the against an employee with respect to
provisions of Article 264 of this Code. whom membership in such
(As amended by Batas Pambansa organization has been denied or to
Bilang 70, May 1, 1980) terminate an employee on any
ground other than the usual terms
Art. 259. [248] Unfair Labor Practices and conditions under which
of Employers. — It shall be unlawful for membership or continuation of
an employer to commit any of the membership is made available to
following unfair labor practices: other members;
a. To interfere with, restrain or coerce
employees in the exercise of their Art. 303. [288] Penalties. — Except as
right to self-organization; otherwise provided in this Code, or
b. To require as a condition of unless the acts complained of hinge on
employment that a person or an a question of interpretation or
employee shall not join a labor implementation of ambiguous provisions
organization or shall withdraw from of an existing collective bargaining
one to which he belongs; agreement, any violation of the
provisions of this Code declared to be
Art. 260. [249] Unfair Labor Practices unlawful or penal in nature shall be
of Labor Organizations. — It shall be punished with a fine of not less than
unfair labor practice for a labor One Thousand Pesos (P1,000.00) nor

more than Ten Thousand Pesos imprisonment for not less than three
(P10,000.00), or imprisonment of not months nor more than three (3)
less than three months nor more than years, or both such fine and
three years, or both such fine and imprisonment, at the discretion of
imprisonment at the discretion of the the court. Prosecution under this
court. provision shall preclude prosecution
In addition to such penalty, any for the same act under the Revised
alien found guilty shall be summarily Penal Code, and vice versa.
deported upon completion of service of b. Upon the recommendation of the
sentence. Minister of Labor and Employment
Any provision of law to the and the Minister of National
contrary notwithstanding, any criminal Defense, foreigners who violate the
offense punished in this Code shall be provisions of this Title shall be
under the concurrent jurisdiction of the subject to immediate and summary
Municipal or City Courts and the Courts deportation by the Commission on
of First Instance. Immigration and Deportation and
shall be permanently barred from re-
Art. 304. [289] Who are Liable When entering the country without the
Committed by Other Than Natural special permission of the President
Person — If the offense is committed by of the Philippines.
a corporation, trust, firm, partnership,
association or any other entity, the Book V, Rule XXII, Sec. 20, as
penalty shall be imposed upon the guilty renumbered by D.O. 40-H-13
officer or officers of such corporation, Sec. 20. Criminal Prosecution — The
trust, firm, partnership, association or regular courts shall have jurisdiction
entity. over any criminal action under Article
272 (now 287) of the Labor Code, as
Art. 287. [272] Penalties — amended, but subject to the required
a. Any person violating any of the clearance from the DOLE on cases
provisions of Article 264 of this Code arising out of or related to a labor
shall be punished by a fine of not dispute pursuant to the Ministry of
less than one thousand pesos Justice (now Department of Justice)
(P1,000.00) nor more than ten Circular No. 15, Series of 1982, and
thousand pesos (P10,000.00) and/or Circular No. 9, Series of 1986.

c. hinder the promotion of healthy
TITLE VI – UNFAIR LABOR and stable labor-management
PRACTICES relations
d. violations of the civil rights of both
Chapter I – Concept
labor and management but are
Unfair labor practice refers to acts
also criminal offenses
that violate the workers’ right to
organize. The prohibited acts are
Four forms of Unfair Labor
related to the workers’ right to self-
Practice in Collective Bargaining
organization and to the observance
a. Failure or Refusal to meet and
of a CBA. Without that element, the
convene
acts, no matter how unfair, are not
b. Evading the mandatory subjects
unfair labor practices. The only
of bargaining
exception is Art. 259 (f) [i.e. to
c. Bargaining in bad faith
dismiss, discharge or otherwise
d. Gross violation of the CBA
prejudice or discriminate against an
employee for having given or being
Purpose of the Policy Against
about to give testimony under this
ULPs
Code]. [Philcom Employees Union v.
Protection of right to self-
Phil. Global, G.R. No. 144315
organization and/or collective
(2006)]
bargaining:
a. The employee is not only
Nature of Unfair Labor Practices
protected from the employer but
a. inimical to the legitimate interests
also from labor organizations.
of both labor and management,
b. The employer is also protected
including their right to bargain
from ULP committed by a labor
collectively and otherwise deal
organization.
with each other in an atmosphere
The public is also protected because
of freedom and mutual respect
it has an interest in continuing
b. disrupt industrial peace
industrial peace.

Employer-Employee Relationship unfair labor practice. Rather, it
Required leaves to the court the work of
General Rule: An unfair labor applying the law's general prohibitory
practice may be committed only language in light of infinite
within the context of an employer- combinations of events which may
employee relationship [American be charged as violative of its terms.
President Lines v. Clave, G.R. No. L- [HSBC Employee Union v. NLRC,
51641 (1982)] G.R. No. 125038 (1997)]
Exception: “Yellow Dog” condition Note: Bargaining in bad faith,
or contract: to require as a condition discussed under 3.a. on Duty to
of employment that a person or an Bargain Collectively, constitutes
employee shall not join a labor Unfair Labor Practice which may be
organization or shall withdraw from committed by either Employer or
one to which he belongs. [Art. 259 Labor Organization. See page 182.
(b)]
Parties Not Estopped from Chapter II – Unfair Labor Practices

Raising ULP by Eventual Signing of Employers
of the CBA A. INTERFERENCE/RESTRAINT/C
The eventual signing of the CBA OERCION
does not operate to estop the parties Art. 259. [248] Unfair Labor Practices
from raising unfair labor practice of Employers. — It shall be unfair labor
charges against each other. practices for a labor organization, its

officers, agents or representatives:
[Standard Chartered Bank Union v.
a. To interfere with, restrain or
Confesor, G.R. No. 114974 (2004)]
coerce employees in the
exercise of their right to self-
Statutory Construction
organization;
The Labor Code does not undertake
the impossible task of specifying in Notes:
precise and unmistakable language There is no per se test of good faith
each incident which constitutes an in bargaining. Good faith or bad faith

is an inference to be drawn from the Marine Officer’s Guild, G.R. Nos. L-
facts. The effect of an employers or 20667 and 20669 (1965)]
a unions actions individually is not Note: The interrogation of the ER
the test of good-faith bargaining, but shouldn’t be persistent and/or hostile
the impact of all such occasions or
actions, considered as a whole. In Speech
this case, the fact that the The acts of a company which
resignations of the union members subjects a union to vilification and its
occurred during the pendency of the participation in soliciting membership
case before the labor arbiter shows for a competing union are also acts
GMCs desperate attempts to cast constituting a ULP. [Phil. Steam
doubt on the legitimate status of the Navigation Co. v. Phil. Marine
union. The ill-timed letters of Officer’s Guild, G.R. Nos. L-20667
resignation from the union members and 20669 (1965)]
indicate that GMC had interfered An employer may not send
with the right of its employees to self- letters containing promises or
organization. [General Milling benefits, nor of threats of obtaining
Corporation v. Court of Appeals, replacements to individual workers
G.R. 146728 (2004)] while the employees are on strike
due to a bargaining deadlock. This is
Interrogation tantamount to interference and is not
General rule: employer may protected by the Constitution as free
interrogate its employees regarding speech. [Insular Life Assurance Co.
their union affiliation for legitimate Employees Assn. v. Insular Life
purposes and with the assurance Assurance Co. Ltd, G.R. No. L-
that no reprisals would be taken 25291 (1971)]
against the unionists.
Exception: when interrogation Espionage
interferes with or restrains Espionage and/or surveillance by the
employees' right to self-organization. employer of union activities are
[Phil. Steam Navigation Co. v. Phil. instances of interference, restraint or

coercion of employees in connection b. To require as a condition of
with their right to organize, form and employment that a person or an
join unions as to constitute unfair employee shall not join a labor

organization or shall withdraw
labor practice. […] The information
from one to which he belongs;
obtained by means of espionage is
invaluable to the employer and can
Yellow dog contracts require, as a
be used in a variety of cases to
condition of employment that a
break a union. [Insular Life
person or an employee shall not join
Assurance Co. Employees Assn. v.
a labor organization or shall
Insular Life Assurance Co. Ltd, G.R.
withdraw from one to which he
No. L-25291 (1971)]
belongs.
Concerted Activities
Requisites of a Yellow Dog
The mass demonstration and
Contract:
stoppage of work of the Union is not
1. a representation by the employee
ULP. They didn’t demonstrate
that he is not a member of a labor
against the employer, but against the
organization
Pasig police for alleged human rights
2. a promise by the employee that
abuses. This is merely an exercise of
he will not join a union
their freedom of expression,
3. a promise by the employee that
assembly, and right to redress of
upon joining a labor organization,
grievances enshrined in the
he will quit his employment
Constitution. [Philippine Blooming
(Azucena)
Mills Employment Organization v.
Philippine Blooming Mills Co., Inc.,
C. CONTRACTING OUT OF
G.R. L-31195 (1973)]
DISCOURAGE UNIONISM
Art. 259. [248] Unfair Labor Practices
B. YELLOW DOG CONTRACTS
of Employers
Xxx
of Employers —
c. To contract out services or
xxx
functions being performed by

union members when such will Company union means any labor
interfere with, restrain or coerce organization whose formation,
employees in the exercise of function or administration has been
their right to self-organization;
assisted by any act defined as unfair
labor practice by this Code. [Art.
General Rule: contracting out is not
219(i)]
a ULP, but is covered by the
The employer commits ULP if
employer’s management
it initiates, dominates, or otherwise
prerogative.
interferes with the formation or
Exception [Art. 259 (c)]:
administration of any labor
organization.
1. contracted-out services or
Example: giving out financial aid to
functions are performed by union
any union's supporters or organizers.
members AND
2. contracting out will interfere with,
E. DISCRIMINATION TO
restrain, or coerce employees in
ENCOURAGE/ DISCOURAGE
the exercise of their right to self-
UNIONISM [ART. 259 [248] (e)]
organization.
General Rule: it is ULP to
discriminate in regard to wages,
D. COMPANY UNION
hours of work and other terms and
conditions of employment in order to
of Employers
encourage or discourage
xxx
membership in any labor
d. To initiate, dominate, assist or
otherwise interfere with the
organization.
formation or administration of Exception: Union security clauses

any labor organization, including
the giving of financial or other Union Security Clauses
support to it or its organizers or Union security is a generic term
supporters; which is applied to and comprehends
“closed shop,” “union shop,”
“maintenance of membership” or any

other form of agreement which discourage membership in any labor
imposes upon employees the organization. Nothing in this Code or in
obligation to acquire or retain union any other law shall stop the parties from
requiring membership in a recognized
membership as a condition affecting
collective bargaining agent as a
employment. [NUWHRAIN v. NLRC,
condition for employment, except those
G.R. No. 179402 (2008)]
employees who are already members of
[Union security clause] is an
another union at the time of the signing
indirect restriction on the right of an of the collective bargaining agreement.
employee to self-organization. It is a Employees of an appropriate bargaining
solemn pronouncement of a policy unit who are not members of the
that while an employee is given the recognized collective bargaining agent
right to join a labor organization, may be assessed a reasonable fee
such right should only be asserted in equivalent to the dues and other fees
a manner that will not spell the paid by members of the recognized
collective bargaining agent, if such non-
destruction of the same organization.
union members accept the benefits
[Tanduay Distillery Labor Union v.
under the collective bargaining
NLRC, G.R. No. 75037 (1987)]
agreement: Provided, that the individual
[Employees], although entitled
authorization required under Article 242,
to disaffiliation from their union to paragraph (o) of this Code shall not
form a new organization of their own, apply to the non-members of the
must, however, suffer the recognized collective bargaining agent;
consequences of their separation
from the union under the security Notes:
clause of the CBA. [Villar v. Inciong, The law has allowed stipulations for
G.R. No. L-50283-84 (1983)]. 'union shop' and 'closed shop' as
means of encouraging workers to
Statutory Basis and Rationale join and support the union of their
Art. 259. [248] Unfair Labor Practices choice in the protection of their rights
of Employers. – To discriminate in and interests vis-a-vis the employer.
regard to wages, hours of work and
[Del Monte Philippines v. Salvidar,
other terms and conditions of
G.R. No. 158620 (2006)]
employment in order to encourage or

Exception:
Purpose 1. Employees who are already
To safeguard and ensure the members of another union at the
existence of the union and thus, time of the signing of the
promote unionism in general as a collective bargaining agreement
state policy. may not be compelled by any
It is the policy of the State to union security clause to join any
promote unionism to enable the union. [Art. 254 (e)]
workers to negotiate with the 2. Employees already in service at
management on the same level and the time the closed shop union
with more persuasiveness than if security clause took effect.
they were to individually and
independently bargain for the A closed shop provision in a CBA
improvement of their respective is not to be given a retroactive
conditions. […] For this reason, the effect as to preclude its being
law has sanctioned stipulations for applied to employees already in
the union shop and closed shop as a service. [Guijarno v. CIR, G.R.
means of encouraging the workers to No. L-28791-93 (1973)]
join and support the labor union of 3. Any employee who at the time
their own choice vis-à-vis the the union security clause took
employer. [Liberty Flour Mills effect is a bona fide member of
Employees v. Liberty Flour Mills, religious organization which
G.R. No. 58768-70 (1989)] prohibits its members from joining
labor unions on religious grounds
Coverage [BPI v. BPI Employees [Reyes v. Trajano, 209 SCRA
Union-Davao Chapter, G.R. No. 484 (1992)]
164301 (2010)] 4. Confidential employees who are
General Rule: All employees in the excluded from the rank-and-file
bargaining unit covered by the union bargaining unit
security clause are subject to its
terms

5. Employees excluded from the potent weapon wielded by the union
union security provisions by against the workers whom the union
express terms of the agreement is supposed to protect in the first
place. Hence, any doubt as to the
Types of Union Security Clause existence of a closed shop provision
1. Closed shop in the CBA will be resolved in favor
Condition for employment of the nonexistence of the closed
An agreement where only union shop provision. [Azucena]
members may be employed and, for
the duration of the agreement, 2. Maintenance of membership
remains a member in good standing shop
of a union. Condition for continued
employment
A closed shop may be defined as an An agreement where present and
enterprise in which, by agreement future employees are not compelled
between the employer and his to join the SEBA, but once so joined,
employees or their representatives, they must maintain their membership
no person may be employed in any as a condition for continued
or certain agreed departments of the employment until they are promoted
enterprise unless he or she is, or transferred out of the bargaining
becomes, and, for the duration of the unit or the agreement is terminated.
agreement, remains a member in There is maintenance of
good standing of a union entirely membership shop when employees,
comprised of or of which the who are union members as of the
employees in interest are a part. effective date of the agreement, or
[General Milling Corporation (GMC) who thereafter become members,
v. Casio, G.R. No. 149552 (2010)] must maintain union membership as
a condition for [their] continued
The closed shop provision is the employment until they are promoted
most prized achievement of or transferred out of the bargaining
unionism. However it can also be a unit or the agreement is terminated.

[General Milling Corporation (GMC) Employees belonging to an
v. Casio, G.R. No. 149552 (2010)] appropriate collective bargaining unit
who are not members of the
3. Union shop recognized collective bargaining
Condition for continued agent may be assessed a
employment reasonable fee equivalent to the
There is union shop when all new dues and other fees paid by
regular employees are required to members of the recognized
join the union within a certain period collective bargaining agent, if such
as a condition for their continued non-union members accept the
employment. [General Milling benefits under the collective
Corporation (GMC) v. Casio, G.R. agreement: Provided, That the
No. 149552 (2010)] individual authorization required
Non-members may be hired, under Art. [250], paragraph (o) of
but to retain employment, they must [the Labor] Code shall not apply to
become union members after a non-members of the recognized
certain period. The requirement collective bargaining agent [Art.
applies to present and future 258(e)]
employees. [Azucena]
Enforcement of Union Security
4. Modified union shop Clause
Condition for continued  Termination due to Union
employment of future employees Security Provision
Employees who are not union Termination of employment by virtue
members at the time of signing the of a union security clause embodied
contract need not join the union, but in a CBA is recognized and accepted
all workers hired thereafter must join. in our jurisdiction. This practice
[Azucena] strengthens the union and prevents
disunity in the bargaining unit within
5. Agency shop the duration of the CBA. By
preventing member disaffiliation with

the threat of expulsion from the While company may validly dismiss
union and the consequent the employees expelled under the
termination of employment, the union security clause upon the
authorized bargaining representative recommendation by the union, this
gains more numbers and dismissal should not be done hastily
strengthens its position as against and summarily thereby eroding the
other unions which may want to employees' right to due process,
claim majority representation. self-organization and security of
[Alabang Country Club v. NLRC, tenure. The enforcement of union
G.R. No. 170287 (2008)] security clauses is authorized by law
provided such enforcement is not
 Requisites for the enforcement characterized by arbitrariness, and
of Union Security Clauses always with due process. Even if
In terminating the employment of an there are valid grounds to expel the
employee by enforcing the union union officers, due process requires
security clause, the employer needs that these union officers be accorded
only to determine and prove that: a separate hearing by respondent
1. The union security clause is company. [Malayang Samahan ng
applicable Manggagawa sa M. Greenfield v.
2. The union is requesting for the Ramos, G.R. No. 113907 (2000)]
enforcement of the union security
provision in the CBA  Requirement of Due Process
3. There is sufficient evidence to The requirements laid down by the
support the union’s decision to law in determining whether or not an
expel the employee from the employee was validly terminated
union. [Alabang Country Club v. must still be followed even if it is
NLRC, G.R. No. 170287 (2008)] based on a [union security clause] of
a CBA, i.e. the substantive as well as
 Company must conduct the procedural due process
separate investigation or hearing requirements. [Del Monte v. Saldivar,
G.R. No. 158620 (2006)]

 Obligations and Liabilities F. DISCRIMINATION FOR HAVING
Where the employer dismissed his GIVEN OR ABOUT TO GIVE
employees in the belief in good faith TESTIMONY
that such dismissal was required by Art. 259. [248] Unfair Labor Practices
the [union security provision] of the of Employers — xxx

f. To dismiss, discharge or otherwise
collective bargaining agreement with
the union, he may not be ordered to
pay back compensations to such
about to give testimony
employees although their dismissal
is found to be illegal. [Confederated
Notes:
Sons of Labor v. Anakan Lumber
It is an act of ULP by an employer to
Co., G.R. No. L-12503 (1960)]
dismiss, discharge or otherwise
As dictated by fairness, […]
the union shall be liable to pay their
backwages. This is because
about to give testimony under this
management would not have taken
Code.
the action it did had it not been for
Note: This is broader than the
the insistence of the labor union
prohibition under Art. 118 because
seeking to give effect to its
Art. 248 (f) covers testimony under
interpretation of a closed shop
the whole Code, while Art. 118 only
provision. [Guijarno v. CIR, G.R. No.
covers testimony under Book I: Pre-
L-28791-93 (1973)]
Employment, Title II: Wages
Nothing in this Code or in any
Note further: Includes not giving
other law shall stop the parties from
testimony (see Azucena)
requiring membership in a
recognized collective bargaining
G. VIOLATION OF DUTY TO
agent as a condition for employment.
BARGAIN COLLECTIVELY
Note: Dismissals due to USC should
still follow the requirements of due
of Employers — xxx
process

g. To violate the duty to bargain of collective bargaining. […] Unless
collectively as prescribed by this [the union’s] certificate of registration
Code; and status as the certified bargaining
agent is revoked, [the employer], by
Notes: express provision of the law, is duty
Duty to bargain collectively is a bound to collectively bargain with the
continuous process, non-compliance Union.” [Capitol Medical Center v.
of which constitutes ULP. Collective Trajano, G.R. No. 155690 (2005)]
bargaining does not end with the
execution of an agreement. Being a 2. Employer’s suspension of
continuous process, the duty to operations in order to forestall
bargain necessarily impose on the a demand for collective
parties the obligation to live up to the bargaining
terms of such a collective bargaining By admitting that the closure [of the
agreement if entered into, it is business] was due to irreconcilable
undeniable that non-compliance differences between the Union and
therewith constitutes an unfair labor the school management, […] SJCI in
practice. [Shell Oil Workers Union v. effect admitted that it wanted to end
Shell Co., G.R. No. L-28607 (1971)] the bargaining deadlock and
eliminate the problem dealing with
Note: See ULP in Collective the demands of the union. [St. John
Bargaining above. Colleges Inc. v. St. John Academy
Faculty and Employees Union, G.R.
Acts Deemed as Refusal to No. 167892 (2006)]
Bargain
1. Refusal to bargain when there 3. Implied refusal
is an unresolved petition for The school is guilty of unfair labor
union cancellation practice when it failed to make a
“That there is a pending cancellation timely reply to the proposals of the
proceedings against the union is not union more than one month after the
a bar to set in motion the mechanics same were submitted by the union.

In explaining its failure to reply, the 6. Refusal to bargain because the
school merely offered a feeble other party is making unlawful
excuse that its Board of Trustees bargaining demands
had not yet convened to discuss the
matter. Clearly, its actuation showed H. PAYMENT OF NEGOTIATION
a lack of sincere desire to negotiate. OR ATTORNEY’S FEES
[Colegio de San Juan de Letran v. Art. 259. [248] Unfair Labor Practices
Association of Employees and of Employers — xxx
Faculty of Letran, G.R. No. 141471 h. To pay negotiation or attorney's
(2000)] fees to the union or its officers or

agents as part of the settlement
of any issue in collective
Acts Not Deemed Refusal to
bargaining or any other dispute;
Bargain
1. Adoption of an adamant
Notes:
bargaining position in good faith,
Sweetheart contracts are favorable
particularly where the company is
both to the union and the employer
operating at a loss
at the expense of the employees.
2. Refusal to bargain over demands
The settlement of bargaining issues
for commission of unfair labor
must be made by fair bargaining in
practices
good faith, and not through the
3. Refusal to bargain during period
payment of negotiation or attorney's
of illegal strike
fees which will ultimately lead to
4. Not initiating the bargaining
sweetheart contracts.
5. Refusal to bargain where the
union demands for recognition
I. VIOLATION OF A COLLECTIVE
and bargaining within the year
BARGAINING AGREEMENT
following a certification election,
and the clear choice is no union
of Employers —
and no ad interim significant xxx
change has taken place in the i. To violate a collective bargaining
unit agreement.

malicious and flagrant, is not a
Flagrant and/or Malicious Refusal violation of an economic provision,
to Comply with Economic thus not an Unfair Labor Practice.
Provisions Required [BPI Employees Union-Davao FUBU
Art. 261. Jurisdiction of Voluntary v. BPI, G.R. No. 174912 (2013)]
Arbitrators. – Accordingly, violations of An employer cannot be
a Collective Bargaining Agreement, considered to have committed a
except those which are gross in
gross and economic violation of the
character, shall no longer be treated as
CBA when it, in good faith, withheld
unfair labor practice and shall be
union dues and death benefits from
resolved as grievances under the
the union upon written request of the
Collective Bargaining Agreement. For
purposes of this Art., gross violations of
union members in light of the conflict
Collective Bargaining Agreement shall between the members and the union
mean flagrant and/or malicious refusal officers and instead deposited such
to comply with the economic provisions amount to the DOLE. [Arellano
of such agreement. University Employees and Workers
Union v. Court of Appeals, G.R.
Violations of collective bargaining 139940 (2006)]
agreements, except flagrant and/or
malicious refusal to comply with its Motive, Conduct, Proof
economic provisions, shall not be To constitute ULP, the dismissals by
considered unfair labor practice and the ER need not be entirely
shall not be strikeable. [Book V, Rule motivated by union activities or
XXII, Sec. 5] affiliations. It is enough that
discrimination was a factor. The
Note: The list in Art. 248 is not other reasons for the dismissal
exhaustive. Other acts which are proffered by the ER, though
analogous to those enumerated can seemingly valid, would be unavailing
be ULPs. under these circumstances. [Me-
The alleged violation of the Shurn Corp. v. Me-Shurn Workers
CBA, even assuming it was Union-FSM, G.R. 156292 (2005)]

Note: The basic inspiration of the Art. 260. [249] Unfair Labor
dismissals should concern the right Practices of Labor Organizations
to self-organization — xxx
a. To restrain or coerce employees
Totality of Evidence in the exercise of their right to
Where the attendant circumstances, self-organization. However, a

labor organization shall have the
the history of the employer's past
right to prescribe its own rules
conduct and like considerations,
with respect to the acquisition or
coupled with an intimate connection
retention of membership;
between the employer's action and
the union affiliations or activities of
“Interfere” is not included in Art. 260
the particular employee or
simply because any act of a labor
employees taken as a whole raise a
organization amounts to interference
suspicion as to the motivation for the
to the right of self-organization.
employer's action, the failure of the
employer to ascribe a valid reason
B. DISCRIMINATION:
therefor may justify an inference that
ENCOURAGE/ DISCOURAGE
his unexplained conduct in respect of
UNIONISM
the particular employee or
employees was inspired by the of Labor Organizations — xxx
latter's union membership or b. To cause or attempt to cause an
activities. [Royal Undergarment employer to discriminate against
Corporation of the Philippines v. CIR, an employee, including
G.R. L-39040 (1990)] discrimination against an
employee with respect to whom
membership in such organization
Chapter III – Unfair Labor
has been denied or to terminate
Practices of Labor
an employee on any ground
Organizations other than the usual terms and
A. RESTRAINT OR COERCION conditions under which
membership or continuation of

membership is made available to agree to pay or deliver any
other members; money or other things of value,
in the nature of an exaction, for
General rule: it is a ULP for a labor services which are not
organization to cause an employer to performed or not to be

performed, including the demand
discriminate against an employee.
for fee for union negotiations;
Exception: provisions of a valid
union security clause and other
The practice of the labor
company policies applicable to all
organization to cause or attempt to
employees.
cause an employer to pay or deliver
or agree to pay or deliver money or
C. VIOLATION OF DUTY, OR
other things of value, in the nature of
REFUSE TO BARGAIN
an exaction, for services which are
not performed or are not to be
of Labor Organizations — xxx
c. To violate the duty, or refuse to performed, including the demand for
bargain collectively with the a fee for union negotiations.
employer, provided it is the
representative of the employees; E. ASKING OR ACCEPTING
NEGOTIATION AND OTHER
Note: See ULP in Collective ATTORNEY'S FEES
Bargaining above. Art. 260. [249] Unfair Labor Practices
Note further: See discussion under of Labor Organizations — xxx
2(g) e. To ask for or accept negotiation
or attorney's fees from
employers as part of the
D. ILLEGAL EXACTION
settlement of any issue in
(FEATHERBEDDING)
collective bargaining or any other
dispute
of Labor Organizations — xxx
See counterpart in ULP by
d. To cause or attempt to cause an
Employers (sweetheart contracts).
employer to pay or deliver or

274] and shall not be strikeable [Sec.
F. VIOLATION OF A COLLECTIVE 5, Rule XXII, Book V, IRR].
BARGAINING AGREEMENT Note: See also discussion on
Art. 260. [249] Unfair Labor Practices bargaining in bad faith under 3(a)
of Labor Organizations — xxx which constitute ULP of either the
f. To violate a collective bargaining Employer or the Labor Organization.
agreement.
Gross Violations of the CBA

TITLE VII – COLLECTIVE
Art. 274. [261] Jurisdiction of
BARGAINING AND
Voluntary Arbitrators. –
Accordingly, violations of a Collective ADMINISTRATION OF
Bargaining Agreement, except those AGREEMENTS
which are gross in character, shall GENERAL CONCEPTS
no longer be treated as unfair labor Constitutional Policies
practice and shall be resolved as a. [The State] shall guarantee the
grievances under the Collective rights of all workers to self-
Bargaining Agreement. For purposes organization, collective
of this Art., gross violations of bargaining and negotiations […]
Collective Bargaining Agreement [par. 2, Sec. 3, Art. XIII, 1987
shall mean flagrant and/or malicious Constitution]
refusal to comply with the economic b. The State shall promote the
provisions of such agreement. principle of shared responsibility
between workers and employers
Flagrant and/or malicious refusal and the preferential use of
required voluntary modes in settling
Violations of collective bargaining disputes, including conciliation,
agreements, except flagrant and/or and shall enforce their mutual
malicious refusal to comply with its compliance therewith to foster
economic provisions, shall not be industrial peace. [par. 3, Sec. 3,
considered unfair labor practice [Art. Art. XIII, 1987 Constitution]

set or fix wages, rates of pay,
Statutory Policies hours of work or other terms and
a. To promote and emphasize the conditions of employment, except
primacy of free collective as otherwise provided under this
bargaining and negotiations, Code [Art. 218-B]
including voluntary arbitration,
mediation and conciliation, as Definition, Nature, and Purpose
modes of settling labor or Collective bargaining which is
industrial disputes. [Art. 218-A(a)] defined as negotiations towards a
b. It is the policy of the State to collective agreement, is one of the
promote and emphasize the democratic frameworks under the
primacy of free and responsible [Labor] Code, designed to stabilize
exercise of the right to self- the relations between labor and
organization and collective management and to create a climate
bargaining, either through single of sound and stable industrial peace.
enterprise level negotiations or It is a mutual responsibility of the
through the creation of a employer and the Union and is
mechanism by which different characterized as a legal obligation.
employers and recognized [Kiok Loy v. NLRC, G.R. No. L-
certified labor unions in their 54334 (1986)]
establishments bargain The institution of collective
collectively. [Book V, IRR Rule bargaining is [...] a prime
XVI, Sec. 1] manifestation of industrial
c. To encourage a truly democratic democracy at work. The two parties
method of regulating the relations to the relationship, labor and
between the employers and management, make their own rules
employees by means of by coming to terms [...] to govern
agreements freely entered into themselves in matters that really
through collective bargaining, no count. [United Employees Union of
court or administrative agency or Gelmart Industries v. Noriel, G.R.
official shall have the power to No. L-40810 (1975)]

collectively means the performance of a
Right to Suspend Free Collective mutual obligation to meet and convene
Bargaining promptly and expeditiously in good faith

for the purpose of negotiating an
The assailed PAL-PALEA agreement
agreement with respect to wages, hours
was the result of voluntary collective
of work, and all other terms and
bargaining negotiations undertaken
conditions of employment including
in the light of the severe financial
proposals for adjusting any grievances
situation faced by the employer, with or questions arising under such
the peculiar and unique intention of agreement and executing a contract
not merely promoting industrial incorporating such agreements if
peace at PAL, but preventing the requested by either party, but such duty
latter’s closure. [...] It was PALEA, as does not compel any party to agree to a
the exclusive bargaining agent of proposal or to make any concession.
PALs ground employees, that

voluntarily entered into the CBA with Jurisdictional Preconditions on
PAL. It was also PALEA that Duty to Bargain
voluntarily opted for the 10-year 1. Possession of the status of
suspension of the CBA. Either case majority representation of the
was the union’s exercise of its right employees’ representative in
to collective bargaining. The right to accordance with any of the
free collective bargaining, after all, means of selection or designation
includes the right to suspend it. provided for by the Code;
[Rivera v. Espiritu, G.R. No. 135547 2. Proof of majority representation;
(2000)] AND Demand to bargain under

Art. 261(a) [Kiok Loy v. NLRC,
A. Duty to Bargain Collectively G.R. No. L-54334 (1986)]
i. In General
Definition [Citing Art. 267], only the labor
organization designated or selected
Art. 252. Meaning of duty to bargain by the majority of the employees in
collectively. — The duty to bargain an appropriate collective bargaining

unit is the exclusive representative of Corporation, G.R. No. 170007
the employees in such unit for the (2014)]
purpose of collective bargaining. The
union is admittedly not the exclusive Duty to Bargain does not include:
representative of the majority of the 1. Any legal duty [on the employer]
employees [...], hence, it could not to initiate contract negotiation
demand from [the employer] the right [Kiok Loy v NLRC, G.R. No. L-
to bargain collectively in their behalf. 54334 (1986)]
[Phil. Diamond Hotel and Resort Inc 2. The obligation to reach an
v. Manila Diamond Hotel and agreement: While the law makes
Employees Union, G.R. No. 158075 it an obligation for the employer
(2006)] and the employees to bargain
collectively with each other, such
Meaning of Bargaining in Good compulsion does not include the
Faith commitment to precipitately
[T]here is no per se test of good faith accept or agree to the proposals
in bargaining. Good faith or bad faith of the other. All it contemplates is
is an inference to be drawn from the that both parties should approach
facts. [Union of Filipino Employees v. the negotiation with an open mind
Nestle Philippines, Inc., G.R. Nos. and make reasonable effort to
158930-31 (2008)][T]he failure to reach a common ground of
reach an agreement after agreement. [Union of Filipro
negotiations continued for a Employees v. Nestle, G.R. Nos.
reasonable period does not establish 158930-31 (2008)]
a lack of good faith. The laws invite
and contemplate a collective Evading the Mandatory Subjects
bargaining contract, but they do not of Bargaining
compel one. [Tabangao Shell The refusal to negotiate a mandatory
Refinery Employees Association v. subject of bargaining is an unfair
Pilipinas Shell Petroleum labor practice although either party
has every desire to reach agreement

and earnestly and in all good faith Union v. NLRC, G.R. No. 125038
bargains to that end. […] However, (1997)]
the duty to bargain does not obligate
the parties to make concessions or Blue-Sky Bargaining
yield a position fairly held. [Azucena] Blue-Sky Bargaining is defined as
The duty to bargain is limited "unrealistic and unreasonable
to mandatory bargaining subjects; as demands in negotiations by either or
to other matters, he is free to bargain both labor and management, where
or not to bargain. Over mandatory neither concedes anything and
subjects, a party may insist on demands the impossible." It actually
bargaining, even to the point of is not collective bargaining at all.
deadlock, and his insistence will not [Roberts Dictionary of Industrial
be construed as bargaining in bad Relations as cited in Standard Bank
faith. Chartered Employees Union v.
Over a non-mandatory Confesor, G.R. No. 114974 (2004)]
subject, on the other hand, a party
may not insist on bargaining to the Surface Bargaining
point of impasse, otherwise his Surface bargaining is defined as
insistence can be construed as "going through the motions of
bargaining in bad faith. negotiating," without any real intent
to reach an agreement. [Roberts
Bargaining in Bad Faith Dictionary of Industrial Relations as
The crucial question whether a party cited in Standard Bank Chartered
has met his statutory duty to bargain Employees Union v. Confesor,
in good faith typically turns on the supra.]
facts of the individual case. There is It violates the Act's
no per se test of good faith in requirement that parties negotiate in
bargaining. Good faith or bad faith is "good faith." It is prohibited because,
an inference to be drawn from the as one commentator explained: The
facts of the case. [Hongkong and bargaining status of a union can be
Shanghai Banking Corp. Employees destroyed by going through the

motions of negotiating almost as A take-it-or-leave-it approach in
easily as by bluntly withholding negotiation constitutes bad faith.
recognition […] As long as there are "Although the law cannot open a
unions weak enough to be talked to man's mind, it can at least compel
death, there will be employers who him to conduct himself as if he were
are tempted to engage in the forms trying to persuade and were willing
of collective bargaining without the to be persuaded. To offer the union a
substance. [K-MART Corporation v. contract saying 'Take it or leave it,' is
NLRB, 1980 626 F.2d 704] not bargaining collectively within the
meaning of the act.” [Herald Delivery
Individual Bargaining Carriers Union v. Herald Publication
It is an unfair labor practice for an Inc., G.R. No. L-29966 (1974), citing
employer operating under a CBA to NLRB v. Pilling and Son Co. US, 119
negotiate with his employees F2D 32 (1941)]
individually. That constitutes
interference because the company is ii. When there is an Absence of
still under obligation to bargain with CBA
the union as the bargaining Art. 262. Duty to bargain collectively
representative. in the absence of collective
Individual bargaining bargaining agreements. — In the

absence of an agreement or other
contemplates a situation where the
voluntary arrangement providing for a
employer bargains with the union
more expeditious manner of collective
through the employees instead of the
bargaining, it shall be the duty of the
employees through the union. [The
employer and the representatives of the
Insular Life Assurance Co. Ltd., employees to bargain collectively in
Employees Assn. v. Insular Life accordance with the provisions of this
Assurance Co. Ltd, G.R. No. L- Code.
25291 (1971)]
iii. When there is a CBA
Boulwarism General Rule: The duty to bargain
collectively shall also mean that

neither party shall terminate nor It shall be the duty of both parties to
modify such agreement during its keep the status quo and to continue
lifetime. [Art. 264] in full force and effect the terms and
conditions of the existing agreement
Substitutionary Doctrine during the 60-day period and/or until
Note: See also discussion under a new agreement is reached by the
V.b.2 parties.
Even during the effectivity of a
collective bargaining agreement iv. Bargaining Procedure
executed between employer and General Rule: Private Procedure -
employees [through] their agent, the The bargaining procedure shall be
employees can change said agent governed by [the parties’] agreement
but the contract continues to bind or other voluntary arrangement
then up to its expiration date. They providing for a more expeditious
may bargain however for the manner of collective bargaining.
shortening of said expiration date. Rationale: It is the policy of the state
[Elisco-Elirol Labor Union v Noriel, to promote and emphasize the
G.R. No. L-41955 (1977)]. primacy of free collective bargaining
Exception: At least sixty (60) days and negotiations [Art. 218-A(a)]
prior to the expiration of the Exception:
collective bargaining agreement, Labor Code Procedure – In absence
either party can serve a written of a private agreement, the collective
notice to terminate or modify the bargaining procedure under Art. 261
agreement. shall be followed.
Note: During this 60-day period, a 1. Written notice and statement of
verified petition questioning the proposals. When a party desires
majority status of the incumbent to negotiate an agreement, it
bargaining agent may also be filed shall serve a written notice upon
[Art. 268]. the other party with a statement
of its proposals.
Effect on existing CBA

2. Reply. The other party shall make 6. Prohibition against disruptive
a reply thereto not later than ten acts. During the conciliation
(10) calendar days from receipt of proceedings in the Board, the
such notice. parties are prohibited from doing
3. Conference. Should differences any act which may disrupt or
arise on the basis of such notice impede the early settlement of
and reply, either party may the disputes. [Book V, IRR Rule
request for a conference which XII, Sec. 1]
shall begin not later than ten (10) 7. Deadlock. Any certified or duly
calendar days from the date of recognized bargaining
request. representative may file a notice
4. Board intervention and or declare a strike or request for
conciliation. If the dispute is not preventive mediation in cases of
settled, the [NCMB] shall bargaining deadlocks and unfair
intervene upon request of either labor practices. The employer
or both parties or at its own may file a notice or declare
initiative and immediately call the lockout or request for preventive
parties to conciliation meetings. mediation in the same cases. In
The [NCMB] shall have the power the absence of certified or duly
to issue subpoenas requiring the recognized bargaining
attendance of the parties to such representative, any legitimate
meetings. It shall be the duty of labor organization in the
the parties to participate fully and establishment may file a notice,
promptly in the conciliation request preventive mediation or
meetings the Board may call; declare a strike but only on
5. Voluntary arbitration. The grounds of unfair labor practice
[NCMB] shall exert all efforts to [NCMB Manual of Procedure,
settle disputes amicably and Rule IV, Sec. 3]
encourage the parties to submit
their case to a voluntary Period to Reply; Bad Faith
arbitrator.

[The period to reply] is merely Examples:
procedural, and non-compliance 1. Vacations and holidays
cannot be automatically deemed to 2. Bonuses
be an act of unfair labor practice. 3. Seniority, Transfer, and Layoffs
[National Union of Restaurant 4. Employee workloads
Workers v. CIR, G.R. No. L-20044 5. Work rules and regulations
(1964)] 6. Union security arrangements
7. Pension and insurance benefits
Failure to Reply as Indicia of Bad for active employees
Faith
[The employer’s] refusal to make a Permissive Issues
counter-proposal [...] is an indication Unilateral benefits extended by the
of its bad faith. Where the employer employer [cf. Union of Filipino
did not even bother to submit an Employees v. Nestle, G.R. Nos.
answer to the bargaining proposals 158930-31 (2008)]
of the union, there is a clear evasion A collective bargaining
of the duty to bargain collectively, [...] agreement refers to the negotiated
making it liable for unfair labor contract between a legitimate labor
practice. [General Milling Corp. v. organization and the employer
CA, G.R. No. 146728 (2004)] concerning wages, hours of work
and all other terms and conditions of
v. Bargainable Issues employment in a bargaining unit […].
Mandatory Bargainable Issues As in all other contracts, the parties
1. Wages in a CBA may establish such
2. Hours of work stipulations, clauses, terms and
3. All other terms and conditions of conditions as they may deem
employment including proposals convenient provided they are not
for adjusting any grievances or contrary to law, morals, good
questions arising under such customs, public order or public
agreement policy. [Manila Fashions v. NLRC,
G.R. No. 117878 (1996)]

Test For Mandatory Bargainable matter which is a mandatory subject
Issues of collective bargaining. [But] a
The NEXUS Between the Nature of refusal to contract unless the
Employment and the Nature of the agreement covers a matter which is
Demand: For “other terms and not a mandatory subject is in
conditions of employment” to substance a refusal to bargain about
become a mandatory bargainable matters which are mandatory
issue, they must have a connection subjects of collective bargaining; and
between the proposal and the nature it is no answer to the charge of
of the work. refusal to bargain in good faith that
In order for a matter to be the insistence on the disputed clause
subject to mandatory collective was not the sole cause of the failure
bargaining, it must materially or to agree or that agreement was not
significantly affect the terms and reached with respect to other
conditions of employment. Whether disputed clauses.
the agreement concerns a Such refusal will not be
mandatory subject of bargaining deemed as an unfair labor practice.
depends not on its form, but on its However, if a party refuses to
practical effect. [Azucena] contract based on an issue which is
not a mandatory bargainable issue,
Importance of Determining the the party will be guilty of ULP.
character of the Bargaining Issue [Samahang Manggagawa sa Top
The question as to what are Form v. NLRC, G.R. No. 113856
mandatory and what are merely (1998)]
permissive subjects of collective
bargaining is of significance on the Minutes of Negotiation
right of a party to insist on his Where a proposal raised by a
position to the point of stalemate. A contracting party does not find print
party may refuse to enter into a in the CBA, it is not a part thereof
collective bargaining contract unless and the proponent has no claim
it includes a desired provision as to a whatsoever to its implementation.

[...] The Minutes [only] reflects the
proceedings and discussions vi. Bargaining Deadlock
undertaken in the process of Deadlock is defined as the
bargaining for worker benefits in the “counteraction of things producing
same way that the minutes of court entire stoppage: a state of inaction or
proceedings show what transpired of neutralization caused by the
therein. At the negotiations, it is but opposition of persons or of factions:
natural for both management and a standstill. There is a deadlock
labor to adopt positions or make when there is a “complete blocking
demands and offer proposals and or stoppage resulting from the action
counter-proposals. However, nothing of equal and opposed forces.” The
is considered final until the parties word is synonymous with the word
have reached an agreement. impasse which, within the meaning
[Samahang Manggagawa sa Top of the American federal labor laws,
Form v. NLRC, G.R. No. 113856 “presupposes reasonable effort at
(1998)] good faith bargaining which, despite
noble intentions, does not conclude
Suspension of Bargaining in agreement between the parties.”
Negotiations [Divine World Tacloban v. Secretary
In order to allow the employer to of Labor, G.R. No. 91915 (1992)]
validly suspend the bargaining
process there must be a valid Collective Bargaining Deadlock is
petition for certification election defined as the situation between the
raising a legitimate representation labor and the management of the
issue. Hence, the mere filing of a company where there is failure in the
petition for certification election does collective bargaining negotiations
not ipso facto justify the suspension resulting in a stalemate. [San Miguel
of negotiation by the employer. Corp. v NLRC, G.R. No. 99266
[Colegio de San Juan de Letran v. (1999)].
Association of Employees, G.R. No.
141471 (2000)]

Privileged Communication in concerning wages, hours of work
Conciliation Proceedings and all other terms and conditions of
Information and statements made at employment in a bargaining unit.
conciliation proceedings shall be [Sec. 1(k), Rule I, Book V, IRR]
treated as privileged communication
and shall not be used as evidence in Nature of the CBA
the Commission. Conciliators and It is a familiar and fundamental
similar officials shall not testify in any doctrine in labor law that the CBA is
court or body regarding any matters the law between the parties and they
taken up at conciliation proceedings are obliged to comply with its
conducted by them. [Art. 233] provisions. [Zuellig Pharma
Corporation v. Alice Sibal, G.R. No.
Rationale: 173587 (2013)]
1. A person is entitled to ‘buy his or Although it is a rule that a
her peace’ without danger of contract freely entered between the
being prejudiced in case his or parties should be respected, since a
her efforts fail contract is the law between the
2. offers for compromise are parties, said rule is not absolute. [...
irrelevant because they are not Citing Art. 1700,] the relations
intended as admissions by the between capital and labor are not
parties making them [Pentagon merely contractual. They are so
Steel v. CA, G.R. No. 174141 impressed with public interest that
(2009)] labor contracts must yield to the
common good. [Halagueña v.
B. Collective Bargaining Philippine Airlines, G.R. No. 172013
Agreement (CBA) (2009)]
i. General Concepts
Collective Bargaining Agreement Beneficiaries of the CBA
or “CBA” refers to the negotiated Art. 267. [255] Exclusive Bargaining
contract between a legitimate labor Representation and Workers’
organization and the employer Participation in Policy and Decision-

Making. – The labor organization contractual in nature but impressed
designated or selected by the majority of with public interest, thus, it must
the employees in an appropriate yield to the common good. As such,
collective bargaining unit shall be the
it must be construed liberally rather
exclusive representative of the
than narrowly and technically, and
employees in such unit for the purpose
the courts must place a practical and
of collective bargaining.
realistic construction upon it, giving
due consideration to the context in
When a collective bargaining
which it is negotiated and purpose
contract is entered into by the union
which it is intended to serve. [Davao
representing the employees and the
Integrated Port Stevedoring Services
employer, even the non-member
v. Abarquez, G.R. No. 102132
employees are entitled to the
(1993)]
benefits of the contract. To accord its
benefits only to members of the
General Rule: [W]here the CBA is
union without any valid reason would
clear and unambiguous, it becomes
constitute undue discrimination
the law between the parties and
against non-members. [New Pacific
compliance therewith is mandated by
Timber and Supply v. NLRC, G.R.
the express policy of the law. [Zuellig
No. 124224 (2000)]
Pharma Corporation v. Alice Sibal,
G.R. No.173587 (2013)]
Contract Interpretation
Exception: If the words appear to be
Art. 1702, Civil Code. In case of
contrary to the evident intention of
doubt, all labor legislation and all
the parties, the latter shall prevail
labor contracts shall be construed in
over the former. [Kimberly Clark
favor of the safety and decent living
Phils. v. Lorredo, G.R. No. 103090
for the laborer.
(1993)]
A CBA, as a labor contract
within the contemplation of Art. 1700
ii. Mandatory Provisions of the
of the Civil Code of the Philippines
CBA
which governs the relations between
labor and capital, [it] is not merely

Art. 273 [Grievance Machinery and panel of Voluntary Arbitrators, as may
Voluntary Arbitration. — The parties to be necessary, pursuant to the selection
a Collective Bargaining Agreement shall procedure agreed upon in the Collective
include therein provisions that will Bargaining Agreement, which shall act
ensure the mutual observance of its with the same force and effect as if the
terms and conditions. They shall Arbitrator or panel of Arbitrators have
establish a machinery for the adjustment been selected by the parties as
and resolution of grievances arising described above.
from the interpretation or
implementation of their Collective iii. Administration and
Bargaining Agreement and those arising Enforcement of CBA
from the interpretation or enforcement of
company personnel policies.
Substandard CBA
All grievances submitted to the
A CBA that falls below the minimum
grievance machinery which are not
standards required by law is
settled within seven (7) calendar days
from the date of its submission shall
prohibited. Nonetheless, RA 9481
automatically be referred to voluntary removed substandard CBAs as a

arbitration prescribed in the Collective ground for the cancellation of
Bargaining Agreement. registration of union registration.
For this purpose, parties to a Note: A substandard CBA cannot
Collective Bargaining Agreement shall bar a petition for certification election
name and designate in advance a under the contract-bar rule. [Prof.
Voluntary Arbitrator or panel of
Battad]
Voluntary Arbitrators, or include in the
agreement a procedure for the selection
Ratification
of such Voluntary Arbitrator or panel of
Within thirty (30) days from the
Voluntary Arbitrators, preferably from
the listing of qualified Voluntary execution of a collective bargaining
Arbitrators duly accredited by the Board. agreement, the parties shall submit
In case the parties fail to select a copies of the same directly to the
Voluntary Arbitrator or panel of Bureau or the Regional Offices of the
Voluntary Arbitrators, the Board shall Department of Labor and
designate the Voluntary Arbitrator or Employment for registration

accompanied with verified proofs of Exception: Even if there was no
its posting in two conspicuous places ratification, the CBA will not be
in the place of work and ratification invalid or void considering that the
by the majority of all the workers in employees have enjoyed benefits
the bargaining unit. [Art. 237; Book from it.
V, IRR Rule XVII, Sec. 2 (c)]
[T]he posting of copies of the [The employees] cannot
collective bargaining agreement is receive benefits under provisions
the responsibility of the employer. favorable to them and later insist that
The fact that there were "no impartial the CBA is void simply because
members of the unit" is immaterial. other provisions turn out not to the
The purpose of the requirement is liking of certain employees. [Planters
precisely to inform the employees in Products Inc. v. National Labor
the bargaining unit of the contents of Relations Commission, G.R. No.
said agreement so that they could 78524 (1989)]
intelligently decide whether to accept Note: Ratification of the CBA by the
the same or not. [Associated Labor employees in the bargaining unit is
Unions v. Ferrer-Calleja, G.R. No. L- not needed when the CBA is a
77282 (1989)] product of an arbitral award as a
result of voluntary arbitration under
Effect of Non-ratification Art. 275 or from the secretary’s
General Rule: The collective assumption of jurisdiction or
bargaining agreement should be certification under Art. 278 (g).
ratified by the majority of all the
members of the bargaining unit. Registration
Non-compliance with this Within thirty (30) days from the
requirement renders the CBA execution of a Collective Bargaining
ineffective. [Associated Trade Agreement, the parties shall submit
Unions v. Trajano, G.R. No. 75321 copies of the same directly to the
(1988)] Bureau or the Regional Offices of the
Department of Labor and

Employment for registration […]. [Art. Specific information submitted in
237] confidence
General rule: Shall not be disclosed
iv. Requirements for Exceptions:
Registration 1. authorized by Secretary of Labor
2. when it is at issue in any judicial
The application for CBA registration litigation
shall be accompanied by the original 3. public interest or national security
and two (2) duplicate copies of the requires [Art. 237]
following documents which must be
certified under oath by the Effect of Unregistered CBA
representative(s) of the employer(s) An unregistered CBA is binding upon
and labor union(s) concerned: the parties but cannot serve as a bar
1. The collective bargaining to a petition for certification election
agreement under the contract-bar rule.
2. A statement that the collective Sec. 3, Rule VIII, Book V
bargaining agreement was states: A petition for certification
posted in at least two (2) election may be filed anytime,
conspicuous places in the except: [...] (d) when a collective
establishment or establishments bargaining agreement between the
concerned for at least five (5) employer and a duly recognized or
days before its ratification certified bargaining agent has been
3. A statement that the collective registered in accordance with Art.
bargaining agreement was 231 [now 237] of the Labor Code.
ratified by the majority of the
employees in the bargaining unit v. CBA Effectivity
of the employer or employees If it is the first ever CBA, the
concerned. [Sec. 2, Rule XVII, effectivity date is whatever date the
Book V, IRR] parties agree on.
If it is renegotiated CBA, the
retroactivity of the date of effectivity

depends upon the duration of aspect of the CBA. A [CBA which
conclusion [Art. 265]: continues to take effect beyond its
1. If it is concluded within 6 months expiration date] cannot constitute a
from the expiry date, the new bar to a filing of petition for
CBA will retroact to the date certification election. When there is a
following the expiry date representational issue, the status
[Illustration: expiry date: quo provision insofar as the need to
December 13; renegotiations await the creation of a new
concluded on November 30: agreement will not apply. Otherwise,
effectivity date: December 14]. it will create an absurd situation
2. If it is concluded beyond 6 where the union members will be
months from the expiry date, the forced to maintain membership by
matter of retroaction and virtue of the union security clause
effectivity is left with the parties. existing under the CBA and,
thereafter, support another union
Hold Over Principle when filing a petition for certification
Art. 264. [253] Duty to bargain election. If we apply it, there will
collectively when there exists a always be an issue of disloyalty
collective bargaining agreement. — whenever the employees exercise
… It shall be the duty of both parties to
their right to self-organization. The
keep the status quo and to continue in
holding of a certification election is a
full force and effect the terms and
statutory policy that should not be
conditions of the existing agreement
circumvented, or compromised.
during the 60-day period and/or until a
new agreement is reached by the
[PICOP Resources, Inc. v. Taneca et
parties. al., G.R. No. 160828 (2010)]
The last sentence of Art. 253, which Arbitrated CBA

provides for automatic renewal [upon In the absence of an agreement
expiry], pertains only to the between the parties, an arbitrated
economic provisions of the CBA and CBA takes on the nature of any
does not include representational judicial or quasi-judicial award.

[Manila Electric Company v. vi. CBA Duration
Quisumbing, G.R. No. 127598 Any Collective Bargaining
(1999)] Agreement that the parties may
[I]n the absence of the enter into shall, insofar as the
specific provision of law prohibiting representation aspect is concerned,
retroactivity of the effectivity of the be for a term of five (5) years. [...] All
arbitral awards issued by the other provisions of the Collective
Secretary of Labor pursuant to Art. Bargaining Agreement shall be
263(g) of the Labor Code, [the renegotiated not later than three (3)
Secretary] is deemed vested with years after its execution. [...] [Art.
plenary powers to determine the 265]
effectivity thereof.
[T]o deprive respondent CBA Duration for economic
Secretary of such power and provisions: 3 years.
discretion would run counter to the
well-established rule that all doubts CBA Duration for non-economic
in the interpretation of labor laws provisions: 5 years for
should be resolved in favor of labor. representational or political issues;
In upholding the assailed orders of cannot be renegotiated to extend
respondent Secretary, this Court is beyond 5 years. [FVC Labor Union-
only giving meaning to this rule. PTGWO v. SANAMA-FVC-SIGLO,
Indeed, the Court should help labor G.R. No. 176249 (2009)]
authorities in providing workers
immediate benefits, without being CBA Duration: Freedom Period
hampered by arbitration or litigation No petition questioning the majority
processes that prove to be not only status of the incumbent bargaining
nerve-wracking but financially agent shall be entertained and no
burdensome in the long run. [LMG certification election shall be
Chemicals v. Secretary of Labor, conducted by the DOLE outside of
G.R. No. 127422 (2001)] the sixty-day period immediately
before the date of the expiry of such

five year term of the Collective his or her predecessor [Philippine
Bargaining Agreement. [Art. 265] Airlines, Inc. v. NLRC, G.R. No.
125792 (1998)]
CBA and 3rd Party Applicability General Rule: An innocent
Labor contracts such as employment transferee of a business
contracts and CBAs are not establishment has no liability to the
enforceable against a transferee of employees of the transferor to
an enterprise, labor contracts being continue employing them. Nor is the
in personam, is binding only between transferee liable for past unfair labor
the parties. As a general rule, there practices of the previous owner.
is no law requiring a bona fide Exception: When the liability
purchaser of the assets of an on- therefore is assumed by the new
going concern to absorb in its employer under the contract of sale,
employ the employees of the latter. or when liability arises because of
However, although the purchaser of the new owner's participation in
the assets or enterprise is not legally thwarting or defeating the rights of
bound to absorb in its employ the the employees. The most that the
employees of the seller of such transferee may do, for reasons of
assets or enterprise, the parties are public policy and social justice, is to
liable to the employees if the give preference to the qualified
transaction between the parties is separated employees in the filling of
colored or clothed with bad faith. vacancies in the facilities of the
[Sundowner Development purchaser. [Manlimos v. NLRC, G.R.
Corporation v. Drilon, G.R. No. No. 113337 (1995)]
82341 (1989)] The general rule applies only
Where the change of to the sale and purchase of asset. If
ownership is in bad faith or is used to the method of acquisition is by way
defeat the rights of labor, the of purchase of controlling shares, the
successor-employer is deemed to employer remains the same and the
have absorbed the employees and is new owners must honor the existing
held liable for the transgressions of contracts.

composed of at least two(2)
TITLE VII-A – GRIEVANCE representatives from the members of
MACHINERY AND the bargaining unit(which shall be

designated by the union) and at least
VOLUNTARY ARBITRATION
two(2) from the employer.
GRIEVANCE MACHINERY
 Grievance
 Grievance Procedure
This is a dispute or controversy
The following procedures shall be
between an employer and the
observed, UNLESS a different
collective bargaining agent,
procedure is prescribed in the
individual employee or group of
collective bargaining agreement:
employees, arising from
1. An employee shall present his
interpretation or implementation of
grievance or complaint orally or
the collective bargaining agreement
in writing to the shop steward.
or interpretation or enforcement of
2. Upon receipt thereof, the shop
company personnel policies.
steward shall verify the facts
and determine whether or not
 Grievance Machinery
the grievance is valid.
This is where grievances are
3. if the grievance is VALID, the
processed which the parties to a
shop steward shall immediately
collective bargaining agreement are
bring the complaint to the
required to establish under Article
employee’s immediate
260 of the Labor Code.
supervisor.
4. the shop steward, the employee
 If NO Grievance Machinery
and his immediate supervisor
provided in the Collective
shall exert efforts to settle the
Bargaining Agreement
grievance at their level.
The parties are required to create,
5. if No settlement is reached, the
within ten (10) days from signing of
grievance shall be referred to
the collective bargaining agreement,
the grievance committee which
a grievance committee to be

shall have ten (10) days to 2. any person chosen or designated
decide the case. by the parties in the collective
bargaining agreement; or
 Grievance Handling - Part of the 3. one chosen with or without the
Collective Bargaining Process assistance of the National
Because it is a continuous process. Conciliation and Mediation Board
The duty to bargain collectively pursuant to a selection procedure
imposes upon the parties during the agreed upon in the Collective
term of their agreement to meet and Bargaining Agreement; or
confer promptly and expeditiously ad 4. any official who may be
in good faith for the purpose of authorized by the Secretary of
adjusting any grievance or question Labor and Employment to act as
arising under such agreement. (Art. Voluntary Arbitrator upon the
260, Labor Code) written request and agreement of
the parties to a labor dispute,
VOLUNTARY ARBITRATION whose function is to resolve the
 Definition disputes submitted to it by the
This is a system whereby the parties parties (Art. 261, Labor Code)
agree to refer their dispute to an
impartial third person for a final and  Original and Exclusive
binding resolution, UNLIKE in Jurisdiction of Voluntary
compulsory arbitration in which the Arbitrators
third party is appointed by the 1. unresolved grievance arising
government. (Art. 260, Labor Code) from interpretation or
implementation of a collective
 Voluntary Arbitrator bargaining agreement;
1. A person accredited as such by 2. unresolved grievance arising
the National Conciliation and from interpretation or
Mediation Board; or enforcement of company
personnel policies;

3. disputes arising from wage XPN: Disputes over the validity of
distortion caused by the dismissal or severance of
application any wage order in employment will fall within the
organized establishments; and jurisdiction of voluntary arbitrators
4. disputes arising from only when the issue pertains to
interpretation and implementation interpretation or implementation of a
of the productivity incentive collective bargaining agreement or
programs under RA No. 6971 company personnel policy. (Art. 261,
Labor Code)
 Jurisdictional Preconditions
A voluntary arbitrator can acquire  Scope of Arbitration Awards
jurisdiction over the foregoing The power and authority of voluntary
disputes only when the following arbitrators to decide a case is limited
conditions have been complied with: to those matters which have been
1. the dispute has been brought to submitted to them for arbitration.
the grievance machinery for  Judicial Review of Arbitration
resolution; Awards
2. the grievance machinery failed to Decisions or awards of voluntary
resolve the dispute; and arbitrations are appealable to the
3. the parties agree to submit the Court of Appeals.
dispute for voluntary arbitration. The state of our present law
relating to voluntary arbitration
 Jurisdiction Over Termination provides that “the award or decision
Disputes of the Voluntary Arbitrator x xx shall
GR: Disputes over the validity of be final and executory after 10
dismissal or severance of calendar days from receipt of the
employment do not fall within the copy of the award or decision by the
jurisdiction of voluntary arbitrators parties,” while the “decisions,
BUT within the original and exclusive awards, or orders of the Labor
jurisdiction of the Labor Arbiter. Arbiters are final and executory
unless appealed to the Commission

by any or both parties within 10 Unless the parties agree otherwise,
calendar days from receipt of such the cost of voluntary arbitration
decisions, awards, or orders.” proceedings and voluntary
Hence, while there is an arbitrator’s fee shall be shared
express mode of appeal from the EQUALLY by the parties.
decision of labor arbiter, RA No. If their funds is
6715 is silent with respect to an INSUFFICIENT, they may avail of
appeal from the decision of a the subsidy under the Special
voluntary arbitrator. Voluntary Arbitrator’s Fund. (Art.
262-B, Labor Code)
 Power to Enforce Arbitration
Awards TITLE VIII – STRIKE AND
The Voluntary Arbitrator has the LOCKOUTS AND FOREIGN
power to:
INVOLVEMENT IN TRADE
1. Issue writ of execution
UNION ACTIVITIES
2. May require the sheriff of the
NLRC or the regular courts or Chapter I – Strikes and
any public official whom the Lockouts
parties may designate in the
submission agreement, to STRIKES AND LOCKOUTS
execute the arbitration award. Art. 268. Strikes, Picketing, and
In the ABSENCE of Voluntary Lockouts
Arbitrator or in case of his STRIKE
INCAPACITY, the motion for Strike is any temporary stoppage of
issuance of writ of execution may be work by the concerted action of
filed with the Labor Arbiter in the employees as a result of a labor
region having jurisdiction over the dispute. (Art. 217(o), Labor Code;
workplace. (Art. 262-A, Labor Code) Lapanday Workers vs. NLRC, 248
SCRA 95.)
 Voluntary Arbitrator’s Fee and The idea behind a strike is
Arbitration Cost that a company engaged in profitable

business cannot afford to have its To constitute a strike the stoppage of
production or activities interrupted work must be:
much less, paralyzed. Any 1. Concerted;
interruption or stoppage of 2. Temporary; and
production spells loss even, even 3. Must result from a labor dispute.
disaster. The capital invested in
machinery, factory and other The Stoppage of Work Must Be
properties connected with the Concerted
business would be unproductive The concerted stoppage of work may
during a strike or the stoppage of the take the form of:
business. On the other hand, the 1. walk-out;
overhead expenses consisting in the 2. slowdown;
salaries of its official, including real 3. mass leave;or
estate taxes and license fees 4. just plain sit-down
continue. Knowing this, the strikes by 5. attempt to damage destroy or
going on strike seek to interrupt and sabotage plant equipment and
paralyze the business and facilities and similar activities.
production of the company. The Samahang Manggagawa sa
employer company is on the Sulpicio Lines v. Sulpicio Lines,
defensive. It almost invariably wants 426 SCRA 319.)
the strike stopped and the strikers
back to work so as to resume and The Stoppage of Work Must Be
continue production. Because of this Temporary
threat to danger of loss to the Strike means only a “temporary
company, it not infrequently gives in stoppage of work,” not a permanent
to the demands of the striker, just so cut-off of employment relationship.
it can maintain the continuity of its Mass resignation of
production. (Philippine Can Co. v. employees in protest of the dismissal
CIR, 87 Phil. 9.) of a co-employee is not a strike
because the stoppage of work,
ELEMENTS OF STRIKE (CTR) though concerted and resulting from

a labor dispute, is not temporary.
Mass resignation evidently intends KINDS OF STRIKE
permanently cut-off the employment As to Purpose:
relation. (Airline Pilots Association of 1. Unfair labor practice strike- a
the Philippines v. CIR, 76 SCRA concerted activity staged to protest
274) the employer’s unfair labor practice.
It is not necessary that the employer
The Stoppage of Work Must should in fact commit an unfair labor
Result From a Labor Dispute practice. A strike staged in good faith
Labor Dispute: As defined in Art. under the belief that the employer
218 (1), “Labor dispute includes any has committed an unfair labor
controversy or matter concerning practice, is still an unfair labor
terms or conditions of employment or practice strike.
matter concerning terms or 2. Economic strike- a concerted
conditions of employment or the activity staged to force wage or other
association, or representation of concessions from the employer
persons in negotiating, fixing, which he is not required by law to
maintaining, changing, or arranging grant.
the terms and conditions of
employment, regardless of whether As to the Manner of Execution:
the disputants stand in the proximate 1. Walk-out- a form of strike where
relation of employer and employee.” employees leave their workplace and
“Regardless of whether the establish themselves outside the
disputants stand in the proximate plant and refuse access to the
relation of employer and employee” owners and other employees who
means that there need not be a want to work.
direct employment relation between 2. Sit-down- a form of strike where
the parties in order that their the strikers do not leave the
controversy can be considered as a workplace but merely establish
labor dispute. (PAFLU v. Tan, 99 themselves within the plant, stop its
Phil. 854) production and refuse access to the

owners and other employees who dispute between the strikers and
want to work. their employer.
3. Slowdown- a form of strike where
workers merely retard production. Who Can Declare a Strike
4. Mass leave- a form of strike Only a certified or duly recognized
where the strikers take time-off from collective bargaining representative
work simultaneously. can declare a strike, be it in an
5. Wildcat- a strike staged without economic or unfair labor strike.
the authorization of the union. It is an If there is none, a strike can be
illegal strike. declared only by:
1. A legitimate labor organization
As to the Employer Against Whom and
it is Directed: 2. Only on the ground of unfair labor
1. Primary strike- directed against practices.
the employer because of a labor
dispute with him. Legal Grounds for Declaring a
2. Secondary strike- directed Strike
against the employer connected by 1. Collective bargaining deadlock;
product or employment with alleged and
unfair labor conditions or practices. 2. Unfair labor practices (ULP).
3. General strike- directed against
all the employers, participated in by Mandatory Requirements of a
the workmen irrespective of the Strike (NVR)
employers for whom they are 1. Notice of strike;
working. 2. Strike vote; and
4. Particular strike- directed solely 3. Strike vote report.
against the strikers’ employer.
5. Sympathy strike- a strike staged NOTICE OF STRIKE
to make common cause with strikers Should be filed with the National
in other establishments, without any Conciliation and Mediation Board
(NCMB) at least:

1. Fifteen (15) days before the Under the foregoing situation
intended day of strike (if the as provided in Art. 282(b), the
ground is based on ULP) Secretary of Labor and Employment
2. Thirty (30) days before the may suspend the effects of dismissal
intended date of strike (if based upon a prima facie finding by the
on CBA deadlock) NCMB that sucg dismissal may
cause a serious labor dispute or is in
Purpose of Notice the implementation of a mass lay-off.
To provide a cooling-off period in
order to give the parties time to settle STRIKE VOTE
their disputes in a peaceful manner The decision to declare a strike must
before declaring a strike. be approved by the majority of the
Observance of a cooling-off total union membership through a
period is mandatory. Hence, if the secret ballot in a referendum duly
union strikes without observing the called for the purpose. This is a
cooling-off period, the strike is illegal. mandatory requirement.
When the Cooling-off Period May Purpose of Strike Vote

Be Dispensed With To ensure that the intended strike is
When the dispute pertains to unfair a majority decision. Hence, a strike
labor practice involving dismissal of declared without the approval of the
duly elected union officers to the majority of the total union
point that the existence of the union membership is illegal.
is threatened, as provided in Art. 268
(c). Strike Vote Notice
However, the union is still The Union should notify the NCMB
obliged to file a notice of strike, at least 24 hours before conducting
obtain a strike vote and submit the the strike vote. The conduct of
strike vote report before staging the referendum may be supervised by
strike. the NCMB, at its own initiative or
upon the request of any party. (Sec.

10, Rule XXII, Book V, Rules
Implementing the Labor Code, as When to Stage a Strike
amended by D.O. No. 40-03) If the dispute is not settled after the
lapse of the cooling-off period and
Validity of Decision to Strike the seven (7)- day strike bab, the
Valid as long as the dispute upon union may go on strike.
which the strike vote was taken
exists. (Art. 268(f), Labor Code) Referendum on Improved Offer
Notwithstanding the declaration to
STRIKE VOTE REPORT strike, the NCMB is still obliged to
The Union should report the results continue mediating and conciliating.
of the strike referendum to the If in the course of the mediation and
NCMB at least seven (7) days before conciliation, the employer presents
the intended strike. This is a an improved offer, the NCMB shall
mandatory requirement. conduct a referendum among the
union members to determine
Purpose of the Strike Vote Report whether or not the improved offer is
To give assurance that a strike vote accepted or not. If the majority
has been taken and also to enable member votes to accept the
the majority of the union members to improved or reduced offer, the strike
take appropriate remedy before it is ends. (Art. 270, Labor Code)
too late, if such report turns out to be
false. Strikes in Medical Institutions
As can be gleaned from Art. 268(g),
The Seven-Day Strike Ban strikes in hospitals, clinics and
It is the seven (7)-day period similar institutions are strongly
reckoned from the submission of the discouraged because of their effects
strike vote report, during which on the life and health o the patient.
period, the union is forbidden to Should the strike be
strike, as can be gleaned from Art. inevitable, the striking union must
268 (f). provide and maintain an effective

skeletal workforce of medical and Employment status subsists during a
health personnel whose movement strike. It is not a renunciation of the
and services shall be unhampered employment relation. The mere
and unrestricted. The Secretary of participation of a worker in a lawful
Labor and Employment may strike is not a ground for the
immediately assume jurisdiction over termination of his employment.
the dispute or certify the same for
compulsory arbitration for twenty- Re-Admission of Strikers
four (24) hours from knowledge of General Rule: Striking employees
the occurrence of the strike. are entitled to re-admission
regardless of whether or not the
Return-To-Work Order strike was the consequence of the
A directive from the Secretary of employer’s ULP.
Labor and Employment commanding Only the following strikes may be
the strikers to resume working declared to have lost their
pending the resolution of the labor employment status and be denied
dispute. It is immediately executory, re-admission:
once the order is issued, returning to 1. Union officers who knowingly
work is not a matter of option but of participate in an illegal strike;
obligation. 2. Union officers or members who
knowingly participate in the
Strikers who defy a return-to-work commission of illegal acts during
order may be declared to have lost the strike; and
their employment status. This is not 3. Strikes who defy a return-to-work
violative of the constitutional order.
provision outlawing involuntary
servitude. (Kaisahan ng mga Wages During Strike
Manggagawa sa Kahoy v. Gotamco Under the principle of “a fair day’s
Sawmills, 80 Phil. 521) wage for a fair day’s labor,” strikers
are not entitled to their wages during
Employment Status of Strikers

the period of the srtike even if the relation to the advancement of their
strike is legal. interest is not a valid strike.
However, backwages may be
awarded in the following exceptional Means Employed in Carrying Out
cases: a Strike
1. When the supposed strikers did 1. If the purpose is lawful and the
not strike but were practically means employed are lawful, the
locked-out; and strike is legal.
2. Where the strikers voluntarily and 2. If the purpose is lawful but the
unconditionally offered to return means employed are unlawful,
to work, but the employer refused the strike is illegal.
to accept the offer without 3. If declared for both a legal and
justifiable reason. illegal purpose, the strike is illegal
in its entirety.
Legality of Strike A strike may be valid at its inception
For a strike to be valid, the following because its objective or purpose is
requisites should be complied with: lawful, but it becomes illegal where
1. It should be staged by s certified the means employed are illegal.
or duly recognized bargaining The legality of strike does not
representative; depend upon the reasonableness of
2. It should be declared only on the demands. To make the legality or
grounds specified by law; and illegality of the strike dependent
3. It should comply with the solely on whether the demands of
requirements prescribed by law. employees may or may not be
A valid strike presupposes the granted is to outlaw altogether an
existence of a labor dispute. Thus, a effective means for securing better
sympathy strike having no demands working conditions.
or grievances of their own, but strike A strike staged in good faith
for the purpose of of directly or under the belief that the
indirectly aiding others, without direct management committed ULP is not
illegal. However, not very claim of

good faith is justifiable-- it must be 3. Strike declared for an unlawful
substantiated and supported by purpose
factual basis. Ex. Those strikes declared:
a. To induce the employer to commit
Categories of Illegal Strike an unfair labor practice against
1. Strike staged in violation of a non-union employees;
specific prohibition of law b. For trivial, unjust or unreasonable
Ex. Those strikes staged by: purpose;
a. By employees performing c. Without giving the employer
governmental; reasonable time to consider and
b. By managerial employees; act on the demands;
c. On grounds involving inter-union d. To compel the employer to
and intra-union disputes; bargain despite the existence of a
d. To compel the employer to correct certified bargaining agent;
wage distortion; e. To compel the implementation of a
e. On grounds other than unfair labor pending writ of execution;
practice or deadlock in collective f. To compel an employer to
bargaining; negotiate a CBA during the
f. Without first having bargained pendency of a petition for
collectively. certification election.
2. Strike in violation of a specific 4. Strike carried out without the

requirement of law use of Unlawful means
Ex. Those strikes declared: Ex. Those strikes:
a. Without notice of strike; a. Attended by commission of any
b. Without conducting strike vote; prohibited acts under Art. 269 of
and the Labor Code;
c. Without submitting strike vote b. Carried out with the use of
report. widespread terrorism against
non-strikers;

c. Carried out with the use of b. Without exhausting or availing of
violence, physical injuries, the grievance machinery under
sabotage and obscene language; the CBA;
d. Where customers were c. In violation of the no-strike
intimidated and harassed to turn stipulation in the CBA.
them away and discouraged NOTE: The no-strike stipulation
them from patronizing the applies only to economic strikes and
business. not to unfair labor practice strikes.
5. Strike declared in violation of Sanction for Illegal Strike

an existing Injunction An illegal strike does not
Ex. Those strikes declared: automatically warrant the wholesale
a. During the cooling-off period; dismissal of strikers. Only the
b. Without observing the 7-day strike following strikers can be penalized
ban; with loss of employment status:
c. After the Secretary of Labor and 1. Union officers who knowingly
Employment has assumed participate in an illegal strike; and
jurisdiction over the dispute; 2. Union officers or members who
d. After the dispute has already been knowingly participate in the
submitted for compulsory commission of illegal acts during
arbitration; or a strike.
e. In defiance of a return-to-work Since the objective of the Labor
order. Code is to ensure stable but dynamic
and just industrial peace, union
6. Strike in violation of an existing leaders are duty bound to guide their
agreement members to respect the law. The
Ex. Those strikes declared: responsibility of the union officers, as
a. In violation of the conclusive main players of illegal strike, is
arbitration clause in the CBA; greater than that of the members, as
the union officers have the duty to
guide their members to respect the

law. Dismissal of loss of employment General Rule: A strike cannot be
status can be imposed only against enjoined even if it may appear to be
the union officers who were acting as illegal because strike is a weapon
such during the strike-- it cannot be that the law grants the employees for
imposed against those who became their protection and advancement of
officers after the strike. their interest.
If the strike is declared illegal, Exceptions:
the employer cannot be restrained or 1. If declared against an industry
enjoined from imposing the indispensable to national interest;
appropriate sanctions against the 2. If staged by employees who are
union officers who knowingly not accorded the right to strike,
participated in the illegal strike and like managerial employees;
against any striking employee who 3. If staged on other non-strikeable
committed illegal acts during the issues, such as intra-union or
strike. inter-union dispute or correction
of wage distortion.
Liability for damages arising from Note: Even if the strike itself cannot
illegal strike be enjoined, illegal acts committed
In order to hold the union and the during the strike may be enjoined.
strikers liable for damages, the best
evidence obtainable must be Who can issue injunction against
presented. Actual or compensatory strikers
damages cannot be presumed, but 1. Secretary of Labor and
must be duly proved with reasonable Employment- in strikes against
degree of certainty. There must be an industry indispensable to the
competent proof that damages have national interest.
been suffered and the actual amount 2. National Labor and Relations
thereof. Commission- in other exceptional
cases.
Injunction against strikers

With regard to injunction against General Rule: Picketing cannot be
illegal acts during the strike, enjoined because it is part of the
NLRC has the jurisdiction to freedom of speech guaranteed by
issue the injunction. the Constitution. If peacefully carried
out, it cannot be curtailed even in the
PICKETING absence of employer-employee
Picketing is the marching to and fro relationship because peaceful
before the premises of an picketing is constitutionally
establishment involved in a dispute, guaranteed.
generally accompanied by the Exceptions: Injunction against
carrying and display of a sign, picketing may issue under the
placard or banner bearing following exceptional circumstances:
statements in connection with 1. If necessary to protect the rights of
dispute. third parties or innocent
bystanders;
Limitations on the right to picket 2. If the picketing is carried out
The right to picket as means of through the use of illegal means;
communicating the facts of a labor or
dispute is guaranteed only when it is 3. If the picketing is carried out
peacefully carried out. Thus, Art. 269 through the use of violence and
(e) of the Labor Code prohibits other illegal acts.
persons or employees engaged in
picketing from: Innocent Bystander Doctrine
1. Committing any act of violence, Under this doctrine, picketers may
coercion or intimidation; be enjoined from picketing
2. Obstructing the free ingress to and establishments with whom they have
egress from the employer’s no employment relation or dispute.
premises; and
3. Obstructing public thoroughfares. LOCKOUT
Lockout is the temporary refusal of
Injunction against Picketing an employer to furnish work as a

result of an industrial or labor Notice of Lockout
dispute. Notice should be filed with the
National Conciliation and Mediation
ELEMENTS OF LOKOUT Board, at least:
To constitute a lockout, refusal to 1. Fifteen (15) days before the
furnish work must be: intended date of lockout-- if
1. Temporary; and based on unfair labor practice; or
2. The result of a labor dispute. 2. Thirty (30) days before the
A strike cannot be converted into a intended date of lockout-- if
lockout by the mere expedient of based on collective bargaining
filing a notice of offer to return to deadlock.
work during the pendency of the
labor dispute. Purpose of Notice
To provide a cooling-off period in
Lockout vs. Shutdown order to give the parties time to settle
LOCKOUT SHUTDOWN their disputes in a peaceful manner
The plant before declaring a lockout.
The plant cease
continues to The observance of the
to operate
operate cooling-off period is mandatory.
GROUNDS FOR DECLARING A

Lockout Vote
LOCKOUT
Declaration of lockout must be
1. Collective bargaining deadlock;
approved by the majority of the
and
Board of Directors or partners
2. Unfair labor practice.
through a secret balloting in a
meeting duly called for the purpose.
MANDATORY REQUIREMENTS
Validity of the decision to
FOR A VALID LOCKOUT
declare a lockout is valid as long as
1. Notice of lockout;
the dispute upon which the lockout
2. Lockout vote; and
vote was taken exists.
3. Lockout vote report.

Lockout Vote Report trustees, or partners of the company
The employer should report the votes to accept the reduced offer,
result of the lockout voting to the the lockout ends.
regional office of the NCMB at least
seven (7) days before the intended Lockout in Medical Institutions
lockout. Lockout in hospitals, clinics and
similar institutions are strongly
Seven-Day Lockout Ban discouraged because of their effects
The seven (7) day lockout ban is the on the life and health of patients.
seven (7)-day period reckoned from Should a lockout be declared, the
the submission of the lockout vote employer must provide and maintain
report. During this period, the an effective skeletal workforce of
employer is forbidden to lockout. medical and health personnel whose
If the dispute is not settled movement and services shall be
after the lapse of the cooling-off unhampered and unrestricted.
period and the seven (7) day lockout
ban, the employer may lockout. Requisites of a Valid Lockout
1. It should be declared only on
Referendum on Reduced Offer grounds specified by law; and
Notwithstanding the declaration of 2. It should comply with the
lockout, the NCMB is still obliged to requirements prescribed by law.
continue mediating and conciliating.
If in the course of the mediation and Illegality Lockout
conciliation, the Union presents a Lockout is illegal if declared in
reduced offer, the NCMB shall violation of:
conduct a referendum among board 1. A specific prohibition by law;
of directors, trustees, or partners of 2. A specific requirement of law;
the company for the purpose of 3. An existing injunction; and
determining whether or not the 4. An existing agreement.
reduced offer is acceptable or not. If
the majority of the board of directors, Sanction for Illegal Lockout

An employer found guilty of illegal Doctrine: If units in one industry
lockout may be held liable for cannot be determined, the
backwages, and workers terminated employees can decide how to
as a consequence of an unlawful organize themselves into units. The
lockout are entitled to reinstatement. best way to . determine such
preference is through referendum or
Chapter II – Assistance to plebiscite. (Kapisanan ng mga
Labor Organizations Manggaagawa sa Manila Road Co.
Art. 282. [267] Assistance by the

v. Yard Crew Union, G.R. Nos. L-
Department of Labor. – The 16292-94, 1960)

Department of Labor, at the initiative of
the Secretary of Labor, shall extend Exceptions:
special assistance to the organization,  Supervisory employees who are
for purposes of collective bargaining, of allowed to form their own unions
the most underprivileged workers who, apart from the rank-and-file
for reasons of occupation,
employees;
organizational structure or insufficient
 Where the employees exercise
incomes, are not normally covered by
their right to form unions or
major labor organizations or federations.
associations for purpose not
contrary to law, to self-
Bargaining Unit - “a group of
organizatibn, and. to enter into
employees of a given employer,
collective bargaining negotiations
comprised of all or less than all of
(Barbizon Phil. v .Nagkakaisang
the entire body of employees, which
Supervisor ng Barbizon, G.R. Nos.
the collective interests of all the
113204-05, 1996)
employees indicate to be best suited
to serve reciprocal rights and duties
Bargaining Representative - The
of the parties consistent with equity
labor organization designated or
to the employer. [Belyca Corp. v.
selected by the majority of the
Calleja, G.R. No. 77395 (1988) citing
employees in an appropriate
Rothenberg]
collective bargaining unit shall be the

exclusive representative of the Non-Distinction Policy
employees in such unit for the Collective bargaining covers all
purpose of collective bargaining. aspects of the employment relation
and the resultant CBA binds all
QUALIFICATION OF VOTERS employees in the bargaining unit. All
Eligible Voter - refers to a voter rank and file employees,
belonging to the appropriate probationary or permanent, have a
bargaining unit that is the subject of substantial interest in the selection of
the petition for certification election the bargaining representative.
[Sec. 1(q), Rule VIII, Book V, IRR] [Airtime Specialists, Inc. v Ferrer-
All employees who are Calleja,.]
members of the appropriate
bargaining unit three (3) months Dismissed employees [Sec. 6,
prior to the filing of the petition Rule IX, Book V, IRR]
shall be eligible to vote. [Sec. 6, General Rule: [Dismissed]
Rule IX, Book V, IRR] employees [who] contested legality
Note: Rule VIII, Sec. 14 (f) and Rule of the dismissal in a forum of
IX, Sec. 6 refer to employees as appropriate jurisdiction at the time of
those employed 3 months prior to the issuance of the order for conduct
the issuance of the order/the filing of of a certification election
the petition for certification election Exception: Dismissal was declared
while Rule IX, Sec. 2 reckon the valid in a final judgment at the time
period of employment from the “time of the conduct of the certification
of filing the petition”. This difference election.
has not been resolved in any case
before the Supreme Court. Corporate Entities
All rank and file employees in Rule: Two companies having
the appropriate bargaining unit, separate juridical personalities shall
whether probationary or permanent NOT be treated as a single
are entitled to vote bargaining unit. [Diatagon Labor

Federation Local v. Ople, G.R. No. Philippines v. Ferrer-Calleja, G.R.
L-44493-94 (1980)] No. 96189 (1992)]
Exception: Pervasive Unitary Note: Where the employment status
Aspect of Management Doctrine was not at issue but the nature of
The cross-linking of the work of the employees concerned;
agencies’ command, control, and the Court stressed the importance of
communication systems indicate the 2nd factor. [Belyca Corp. v.
their unitary corporate personality. Calleja, G.R. No. 77395 (1988)]
Accordingly, the veil of corporate
fiction [...] should be lifted for the Prior Collective Bargaining
purpose of allowing the employees History
of the three agencies to form a single The existence of a prior collective
labor union. [Philippine Scouts bargaining history is neither decisive
Veterans v. Torres, G.R. No. 92357 nor conclusive in the determination
(1993)] of what constitutes an appropriate
bargaining unit. [Sta. Lucia East
TEST TO DETERMINE THE Commercial Corporation v. SOLE,
CONSTITUENCY OF AN G.R. No. 162355 (2009)]
APPROPRIATE BARGAINING
UNIT (WAPE): Methods to determine the
1. Will of the Employees (Globe bargaining representative (R3C2):
Doctrine)  Request for SEBA (D.O. No-
2. Affinity and unity of employees’ 40- I-15 Rule VII)
interest (Substantial Mutual  Certification election (IRR of
Interests Rule) the Labor Code, Book V Rule
3. Prior collective bargaining history X)
4. Employment status [Democratic  Run Off Election (IRR of the
Labor Association v. Cebu Labor Code Book V Rule X)
Stevedoring Co. Inc, G.R. No. L-  Re-run Election (D.O No. 40-I-
10321 (1958); University of the 15 Rule 1, Sec. 1((tt))

 Consent Election (IRR of the activities on existing labor laws,
Labor Code, Book V Rule VIII collective agreements, company
Sec. 10) rules and regulations and other
relevant matters. The union
SEBA Certification –recognition seminars and similar activities may
whereby the employer recognizes a be conducted independently or in
labor organization as the exclusive cooperation with the DOLE or other
bargaining representative of the labor educational institutions.
employees in the appropriate To conduct labor education
bargaining unit after a showing that and research, Article 277(a)
the labor organization is supported authorizes unions to collect
by at least a majority of the reasonable membership fees and
employees in the bargaining unit other contributions. A labor union's
(IRR of the LABOR CODE, Book V failure to provide labor education to
Rule 1 Sec 1(bbb), as amended by members is such a great neglect it
D.O No. 40-03). was a ground for cancellation of
union registration and expulsion of
Art. 283. [268] Assistance by the the union officers at fault.
Institute of Labor and Manpower
Studies. – The Institute of Labor and
Manpower Studies shall render Organized establishment: an
technical and other forms of assistance
establishment with a duly certified
to labor organizations and employer
bargaining agent and/or an existing
organizations in the field of labor
CBA.
education, especially pertaining to
collective bargaining, arbitration, labor
standards and the Labor Code of the Requisites for holding a
Philippines in general. certification election in an
organized establishment (Labor
Labor education - It is mandatory Code, Art. 268):
for every labor organization to
conduct seminars and similar

1. The Med-Arbiter shall bargaining; Provided, further, That said
automatically order an election by aliens are nationals of a country which
secret ballot when grants the same or similar rights to

Filipino workers.
2. Verified petition supported by at
least 25% of all the employees in
Trade Union Activities of Aliens
the bargaining unit, questioning
Aliens and foreign organizations are
the majority status of the
prohibited from engaging to all forms
incumbent bargaining agent.
of trade union activities. However,
3. Filed before the DOLE within the
alien employees with valid working
60-day period before the
permits issued by the DOLE may
expiration of the five year
exercise the right to self-organization
representation aspect of the
and join or assist labor organization,
CBA.
if they are nationals of a country
which grants the same or similar
Chapter III – Foreign
rights to Filipino workers, as certified
Activities
by the DFA.
ART. 284. [269] PROHIBITION
AGAINST ALIENS; EXCEPTIONS
Trade Union Activities
All aliens, natural or juridical as well as
1. Organization, formation, and
foreign organizations are strictly
prohibited from engaging directly or
administrator of labor
indirectly in all forms of trade union organizations;

activities without prejudice to normal 2. Negotiation and administration of
contacts between Philippine labor collective bargaining agreements
unions and recognized international 3. All forms of concerted union
labor centers: Provided, however, That action
aliens working in the country with valid 4. Organizing, managing, or
permits issued by the Department of
assisting union conventions,
Labor and Employment, may exercise
,meetings, rallies, referenda,
the right of self-organization and join or
teach-ins, seminars, conferences
assist labor organizations of their own
and institutes
choosing for purposes of collective

5. Any form of participation or (3) all forms of concerted union
involvement in representation action;
proceedings, representation (4) organizing, managing, or
elections, consent elections, assisting union conventions,
union elections and meetings, rallies, referenda,
6. Other activities or actions teach-ins, seminars,
analogous to the foregoing. conferences and institutes;
(5) any form of participation or
involvement in representation
ART. 285. [270] REGULATION OF proceedings, representation
FOREIGN ASSISTANCE elections, consent elections,
(a) No foreign individual, organization or union elections; and
entity may give any donations, (6) other activities or actions
grants or other forms of assistance,
analogous to the foregoing.
in cash or in kind, directly or
indirectly, to any labor organization,
(b) This prohibition shall equally
group of workers or any auxiliary
apply to foreign donations, grants
thereof, such as cooperatives, credit
unions and institutions engaged in or other forms of assistance, in
research, education or cash or in kind, given directly or

communication, in relation to trade indirectly to any employer or
union activities, without prior employers' organization to
permission by the Secretary of support any activity or activities
Labor. affecting trade unions.
"Trade union activities" shall (c) The Secretary of Labor shall
mean: promulgate rules and regulations
(1) organization, formation and to regulate and control the giving
administration of labor and receiving of such donations,
organizations; grants, or other forms of
(2) negotiation and administration assistance, including the
of collective bargaining mandatory reporting of the
agreements; amounts of the donations or

grants, the specific recipients thousand pesos (P10,000.00) and/or
thereof, the projects or activities imprisonment for not less than three
proposed to be supported, and months nor more than three (3)

years, or both such fine and
their duration.
imprisonment, at the discretion of
the court. Prosecution under this
ART. 271. APPLICABILITY TO FARM
provision shall preclude prosecution
TENANTS AND RURAL WORKERS
for the same act under the Revised
The provisions of this Title pertaining to
Penal Code, and vice versa.
foreign organizations and activities shall
(b) Upon the recommendation of the
be deemed applicable likewise to all
Minister of Labor and Employment
organizations of farm tenants, rural
and the Minister of National
workers, and the like: Provided, That in
Defense, foreigners who violate the
appropriate cases the Secretary of
provisions of this Title shall be
Agrarian Reform shall exercise the
subject to immediate and summary
powers and responsibilities vested by
deportation by the Commission on
this Title in the Secretary of Labor.
Immigration and Deportation and
shall be permanently barred from
Regulatory Body for Farm Tenants
reentering the country without the
The regulatory functions with respect special permission of the President
to foreign assistance for farm tenants of the Philippines.
and rural workers shall be exercised
by the Secretary of Agrarian Art. 272 of the labor code
penalizes the following violations
of ART. 264:
Chapter IV – Penalties for 1. Declaring a strike or lockout
Violation without having first bargained
ART. 287. [272] PENALTIES collectively
(a) Any person violating any of the 2. Declaring a strike or lockout
provisions of Article 264 of this Code without complying with the legal
shall be punished by a fine of not requirements
less than one thousand pesos 3. Declaring a strike or lockout after
(PI,000.00) but more than ten
an assumption or certification

order has been issued or after TITLE IX – SPECIAL
the dispute has been submitted PROVIONS
to compulsory voluntary ART. 288. [273] STUDY OF LABOR-
arbitration or during the pendency MANAGEMENT RELATIONS
of cases involving the same The Secretary of Labor shall have the
grounds for the strike or lockout; power and it shall be his duty to inquire
4. Obstructing or interfering with by into:
force, violation, coercion, threats (a) The existing relations between
or intimidation any peaceful employers and employees in the

Philippines;
picketing during any labor
(b) The growth of associations of
controversy or aiding or abetting
employees and the effect of such
such obstruction or interference
associations upon employer-
5. Using or employing strike-
employee relations;
breakers (c) The extent and results of the
6. Brining in, introducing or methods of collective bargaining in
escorting on the part of an armed the determination of terms and
person, public officer, personnel conditions of employment;
of the AFP or PNP, any person (d) The methods, which have been tried
who seeks to replace strikers, in by employers and associations of
entering or leaving the premises employees for maintaining mutually

satisfactory relations;
of a strike area
(e) Desirable industrial practices which
7. Committing acts of violence,
have been developed through
coercion or intimidation while
collective bargaining and other
engaged in picketing.
voluntary arrangements;
8. Obstructing the free ingress to (f) The possible ways of increasing the
and egress from the employer’s usefulness and efficiency of
premises while engaged in collective bargaining for settling
picketing and differences;
9. Obstructing public thoroughfares (g) The possibilities for the adoption of
practical and effective methods of
labor-management cooperation;

(h) Any other aspects of employer- violations of the law and the union
employee relations concerning the constitution and by-laws; Provided, That
promotion of harmony and such inquiry or examination shall not be
understanding between the parties; conducted during the sixty (60)-day
and freedom period nor within the thirty (30)
(i) The relevance of labor laws and days immediately preceding the date of
labor relations to national election of union officials.
development.
Visitorial Power of SOLE
The Secretary of Labor shall also inquire Visitorial power of the Secretary of
into the causes of industrial unrest and
Labor and Employment (or his duly
take all the necessary steps within his
authorized representative) is the
power as may be prescribed by law to
subject also of Article 128. But the
alleviate the same, and shall from time
visitorial power under that article
to time recommend the enactment of
such remedial legislation as in his
covers a broader subject than that
judgment may be desirable for the under this Article 274. Article 128
maintenance and promotion of industrial pertains to administrative
peace. enforcement of Labor Code
provisions and all labor laws and
ART. 289. [274] VISITORIAL POWER wage orders in employer
The Secretary of Labor and establishments. This Article 274, on
Employment or his duly authorized the other hand, speaks of
representative is hereby empowered to
enforcement of law or regulations
inquire into the financial activities of
relating only to financial activities
legitimate labor organizations upon the
and records of labor organizations.
filing of a complaint under oath and duly
supported by the written consent of at
ART. 290. [275] TRIPARTISM AND
least twenty (20%) percent of the total
TRIPARTITE CONFERENCES
membership of the labor organization
(a) Tripartism in labor relations is
concerned and to examine their books
hereby declared a State policy.
of accounts and other records to
Towards this end, workers and
determine compliance or noncompliance
employers shall as far as
with the law and to prosecute any

practicable, be represented in making processes directly affecting
decision and policy-making bodies of their rights, benefits, and welfare.
the government.
(b) The Secretary of Labor and ART. 291. [276] GOVERNMENT
Employment or his duly authorized EMPLOYEES
representatives may from time to The terms and conditions of
time call a national, regional, or employment of all government
industrial tripartite conference of employees, including employees of
representatives of government, government-owned and controlled
workers and employers for the corporations, shall be governed by the
consideration and adoption of Civil Service Law, rules and regulations.
voluntary codes of principles Their salaries shall be standardized by
designed to promote industrial the National Assembly as provided for in
peace based on social justice or to the New Constitution. However, there
align labor movement relations with shall be no reduction of existing wages,
established priorities in economic benefits and other terms and conditions
and social development. In calling of employment being enjoyed by them
such conference, the Secretary of at the time of the adoption of this Code.
Labor and Employment
ART. 292. [277] MISCELLANEOUS

Tripartism, as here, contemplated, PROVISIONS
is representation of the three sectors (a) All unions are authorized to collect
— the public or the government, the reasonable membership fees, union
employers, and the workers — in dues, assessments and fines and
policymaking bodies of the other contributions for labor

education and research, mutual
government. Such kind of
death and hospitalization benefits,
representation in the policymaking
welfare fund, strike fund and credit
bodies of private enterprises is not
and cooperative undertakings.
ordained, not even by the Philippine
(b) Subject to the constitutional right of
Constitution. What is provided for, for workers to security of tenure and
the private sector, is workers' their right to be protected against
participation in policy and decision- dismissal except for a just and
authorized cause and without

prejudice to the requirement of termination may cause a serious
notice under Article 283 of this labor dispute or is in implementation
Code, the employer shall furnish the of a mass layoff.
worker whose employment is sought (c) Any employee, whether employed
to be terminated a written notice for a definite period or not, shall,
containing a statement of the causes beginning on his first day of service,
for termination and shall afford the be considered an employee for
latter ample opportunity to be heard purposes of membership in any
and to defend himself with the labor union.
assistance of his representative if he (d) No docket fee shall be assessed in
so desires in accordance with labor standards disputes. In all other
company rules and regulations disputes, docket fees may be
promulgated pursuant to guidelines assessed against the filing party,
set by the Department of Labor and provided that in bargaining deadlock
Employment. Any decision taken by such fees shall be shared equally by
the employer shall be without the negotiating parties.
prejudice to the right of the workers (e) The Minister of Labor and
to contest the validity or legality of Employment and the Minister of the
his dismissal by filing a complaint Budget shall cause to be created or
with the regional branch of the reclassified in accordance with law
National Labor Relations such positions as may be necessary
Commission. The burden of proving to carry out the objectives of this
that the termination was for a valid Code and cause the upgrading of
or authorized cause shall rest on the the salaries of the personnel
employer. The Secretary of the involved in the Labor Relations
Department of Labor and System of the Ministry. Funds
Employment may suspend the needed for this purpose shall be
effects of the termination pending provided out of the Special Activities
resolution of the dispute in the event Fund appropriated by Batas
of a prima facie finding by the Pambansa Blg. 80 and from annual
appropriate official of the appropriations thereafter.
Department of Labor and (f) A special Voluntary Arbitration Fund
Employment before whom such is hereby established in the Board to
dispute is pending that the subsidize the cost of voluntary

arbitration in cases involving the cooperation programs at appropriate
interpretation and implementation of levels of the enterprise based on
the Collective Bargaining shared responsibility and mutual
Agreement, including the Arbitrators respect in order to ensure industrial
fees, and for such other related peace and improvement in
purposes to promote and develop productivity, working conditions and
voluntary arbitration. The Board shall the quality of working life.
administer the Special Voluntary (h) In establishments where no
Arbitration Fund in accordance with legitimate labor organization exists,
the guidelines it may adopt upon the labor-management committees may
recommendation of the Council be formed voluntarily by workers and
which guidelines shall be subject to employers for the purpose of
the approval of the Secretary of promoting industrial peace. The
Labor and Employment. Continuing Department of Labor and
funds needed for this purpose in the Employment shall endeavor to
initial yearly amount of fifteen million enlighten and educate the workers
pesos (PI5,000,000.00) shall be and employers on their rights and
provided in the 1989 annual general responsibilities through labor
appropriation acts. education with emphasis on the
The amount of subsidy in policy thrusts of this Code.
appropriate cases shall be (i) To ensure speedy labor justice, the
determined by the Board in periods provided in this Code within
accordance with established which decisions or resolutions of
guidelines issued by it upon the labor relations cases or matters
recommendation of the Council. should be rendered shall be
The Fund shall also be utilized mandatory. For this purpose, a case
for the operation of the Council the or matter shall be deemed submitted
training and education of Voluntary for decision or resolution upon the
Arbitrators, and the Voluntary filing of the last pleading or
Arbitration Program. memorandum required by the rules
(g) The Ministry shall help promote and of the Commission or by the
gradually develop, with the Commission itself, or the Labor
agreement of labor organizations Arbiter, or the Director of the Bureau
and employers, labor-management of Labor Relations or Med-Arbiter, or

the Regional Director.Upon undertaking or activity of any kind
expiration of the corresponding and uses the services of another
period, a certification stating why a person who is under his orders as
decision or resolution has not been
regards the employment, except the
rendered within the said period shall
Government and any of its political
be issued forthwith by the Chairman
subdivisions, branches or
of the Commission, the Executive
instrumentalities, including
Labor Arbiter, or the Director of the
Bureau of Labor Relations or Med-
corporations owned or controlled by
Arbiter, or the Regional Director, as the Government.

the case may be, and a copy thereof The employer may be a
served upon the parties. Despite the natural or juridical person. It may
expiration of the applicable be a single proprietor, a partnership
mandatory period, the aforesaid or a corporation.
officials shall, without prejudice to
any liability which may have been
Employee is any person who
incurred as a consequence thereof,
performs services for an employer in
see to it that the case or matter hall
which either or both mental and
be decided or resolved without any
physical efforts are used and who
further delay.
receives compensation for such
services, where there is an
employer‐employee relationship (RA
BOOK SIX – POST-
No. 8282, Social Security Law).
EMPLOYMENT
Only a natural person can
TITLE I – TERMINATION OF qualify as an employee. Natural
EMPLOYMENT persons may include Filipino citizens
A. EMPLOYER-EMPLOYEE and foreigners.
RELATIONSHIP NOTE: A self-employed person shall
Employer is any person, natural or be both employee and employer at
juridical, domestic or foreign, who the same time.
carries on it the Philippines any
trade, business, industry,

Existence of an employment Fold Test on employment has to be
relationship applied (Insular Life Assurance Co.
Employment relationship is Ltd. v. NLRC, G.R. No. 119930,
determined by law and not by March 12, 1998).
contract (Insular Life Assurance Co.
Ltd. v. NLRC, G.R. No. 119930, Employer-Employee Relation As A
March 12, 1998). Question Of Fact
NOTE: Taxi or jeepney drivers under The existence of an employer-
the “boundary” system are Ee’s of employee relationship depends upon
the taxi or jeepney owners/operators; the facts of each case (Social
also the passenger bus drivers and Security System v. CA, G.R. No.
conductors (Jardin v. NLRC and 100388, December 14, 2000).
Goodman Taxi, G.R. No. 119268,
February 23, 2000). 1. TEST TO DETERMINE
EXISTENCE OF EMPLOYMENT
Employer-Employee Relation as a RELATIONSHIP
Question of Law (Stipulation that
No Er-Ee Relationship Exists) FOUR-FOLD TEST
It is axiomatic that the existence of Factors determining the existence
an Er-Ee relationship cannot be of an employer-employee
negated by expressly repudiating it relationship
in the management contract and The four–fold test (indicia of
providing therein that the Ee is an determination):
independent contractor when the a. Selection and engagement of the
terms of the agreement clearly show employee;
otherwise. For the employment b. Payment of wages;
status of a person is defined and c. Power of dismissal; and
prescribed by law and not by what d. Power of control (1 Azucena,
the parties say it should be. In 2016 p. 189)
determining the status of the It is the so-called “control test” that
management contract, the Four- is the most important element.

Absent the power to control to the described as Unit Development Fund
employee with respect to the means are but hallmarks of the
and methods of accomplishing his management system where there
work, there is no employeremployee can be no escaping the conclusion
relationship between the parties that one is an employee of the
(Continental Marble Corp., et.al v. insurance company (Insular
NLRC, G.R. No. 43825, May 9, Assurance Co., Ltd., v. NLRC, G.R.
1988). No. 119930, March 12, 1998).
Control test Kinds of control exercised by an

The control test assumes primacy in Er
the overall consideration. There is an Not every form of control establishes
Er-Ee relationship when the person employeremployee relationship. A
for whom the services are performed demarcation line should be drawn
reserves the right to control not only between:
the end achieved but also the a. That merely serve as guidelines
manner and means used to achieve which only promote the result;
that end (Television and Production and
Exponents Inc. v. Servana, 542 b. Rules that fix the methodology
SCRA 578). and bind or restrict the party hired
The control test calls merely to the use of such means or
for the existence of the right to methods.
control the manner of doing the Under the first category, there exists
work, not the actual exercise of the no employeremployee relationship.
right. In the second category, it has the
Exclusivity of service, control effect of establishing employer-
of assignments and removal of employee relationship (Insular life v.
agents under private respondents NLRC, 179 SCRA 439; Consulta v.
unit, collection of premiums, CA, G.R. No. 145443, March 18,
furnishing of company facilities and 2005).
materials as well as capital

Guidelines indicative of labor totality of circumstances surrounding
law "control" should not merely relate the true nature of the relationship
to the mutually desirable result between the parties. This is
intended by the contractual especially appropriate in this case
relationship; they must have the where there is no written agreement
nature of dictating the means or or terms of reference to base the
methods to be employed in attaining relationship on and due to the
the result, or of fixing the complexity of the relationship based
methodology and of binding or on the various positions and
restricting the party hired to the use responsibilities given to the worker
of these means. Absence of such over the period of the latter’s
control, there is no employer- employment (Francisco v. NLRC,
employee relationship (Tongko v. G.R. No. 170087, August 31, 2006).
Manulife, G.R. No. 167622, June 29,
2010). Elements:
NOTE: However, in certain cases a. The putative Er’s power to control
the control test is not sufficient to the Ee with respect to the means
give a complete picture of the and methods by which the work
relationship between the parties, is to be accomplished (Four-fold
owing to the complexity of such a test);
relationship where several positions b. The underlying economic realities
have been held by the worker. The of the activity or relationship
better approach is to adopt the two- (economic reality test).
tiered test (Francisco v. NLRC, G.R.
No. 170087, August 31, 2006). Proper standard for economic
dependence
ECONOMIC DEPENDENCY The proper standard is whether the
(TWO-TIERED TEST) worker is dependent on the alleged
This two-tiered test would provide us Er for his continued employment in
with a framework of analysis, which that line of business.
would take into consideration the

The determination of the Piece-rate, boundary, and pakyaw
relationship between Er and Ee are merely methods of pay
depends upon the circumstances of computation and do not prove
the whole economic activity, such as: whether the payee is an employee or
a. The extent to which the services not (1 Azucena, 2016, p. 197).
performed are an integral part of
the Er’s business Boundary-Hulog System
b. The extent of the worker’s Under the boundary-hulog scheme,
investment in equipment and a dual juridical relationship was
facilities; created: that of employer-employee
c. The nature and degree of control and vendor-vendee. The boundary
exercised by the Er; system is a scheme by an
d. The worker’s opportunity for profit owner/operator engaged in
and loss; transporting passengers as a
e. The amount of initiative, skill, common carrier to primarily govern
judgment, or foresight required the compensation of the driver, that
for the success of the claimed is, the latters daily earnings are
independent enterprise; remitted to the owner/operator less
f. The permanency and duration of the excess of the boundary which
the relationship between the represents the drivers compensation.
worker and Er; and Under this system, the
g. The degree of dependency of the owner/operator exercises control and
worker upon the Er for his supervision over the driver
continued employment in that line (Villamaria v. CA and Bustamante,
of business (Francisco v. NLRC, G.R. No. 165881, April 19, 2006).
G.R. No. 170087, August 31,
2006). Labor union and unregistered
association as employer
Mode of Compensation; Not The mere fact that the respondent is
Determinative of Er-Ee a labor union does not mean that it
Relationship cannot be considered an employer of

the persons who work for it. Much employment arrangement: regular,
less should it be exempted from the project, seasonal, and casual. The
very labor laws which it espouses as article presupposes that employment
labor organization (Bautista v. relationship exists between the
Inciong, G.R. No. L-52824, March parties (2 Azucena, 2016, p. 755).
16, 1988).
2. KINDS OF EMPLOYMENT
Application of the four-fold test a. As to tenure:
and the two-tiered test i. Permanent- who is appointed
Present Philippine law recognizes a to a job for an undefined and
two-tiered test. The first tier of the indefinite period.
test is the four-fold test. The second ii. Temporary/Probationary-
tier is the economics of the one who stays on the job for a
relationship test. But the latter test is defined or preagreed period
used if and only if there is going to (1 Azucena, 2016 p. 210).
be harshness in the results because b. As to Labor Code Book VI
of the strict application of the four- i. Regular
fold test (Francisco v. NLRC, G.R. ii. Project
No. 170087, August 31, 2006). iii. Seasonal
iv. Casual
Article 295 Presupposes v. Probationary
Employment Relationship vi. Fixed-term
Article 295 applies where the Regular Employment
existence of Employer-Employee Types of regular employment
relationship is not the issue of the 1. As to nature of work – An
dispute. If the issue is whether or not employment shall be deemed to
the claimant is an employee, the be regular where the Ee has
tests of employment relationship been engaged to perform
shall be resorted to. activities which are usually
Article 295 limits itself to necessary or desirable in the
differentiating four kinds of usual business or trade of the Er,

the provisions of written (Universal Robina Corp. v.
agreements to the contrary Catapang, G.R. No. 164736,
notwithstanding and regardless of October 14, 2005).
the oral agreements of the parties
(IRR, Book VI, Rule I, Sec. 5 [a]). Tests to determine regular
2. As to length of service – Any employment
Ee who has rendered at least one 1. The primary standard of
(1) year of service, whether such determining regular employment
service is continuous or broken, is the reasonable connection
shall be considered a regular Ee between the particular activity
with respect to the activity in performed by the Ee to the usual
which he is employed and his trade or business of the Er. The
employment shall continue while test is whether the former is
such activity exists (IRR, Book usually necessary or desirable in
VI, Rule I, Sec. 5 [b]). the usual business or trade of the
NOTE: Regularization is not a Er (De Leon v. NLRC, G.R. No.
management prerogative; rather, it is 70705, August 21, 1989).
the nature of employment that NOTE: The connection can be
determines it. It is a mandate of the determined by considering the
law (PAL v. Pascua, G.R. No. nature of the work performed and
143258, August 15, 2003). its relation to the scheme of the
What determines regularity or particular business or trade in its
casualness is not the employment entirety (Highway Copra Traders
contract, written or otherwise, but the v. NLRC, G.R. No. 108889, July
nature of the job (Policy Instruction 30, 1998).
No. 2). 2. Also, the performance of a job for
The practice of entering into at least a year is sufficient
employment contracts which would evidence of the job’s necessity if
prevent the workers from becoming not indispensability to the
regular should be struck down as business. This is the rule even if
contrary to public policy and morals its performance is not continuous

and merely intermittent. The In case of OFWs, Art. 280
employment is considered of the LC does not apply.
regular, but only with respect to
such activity and while such Temporary Employee becoming
activity exists (Universal Robina regular
Corp. v. Catapang, G.R. No. An employment may only be said to
164736, October 14, 2005). be ‘temporary’:
The status of regular 1. Where it has been fixed for a
employment attaches to the specific undertaking the completion
casual Ee on the day immediately of which has been determined at the
after the end of his first year of time of the engagement of the
service. The law does not provide employee; or
the qualification that the Ee must 2. Where the work or services to be
first be issued a regular performed is seasonal in nature and
appointment or must first be the employment is for the duration of
formally declared as such before the season
he can acquire a regular status
(Aurora Land Projects Corp. v. Contract of perpetual employment
NLRC, G.R. No. 114733, January It deprives management of its
2, 1997). prerogative to decide whom to hire,
NOTE: Seafarers cannot be fire, and promote and renders inutile
considered as regular Ees. The the basic precepts of labor relations
contract which they sign every
time they are hired governs their It is contrary to public policy and
employment. Their employment good customs, as it unjustly forbids
is terminated when the contract the employer from terminating the
expires. Their employment is services of an employee despite the
fixed for a certain period of time existence of a just or valid cause.
(Ravago v. Esso Eastern
Maritime Ltd., G.R. No. 158324,
March 15, 2005).

Mode of compensation is not 2. Time-bound – termination of
determinative of regular which has been determined at the
employment time of engagement of the Ee (IRR,
While the Ees mode of Book VI, Rule I, Sec. 5[a]).
compensation was on a “per piece The period is not the determining
basis” the status and nature of their factor, so that even if the period is
employment was that of regular Ees more than 1 year, the Ee does not
(Labor Congress of the Phils v. necessarily become regular.
NLRC, G.R. No. 123938, May 21, NOTE: Where the employment of a
1998). project Ee is extended long after the
supposed project has been finished,
Project Employment the Ees are removed from the scope
Project of project Ees and considered as
A "project" has reference to a regular Ees.
particular job or undertaking that Repeated hiring on a project-
may or may not be within the regular to-project basis is considered
or usual business of the Er. In either necessary and desirable to the
case, the project must be distinct, business of the Er. The Ee is
separate and identifiable from the deemed regular (Maraguinot v.
main business of the Er, and its NLRC, G.R. No. 120969, July 22,
duration must be determined or 1998).
determinable (PAL v. NLRC, G.R.
No. 125792, November 9, 1998). Indicators of project employment
in construction industry (D.O. No.
Project employment 19, Series of 1993)
Project employment is employment Either one or more of the following
that has been fixed for: circumstances, among others, may
1. Specific undertaking – a specific be considered as indicators that an
project or undertaking the Ee is a project Ee (Hanjin v. Ibañez,
completion; or G.R. No. 170181, June 26, 2008).

1. The duration of the 6. An undertaking in the employment
specific/identified undertaking for contract by the Er to pay completion
which the worker is engaged is bonus to the project Ee as practiced
reasonably determinable; by most construction companies.
2. Such duration, as well as the
specific work/service to be Requisites in determining whether
performed, is defined in an an Ee is a project Ee
employment agreement, and is 1. Designation of named Ees as
made clear to the Ee at the time “Project Ees”;
of hiring; 2. The project Ee was assigned to
NOTE: Absent any other proof carry out a specific project or
that the project Ees were undertaking;
informed of their status as such, it 3. The duration and scope of which
will be presumed that they are were specified at the time the Ee
regular Ees. was engaged for that project
3. The work/service performed by (Imbuido v. NLRC, G.R. No. 114734,
the Ee is in connection with the May 31, 2000);
particular project/ undertaking for 4. The Ee must have been dismissed
which he is engaged; every after completion of his project
4. The Ee, while not employed and or phase; 5. Report to the DOLE of
awaiting engagement, is free to offer Ee’s dismissal on account of
his services to any other Er; completion of contract (Policy Inst.
5. The termination of his employment No. 20; D.O. 19 [1997]).
in the particular project/undertaking
is reported to the DOLE Regional Employees in the construction
Office having jurisdiction over the industry
workplace within 30 days following Two types of employees in the
the date of his separation from work, construction industry:
using the prescribed form on Ee’s 1. Project Employees - those
termination, dismissal or employed in connection with a
suspensions;

particular construction project or non-project employees or employees
phase; for an indefinite period.
2. Non-project Employees - those If they are employed in a
employed by a construction particular project, the completion of
company without reference to a the project or any phase thereof will
particular project. not mean severance of employer-
NOTE: In the case of Exodus employee relationship.
International Construction
Corporation v. Guillermo Biscocho, Requisites to acquire regular Ee
et al., (G.R. NO. 166109, 23 status of project Ee or a member
February 2011), when one project is of work pool
completed, employees were The following must concur to acquire
automatically transferred to the next a status of a regular Ee status:
project. There was no employment 1. There is a continuous rehiring of
agreement given to the employees project Ee’s even after cessation of a
which clearly spelled out the duration project; and
of their employment, the specific 2. The tasks performed by the
work to be performed and that such alleged “project Ee” are vital,
is made clear to them at the time of necessary and indispensable to the
hiring. As such, they are regular usual business or trade of the Er
employees falling under the (D.M. Consunji, Inc. v. JAMIN, G.R.
classification of non-project No. 192514, April 18, 2012).
employees. The length of time during which the
Ee was continuously re-hired is not
Work Pool controlling, but merely serves as a
Members of a work pool from which badge of regular employment.
a construction company draws its
project employees, if considered “Day certain” rule
employee of the construction It states that a project employment
company while in the work pool, are that ends on a certain date does not

end on an exact date but upon the season. The termination of their
completion of the project. employment cannot and should not
constitute an illegal dismissal
Entitlement to separation pay (Mercado v. NLRC, G.R. No. 79869,
GR: Project Ees are not entitled to September 5, 1991).
separation pay if their services are One year duration on the job
terminated as a result of the is pertinent in deciding whether a
completion of project. casual Ee has become regular or
XPN: If the projects they are working not, but it is not pertinent to a
on have not yet been completed Seasonal or Project Ee. Passage of
when their services are terminated; time does not make a seasonal
project Ees also enjoy security of worker regular or permanent
tenure during the limited time of their (Mercado v. NLRC, G.R. No. 78969,
employment (De Ocampo v. NLRC, September 5, 1991).
G.R. No. 81077, June 6, 1990). During off-season, the
relationship of Er-Ee is not severed;
Seasonal Employment the Seasonal Ee is merely
Employment where the job, work or considered on LOA without pay.
service to be performed is seasonal Seasonal workers who are
in nature and the employment is for repeatedly engaged from season to
the duration of the season [IRR, season performing the same tasks
Book VI, Rule I, Sec.5 (a)]. are deemed to have acquired regular
An employment arrangement employment (Hacienda Fatima v.
where an Ee is engaged to work National Federation of Sugarcane
during a particular season on an Workers-Food and General Trade,
activity that is usually necessary or G.R. No. 149440, January 28, 2003).
desirable in the usual business or
trade of the Er. Seasonal Ees as regular Ees
NOTE: For Seasonal Ees, their Seasonal Ees can be considered
employment legally ends upon regular Ees. The fact that Seasonal
completion of the project or the Ees do not work continuously for one

whole year but only for the duration When the business establishment is
of the season does not detract from sold which effectively terminates the
considering them in regular employment of the seasonal Ees, the
employment. Seasonal workers who latter would be entitled to separation
are called to work from time to time pay.
and are temporarily laid off during
off-season are not separated from Casual Employment
service in that period, but merely It is an employment where the Ee is
considered on leave until re- engaged in an activity which is not
employed. usually necessary or desirable in the
If the Ee has been performing usual business or trade of the Er,
the job for at least a year, even if the provided: such employment is
performance is not continuous and neither Project nor Seasonal (LC,
merely intermittent, the law deems Art. 281). He performs only an
repeated and continuing need for its incidental job in relation to the
performance as sufficient evidence principal activity of the Er.
of the necessity if not indispensability NOTE: But despite the distinction
of that activity to the business. between regular and casual
Hence, the employment is employment, every Ee shall be
considered regular, but only with entitled to the same rights and
respect to such activity and while privileges, and shall be subject to the
such activity exists (Benares v. same duties as may be granted by
Pancho, G.R. No. 151827, April 29, law to regular Ees during the period
2005). of their actual employment.
It is not enough that they An Ee is engaged to perform
perform work or services that are a job, work or service which is
seasonal in nature. They must have merely incidental to the business of
also been employed only for the the Er, and such job, work or service
duration of one season. is for a definite period made known
to the Ee at the time of engagement
Entitlement to separation pay [IRR, Book Vi, Rule I, Sec. 5 (b)].

engagement. of his
Casual Ee becoming a regular Ee employment is
If he has rendered at least 1 year of made known to
service, whether such service is him at the time
continuous or broken, he is of his
considered as regular Ee with engagement.
respect to the activity in which he is His work need His continued
employed and his employment shall not be incidental employment
continue while such activity exists. to the business after the lapse
A casual Ee is only casual for of the Er and his one year makes
1 year, and it is the passage of time employment him a regular
that gives him a regular status may exceed one Ee.
(KASAMMA-CCO v. CA, G.R. No. year without
159828, April 19, 2006). necessarily
The purpose is to give making him a
meaning to the constitutional regular Ee.

Job is No termination
guarantee of security of tenure and
coterminous report required.
right to self-organization (Mercado v.
with a specific
NLRC, G.R. No. 79868, September
project or phase
5, 1991).
thereof. It is
required that a
Project Ee vs. Casual Ee
termination
PROJECT EE CASUAL EE
Employed for a Engaged to report be
specific project perform a job, submitted at the
or undertaking work or service nearest
the completion which is employment
or termination of incidental to the office upon
which is business of the completion of
determined at Er and the the project or
the time of his definite period phase.

Fixed Term Employment Fadriquela, G.R. No. 141717, April
Term employment 14, 2004).
A contract of employment for a
definite period terminates by its own Fixed-term employment v. Project
terms at the end of such period Employment
(Brent School v. Zamora, G.R. No. Both employments are time bound or
L-48494, February 5, 1990). for a certain period as agreed upon
Term employment is not a at the time of engagement, however
circumvention of the law on security in project employment, the employee
of tenure if it follows the requisites is tasked to do specific undertaking,
laid down by the Brent ruling which is not present in fixed-term
(Romares v. NLRC, G.R. No. employment.
122327, August 19, 1998).
Brent Doctrine
Decisive determinant in term Article 295 of the Labor Code does
employment not prohibit an employment contract
It is the day certain agreed upon by with a fixed period, provided it is
the parties for the commencement entered into by the parties without
and the termination of their any force, duress of improper
employment relation. pressure being brought to bear upon
either party, particularly the
Fixed term employment employee and absent any other
It is an employment where a fixed circumstances vitiating consent.
period of employment was agreed Such employment for a
upon: defined period is allowed even where
1. Knowingly and voluntarily by the the duties of the employee consist of
parties; activities usually necessary or
2. Without any force, duress or desirable in the usual business of the
improper pressure being brought to employer.
bear upon the Ee and business of Er
(Philips Semiconductor v.

Overseas Seafarers are (Holiday Inn Manila v. NLRC, G.R.
contractual No. 109114, September 14, 1993).
The employment of overseas
seafarers is governed by the POEA Probationary employment
Standard Employment Contract for Employment where the Ee, upon his
Filipino Seamen. engagement:
Their employment is governed 1. Is made to undergo a trial period
by the contracts they sign every time 2. During which the Er determines
they are rehired and their his fitness to qualify for regular
employment is terminated when the employment,
contract expires. 3. Based on reasonable standards
It is an accepted maritime made known to the Ee at the time of
industry practice that employment of engagement (IRR, Book VI, Rule I,
seafarers is for a fixed period only. Sec 6).
NOTE: In all cases involving
Domestic Seafarers are not employees engaged on probationary
contractual basis, the employer shall make
Seamen employed in domestic known to the employee the
shipping are entitled to security of standards under which he will qualify
tenure, can become permanent as a regular employee at the time of
employees and can be terminated his engagement (IRR, Book VI, Rule
only for just or authorized causes. I, Sec 6[d]).
Domestic seafarers are
covered by the Labor Code, Characteristics of probationary
including its Book VI. employment
1. It is an employment for a trial
Probationary Employment period;
Probation is the period during which 2. It is a temporary employment
the employer may determine if the status prior to regular employment;
employee is qualified for possible 3. It arises through a contract with
inclusion in the regular force the following elements:

a. The Ee must learn and work at GR: It shall not exceed 6 months.
a particular type of work XPNs:
b. Such work calls for certain 1. Covered by an Apprenticeship or
qualifications Learnership agreement stipulating a
c. The probation is fixed different period;
d. The Er reserves the power to 2. Voluntary agreement of parties
terminate during or at the end of the (especially when the nature of work
trial period requires a longer period)
e. And if the Ee has learned the NOTE: By voluntarily agreeing to
job to the satisfaction of the Er, he such an extension, the Ee waived
becomes a regular Ee. any benefit attaching to the
completion of the period if he still
Rules on probationary failed to make the grade during
employment the period of extension
1. Er shall make known to the Ee at (Mariwasa Mfg. Inc. v. Hon.
the time he is hired, the standards by Leogardo, G.R. No. 74246,
which he will qualify as a regular Ee; January 26, 1989);
2. Probationary employment must 3. The Er gives the Ee a second
have been expressly agreed upon; chance to pass the standards set
without such explicit agreement, the (Mariwasa Manufacturing, Inc. v.
employment is considered regular; Leogardo, Jr., G.R. No. 74246,
3. An Ee allowed to continue work January 26, 1989);
after the probationary period shall be 4. When the same is required by the
considered a regular Ee; nature of the work, e.g. the
4. During the probationary period, probationary period set for
the Ee enjoys security of tenure; his professors, instructors and teachers
services can only be terminated for is 3 consecutive years of satisfactory
just or authorized causes. service pursuant to DOLE Manual of
Regulations for Private Schools;
Period of probationary 5. When the same is established by
employment company policy.

Period of probation shall be
reckoned from the date the Ee Essence of the prohibition on
actually started working[IRR, Book double or successive probation
VI, Rule I, Sec.6(b)]. Probationary The evil sought to be prevented is to
Ees may be dismissed for cause discourage scheming Ers from using
before end of the probationary the system of double or successive
period. probation to circumvent the mandate
After the lapse of the of the law on regularization and
probationary period (6 months), Ee make it easier for them to dismiss
becomes regular. their Ees (Holiday Inn Manila v.
NLRC, G.R. No. 109114, September
Purpose of the probation period 14, 2003).
The purpose of the probation period
is to afford the Er an opportunity to Obligation of the Er to his
observe the fitness of a probationary probationary Ees
Ee at work. There is obligation on the part of Er
to inform standards for regularization
Instances when extension of at the time of engagement. The
probationary period is allowed failure to inform has the effect that
Extension is allowed only when: upon the expiry of the probationary
1. Nature of the job requires employment, with or without the
extensive training; or period provided for in the contract,
2. If it is a company policy that the the worker is deemed to be regular.
period of probationary employment
should be an extended period. Instances when a probationary Ee
NOTE: The extension of period is deemed to be a regular Ee
should always be reasonable; Such 1. If he is allowed to work after a
that, the nature of the work so probationary period (LC, Art. 281).
requires and that it is the amount of 2. If no standards, under which he
time required for an ordinary worker will qualify as a regular Ee, are made
to learn the job. known to him at the time of his

engagement (IRR, Book VI, Rule I, (CSA v. NLRC, G.R. No. 87333,
Sec. 6[d]). September 6, 1991).
Grounds for terminating a Limitations on the Er’s power to

probationary employment terminate a probationary
1. Just/authorized causes employment contract
2. When he fails to qualify as a 1. The power must be exercised in
regular Ee in accordance with accordance with the specific
reasonable standards made known requirements of the contract;
by the Er to the Ee at the time of his 2. If a particular time is prescribed,
engagement (ICMC v. NLRC, G.R. the termination must be within such
No. 72222, January 30, 1989; LC, time and if formal notice is required,
Art. 281). then that form must be used;
NOTE: If Pre-termination of 3. The Er’s dissatisfaction must be
probationary contract is due to the real and in good faith, not feigned so
valid causes, the Er is not liable to as to circumvent the contract or the
pay the monetary value of the law; and
unexpired portion of the 4. There must be no unlawful
employment. discrimination in the dismissal.
While probationary Ees do not NOTE: The probationary Ee is
enjoy permanent status, they are entitled to procedural due process
afforded the security of tenure prior to dismissal from service.
protection of the Constitution.
Consequently, they cannot be Period of probationary
removed from their positions unless employment of private school
for cause. Such constitutional teachers
protection, however, ends upon the The probationary employment of
expiration of the period stated in their academic teaching personnel shall
probationary contract of not be more than a period of 6
employment. Thereafter, the parties consecutive semesters or 9
are free to renew the contract or not consecutive trimesters of satisfactory

service, as the case may be (The Requirement of full-time academic
Manual of Regulations for Private personnel or teacher
Higher Education, Sec. 117). 1. Who possess at least the
NOTE: An academic teaching minimum academic qualifications
personnel, who does not possess prescribed by the Department under
the minimum academic qualifications this Manual for all academic
under Section 35 and 36 of the personnel;
Manual of Regulations for Private 2. Who are paid monthly or hourly,
Higher Education shall be based on the regular teaching loads
considered as a part-time Ee, and as provided for in the policies, rules
therefore can not avail of the status and standards of the Department
and privileges of a probationary and the school;
employment. A part-time Ee cannot 3. Whose total working day of not
acquire a regular permanent status, more than 8 hours a day is devoted
and hence, may be terminated when to the school;
a qualified teacher becomes 4. Who have no other remunerative
available (Manual of Regulations for occupation elsewhere requiring
Private Higher Education). regular hours of work that will conflict
with the working hours in the school;
Full-time Teacher and
One whose total working day is 5. Who are not teaching full-time in
devoted to school, no other regular any other educational institution.
remunerative employment and is All teaching personnel who do not
paid on a regular monthly basis meet the foregoing qualifications are
regardless of the number of teaching considered part-time
hours.
In college, the normal The legal requisites for
teaching load of a full-time instructor acquisition by a teacher of
shall be eighteen(18) hours a month. permanent employment
1. The teacher is a full-time teacher

2. Must have rendered 3 consecutive There are three parties involved in
years of service these arrangements:
3. Such service must be satisfactory 1. Principal – any employer who
decides to farm out a job or service
to a contractor or subcontractor;
3. CONTRACTING OR SUB- 2. Contractor or subcontractor –
CONTRACTING has the capacity to independently
Job Contracting or undertake the performance of the
Subcontracting job, work or service; and, 3.
This refers to an arrangement Contractual workers –engaged by
whereby a principal agrees to put out the contractor or subcontractor to
or farm out to a contractor or accomplish the job, work or service
subcontractor the performance or (Aliviado et. al., v. Procter & Gamble
completion of a specific job, work or Phils., Inc., and Promm-Gem, Inc.,
service within a definite or G.R. No. 160506, June 6, 2011)
predetermined period, regardless of pursuant to the agreement between
whether such job, work or service is the latter and the principal.
to be performed or completed within
or outside the premises of the Elements of Legitimate Job
principal. Contracting or Subcontracting
A person is considered engaged in
Trilateral Relationship legitimate job contracting or
In legitimate contracting, there exists subcontracting if the following
a trilateral relationship under which conditions concur:
there is a contract for a specific job, 1. The contractor or subcontractor
work or service between the principal carries on a distinct and independent
and the contractor or subcontractor, business and undertakes to perform
and a contract of employment the job, work or service on its own
between the contractor or account and under its own
subcontractor and its workers. responsibility according to its own
manner and method, and free from

the control and direction of the himself (Guarin v. NLRC, G.R. No.
principal in all matters connected 86010, October 3, 1989).
with the performance of the work NOTE: In legitimate Job Contracting,
except as to the results thereof; the principal is jointly and severally
2. The contractor or subcontractor liable with the contractor for the
has substantial capital or investment; payment of unpaid wages (LC, Arts.
and 106, 107 & 109).
3. The Service Agreement ensures
compliance with all the rights and Independent Contractor
benefits for all the employees of the Those who undertake “job-
contractor or subcontractor under the contracting.” They exercise
labor laws (D.O. No. 174, Sec. 8, s. independent employment,
2017). contracting to do a piece of work
according to their own methods and
Substantial Capital refers to paid- without being subject to control of
up capital stocks/shares of at least their employer except as to the result
PHP 5 Million in the case of of their work (Villuga v. NLRC, G.R.
corporations, partnerships and No. 75038, August 23, 1993).
cooperatives. PHP 5 Million net NOTE: Independent contractors
worth in the case of a single often present themselves to
proprietorship (Sec. 3, [L], DOLE possess unique skills, expertise
D.O. No. 174 S. 2017). or talent to distinguish them from
The law does not require both ordinary employees (Sonza v. ABS-
substantial capital and investments, CBN, G.R. No. 138051, June 10,
it is sufficient that either of the two is 2004).
complied with (Neri v. NLRC, G.R.
Nos. 9700809, July 23,1993). Indirect or Statutory Employer is
Burden of proof to prove that one who enters into a contract with
he/it has substantial capital or an independent contractor for the
investment rests on the contractor performance of any work, task, job,
or project not directly related to the

employer’s business (Baguio v. the contractor may in turn become a
NLRC, G.R. Nos. 79004-08, October contractee if he contracts with a
4, 1991). contractor.
NOTE: There is no Er-Ee
relationship exists between the Employer-employee relationship may
owner of the project and the be declared to exist between the
employees of the independent principal and the contractor’s
contractor (Baguio v. NLRC, G.R. workers where the contracting
Nos. 79004-08, October 4, 1991). arrangement is not legitimate.
The principal employer is considered
only an indirect employer (PCI “Labor-Only” Contracting
Automation Center, Inc. v. NLRC, It is a prohibited act, an arrangement
G.R. No. 115920, January 29, 1996). where the contractor or
What is contracted is the subcontractor merely recruits,
performance and completion of a supplies or places workers to
designated job, and not just the perform a job, work or service for a
supplying of people to do the job. principal.
Major Laws Applicable to Work Essential Elements of Labor-Only

Relationship Contracting
1. Between the Principal and 1. The contractor or subcontractor
Contractor – The Civil Code and does not have substantial capital or
pertinent Commercial Laws investment to actually perform the
2. Between Contractor and his job, work or service under its own
Employees – the Labor Code and account and responsibility; and
Special Labor Laws. 2. The employees recruited, supplied
NOTE: Between the principal and or placed by such contractor or
the contractor’s employees, no subcontractor are performing
employer-employee relationship activities which are directly related to
exists; the contractor, being himself the main business of the principal
a businessman, is the employer. But

(Sasan v. NLRC, G.R. No. 176240, 2. Activities necessary or
October 17, 2008). desirable in the usual business or
NOTE: A finding that a contractor is trade.
a “labor-only” contractor is equivalent  Governed by Art. 280.
to declaring that there is an ER-EE  Used to determine regular or
relationship between the principal casual employee.
and the employees of the “labor- NOTE: While the services may be
only” contractor (San Miguel Corp. considered directly related to the
vs. MAERC Integrated Systems. principal business of the employer;
G.R. No. 144672; July 10, 2003). nevertheless, they are not necessary
in the conduct of the principal
Element of Control business of the employer (Neri v
Control over the manner or method NLRC, G.R. Nos. 97008-09, July
of doing the work characterizes 23,1993) .
employment. In contrast, control only
of the desired result of the work often “Labor-only” contractor is
indicates a contracting arrangement considered merely as an agent of the
(1 Azucena, 2016, p. 371). employer and is responsible to the
employees of the “labor-only”
Activities: Directly Related to the contractor as if they had been
Principal Business of the directly employed by the employer
Employer vs. Necessary or (LC, Art. 106).
Desirable in the Usual Business or
Trade Confirming Elements
1. Activities which are directly To have labor-only contracting, the
related to the principal business essential element of supplying
of the employer. workers to another is not enough. To
 Governed by Art. 106. it must be added either one of two
 Refers to the standard used confirming elements:
whether or not labor-only One. Lack of substantial capital or
contracting exists. investment and performance of

activities directly related or Refers to a contractor or
usually necessary or desirable to subcontractor engaged in the supply
the principal’s main business; or of labor which: 1. Is owned,
Two. The contractor does not managed or controlled by the
exercise control over the principal; and 2. Operates solely for
performance of the employees (1 the principal owning, managing or
Azucena, 2016, p. 369). controlling it.
NOTE: If the essential element is NOTE: Contracting out a job, work or
absent, there can be no LOC. And service through an in-house agency
even, if the essential element is is contrary to law or public policy
present, but confirming element one (DOLE D.O. No. 174 s. 2017).
or twois absent, there is still no LOC
(Ibid.). Job Contracting vs. Labor-only
Notwithstanding the absence Contracting
of a direct employeremployee Job Labor-only
relationship between the employer in Contracting Contracting
The er/principal The er/principal
whose favour work had been
is merely an is treated as
contracted out by a Labor-Only
indirect direct employer
Contractor, and the employees, the
employer, by of the
former has the responsibility,
operation of law, contractor’s
together with the LOC for any valid
of his employees in all
labor claims, by operation of law.
contractor’s instances.
The reason is that the LOC is
employees. (contractor =
considered merely an agent of the
agent of the
employer, and liability must be
employer)
shouldered by either one or shared
the law creates the statute
by both (Tabas, et al., v. California
an er-ee creates an eree
Manufacturing Company, Inc. et al.,
relationship for relationship for
G.R. No. 80680, January 26, 1989).
a limited a
purpose. comprehensive
In-House Agency
purpose.

The principal The principal subcontracting arrangement.
becomes becomes Including:
solidarily liable. solidarily liable 1. BPO/KPO. It does not
The liability with the contemplate to cover information-
however does contractor not technology enabled services
not extend to only for unpaid involving an entire or specific
the payment of wages but also business process such as Business
backwages or for all the Process Outsourcing (BPO) or
separation pay rightful claims of Knowledge Process Outsourcing
of employees the employees (KPO) (DOLE D.O. No. 01, s. 2017).
who are illegally under the Labor 2. Construction Industry. Licensing
dismissed. Code and and exercise of regulatory powers
ancillary laws. over the construction industry is
Allowed by law Prohibited by lodged with the Philippine
law Constructors Accreditation Board
Presence of Absence of
(PCAB) of the Construction Industry
substantial substantial
Authority of the Philippines (CIAP).
capital or capital or
3. Private Security Agency. Except
investment. investment.
for the registration requirement as
DOLE D.O. No. 174 s. 2017 provided in DO No. 174, s. 2017,
Issued by the Secretary of Labor and contracting or subcontracting
Employment implementing and arrangement in the private security
interpreting Articles 106 to 109 of the industry shall be governed by DO
LC. Effective 16 March 2017. No. 150, s. 2016.
4. Other Contractual
Non-applicability of D.O. No. 174 Relationships. DO No. 174. S.
s. 2017 2016 does not contemplate to cover
D.O. 174, Series of 2017 is not contractual relationship such as in
applicable to trilateral relationship contract of sale or purchase, contract
which characterizes contracting or of lease, contract of carriage,
contract growing/growership

agreement, toll manufacturing, 4. Social security and welfare
contract of management, operation benefits;
and maintenance and such other 5. Self-organization, collective
contracts governed by the Civil Code bargaining and peaceful
and special laws. concerted activities; and
6. Security of tenure.
Effect of Failure to Register by the NOTE: Generally, the
Independent Contractor with contractor is presumed to be a
DOLE: labor-only contractor, unless such
A Certificate of Registration shall be contractor overcomes the burden of
effective for (2) two years, unless proving that it has the substantial
cancelled after due process. Failure capital, investment, tools and the
to register shall give rise to the like. However, where the principal is
presumption that the contractor is the one claiming that the contractor
engaged in labor-only contracting is a legitimate contractor, as in the
(Section 14, D.O. No. 174, Series present case, said principal has the
2017). burden of proving that supposed
status (Alilin v. Petron Corp., G.R.
Rights of Contractor’s Employees No. 177592, June 9, 2014).
1. Safe and healthful working
conditions; Contractor or Subcontractor to
2. Labor standards such as but not Furnish A Bond
limited to service incentive leave, An employer or indirect employer
rest days, overtime pay, holiday may require the contractor or
pay, 13th month pay, and separation subcontractor to furnish a bond
pay as may be provided in the equal to the cost of labor under
Service Agreement or under the contract, on the condition that the
Labor Code; bond will answer for the wages due
3. Retirement benefits under the the employees should the contractor
SSS or retirement plans of the or subcontractor, as the case may
contractor, if there is any;

be, fail to pay the same (LC, Art of the Labor Code and other social
107). legislation.
NOTE: Where the employer fails to The principal shall be
require the posting of the bond, he solidarily liable with the contractor in
must be liable for whatever the the event of any violation of any
contractor may have incurred to his provisions of the Labor Code,
employees, without prejudice to its including the failure to pay wages
right of reimbursement from the (D.O. No. 18-02 s. 2002).
contractor for whatever amount paid
(Baguio v NLRC, G.R. Nos. 79004- For wages and money claims
08, October 4, 1991). In the event that the contractor or
subcontractor fails to pay the ages of
Extent of employer’s liability in his employees in accordance with
invalid contracting the Code, the employer shall be
Where the contracting is found to be jointly and severally liable with the
labor-only contracting, the liability is contractor or subcontractor to such
immediately and directly imposed employees to the extent of the work
upon the principal. The principal performed under the contract, in the
shoulders all the obligations of an same manner and extent that he is
employer, not just the payment of liable to employees directly
wages. The liability becomes direct employed by him (LC, Art. 107).
and total as that of a directly-hiring NOTE: Where no ER-EE relationship
employer. exists between the parties and no
issue is involved which may be
Extent of principal’s liability in resolved by reference to the Labor
legitimate contracting Code, other labor statutes or any
The contractor or sub-contractor collective bargaining agreement, it is
shall be considered the employer of the Regional trial Court that has
the contractual employee for jurisdiction.
purposes of enforcing the provisions
For other violations

The court has interpreted the liability is accomplished through the
of the principal under Article 109 as principal’s requiring the posting of a
a qualified or limited liability. bond. After satisfying from the bond
the unpaid wages and overtime pay,
Liability: the contractor cannot recover from
1. For failure to pay the minimum the principal if the principal has
wage or the service incentive already handed over to the
leave or other benefits- the contractor the amount covering the
principal is equally liable with the wages or the pay increase mandated
contractor as if the principal were by a wage order (Rosewood
the direct employer. Processing, Inc. v. NLRC, G.R. Nos.
2. With punitive character - such as 116476-84, May 21, 1998).
an award for backwages and
separation pay because of an Effect of registration or non-
illegal dismissal of the registration
contractor’s employee, the Labor contractors are mandatorily
liability should be solely that of required to register with DOLE.
the contractor, in the absence of Failure to register presumes that the
proof that the principal conspired non-registrant is an LOC. However,
with the contractor in the this is a disputable presumption.
commission of the illegal Although unregistered, the contractor
dismissal. may prove that it is a legitimate
NOTE: The contractor’s liability for contractor.
underpaid wages and unpaid The fact of being registered is
overtime work could be enforced not conclusive proof of being a
against the surety bond posted by legitimate contractor. Neither does
the contractor as required by the the registration presume the
principal. The law’s aim in imposing registrant to be a legitimate
indirect liability upon the principal is contractor, Actual conduct of the
to assure payment of monetary relationship proves independent
obligations to the workers. This aim contractorship.

No worker shall be dismissed except
4. TERMINATION OF for a just or authorized cause
EMPLOYMENT provided by law and after due
Coverage of Termination of process (LC, Art. 294, as
Employment renumbered).
Applies to all establishments or The policy of the State is to
undertakings whether for profit or not assure the right of workers to
(LC, Art. 293, as renumbered). security of tenure (1987 Constitution,
Art. XIII, Sec. 3). The guaranty is an
Termination is a broader concept act of social justice.
that is used to denote dismissal or
lay-off. It may also imply complete Security of Tenure is the right not to
severance of employer-employee be removed from one’s job without
relationship. valid cause and valid procedure. It
extends to regular as well as
On the other hand, dismissal is a nonregular employment (Kiamco v.
form of ending an employer- NLRC, G.R.No. 129449, June 29,
employee relationship initiated either 1999).
by the employee or employer.
e.g. just cause or authorized cause MANAGEMENT RIGHTS
dismissal. The right to stay on the job against
the right to remove the employee
Lay-off is a termination initiated by from the job are two differing rights.
the employer without prejudice to Labor relations endlessly requires
reinstatement or recall of an balancing the rights and interests of
employee who has been temporarily both the employer and the
separated brought about by adverse employee.
economic conditions.
Basic Rights of the Employer
SECURITY OF TENURE 1. Right to manage people;
2. Right to discipline;

3. Right to transfer employees; NOTE: The employer is bound to
4. Right to demote; and exercise caution in terminating the
5. Right to dismiss. services of his employees especially
so when it is made upon the request
Right to Dismiss of a labor union pursuant to the CBA.
It is management prerogative to Dismissal must not be arbitrary and
transfer, demote, discipline and even capricious (Rance et al., v. NLRC,
to dismiss an employee to protect its G.R. No. 68147, June 30, 1988).
business, provided it is not tainted
with unfair labor practice(Petrophil TERMINATION BY EMPLOYER
Corporation v. NLRC, et al., G.R. 2-Fold Requirements For Lawful
No. L-64048, August 29, 1986). Dismissal
A company has the right to 1. Substantive – legality or illegality
dismiss its erring employees if only of the act of dismissal (just and
as a measure of self-protection authorized causes)
against acts inimical to its interest 2. Procedural – legality or illegality
(Filipro, Inc. v. NLRC. G.R. No. of the manner of dismissal (due
70546, October 16, 1986). process; notice and hearing)
Power to Dismiss Not Absolute Just Cause vs. Authorized Cause

GR: An employer can dismiss or lay- Just Authoriz
off an employee for just and Cause ed Cause
authorized causes enumeratd under By the
Art. 297 and Art. 298 of the LC. employer
XPN: The right of an employer to in the

By the
freely discharge his employees is Initiated by exercise
employ
subject to regulation by the State, in whom of
ee.
the exercise of its paramount police manage
power (Manila Electric Company v. ment
NLRC, G.R. No. 78763, July 12, prerogati
1989). ve.
Payment of Not Required

require dismiss him which notice must
Separation d to be to be come only after the employee
Pay paid. paid. is given a reasonable period
from receipt of the first notice
Noncompli Indemn within which to answer the
Indemnit
ance with ity: charge, and ample
y: PHP
Due PHP opportunity to be heard and
50,000
Process 30,000 defend himself.
2. Hearing (opportunity to be
JUST CAUSE
heard) – the worker may answer
It is a termination initiated by the
the allegations against him in the
employee. This is an exercise of
notice of dismissal within a
management prerogative; however,
reasonable period from receipt of
it must not be exercised with abuse
the notice of dismissal with the
of discretion.
ample opportunity to be heard.
3. Judgement/Decision to Dismiss
Procedural Requirements of
– it should be in writing and
Dismissal for Just Causes:
should clearly state all the reason
1. Notice (two-notice rule) – the
thereof.
employer is required to furnish an
employee who is to be dismissed
Under the Perez Doctrine it is no
with 2 written notices before such
longer the 2 notice rule and hearing,
termination:
because you can now dispense the
a. Pre-notice- the notice to
hearing. The Supreme Court held
apprise the employee of the
that what is important is that the
particular acts or omissions
parties are given the opportunity to
for which dismissal is sought
be heard unless they request for a
and is considered as the
hearing. What is required is that the
proper charge;
complainant is given the opportunity
b. Post-notice- the notice
to be heard (Perez v Philippine
informing the employee of the
employer’s decision to

Telegram and Telephone Company, 1. Serious misconduct or willful
G.R. 152048, April 7,2009). disobedienceby the Ee of the
Where the employer had a lawful orders of his Er or
valid reason to dismiss the employee representative in connection with
but has failed to comply with the due his work;
process requirement, the dismissal 2. Gross and habitual neglect by the
may be upheld but the employer will Ee of his duties;
be penalized to pay an indemnity to 3. Fraud or willful breach by the Ee
the employee (Wenphil Corp. v. of the trust reposed in him by his
NLRC, G.R. No. 80587, February 8, Er or duly organized
1989). representative;
NOTE: The burden of proving that 4. Commission of a crime or offense
the termination was for a valid or by the Ee against the person of
authorized cause shall rest on the Er his Er or any immediate member
(LC, Art. 292[b]). of his family or his duly
authorized representative;
Preventive Suspension 5. Other causes analogous to the
The employer may place the foregoing (LC, Art. 297, as
employee under preventive renumbered)
suspension, during the pendency of NOTE: For non-compliance by the
the investigation, if his continued ER of due process in just cause
employment poses a serious and dismissal, the ER is liable to pay
imminent threat to life and property indeminity or nominal damages
of the employer or his employees. amounting to Php 30,000 (Agabon v
NOTE: It must not be more than 30 NLRC, G.R. No. 158693, November
days; otherwise it will amount to 17, 2004).
constructive dismissal.
Serious Misconduct
JUST CAUSES FOR It is an improper or wrong conduct;
TERMINATION the transgression of some
established and definite rule of

action, a forbidden act, a dereliction
of duty, willful in character, and Willful Disobedience
implies wrongful intent and not mere There is wilful disobedience when
error in judgment. To be serious there is wanton disregard to follow
within the meaning and intendment orders of the employer. Willful is
of the law, the misconduct must be characterized by a wrongful perverse
of such grave and aggravated mental attitude rendering the
character and not merely trivial or employee’s act inconsistent with the
unimportant (Villamor Golf Club v. proper subordination.
Pehid, G.R. No. 166152, October 4, The employee’s disobedience
2005). must relate to substantial matters,
not merely to trivial or unimportant
Elements: matters. Disobedience to be
1. It must be serious or of such a considered willful must be resorted
grave and aggravated character; to without regard to its
2. Must relate to the performance of consequences (DOLE Manual; BLTB
the Ees’ duties; Co. v CA 71 SCRA 470; Family
3. Ee has become unfit to continue Planning Org. of the Phil. Inc. v.
working for the Er (Philippine NLRC, G.R. No. 75907, March 23,
Aeolus Automotive United Corp. 1992).
v. NLRC, G.R. No. 124617, April
28, 2000). Requisites:
1. The Ees assailed conduct must
Examples: have been willful or intentional,
1. Sexual harassment; the willfulness being
2. Fighting within the company characterized by a wrongful and
premises; perverse attitude; and
3. Uttering obscene, insulting, or 2. The disobeyed orders,
offensive words against a superior; regulations, or instructions of the
4. Falsification of time records; Er must be:
5. Gross immorality. a. Reasonable and lawful

b. Sufficiently known to the Ee organization (Pocketbell Philippines,
c. In connection with the duties Inc. v. NLRC, et al., G.R. No.
which the Ee has been 106843, January 20, 1995).
engaged to discharge
(Cosep v. NLRC, G.R. No. Disobeying an Order to Transfer
124966, June 16, 1998). The requisites for wilful disobedience
need to be observed before
Valid Transfer dismissing an employee who
GR: Management has the right to disobeys an order transferring him
transfer or reassign an employee. from one job or one location to
The right of the employer to transfer another (2 Azucena, 2016, p. 829).
the employees in the interest of the NOTE: The refusal to obey a valid
efficient and economic operation of transfer order constitutes willful
its business cannot be seriously disobedience of a lawful order of an
challenged. employer. Employees may object to,
XPN: Where the transfer is vitiated negotiate and seek redress against
by improper motive and is merely a employers for rules or orders that
disguised attempt to remove or they regard as unjust or illegal.
punish the employee sought to be However, until and unless these
transferred (Associated Labor rules or orders are declared illegal or
Unions v. NLRC, G.R. Nos. 76916- improper by competent authority, the
17, March 31, 1983). employees ignore or disobey them at
their peril. But transfer should not
Invalid Transfer result to demotion of rank, which is
The right to transfer personnel tantamount to constructive dismissal
should not be used as a subterfuge (Manila Pavilion Hotel vs. Henry
by the employer to rid himself of an Delada. G.R. No. 189947; January
undesirable worker. Nor when the 25, 2012).
real reason is to penalize an
employee for his union activities and Disobedience of an Inconvenient
thereby defeat his right to self- Transfer

GR: Inconvenience to the employee neglect must not only be gross but
does not necessarily invalidate a must also be habitual in character
transfer order. (DOLE Manual).
NOTE: The transfer from one city to
another within the country is valid as Degree of Negligence as a Just
long as there is no bad faith on the Cause for Termination
part of the employer (Homeowners GR: Gross and habitual negligence.
Savings and Loan Association, Inc. a. Gross neglect has been defined
v. NLRC, et al., G.R. No. 97067, as the want or absence of or
September 26, 1996). failure to exercise slight care or
XPN: Inconvenience caused by diligence, or the entire absence
unreasonableness of the transfer of care. It evinces a thoughtless
order makes the order itself invalid, disregard of consequences
and disobedience thereof is not a without exerting any effort to
reason to dismiss the worker. avoid them (NBS vs. Court of
NOTE: The reasonableness and Appeals. G.R. No. 146741;
lawfulness of a rule, order or February 27, 2002).
instruction depend on the b. Habitual neglect implies repeated
circumstances availing in each case. failure to perform one’s duties
Reasonableness pertains to the kind over a period of time, depending
or character of directives and upon the circumstance (JGB and
commands and to the manner in Associates v. NLRC, GR No.
which they are made (Escobin et al. 10939, March 7, 1996).
v. NLRC et al., G.R. No. 118159, XPN: An employee who was grossly
April 15, 1998). negligent in the performance of his
duty, though such negligence
Gross and Habitual Negligence committed was not habitual, may be
It implies a want or absence of or dismissed especially if the grossly
failure to exercise diligence that an negligent act resulted in substantial
ordinary prudent man would use in damage to the company (LBC
his own affairs. However, such

Express vs. Mateo. G.R. No. with the employee’s work; and 3.
168215; June 9, 2009). There must be proof that the
employee failed to meet the
Failure in Performance standards despite the given
Evaluations reasonable opportunity to meet
As a general concept “poor the same.
performance” is equivalent to
inefficiency and incompetence in the Inefficiency as a Just Cause for
performance of official duties. The Dismissal
fact that an Ee’s performance is Failure to observe prescribed
found to be poor or unsatisfactory standards of work or to fulfill
does not necessarily mean that the reasonable work assignments due to
Ee is grossly and habitually negligent inefficiency may constitute just cause
of his duties. Gross negligence for dismissal. Such inefficiency is
implies a want or absence of or understood to mean failure to attain
failure to exercise slight care of work goals or work quotas, either by
diligence or the entire absence or failing to complete the same within
care. He evinces a thoughtless the allotted reasonable period, or by
disregard of consequences without producing unsatisfactory results
exerting any effort to avoid them (Buiser v. Leogardo, G.R. No. L-
(Eastern Overseas Employment 63316, 1984). This ground is
Center Inc. v. Bea, G.R. 143023, considered analogous to those
November 29, 2005). enumerated under Art. 282
(Skippers United Pacific v. Magud,
Requisites of Poor Performance G.R. No. 166363, August 15, 2006).
as a Ground for Termination
1. Employer must prove that it has Some Forms of Neglect of Duty
set standards of performance 1. Habitual tardiness and
expected of the employee; absenteeism
2. These standards must be 2. Abandonment: a. Failure to report
reasonable and in connection for work or absence without

justifiable reason b. Clear his employment without any intention
intention to sever Er-Ee of returning. There must be a
relationship manifested by some concurrence of the intention to
overt acts (Labor et. al v. NLRC, abandon and some overt acts from
GR No. 110388, September 14, which an Ee may be deduced as
1995). having no more intention to work.
The law, however, does not
Abandonment as a Just Cause for enumerate what specific overt acts
Termination can be considered as strong
It means deliberate and unjustified evidence of the intention to sever the
refusal of an employee to resume his Ee-Er relationship (Sta. Catalina
employment. College v. NLRC, G.R. No. 144483,
November 19, 2003).
Requirements for a Valid Finding NOTE: In case of abandonment the
of Abandonment ER is still required under the law to
Two (2) factors must be present: notify the employee of his
1. The failure to report for work, or termination. There is still a need to
absence without valid or observe the two-notice rule and
justifiable reason; and opportunity to be heard requirement
2. A clear intention to sever Er-Ee (New Puerto Commercial v Lopez,
relationship, with the 2nd element G.R. NO. 169999, July 26, 2010).
as the more determinative factor,
being manifested by some overt Fraud or Willful Breach of Trust
acts (Sta. Catalina College v. Any act, omission, or concealment
NLRC, G.R. No. 144483, which involves a breach of legal
November 19, 2003). duty, trust, or confidence justly
reposed and is injurious to another.
How to Prove Abandonment Fraud must be committed
Abandonment is proven when the Er against the employer or
must show that the Ee deliberately representative and in connection
and unjustifiably refused to resume

with the employee’s work (Poquiz, NOTE: The mere existence of
2012). a basis for the loss of trust
and confidence justifies the
Loss of Trust and Confidence as a dismissal of the managerial
Just Cause for Termination: Ee because when an Ee
1. It applies only to cases involving: accepts a promotion to a
a. Ees occupying positions of managerial position or to an
trust and confidence office requiring full trust and
(confidential and confidence, such Ee gives up
managerial Ee’s)– To this some of the rigid guaranties
class belong managerial Ees, available to ordinary workers
i.e., those vested with the (Cecilia T. Manese v. Jollibee
powers or prerogatives to lay Foods Corporation, G.R. No.
down management policies 1704 54, October 11, 2012).
and/or to hire, transfer, b. Ees routinely charged with
suspend, lay-off, recall, the care and custody of the
discharge, assign or discipline Er’s money or property – To
Ees or effectively recommend this class belong cashiers,
such managerial actions auditors, property custodians,
Position of trust and etc., or those who, in the
confidence is one where a normal and routine exercise of
person is entrusted with their functions, regularly
confidence on delicate handle significant amounts of
matters, or with the custody, money or property (Mabeza v.
handling, or care and NLRC, G.R. No. 118506, April
protection of the employer’s 18, 1997).
property (Pandoy v. NLRC, 2. The loss of trust and confidence
G.R. No. 67664, May 20, must be based on willful breach.
1992) and/or funds (Gonzales A breach is willful if it is done
v NLRC, 355 SCRA 197). intentionally, knowingly, and
purposely without justifiable

excuse, as distinguished from an managerial Ees, such as Caoile,
act done carelessly, mere existence of a basis for
thoughtlessly, heedlessly, or believing that such Ee has breached
inadvertently (De la Cruz v. the trust of his Er would suffice for
NLRC, G.R. No. 119536, his dismissal (Caoile v. NLRC, G.R.
February 17, 1997). No. 115491, November 24, 1998).
3. The act constituting the breach
must be “workrelated” such as Guidelines for the Doctrine of
would show the Ee concerned to Loss of Confidence to Apply
be unfit to continue working for 1. Loss of confidence should not be
the Er (Gonzales v. NLRC, G.R. simulated (reasonable basis for
No. 131653, March 26, 2001). loss of trust and confidence);
4. It must be substantial and founded 2. Not used for subterfuge for causes
on clearly established facts which are improper and/or illegal
sufficient to warrant the Ee’s or unjustified;
separation from employment 3. Not arbitrarily asserted in the face
(Sulpicio Lines Inc. v. Gulde, of overwhelming evidence to the
G.R. No. 149930, February 22, contrary;
2002). 4. Must be genuine, not a mere
5. Fraud must be committed against afterthought to justify earlier
the Er or his representatives, action taken in bad faith; and
e.g.: 5. The Ee involved holds a position
a. Falsification of time cards of trust and confidence (Ramos
b. Theft of company property v. Court of Appeals, G.R. No.
c. Unauthorized use of 145405, June 29, 2004).
company vehicle
NOTE: The treatment of rank and file Commission of a Crime or Offense
personnel and managerial Ees in so This refers to an offense committed
far as the application of the doctrine by the Ee against the person of his
of loss of trust and confidence is Er or any immediate member of his
concerned is different. As regards family or his duly authorized

representative and thus, conviction omission of the Ee (Nadura v.
of a crime involving moral turpitude Benguet Consolidated, G.R. No. L-
is not analogous thereto as the 17780, August 24, 1962).
element of relation to his work or to Examples:
his Er is lacking. 1. Violation of company rules and
NOTE: A criminal case need not be regulations
actually filed. Commission of acts 2. Immorality, Drunkenness or
constituting a crime itself is sufficient Fighting inside the premise
(National Labor Union, Inc. v. 3. Gross inefficiency
Standard Vacuum Oil Company. 4. Illegally diverting Er’s products
G.R. No. L-48170, October 10, 5. Failure to heed an order not to join
1941). an illegal picket
6. Violation of safety rules and code
Conviction not a Condition Sine of discipline
Qua Non 7. Theft of company property
The conviction of an employee in a To fall within the ambit of “analogous
criminal case is not indispensable to cases” the act or omission must
warrant his dismissal by his have an element similar to those
employer (Starlite Plastic Industrial found in the specific Just cause
Corporation v. NLRC. G.R. No. enumerated under Art. 282
78491, March 16, 1989). (International Rice Research
Ratio: The quantum of evidence Institute v. NLRC, G.R. No. 97239,
needed is merely substantial May 12, 1993).
evidence to terminate an employee
under these grounds. Past offenses
Previous offenses may be so used
Analogous Cases as a valid justification for dismissal
For an act to be included in from work ONLY if the infractions are
analogous cases of just causes of related to the subsequent offense
termination, it must be due to the upon which the basis the termination
voluntary and/or willful act or of employment is decreed (Stellar

Industrial Service Inc. v. NLRC, G.R. Doctrine of Commensurate
No. 117418. Jan. 24, 1996). Penalty/ Proportionality Rule
The school failed to show that In this regard, it is a hornbook
Chua took advantage of her position doctrine that infractions committed
to court her student Chua. If the two by an employee should merit only
eventually fell in love, despite the the corresponding penalty
disparity in their ages and academic demanded by the circumstance. The
levels, this only lends substance to penalty must be commensurate with
the truism that the heart has reasons the act, conduct or omission imputed
of its own which reason does not to the employee and must be
know. But, yielding to this gentle and imposed in connection with the
universal emotion is not to be so disciplinary authority of the employer
casually equated with immorality. (Sagales v Rustans Commercial
The deviation of the circumstances Corporation, G.R. No. 166554,
of their marriage from the usual November 27, 2008).
social pattern cannot be considered Factors that can be considered:
as a defiance of contemporary social 1. Length of service
mores (Chua-Qua v. Clave, G.R. No. 2. Gravity of the offense
L-49549 August 30, 1990). 3. Nature of the position
4. Nature off the business
Doctrine of Incompatibility 5. First offense rule
Where the Ee has done something 6. Totality of infractions
that is contrary or incompatible with 7. Principle of charity, compassion
the faithful performance of his duties, and understanding
his Er has a just cause for 8. Principle of equity
terminating his employment (Manila
Chauffeur’s League v. Bachrach Guidelines to Determine the
Motor Co., G.R. No. L-47071, June Validity of Termination
29, 1940). Validity of termination per se is
determined by compliance with two-
notice rule, hearing (opportunity to

be heard), and the presence of a just 1. Written notice to the employee
or authorized cause. and to the DOLE at least one (1)
month before the intended date
AUTHORIZED CAUSES of termination;
Authorized causes – initiated by the 2. Payment of separation pay of at
employer’s exercise of management least one (1) month for every
prerogative, who shall be liable to year of service;
pay separation pay as mandated by 3. Good faith in the discharge of
law. It does not usually require employees; and
delinquency or culpability on the part 4. Reasonable criteria to be used in
of the employee. implementing automation
Authorized causes of termination Robotics is the switch from ‘men’

by the Er: employment to ‘mechanical’
1. Installation of labor-saving devices employment.
2. Redundancy Reduction of the number of
3. Retrenchment workers in a company’s factory
4. Closing or cessation of operation made necessary by the introduction
of the establishment or of machinery in the manufacture of
undertaking its products is justified. There can be
5. Disease no question as to the right of the
manufacturer to use new laborsaving
Installation of Labor-Saving devices with a view to affecting more
Devices (Automation) economy and efficiency in its method
Automation – is a management of production (Philippine Sheet Metal
prerogative of replacing manpower Workers’ Union vs. CIR. G.R. No. L-
with machine power in order to effect 2028; April 28, 1949).
more economy and greater efficiency
in method of production Redundancy
It is the superfluity in the
Requisites for a valid automation: performance of a particular work. It

exists where the services of an Ee month prior to separation from
are in excess of what is reasonably work
demanded by the actual 2. Payment of separation pay
requirements of the enterprise equivalent to at least 1 month pay
(Wiltshire File Co., Inc. v. NLRC, or at least 1 month pay for every
G.R. No. 82249, February 7, 1991). year of service, whichever is
Redundancy in an Er’s higher.
personnel does not necessarily or 3. Good faith in abolishing redundant
even ordinarily refer to duplication of position
work. The characterization of 4. Fair and reasonable criteria in
services as no longer necessary or ascertaining what positions are to
sustainable and therefore properly be declared redundant:
terminable, was an exercise of a. Less preferred status, e.g.
business judgment on the part of the temporary Ee
Er. The Er has no legal obligation to b. Efficiency and c. Seniority
keep in its payroll more Ees that are (DAP v. Court of Appeals.
necessary for the operation of its G.R. No. 165811;
business (Wiltshire File Co., Inc. v. December 14, 2005).
NLRC, G.R. No. 82249, February 7,
1991). Redundancy in Bad Faith
NOTE: A position is redundant The employee was terminated on the
when it is superfluous. Superfluity is ground of redundancy. But it was
the outcome of some factors: 1. found out that the employer had
Over-hiring of workers 2. Decline in been hiring new employees while it
volume of business 3. Closure of a was firing the old ones, negating the
particular line of an economic activity claim of redundancy (General Milling
previously engaged by the employer. Corp., v. V.L. Viajar, G.R. No.
181738, January 30, 2013).
Requisites of a Valid Redundancy
1. Written notice served on both the Retrenchment
Ees and the DOLE at least 1

It is the reduction of personnel authorized to be undertaken by the
usually due to poor financial returns employer sometime before the
as to cut down on costs of losses anticipated are actually
operations in terms off salaries and sustained or realized. It is not the
wages to prevent bankcruptcy of the intention of the lawmaker to compel
company (2 Poquiz, 2018, p. 560). the employer to stay his hand and
Cutting of expenses includes keep all his employees until
the reduction of personnel; It is a sometime after losses shall have
management prerogative, a means been materialized (Lopez Sugar
to protect and preserve the Er’s Corporation v. Federation of Free
viability it must be effected in good Workers, et al., G.R. Nos. 7570001.
faith and for the retrenchment, which August 30, 1990).
is after all a drastic recourse with
serious consequences for the Standards of Preventive
livelihood of the Ee’s or otherwise Retrenchment
laid-off (2 Poquiz, 2018, p. 552). 1. The losses expected should be
NOTE: The kind of losses substantial and not merely de
contemplated under the Labor Code minimis in extent;
is actual or anticipated/impending 2. The substantial loss apprehended
losses. There is NO prohibition for must be reasonably imminent;
the ER to embark on retretchment 3. It must be reasonably necessary
program if he could perceive that its and likely to effectively prevent
economy will go down the drain (2 the expected losses; and 4.
Poquiz, 2018, p. 554). Alleged losses if already realized,
and the expected imminent
Preventive Retrenchment is losses sought to be forestalled,
Allowed must be proven by sufficient and
“To prevent losses” justifies convincing evidence (Lopez
retrenchment. Such phrase means Sugar Corporation v. Federation
that retrenchment or termination of of Free Workers, et al., G.R. Nos.
the services of some employees is 75700-01. August 30, 1990).

physical fitness, age, and
Causes of Retrenchment financial hardship of certain
1. Lack of Work workers (FASAP v. PAL, G.R.
2. Business Recession No. 178083, October 2, 2009).
3. Fire
4. Conservatorship Criteria in Selecting Employees to
be Retrenched
Requisites of a Valid There must be fair and reasonable
Retrenchment criteria to be used in selecting Ees to
1. Written notice served on both the be dismissed such as: 1. Less
Ee and the DOLE at least 1 preferred status; 2. Efficiency rating;
month prior to the intended date 3. Seniority (Phil. Tuberculosis
of retrenchment; Society, Inc. v. National Labor
2. Payment of separation pay Union, G.R. No. 115414, August 25,
equivalent to at least one month 1998)
pay or at least 1/2 month pay for
every year of service, whichever “Last In First Out” (LIFO) Rule
is higher; It applies to termination of
3. Good faith in effecting employment in the same line of
retrenchement; work. What is contemplated in the
4. Proof of expected or actual losses; LIFO rule is that when there are two
5. To show that the employer first or more Ees occupying the same
instituted cost reduction position in the company affected by
measures in other measures in the retrenchment program, the last
other areas of production before one employed will necessarily be the
undertaking retrenchment as a first one to go (Maya Farms
last resort; and Employees Organization v. NLRC,
6. The Er used fair and reasonable G.R. No. 106256, December 28,
criteria in ascertaining who would 1994).
be retained among the Ees, such
as status, efficiency, seniority, LIFO Rule Mandatory

GR: In cases of installation of labor- Evidence to Prove Losses
saving devices, redundancy and Alleged losses if already realized
retrenchment, the LIFO rule shall and the expected imminent losses
apply. must be proved by sufficient and
XPN: When an employee volunteers convincing evidence.
to be separated from employment. Evidence presented in NLRC
(DOLE Department Order 147-15, Proceedings must have modicum of
Series of 2015) admissibility.
Redundancy vs. Retrenchment Closure of Business

Redundancy Retrenchment It must be done in good faith and not
Does not Involves losses, for the purpose of circumventing
involve losses closures or pertinent labor laws.
or the closing or cessation of A change of business
cessation of operations of ownership does not create an
operations of establishment or obligation on the part of the new
the undertaking due owner to absorb the employees of
establishment. to serious the previous owner, unless expressly
business losses assumed. Labor contracts being in
or financial personam, are generally not
reverses. enforceable against a
transferee(Fernando v. Angat Labor
In preventive Unit, 5 SCRA 248).
retrenchment, Closure contemplated is a
retrenchment unilateral and voluntary act on the
may be part of the Er to close the business
undertaken by establishment.
the employer
before losses Disease
are actually It must be incurable within 6 months
sustained. and the continued employment is

prohibited by law or prejudicial to his Payong, G.R. No. 167462, October
health as well as to the health of his 25, 2005).
co-Ees with a certification from the
public health officer that the disease Procedure in terminating an Ee’s
is incurable within 6 months despite employment on the ground of
due to medication and treatment. disease
1. The Er shall not terminate his
Disease as a ground for dismissal employment unless:
When the Ee suffers from a disease, a. There is a certification by a
and: competent public health
1. His continued employment is authority;
prohibited by law or prejudicial to b. That the disease is of such
his health or to the health of his nature or at such a stage that
co-Ees (IRR, Book VI, Rule I, it cannot be cured within a
Sec.8). period of 6 months even with
2. With a certification by competent proper medical treatment.
public health authority that the 2. If the disease or ailment can be
disease is incurable within 6 cured within the period, the Er
months despite due medication shall not terminate the Ee’s
and treatment (Solis v. NLRC, employment but shall ask the Ee
GR No. 116175, October 28, to take a leave. The Er shall
1996). reinstate such Ee to his former
NOTE: The requirement for a position immediately upon the
medical certification cannot be restoration of his normal health
dispensed with; otherwise, it would (IRR, Book VI, Rule I, Sec.8).
sanction the unilateral and arbitrary
determination by the Er of the gravity HIV Status and AIDS, not a
or extent of the Ee’s illness and thus Ground for Termination
defeat the public policy on the Discrimination in any form from pre-
protection of labor (Manly Express v. employment to post-employment,
including hiring, promotion or

assignment, based on the actual,
perceived or suspected HIV status of Medical Certificate as mandatory
an individual is prohibited. requirement
Termination from work on the sole The requirements of a medical
basis of actual, perceived or certificate are mandatory. Only
suspected HIV status is deemed where there is a prior certification
unlawful (RA No. 8504, Sec. 35). from a competent public authority
that the disease afflicting the Ee
Disability, not a Ground for sought to be dismissed is of such
Termination nature or at such stage that it cannot
GR: Dismissing or terminating the be cured within 6 months even with
services of a disabled employee by proper medical treatment that the
reason of his disability is not a valid latter could be validly terminated
ground. from his job (Tan v. NLRC, G. R. No.
XPN: The employer can prove that 116807, April 14, 1997).
he impairs the satisfactory
performance of the work involve to Other authorized causes
the prejudice of the business entities; 1. Total and permanent disability of
Provided, however, that the Ee
employer first sought provide 2. Valid application of union security
reasonable accommodations for clause
disabled persons. 3. Expiration of period in term of
employment
Entitlement to reinstatement 4. Completion of project in project
An Ee suffering from a disease is employment
entitled to a reinstatement. Provided 5. Failure in probation
he presents a certification by a 6. Relocation of business to a distant
competent public health authority place
that he is fit to return to work (Cebu 7. Defiance of return-to work-order
Royal Plant v. Deputy Minister, G.R. 8. Commission of Illegal acts in strike
No. L-58639, August 12, 1987). 9. Violation of contractual agreement

10. Retirement the requirements of written
notice.
Steps required in termination of
an Ee’s employment for DUE PROCESS
authorized causes: a. Twin-Notice Requirement
1. Written Notice to DOLE 30 days b. Hearing: Ample Opportunity to be
prior to the intended day of Heard
termination. Purpose: To enable
it to ascertain the veracity of the Preliminary Clarificatory
cause of termination. Statement on Due Process
2. Written notice to Ee concerned 30 At the outset, there is a need to point
days prior the intended date of out the following distinction:
termination. 1. Due process required to be
3. Payment of separation pay – complied with by the employer in
Serious business losses do not terminating the employee's
excuse the Er from complying employment (COMPANY-LEVEL
with the clearance or report DUE PROCESS); and
required in Art. 283 of the LC and 2. Due process required to be
its IRR before terminating the observed by the labor
employment of its workers. In the authorities/tribunal/courts (Labor
absence of justifying Arbiter/NLRC/CA) in hearing and
circumstances, the failure of the deciding labor cases brought
Er to observe the procedural before them for adjudication and
requirements under Art. 284 of decision (COURT-LEVEL DUE
the LC taints their actuations with PROCESS).
bad faith if the lay-off was
temporary but then serious No.1 above requires compliance with
business losses prevented the both the statutory and contractual
reinstatement of respondents, the due process as discussed below;
Er’s should have complied with while No.2 above requires

observance of the constitutional own company rules. The
due process. employer's failure to observe its own
company-prescribed due process will
What is the latest rule on due make it liable to pay an indemnity in
process? the form of nominal damages, the
Due process means compliance with amount of which is equivalent to the
BOTH STATUTORY DUE P30,000.00 awarded under the
PROCESS and CONTRACTUAL Agabon doctrine.
DUE PROCESS.
Are the twin-notice requirement
CONSTITUTIONAL DUE PROCESS and hearing required in all cases
is not applicable (Per Agabon of termination?
doctrine). No. The two-notice requirement and
hearing are required only in case of
Statutory due process refers to the just cause termination in the
one prescribed in the Labor Code following order:
(Article 292[b] 277[b]); while 1. Service or first written notice;
contractual due process refers to 2. Conduct of hearing; and
the one prescribed in the Company 3. Service of second written
Rules and Regulations (Per Abbott notice.
Laboratories doctrine).
What is the King of Kings
Contractual due process was Transport doctrine on just cause
enunciated in the 2013 en banc procedural due process?
ruling in Abbott Laboratories Based on this doctrine which was
Philippines vs. Pearlie Ann F. enunciated in the 2007 case of King
Alcaraz. Thus, it is now required that of Kings Transport, Inc v. Mamac,
in addition to compliance with th the following requirements should
statutory due process, the employer be complied with in just cause
should still comply with the due termination:
process procedure prescribed in its (1) First written notice.

The first written notice to be in order to enable him to
served o the employee should: intelligently prepare his
a. Contain the specific explanation and defenses.
causes or grounds for A general description of
termination against him; the charge will not suffice.
b. Contain a directive that d. Specifically mention which
the employee is given the company rules, if any, are
opportunity to submit his violated and/or which
written explanation within among the grounds under
reasonable period of FIVE Article 282 is being
CALENDAR DAYS from charged against the
receipt of the notice: employee.
i. to enable him to
prepare adequately (2) Hearing required
for his defense; After serving the first notice,
ii. to study the the employer should schedule
accusation against and conduct a hearing or
him; conference wherein the employee
iii. to consult a union will be given the opportunity to:
official or lawyer; a. explain and clarify his
iv. to gather data and defenses to the charge/s
evidence; and against him;
v. to decide on the b. present evidence in support of
defenses he will raise his defenses; and
against the complaint. c. rebut the evidence presented
c. Contain a detailed against him by the
narration of the facts and management.
circumstances that will
serve as basis for the During the hearing or conference, the
charge against the employee is given the chance to
employee. This is required defend himself personally, with the

assistance of a representative or a. all circumstances involving the
counsel of his choice. Moreover, this charge/s against the employee
conference or hearing could be used have been considered; and
by the parties as an opportunity to b. grounds have been established
come to an amicable settlement. to justify the severance of his
employment.
NOTE: As earlier discussed, per the
2011 What is the PEREZ doctrine on
hearing?
Lopez doctrine, which is the The 2009 Perez doctrine
prevailing rule, the right to counsel is enunciates the new guiding principle
neither indispensable nor on the hearing requirement. It has
mandatory. It becomes mandatory interpreted the term "ample
only in two (2) situations: opportunity to be heard" as
a. When the employee himself follows:
requests for counsel; or a. "Ample opportunity to be
b. When he manifests that he wants heard" means any meaningful
a formal hearing on the charges opportunity (verbal or written)
against him, in which case, he given to the employee to answer
should be assisted by counsel. the charges against him and
(see Lopez vs. Alturas Group of submit evidence in support of his
Companies). defense, whether in hearing,
conference or some other fair,
(3) Second written notice just and reasonable way.
After determining that termination of b. A formal hearing or
employment is justified, the conference is no longer
employer shall serve the employees mandatory. It becomes
a written notice of termination mandatory only under the
indicating that: following circumstances:
i. When requested by the
employee in writing; or

ii. When substantial evidentiary termination specifying the
disputes exist; or ground/s therefor and the
iii. When a company rule or undertaking to pay the
practice requires it; or separation pay required under
iv. When similar circumstances Article 283 of the Labor Code.
justify it. For obvious reasons, hearing is not
c. the "ample opportunity to be required. However, as earlier
heard" standard in the Labor discussed above, the foregoing due
Code prevails over the "hearing process is not applicable to the
or conference" requirement in its authorized cause of disease as held
Implementing Rules and in Deoferio and Fuji which held that
Regulations. The Perez doctrine just cause due process is the one
is now the prevailing rule as that should be followed.
shown by a catena of cases
which cited it after its Are the twin-notice requirement
promulgation. and hearing applicable to an
abandonment case which is a just
Are the twin-notice requirement cause to terminate employment?
and hearing applicable to No. Although considered as a just
authorized cause termination? cause to terminate employment, the
No. Due process in authorized due process requirement is different.
cause termination is deemed No hearing is required (since the
complied with upon the separate employee has already abandoned his
and simultaneous service of a job) but the following notices should
written notice of the intended be complied with:
termination to both: a. First notice asking the employee
a. the employee to be terminated; to explain why he should not be
and declared as having abandoned
b. the appropriate DOLE Regional his job; and
Office, at least one (1) month b. Second notice informing him of
before the intended date of the employer's decision to

dismiss him on the ground of  Termination of project, seasonal,
abandonment. casual or fixed-term employment.
 Termination of probationary
What are some notable principles employment on the ground of
on the hearing requirement? failure of the probationary
● If employee does not answer, employee to qualify as a regular
hearing should still proceed. employee in accordance with
● Outright termination violates due reasonable standards made
process. known to him at the start of the
● Investigation still required even if employment.
the incident was witnessed by  Termination due to abandonment
many. of work.
● Meeting, dialogue, consultation or  Termination due to authorized
interview is not the hearing causes under Article 283
required by law. It may not be a (installation of labor-saving device,
substitute for the actual holding redundancy, retrenchment or
of a hearing. closure of business or cessation of
● Prior consultation with union is not operations). In such cases, there
part of the due process are no allegations which the
requirement. employees should refute and
● Cross-examination or defend themselves from.
confrontation of witnesses is not  Termination due to disease under
necessary in company Article 284.
investigations.  Termination by the employee
● Co-conspirator's confession is not (resignation) under Article 285.
sufficient to merit dismissal.
 Termination after 6 months of
bona-fide suspension of operation
What are the instances where
under Article 286. For purposes of
hearing is not required?
satisfying due process, what is
Hearing is not required in the
required is simply that the notices
following cases:
provided under Article 283 be

served to both the affected 2. The dismissal was without a just
employees and the DOLE at least or authorized cause but due
one (1) month before the process was observed- This
termination becomes effective. termination is Illegal.
 Termination due to retirement 3. The dismissal was without a just
under Article 287. or authorized cause and due
 Termination due to closure or process was not observed- This
stoppage of work by government termination is Illegal.
authorities when non-compliance 4. The dismissal was for a just or
with the law or implementing rules authorized cause but due process
and regulations poses grave and was not observed- This
imminent danger to the health and termination is Legal.
safety of workers in the workplace. 5. The dismissal was for a non-
 Termination of employee who has existent cause- This termination is
admitted his guilt for the offense Illegal.
charged. 6. The dismissal was not supported
by any evidence of termination-
What are the seven standard This termination is neither legal
situations in termination cases? nor illegal as there is no
The rules on termination of dismissal to speak of.
employment in the Labor Code and Reinstatement s ordered not as a
pertinent jurisprudence are relief for illegal dismissal but on
applicable to seven different equitable ground.
situations, namely: 7. The dismissal was brought about
1. The dismissal was for a just by the implementation of a law.
cause under Article 282, for an The termination is Legal.
authorized cause under Article
283, or for health reasons under Termination by Employee
Article 284, and due process was (Resignation)
observed- This termination is Resignation vs. Constructive
Legal. Dismissal

Resignation similar requirement of service of
What are the two (2) kinds of prior written notice, hence, there
resignation under the Labor Code is no adverse consequence for
(Article 300 [285])? such failure to the involuntarily
a. Voluntary resignation- without resigning employee.
just cause; or c. On whether there is illegal or
b. Involuntary resignation - with constructive dismissal.
just cause. There can be no constructive
dismissal in the case of Voluntary
What are the distinctions Resignation, the same having
between the two? been voluntarily and freely
a. On service of written notice tendered by the employee;
(resignation letter). however, it is different in the of In
Voluntary Resignation requires Involuntary Resignation, since it
the submission of a written always amounts to constructive
resignation letter at least thirty dismissal.
(30) days before its effectivity
date; while in Involuntary What are the requisites for
Resignation, no such written resignation WITHOUT JUST
resignation letter is required CAUSE?
since it is being made by the a. The resigning employee should
employee for just cause. tender a written (not verbal)
b. On the consequence of failure notice of the termination
to serve a written notice. (commonly known as "resignation
In Voluntary Resignation, the letter");
failure to serve the written b. Service of such notice to the
resignation letter within the said employer at least one (1) month
30-day period would make the in advance; and
resigning employee liable for c. (c)Written acceptance by the
damages; while in Involuntary employer of the resignation.
Resignation, since there is no

What is involuntary resignation practically forcing the employee to
(WITH JUST CAUSE)? resign. It is therefore a form of
The following are the just causes involuntary resignation.
that may justify the termination by
employee of the employment Constructive Dismissal
relationship without need to comply When is there constructive
with the 30-dayprior written notice dismissal?
requirement: Constructive dismissal contemplates
a. Serious insult by the employer or any of the following situations:
his representative on the honor a. An involuntary resignation
and person of the employee; resorted to when continued
b. Inhuman and unbearable employment is rendered
treatment accorded the employee impossible, unreasonable or
by the employer or his unlikely;
representative; b. A demotion in rank and/or a
c. Commission of a crime or diminution in pay; or
offense by the employer or his c. A clear discrimination,
representative against the insensibility or disdain by an
person of the employee or any of employer which becomes
the immediate members of his unbearable to the employee that
family; and it could foreclose any choice by
d. Other causes analogous to any him except to forego his
of the foregoing. continued employment.
What is Forced Resignation? What is the test of constructive

The employee is made to do or dismissal?
perform an involuntary act, that is, The test of constructive dismissal is
the submission or tender of whether a reasonable person in the
resignation letter meant to validate employee's position would have felt
the action of the employer in compelled to give up his position
inveigling, luring or influencing or under the circumstances. It is an act

amounting to dismissal but made to suspension which is
appear as if it were not. In fact, the tantamount to dismissal.
employee who is constructively  Imposing indefinite
dismissed may be allowed to keep preventive suspension without
on coming to work. Constructive actually conducting any
dismissal is, therefore, a dismissal in investigation.
disguise. The law recognizes and  Changing the employee's
resolves this situation in favor of the status from regular to casual
employees in order to protect their constitutes constructive dismissal.
rights and interests from the  Preventing the employee from
coercive acts of the employer. reporting for work by ordering
the guards not to let her in.
What are examples of constructive This is a clear notice of
dismissal or forced resignation? dismissal.
 Denying to the workers entry
to their work area and placing What is the distinction between
them on shifts "not by weeks but illegal dismissal and constructive
almost by month" by reducing dismissal?
their workweek to three days. In illegal dismissal, the employer
 Barring the employees from openly shows his intention to dismiss
entering the premises whenever the employee. In fact, the employer,
they would report for work in in compliance with due process, asks
the morning without any the employee to explain why he
justifiable reason, and they should not be dismissed for
were made to wait for a committing a wrongful act and he is
certain employee who would given due process prior to
arrive in the office at around terminating him.
noon, after they had waited for In contrast, in constructive
a long time and had left. dismissal, he employer will never
 Sending to an employee a indicate that he is terminating the
notice of indefinite employee. He will even allow the

employee to report to his work every What are some relevant
day. But he will do any of the three principles in preventive
acts mentioned above that indicates suspension?
his intention to get rid of the  Preventive suspension is not a
services of the employee. This is the penalty.
reason why it is called "dismissal This is different from PUNITIVE
in disguise." SUSPENSION which is imposed
as a penalty less harsh than
Preventive Suspension dismissal.
When is preventive suspension  Preventive suspension, by itself,
proper to be imposed? does not signify that the company
Preventive suspension may be has already adjudged the
legally imposed against an errant employee guilty of the charges for
employee only while he is which she was asked to answer
undergoing an investigation for and explain.
certain serious offenses.  Preventive suspension is neither
Consequently, its purpose is to equivalent nor tantamount to
prevent him from causing harm or dismissal.
injury to the company as well as to  If the basis of the preventive
his fellow employees. It is justified suspension is the employee's
only in cases where the employee's absences and tardiness, the
continued presence on the company imposition of preventive
premises during the investigation suspension on him is not justified
poses a serious and imminent threat as his presence in the company
to the life or property of the premises does not pose any
employer or of the employee's co- such serious or imminent threat to
workers. Without this threat, the life or property of the
preventive suspension is not proper. employer or of the employee's co-
workers simply "by incurring
repeated absences and
tardiness."

 Preventive suspension does not employee's administrative case.
mean that due process may be The period of thirty (30) days may
disregarded. only be extended if the employer
 Preventive suspension should failed to complete the hearing or
only be for a maximum period of investigation within said period
thirty (30) days. After the lapse of due to justifiable grounds. No
the 30-day period, the employer is extension thereof can be made
required to reinstate the worker based on whimsical, capricious or
to his former position or to a unreasonable grounds.
substantially equivalent position.  Preventive suspension lasting
 During the 30-day preventive longer than 30 days, without the
suspension, the worker is not benefit of valid extension,
entitled to his wages and other amounts to constructive dismissal.
benefits. However, if the employer  Indefinite preventive suspension
decides, for a justifiable reason, to amounts to constructive dismissal.
extend the period of preventive
suspension beyond said 30-day Reliefs for Illegal Dismissal
period, he is obliged to pay the What are the reliefs under the
wages and other benefits due the Labor Code, particularly under
worker during said period of Article 279 thereof?
extension. In such a case, the Under this article, an illegally
worker is not bound to reimburse dismissed employee is entitled to
the amount paid to him during the the following relief:
extension if the employer a. Reinstatement without loss of
decides to dismiss him after the seniority rights and other
completion of the investigation privileges;
 Extension of period must be b. Full backwages, inclusive of
justified. During the 30-dayperiod regular allowances; and
of preventive suspension, the c. Other benefits or their monetary
employer is expected to conduct equivalent.
and finish the investigation of the

What are the other reliefs that are f. Imposition of legal interest on
not provided in the Labor Code separation pay, backwages and
but are granted in illegal other monetary awards
dismissal cases?
The following reliefs that are TITLE II – RETIREMENT
awarded in illegal dismissal cases FROM THE SERVICE
are missing in Article 279: Article 287. Retirement. Any employee
a. Award of separation pay in lieu may be retired upon reaching the
of reinstatement. retirement age established in the
b. Award of penalty in the form of collective bargaining agreement or other
nominal damages in case of applicable employment contract.
termination due to just or In case of retirement, the employee
authorized cause but without shall be entitled to receive such

retirement benefits as he may have
observance of procedural due
earned under existing laws and any
process.
collective bargaining agreement and
c. Reliefs to illegally dismissed
other agreements: Provided, however,
employee whose employment is
That an employee’s retirement benefits
for a fixed period. The proper under any collective bargaining and
relief is only the payment of the other agreements shall not be less than
employee's salaries those provided therein.
corresponding to the unexpired In the absence of a retirement
portion of the employment plan or agreement providing for
contract. retirement benefits of employees in the
d. Award of damages and establishment, an employee upon

reaching the age of sixty (60) years or
attorney's fees.
more, but not beyond sixty-five (65)
e. Award for financial assistance in
years which is hereby declared the
cases where the employee's
compulsory retirement age, who has
dismissal is declared legal but
served at least five (5) years in the said
because of long years of service, establishment, may retire and shall be
and other considerations, entitled to retirement pay equivalent to
financial assistance is awarded. at least one-half (1/2) month salary for

every year of service, a fraction of at long as it has the employees’
least six (6) months being considered as consent. Stated conversely,
one whole year. employees are free to accept the
Unless the parties provide for
employer's offer to lower the
broader inclusions, the term ‘one-half
retirement age if they feel they can
(1/2) month salary’ shall mean fifteen
get a better deal with the retirement
(15) days plus one-twelfth (1/12) of the
plan presented by the employer.
13th month pay and the cash equivalent
of not more than five (5) days of service
[Jaculbe v. Silliman University, G.R.
incentive leaves. No. 156934 (2007)]

Retail, service and agricultural
establishments or operations employing Retroactive Effect
not more than ten (10) employees or The Court imposed two (2) essential
workers are exempted from the requisites in order that RA 7641 may
coverage of this provision. be given retroactive effect:
Violation of this provision is
1. the claimant for retirement
hereby declared unlawful and subject to
benefits was still in the employ of
the penal provisions under Article 288 of
the employer at the time the
this Code.
statute took effect; and
2. the claimant had complied with
Notes:
the requirements for eligibility for
RETIREMENT PAY [RA 7641 (The
such retirement benefits under
Retirement Pay Law)]
the statute. [Universal Robina
Sugar Milling Corp. v. Caballeda,
Retirement - the result of a bilateral
G.R. No. 156644 (2008)]
act of the parties, a voluntary
agreement between the employer
A. ELIGIBILITY
and the employee whereby the latter,
General Rule: All employees in the
after reaching a certain age agrees
private sector, regardless of their
to sever his or her employment with
position, designation, or status, and
the former.
irrespective of the method by which
An employer is free to impose a
retirement age less than 65 for as

their wages are paid [Sec. 1, IRR, deserving, is denied retirement
RA 7641] benefits by the nefarious scheme of
Exceptions: employers in not providing for
1. Employees covered by the Civil retirement benefits for their
Service Law; employees. The reason for the
2. Domestic helpers and persons in second situation is expressed in the
the personal service of another, Latin maxim pacta private juri public
and derogare non possunt. Private
3. Employees in retail, service and contracts cannot derogate from the
agricultural establishments or public law. [Oxales v. Unilab, G.R.
operations regularly employing No. 152991 (2008)]
not more than ten employees
[Sec. 2, IRR, RA 7641] Age of retirement
In the absence of a retirement plan
Exclusions from coverage or agreement providing for
RA 7641 only applies in a situation retirement benefits of employees in
where: the establishment, an employee
1. there is no collective bargaining upon reaching the age of sixty (60)
agreement or other applicable years or more, but not beyond sixty-
employment contract providing five (65) years which is hereby
for retirement benefits for an declared the compulsory retirement
employee; OR age (and have served the
2. there is a collective bargaining establishment for at least 5 years).
agreement or other applicable [Sec. 1, IRR, RA 7641]
employment contract providing
for retirement benefits for an Optional retirement – in the
employee, but it is below the absence of a retirement plan or other
requirements set for by law. applicable agreement providing for
The reason for the first situation is to retirement benefits of EEs in an
prevent the absurd situation where establishment, an EE may retire
an employee, who is otherwise upon reaching the age of 60 or more

if he has served for at least 5 years 3. One-twelfth (1/12) of the 13th
in said establishment. month pay. (1/12 x 365/12 =
0.083 x 30.41 = 2.52)
Compulsory retirement – in the Thus, “one-half month salary” is
absence of a retirement plan or other equivalent to 22.5 days. [Capitol
applicable agreement providing for Wireless, Inc. v. Sec. Confessor,
retirement benefits of EEs in an G.R. No. 117174 (1996); Reyes v.
establishment, an EE shall be retired NLRC, G.R. No. 160233 (2007)]
at the age of 65 years. [Sec. 4, IRR, Other benefits may be
RA 7641] included in the computation of the
Note: For surface mine workers, the retirement pay upon agreement of
optional retirement age is 50, while the ER and the EE or if provided in
the mandatory retirement age is now the CBA.
60. [Sec. 2, RA 10757]
Retirement pay under RA 7641
B. AMOUNT OF RETIREMENT vis-à-vis retirement benefits under
PAY SSS and GSIS laws
The minimum retirement pay shall be RA 7641 mandates payment of
equivalent to one-half (1/2) month retirement benefits. All private sector
salary for every year of service, a employees regardless of their
fraction of at least six (6) months position, designation or status and
being considered as one whole year. irrespective of the method by which
For the purpose of computing their wages are paid are entitled to
retirement pay, “onehalf month retirement benefits upon compulsory
salary” shall include all of the retirement at the age of sixty-five
following: (65) or upon optional retirement at
1. Fifteen (15) days salary based on sixty (60) or more but not 65. The
the latest salary rate; minimum retirement pay due
2. Cash equivalent of five (5) days covered employees shall be
of service incentive leave; equivalent to one-half month salary
for every year of service, a fraction of

at least six (6) months being retirement benefits’ fund. If such total
considered as one whole year. The portion from the ER is less, the ER
benefits under this law are other than shall pay the deficiency. [Sec. 3.3,
those granted by the SSS or the IRR]
GSIS. [Secs. 1 & 2, RA 7641]
C. RETIREMENT BENEFITS OF
Retirement Benefits under a CBA WORKERS WHO ARE PAID BY
or Applicable Contract RESULTS
Any EE may retire or be retired by For covered workers who are paid by
his/her ER upon reaching the age result and do not have a fixed
established in the CBA or other monthly salary rate, the basis for the
applicable agreement/contract and determination of the salary for 15
shall receive the days shall be their average daily
retirement benefits granted therein; salary (ADS).
provided, however, that such
retirement benefits shall not be less The ADS is derived by dividing
than the retirement pay required the total salary or earning for the last
under RA 7641, and provided further 12 months reckoned from the date of
that if such retirement benefits under retirement by the number of actual
the agreement are less, the ER shall working days in that particular
pay the difference. [Art. 302; Sec. period, provided that the
3.2, IRR] determination of rates of payment by
Where both the ER and the results are in accordance with
EE contribute to a retirement fund established regulations.
pursuant to the applicable For covered workers who are
agreement, the ER’s total paid by result and do not have a
contributions and the accrued fixed monthly salary rate, the basis
interest thereof should not be less for the determination of the salary for
than the total retirement benefits to 15 days shall be their average daily
which the EE would have been salary (ADS).The ADS is derived by
entitled had there been no such dividing the total salary or earning for

the last 12 months reckoned from Statutory Monetary Benefits, 2018
the date of retirement by the number ed.]
of actual working days in that
particular period, provided that the BOOK SEVEN –
determination of rates of payment by TRANSITORY AND FINAL
results are in accordance with
PROVISIONS
established regulations.
TITLE I – PENAL
D. RETIREMENT BENEFIT OF
PROVISIONS AND
PARTTIME WORKERS LIABILITIES
Part-time workers are also entitled to Article 288. Penalties. Except as
retirement pay of “one-half month otherwise provided in this Code, or

unless the acts complained of hinge on
salary” for every year of service
a question of interpretation or
under RA 7641 after satisfying the
implementation of ambiguous provisions
following conditions precedent for
of an existing collective bargaining
optional retirement:
agreement, any violation of the
a. There’s no retirement plan provisions of this Code declared to be
between the ER and the EE; unlawful or penal in nature shall be
and, punished with a fine of not less than
a. The EE should have One Thousand Pesos (P1,000.00) nor
reached the age of 60 years, more than Ten Thousand Pesos
and should have rendered at (P10,000.00) or imprisonment of not
least 5 years of service with less than three months nor more than
three years, or both such fine and
the ER.
imprisonment at the discretion of the
Applying the foregoing principle, the
court.
components of retirement benefit of
In addition to such penalty, any
part-time workers may likewise be
alien found guilty shall be summarily
computed at least in proportion to deported upon completion of service of
the salary and related benefits due sentence.
them. [DOLE Handbook on Workers’ Any provision of law to the
contrary notwithstanding, any criminal

offense punished in this Code, shall be should be filed within 3 years
under the concurrent jurisdiction of the from the time the cause of
Municipal or City Courts and the Courts action accrued, otherwise, they
of First Instance. (As amended by
will be forever barred by
Section 3, Batas Pambansa Bilang 70)
prescription. (Art. 291, Labor
Code)
Article 289. Who are liable when
committed by other than natural
person. If the offense is committed by a
2. Illegal dismissal
corporation, trust, firm, partnership,  An action for reinstatement

association or any other entity, the prescribes in 4 years. Reason:
penalty shall be imposed upon the guilty action is predicated upon an
officer or officers of such corporation, injury to the rights of the plaintiff
trust, firm, partnership, association or which under Art 1146 of the
entity.
Civil Code must be brought
within 4 years.
TITLE II – PRESCRIPTION OF
 The 4-year prescriptive period
OFFENSES AND CLAIMS should be reckoned from the
1. Money Claims date the employee was unjustly
 All money claims arising from dismissed. The filing of a
employer-employee relations criminal case against the
prescribe in 3 years from the employee will not interrupt the
time the cause of action running of the prescriptive
accrued. period for filing the action for
 Money claims recoverable reinstatement because the right
under a Collective Bargaining to file an action for illegal
Agreement, employment dismissal is not dependent
contract or company policy, fall upon the outcome of the
within the coverage of Art 291 criminal case. (Art. 291, Labor
of the labor code because they Code)
arise from employer-employee
relationship and therefore, 3. Unfair labor practice

 All unfair labor practices arising act to establish periods of
from Book V shall be filed with prescriptions for violations
the appropriate agency within penalized by special acts and
one year from accrual of such municipal ordinances and to
unfair labor practice; otherwise, provide when prescription shall
they shall be forever barred. begin to run, should be applied.
(Art. 290, Labor Code) (Art. 290, Labor Code)
 It would seem that the one-year
will commence from the accrual 5. Illegal recruitment
of the unfair labor practice. This  Illegal recruitment under Art. 38
is not the case. The one-year of the Labor code (which is still
prescriptive period for the in force insofar as recruitment
criminal aspect of ULP will for local employment is
begin to run only when a final concerned), prescribes in 3
judgment is rendered in the years, pursuant to the
administrative proceedings. provisions of Art. 290 of the
This is so because the Labor Code
prescriptive period does not run  Illegal Recruitment under RA
during the pendency of the 8042, otherwise known as
administrative proceedings. Migrant Workers and Overseas
This is expressly provided for in Filipinos Act of 1995” which
Art. 247 of the Labor Code. specifically applies to overseas
Filipino workers, prescribes as
4. Offenses under the Labor Code follows:
 Offenses penalized under the o simple illegal recruitment - 5
labor code prescribe in 3 years. years
The labor code is silent as to o illegal recruitment involving
when the three-year period economic sabotage, i.e.
should be reckoned. Such When committed by a
being the case, Sec. 2 of Act syndicate or in a large scale-
3326, as amended, entitled “An 20 years

Article 296. Termination of the
workmen’s compensation program.
The Bureau of Workmen’s
TITLE III – TRANSISTORY
Compensation, Workmen’s
AND FINAL PROVISIONS
Compensation Commission, and
Article 293. Application of law Workmen’s Compensation Units in the
enacted prior to this Code. All actions regional offices of the Department of
or claims accruing prior to the effectivity Labor shall continue to exercise the
of this Code shall be determined in functions and the respective jurisdictions
accordance with the laws in force at the over workmen’s compensation cases
time of their accrual. vested upon them by Act No. 3428, as
amended, otherwise known as the
Article 294. Secretary of Labor to Workmen’s Compensation Act until
initiate integration of maternity leave March 31, 1976. Likewise, the term of
benefits. Within six (6) months after this office of incumbent members of the
Code takes effect, the Secretary of Workmen’s Compensation Commission,
Labor shall initiate such measures as including its Chairman and any
may be necessary for the integration of commissioner deemed retired as of
maternity leave benefits into the Social December 31, 1975, as well as the
Security System, in the case of private present employees and officials of the
employment, and the Government Bureau of Workmen’s Compensation,
Service Insurance System, in the case Workmen’s Compensation Commission
of public employment. and the Workmen’s Compensation Units
shall continue up to that date.
Article 295. Funding of the Overseas Thereafter, said offices shall be
Employment Development Board and considered abolished and all officials
the National Seamen’s Board referred to and personnel thereof shall be
in Articles 17 and 20, respectively, of transferred to and mandatorily absorbed
this Code shall initially be funded out of by the Department of Labor, subject to
the unprogrammed fund of the Presidential Decree No. 6, Letters of
Department of Labor and the National Instructions Nos. 14 and 14-A and the
Manpower and Youth Council. Civil Service Law and rules.
Such amount as may be necessary to
cover the operational expenses of the

Bureau of Workmen’s Compensation personnel as may be necessary, are
and the Workmen’s Compensation hereby transferred to the Commission
Units, including the salaries of and to its regional branches. All
incumbent personnel for the period up to unexpended funds, properties and
March 31, 1976 shall be appropriated equipment of the National Labor
from the unprogrammed funds of the Relations Commission established
Department of Labor. under Presidential Decree No. 21 are
transferred to the Bureau of Labor
Article 297. Continuation of Relations. Personnel not absorbed by or
insurance policies and indemnity transferred to the Commission shall
bonds. All workmen’s compensation enjoy benefits granted under existing
insurance policies and indemnity bonds laws.
for self-insured employers existing upon
the effectivity of this Code shall remain Article 299. Disposition of pending
in force and effect until the expiration cases. All cases pending before the
dates of such policies or the lapse of the Court of Industrial Relations and the
period of such bonds, as the case may National Labor Relations Commission
be, but in no case beyond December established under Presidential Decree
31, 1974. Claims may be filed against No. 21 on the date of effectivity of this
the insurance carriers and/or self- Code shall be transferred to and
insured employers for causes of action processed by the corresponding labor
which accrued during the existence of relations divisions or the National Labor
said policies or authority to self-insure. Relations Commission created under
this Code having cognizance of the
Article 298. Abolition of the Court of same in accordance with the procedure
Industrial Relations and the National laid down herein and its implementing
Labor Relations Commission. The rules and regulations. Cases on labor
Court of Industrial Relations and the relations on appeal with the Secretary of
National Labor Relations Commission Labor or the Office of the President of
established under Presidential Decree the Philippines as of the date of
No. 21 are hereby abolished. All effectivity of this Code shall remain
unexpended funds, properties, under their respective jurisdictions and
equipment and records of the Court of shall be decided in accordance with the
Industrial Relations, and such of its

rules and regulations in force at the time remainder of this code, or the
of appeal. application of such provision or part to
All workmen’s compensation cases other persons or circumstances, shall
pending before the Workmen’s not be affected thereby.
Compensation Units in the regional
offices of the Department of Labor and Article 302. Repealing clause. All labor
those pending before the Workmen’s laws not adopted as part of this Code
Compensation Commission as of March either directly or by reference are
31, 1975, shall be processed and hereby repealed. All provisions of
adjudicated in accordance with the law, existing laws, orders, decrees, rules and
rules and procedure existing prior to the regulations inconsistent herewith are
effectivity of the Employees likewise repealed.
Compensation and State Insurance Done in the City of Manila, this 1st day
Fund. of May in the year of our Lord, nineteen
hundred and seventy four.
Article 300. Personnel whose
services are terminated. Personnel of
PART II. SOCIAL
agencies or any of their subordinate
units whose services are terminated as LEGISLATION
a result of the implementation of this
Code shall enjoy the rights and SOCIAL SECURITY LAW (RA
protection provided in Sections 5 and 6
8282)
of Republic Act numbered fifty-four
hundred and thirty five and such other
REPUBLIC ACT NO. 8282: SOCIAL
pertinent laws, rules and regulations. In SECURITY ACT OF 1997

any case, no lay-off shall be effected “AN ACT FURTHER
until funds to cover the gratuity and/or STRENGTHENING THE SOCIAL
retirement benefits of those laid off are SECURITY SYSTEM THEREBY
duly certified as available. AMENDING FOR THIS PURPOSE
REPUBLIC ACT NO. 1161, AS
Article 301. Separability provisions. If
AMENDED, OTHERWISE KNOWN
any provision or part of this Code, or the
AS “SOCIAL SECURITY LAW”
application thereof to any person or
circumstance, is held invalid, the

I. COVERAGE AND EXCLUSIONS 4. SSL is NOT a Law on
A. PRELIMINARIES Succession
1. Rationale (Sec. 2, RA 8282) It is not the heirs of the employee but
To establish, develop, promote, and the designated beneficiaries who are
perfect a sound and viable tax- to receive the social security
exempt social security service benefits. It is only when the
suitable to the needs of the people beneficiary is the estate, or when
throughout the Philippines, which there is no designated beneficiary or
shall promote social justice and if the designation of beneficiary is
provide meaningful protection to void, that the SSS is required to pay
members and their beneficiaries the employee’s heirs.
against the hazards of disability, Q: Is SSL part of taxation system?
sickness, maternity, old age, death, A: NO, because it is not intended for
and other contingencies resulting in raising revenues but for the
loss of income or financial burden. promotion of general welfare. (Cons
Estate v. SSS, 132 SCRA 108)
2. Validity
The enactment of SSS law is a 5. Social Security System
legitimate exercise of the police It is the implementing arm of
power. It affords protection to labor the SSA. It is a corporate body with a
and is in full accord with the personality separate and distinct
constitutional mandate on the from the Government, directed and
promotion of social justice. (Roman controlled by the Social Security
Catholic Archbishop of Manila vs. Commission.
SSS, 1 SCRA 10) Q: May SSS be sued? May it sue?
A: YES and YES, based on specific
3. Construction of SSL provision in its organic act. These
The provisions of this act are to be words embrace all civil process
liberally construed in favor of those incident to a legal action. (SSS v.
seeking its benefits. CA, 120 SCRA 707)

Q: Are the funds of SSS
considered public fund? 2. Employee – Any person who:
A: NO, the funds belong to the a. Performs services for an
members and are merely in trust by employer which either or both
the government. Thus the inclusion mental and physical efforts
of religious organizations under the are used
coverage of the Social Security Law b. Who receives compensation
does not violate the constitutional for such services
prohibition against the application of c. There is an employer-
public funds for the use, benefit or employee relationship (Sec.
support of any priest who may be 8(d), R.A. 8282).
employed by the church. (Roman Well-settled is the rule that the
Catholic of Manila v. SSS, 1 SCRA mandatory coverage of RA 1161, as
10) amended, is premised on the
existence of an employer-employee
relationship (Co v. People, G.R. No.
B. DEFINITION OF TERMS 160265, July 13, 2009).
1. Employer -Any person, natural or
juridical, domestic, or foreign, who 3. Contingency – The retirement,
carries into the Philippines any trade, death, disability, injury or sickness
business, industry, undertaking or and maternity of the member
activity of any kind and uses the (Sec.8(l), RA 8282).
services of another person who is
under his orders as regards the 4. Monthly pension – The monthly
employment pension shall be the highest of the
XPN: The Government and any of following amounts:
its political subdivisions, branches, or a. The sum of the following:
instrumentalities, including i. Php 300.00; plus
corporations owned or controlled by ii. 20% of the average
the Government (Sec 8(c), R.A. monthly salary credit;
8282). plus

iii. 2% of the average b. Recovery of the disabled
monthly salary credit member from his permanent
for each credited year total disability
of service in excess of c. Failure to present himself for
10 years; or examination at least once a
b. 40% of the average monthly year upon notice by the SSS
salary credit; or [RA 8282, Sec. 13-A (b)].
c. Php 1,000.00, provided that
the monthly pension shall in 5. Average monthly credit – The
no case be paid for an result obtained by:
aggregate amount of less a. Dividing the sum of the last 60
than sixty (60) months (Sec. monthly salary credits
12 (a), R.A. 8282). immediately preceding the
semester of contingency by
Minimum Pension 60; or
a. Php 2,200.00 - members with b. Dividing the sum of all the
at least 10 credited years of monthly salary credits paid
service (P1,000 increase prior to the semester of
effective January 2017 as per contingency by the number of
a memorandum order issued monthly contributions paid in
by the Office of the President) the same period, whichever is
b. Php 2, 400.00 for those greater.
with 20 credited years of
service (R.A. 8282, Sec. Provided, that the injury or
12(b)). sickness which caused the
NOTE: The monthly dependents’ disability shall be deemed as
pension shall be suspended: the permanent disability for
a. Upon the reemployment or the purpose of computing the
resumption of self- average monthly salary credit
employment; (Sec. 8(m), RA 8282).

6. Average Daily Salary credit – legal processes and liens (SSS vs.
The result obtained by dividing the Davac, et. al., G.R. No.21642, July
sum of the 6 highest monthly salary 30, 1966)
credits in the 12-month period
immediately preceding the semester
of contingency by 180 (Sec. 8(n), RA C. COVERAGE
8282). 1. Compulsory Coverage
a. All employers (Sec. 9);
7. Compensation – all actual b. All Employees not over 60
remuneration for employment, years of age and their
including the mandated cost of employers (Sec 9);
living allowance, as well as the c. Domestic helpers whose
cash value of any remuneration income is not less than P
paid in any medium other than 1000/month and not over 60
cash except that part of the years of age and their
remuneration received during the employers;
month in excess of the maximum The minimum wage of
salary credit as provided under domestic workers is now
section eighteen of this Act [Sec. P1,500 to P2,500 pursuant to
8(f), RA 8282]. Section 24 of RA 10361 or
Q: Are SSS benefits included in Batas Kasambahay Law.
the Estate of a member? Per RA 10361, a
A: NO, benefits receivable under domestic worker who has
the SSS Law are in the nature of rendered at least one (1)
a special privilege or an month of service shall be
arrangement secured by the law covered by the Social
pursuant to the policy of the State Security System (SSS), the
to provide social security to the Philippine Health Insurance
workingman. The benefits are Corporation (PhilHealth), and
specifically declared not the Home Development
transferable and exempt from tax, Mutual Fund or Pag-IBIG,

and shall be entitled to all the employers and the
the benefits in accordance employees concerned;
with the pertinent provisions and
provided by law. iv. The private benefit plan
Limitations: which the employers
i. Any benefit earned by the shall continue for his
employees under private employees shall remain
benefit plans existing at under the employers
the time of the approval management and control
of the Act shall not be unless there is an existing
discontinued, reduced, or agreement to the contrary
otherwise impaired; Q: Can the parties still
ii. Existing private plans shall agree to a private benefit
be integrated with the SSS plan providing for
but if the employer under greater benefits?
such plan is contributing A: Yes. Nothing in this
more than what is required Act shall be construed as
by this Act, he shall pay to a limitation on the right of
the SSS the amount employers and employees
required to him, and he to agree on and adopt
shall continue with his benefits which are over
contributions less the and above those provided
amount paid to SSS; under this Act (Sec. 9, RA
iii. Any changes, 8282).
adjustments, d. All self-employed –
modifications, eliminations, considered both an employer
or improvements in the and employee (Sec. 8, RA
benefits of the remaining 8282)
private plan after the e. All self-employed
integration shall be subject professionals;
to agreements between

f. Partners and single
proprietors of business; 2. Voluntary Coverage
g. Actors and actresses, a. Spouses who devote full time
directors, scriptwriters, and to managing the household
news correspondents who do and family affairs.
not fall within the definition of XPN: They are also engaged
the term “Employee”; in other vocation or
h. Professional athletes, employment which is subject
coaches, trainers, and to mandatory coverage (Sec.
jockeys; and 9(b), R.A. 8282);
i. Individual farmers and b. Filipinos recruited by foreign-
fisherman (Sec. 9-A, R.A. based Employers for
8282) employment abroad (Sec.
9(c), R.A. 8282);
Q: What if both a self-employee c. Employee separated from
and regular employee, how to employment to maintain his
compute contributions? right to full benefits; and
A: If a person is BOTH self- d. Self-employed who realizes
employed and a regular employee, no income for a certain month
he shall pay the contributions under
BOTH status and coverage. But, 3. By Agreement
when combined contributions paid to Any foreign government,
SSS as a regular employee and as a international organization, or their
self-employed member exceed the wholly-owned instrumentality
maximum contributions based on the employing workers in the Philippines.
highest monthly salary credit XPN: Those already covered by
prevailing at the time of their respective civil service
simultaneous coverage, the excess retirement systems.
shall be REFUNDED accordingly to
the member. The excess k certain Effectivity of Compulsory
month. Coverage

1. For employers: on the first day Obligations of Employers under
of his operation SSL
2. For employees: on the first day 1. to report his employees for
of his employment coverage (Sec. 24, RA 8282)
3. For the self-employed: upon his 2. to deduct from the employee’s
registration with SSS. (Sec. 10, monthly salary the employee’s
RA 8282) contribution (Sec. 18, RA 8282)
3. to pay the employer’s contribution
Q: Is securing an SSS Number (Sec. 19, RA 8282)
contemplate membership? 4. to remit the contributions to the
A: No, the mere fact that a person SSS within the first ten (10) days
has obtained an SSS number does of each month. (Sec. 22, RA
not automatically make him an SSS 8282)
member. He will be considered as a
member only when he has been Liabilities of Employer for Failing
reported for SSS coverage and has to Report an Employee for SSS
paid at least one (1) month Coverage
contribution. 1. If the employee becomes sick,
Q: Can SSS members withdraw disabled, retires or dies, the
their membership? employer is liable to the SSS for
A: No. When a person registers for damages equivalent to the
SSS membership, he becomes a benefits to which said employee
member for life. Therefore, during would have been entitled had his
such time that the member failed to name been reported on time.
remit contributions, the benefits and 2. In case of pension benefits, the
loan privileges provided by the SSS employer is liable to the SSS for
can still be availed as long as the damages equivalent to whichever
member meets the qualifying is higher between:
conditions for entitlement thereto. a. the accumulated pension
due as of the date of
settlement of the claim, or

b. to the five (5) years’ monthly moment the remittance of premiums
pension, including due is delayed, the penalty
dependents monthly immediately attaches to the delayed
pensions. (Sec. 24, RA premium payments by force of law.
8282) (United Christian Missionary Society
v. SSS, 30 SCRA 982)
Q: When is an employer not liable
for damages for Failure to Report Q: Is demand a condition
an Employee for SSS Coverage precedent for remittance of SSS
A: IF contingency occurs within thirty Contributions?
(30) days from the date of A: The employer is duty-bound to
employment (Sec. 24, RA 8282) remit the contributions without need
of any demand from the employee. It
Subsidiary Liability of Principal is legal obligation of every employer
The principal is subsidiary liable for to remit the SSS contributions within
the civil liabilities of his contractor the first ten (10) days of the month.
(Sec. 24, RA 8282) (Lantaco v. Llamas, 108 SCRA 502)
Liabilities of Failure of Employer Q: What is the effect of separation

to Remit SSS Contributions of employee on the obligation to
1. to pay the unremitted contribute and remit?
contributions, plus A: The effects are as follows:
2. to pay 3% penalty per month 1. His Er’s obligation to contribute
from the date the contributions arising from that employment
fell due. (Sec. 22, RA 8282) shall cease at the end of the
month of separation.
Q: Is good faith a defense for the 2. But said Ee shall be credited with
preceding failure? all contributions paid on his
A: No. The penalty for failure to behalf and entitled to benefits
remit premium contributions is according to the provisions of
punitive in character. From the R.A. 9282.

3. He may, however, continue to
pay the total contributions to
maintain his right to full benefit D. EXCLUSIONS FROM
(R.A. 8282, Sec. 11). COVERAGE
Any contribution paid in advance by Employment which are excluded
the employer but not due shall be from compulsory coverage under the
credited or refunded to his employer SSS Law:
(R.A. 8282, Sec. 22). 1. Employment purely casual and
The above provision not for the purpose of occupation
recognizes the “once a member, or business of the Employer;
always a member” rule. 2. Service performed on or in
connection with an alien vessel
Contributions of the Self- by an employee if he is employed
Employed when such vessel is outside the
The self-employed SSS member Philippines;
pays both the employer’s and 3. Service performed in the employ
employee’s contributions. The of the Philippine Government or
monthly earnings declared by the instrumentality or agency thereof;
self-employed member at the time of and
his registration shall be the basis of 4. Service performed in the
his monthly salary credit, unless he employ of a foreign government
makes another declaration of his or international organization, or
monthly earnings, in which case, their wholly-owned
such latest declaration becomes the instrumentality: Provided, that
new basis of his monthly salary such institutions employing
credit (Sec. 19-A, RA 8282) workers in the Philippines or
If the self-employed member employing Filipinos outside of
DOES NOT earn any income in any the Philippines, may enter into
given month, he is not required to an agreement with the Philippine
pay contributions for that month. Government for the inclusion of
(Sec. 11-A and Sec. 22-A, RA 8282) such Employees in the SSS

except those already covered by month period immediately
their respective civil service preceding the semester of her
retirement systems. childbirth, abortion or
5. Such other services performed by miscarriage.
temporary and other Employees 6. Notified the employer about the
which may be excluded by pregnancy and the probable date
regulation of the Commission. of childbirth (Sec. 14-A, RA 8282)
Employees of bona fide Notes:
independent contractors shall not  Can be availed only for the first
be deemed Employees of the four (4) deliveries or miscarriages
Employer engaging the service of  Cannot be availed together with
said contractors (Sec. 8(j), R.A. sickness benefit
1161, as amended).  Rate is 100% of the Average Daily
Salary (ADS) credit.
II. BENEFITS ADS = (Sum of 6 highest monthly
A. Maternity leave benefit salary credits in the 12-month
B. Sickness benefit period immediately preceding the
C. Permanent total disability benefits semester of contingency) / 180
D. Permanent partial disability  Duration: 60 days for normal
benefits delivery; 78 days for cesarean
E. Retirement benefits
F. Death benefits B. SICKNESS BENEFIT
G. Funeral benefits It is a daily allowance paid to a
covered Employee who becomes
A. MATERNAL BENEFITS sick and is confined in a hospital for
Requisites: more than 3 days or elsewhere with
4. Female members (married or the Commission’s approval.
unmarried), who gave birth or Requisites:
suffer abortion or miscarriage 1. Payment of at least 3 monthly
5. Paid at least three (3) monthly contributions in the 12-month
contributions in the twelve (12)-

period immediately preceding the C. PERMANENT TOTAL
semester of sickness; DISABILITY BENEFITS
2. Sickness or injury and Permanent disability benefit - It is
confinement for more than 3 days a cash benefit paid to a member who
in a hospital or elsewhere with becomes permanently disabled,
the Commission’s approval; either partially or totally.
3. Notice of the fact of sickness by
the Employee to the Employer (or Permanent total disability - The
to the SSS in case the member is following are deemed permanent
unemployed) within 5 calendar total disabilities:
days after the start of his 1. Complete loss of sight of both
confinement; and eyes;
4. Exhaustion of sick leaves of 2. Loss of two limbs at or above the
absence with full pay to the credit ankle or wrists;
of the Employee (Sec. 14, RA 3. Permanent complete paralysis of
8282). two limbs;
5. In no case shall the daily 4. Brain injury resulting to incurable
sickness benefit be paid longer imbecility or insanity; and
than 120 days in 1 calendar year, 5. Such cases as determined and
nor shall any unused portion of approved by the SSS (Sec. 13-A
the 120 days of sickness benefit (d), RA 8282)
granted be carried forward and
added to the total number of D. PERMANENT PARTIAL
compensable days allowable in DISABILITY BENEFITS
the subsequent year; If disability occurs after thirty-six (36)
6. No employee shall be paid any monthly contributions have been
sickness benefit for more than paid prior to the semester of
240 days on account of the same disability, the benefit shall be the
confinement. (Sec. 14, RA 8282) monthly pension for permanent total
disability payable not longer than the
period designated in the foregoing

schedule. The monthly pension E. RETIREMENT BENEFITS
benefit shall be given in lump sum if Can be enjoyed upon reaching 60
it is payable for less than twelve years (optional retirement) or 65
months. years (compulsory retirement)
For the purpose of
adjudicating retirement, death and Rates:
permanent total disability pension a. Lifetime Monthly Pension –
benefits, contributions shall be member paid AT LEAST 120
deemed paid for the months during monthly contributions prior to the
which the member received partial semester of retirement.
disability pension. NOTE: Member has option to
The permanent partial receive first 18 monthly pensions
disability benefits are as follows: in lump sum discounted at
1. Percentage of the lump sum preferential rate of interest to be
benefit – available if the determined by SSS.
permanent partial disability b. Lump sum benefit equal to the
occurs before thirty-six (36) total contributions paid by him
monthly contributions have been and on his behalf – member has
paid prior to the semester of NOT paid at least 120 monthly
disability; contributions prior to the
2. Monthly pension – available if the semester of retirement
permanent partial disability  Optional Retirement at 60
occurs after thirty-six (36) BUT was re-employed =
contributions, payable in suspended pension
accordance with the schedule.  Death of retired member =
Note: The monthly pension benefit Primary beneficiaries as of the
for permanent partial disability will date of his retirement will be
be given in lump sum if it is entitled for the pension.
payable in less than 12 months  Retired member without
(Ungos, 2013). primary beneficiaries who
died within 60months (5

years) from start of pension = Who are secondary beneficiaries?
Second beneficiaries shall be 1. Dependent parents
entitled to a Lump sum benefit 2. any person designated by the
equivalent to balance of total member as his secondary
monthly pensions within the beneficiary, if no dependent
guaranteed 5-year period. parent
(Sec. 12-B, RA 8282)
Who are dependents?
F. DEATH BENEFITS 1. Legal spouse entitled by law to
A lump sum equivalent to: receive support from the member
1. (36) x (monthly pension); IF 2. Legitimate, legitimated, legally
member has paid at least 36 adopted and illegitimate who are:
monthly contributions prior to the a. unmarried
semester of death b. no gainfully employed
2. Maximum between: c. below 21 years old
a. (monthly pension) x (no. of d. if over 21 years old, he is
contributions paid) physically or mentally
b. (12) x (monthly pension) incapable of self-support
3. parents who receive regular
NOTE: Payable to primary support from the member
beneficiaries, if none then secondary
beneficiaries Q: Suppose the member, while
still unmarried, designates his
Who are primary beneficiaries? brothers and sisters as
1. Dependent spouse until he or she beneficiaries, will they be entitled
remarries to the death benefit?
2. Dependent children, whether A: Yes, assuming that there is no
legitimate, legitimated, or legally surviving spouse, children, or
adopted legitimate parents. The reason is
3. Dependent illegitimate children because death benefits under RA
8282 are vested only upon the death

of the member. (Ungos Jr. and c. 1 representing the general
Ungos III, 2016) public who should have
adequate knowledge and
G. FUNERAL BENEFITS experience regarding
How much? P12,000 payable in social security
cash or in kind Notes:
 The 6 representatives of
When can be availed? the workers and
1. in case of death of a member employers shall be
who has been permanently totally chosen from among the
disabled, or nominees of workers’
2. in case of death of a retired and employers’
member (Sec. 13, RA 8282) organizations,
respectively.
III. SOCIAL SECURITY  Chairman shall be
COMMISSION designated by the
A. COMPOSITION President among the
1. Secretary of DOLE or his duly members
designated undersecretary  Term = 3 years
2. SSS President  Continue to hold office
3. Seven members to be appointed until their successor shall
by the President of the have been appointed
Philippines, to wit; and duly qualified.
a. 3 representatives of the  All vacancies prior to the
workers’ group, at least 1 expiration of the term,
of whom shall be a woman shall be filled for the
b. 3 representatives of the unexpired term only.
employers’ group, at least
1 of whom shall be a B. JURISDICTION
woman Jurisdiction to hear and decide
disputes pertaining to:

1. Coverage Q: Can SSC sue or be sued in the
2. Benefits RTC?
3. contributions and penalties A: Yes, only for matters connected
thereon, or with its administrative functions, but
4. any other matter related thereto not on matters connected to its
(Sec. 5, RA 8282) quasi-judicial functions. (Ungos Jr.
and Ungos III, 2016)
Q: Does SSC has jurisdiction to
condone penalties for late C. APPEAL FROM DECISION OF
payment of premium THE SSC
contributions? May be appealed to and reviewed by
A: NO. The SSC has no jurisdiction the Court of Appeals under Rule 43
to condone penalties for late of Rules of Court, by filing a verified
payment. Being a mere trustee of the petition for review within 15 days
funds of the SSS which actually from notice of judgment. (Sec. 5, RA
belong to the members, the SSC 8282)
cannot legally perform any acts
affecting the same, including GSIS LAW (RA 8291)
condonation of penalties, that would
A. COVERAGE AND
diminish the property rights of the
EXCLUSIONS
owners and beneficiaries of such
(I.R.R. of RA 8291)
funds without an express or specific
RULE II
authority therefor. (Ungos Jr. and
Ungos III, 2016)
MEMBERSHIP OF THE GSIS
Section 2. Compulsory Membership
Q: Is SSC and RTC co-equal in
2.1. All government personnel, whether
rank?
elective or appointive, irrespective of
A: Yes. Hence, RTC cannot issue
status of appointment, provided they
writs of Injunction against SSC. are receiving fixed monthly
(Ungos Jr. and Ungos III, 2016) compensation and have not reached
the mandatory retirement age of 65

years, are compulsorily covered as covered, provided they are receiving
members of the GSIS and shall be fixed monthly compensation and
required to pay contributions. rendering the required number of
2.2. However, employees who have working hours for the month.
reached the retirement age of 65 or
more shall also be covered, subject 2.4. Classes of Membership –
to the following rules: Membership in the GSIS is classified
An employee who is already either by type or status of membership.
beyond the mandatory retirement 2.4.1 As to type of members, there
age of 65 shall be compulsorily are regular and special
covered and be required to pay both members:
the life and retirement premiums a. Regular Members – are
under the following situations: those employed by the
1. An elective official who at the government of the Republic
time of election to public office of the Philippines, national or
is below 65 years of age and local, legislative bodies,
will be 65 years or more at the government-owned and
end of his term of office, controlled corporations
including the period/s of his re- (GOCC) with original
election to public office charters, government
thereafter without interruption. financial institutions (GFIs),
2. Appointive officials who, before except uniformed personnel
reaching the mandatory age of of the Armed Forces of the
65, are appointed to Philippines, the Philippine
government position by the National Police, Bureau of
President of the Republic of Jail Management and
the Philippines and shall Penology (BJMP) and
remain in government service Bureau of Fire Protection
at age beyond 65. (BFP), who are required by
law to remit regular monthly
2.3. Contractual employees including contributions to the GSIS.
casuals and other employees with an b. Special Members – are
employee-government agency constitutional commissioners,
relationship are also compulsorily members of the judiciary,

including those with 3.1.1. Uniformed personnel of the
equivalent ranks, who are Armed Forces of the Philippines
required by law to remit (AFP), Philippine National Police
regular monthly contributions (PNP), Bureau of Fire Protection
for life insurance policies to (BFP) and Bureau of Jail
the GSIS in order to answer Management and Penology
for their life insurance (BJMP);
benefits defined under RA 3.1.2. Barangay and Sanggunian
8291. Officials who are not receiving
fixed monthly compensation;
2.4.2. As to status of membership, 3.1.3. Contractual Employees who
there are active and inactive are not receiving fixed monthly
members. compensation; and
a. Active member – refers to a 3.1.4. Employees who do not have
member of the GSIS, monthly regular hours of work
whether regular or special, and are not receiving fixed
who is still in the government monthly compensation.
service and together with the
government agency to which BENEFITS under R.A. 8291
he belongs, is required to SEC. 9. Computation of the Basic
pay the monthly contribution. Monthly Pension. –
b. Inactive member – a (a) The basic monthly pension is equal
member who is separated to:
from the service either by 1. thirty-seven and one-half
resignation, retirement, percent (37.5%) of the
disability, dismissal from the revalued average monthly
service, retrenchment or, compensation; plus
who is deemed retired from 2. two and one-half percent
the service under this Act. (2.5%) of said revalued
average monthly compensation
Section 3 Exclusion from for each year of service in
Compulsory Coverage excess of (15) years: Provided,
3.1 The following employees are That the basic monthly pension
excluded from compulsory coverage: shall not exceed ninety percent

(90%) of the average monthly corresponding benefits have been
compensation. awarded under this Act or other laws
shall be excluded in the computation of
(b) The basic monthly pension may be service in case of reinstatement in the
adjusted upon the recommendation of service of an employer and subsequent
the President and General Manager of retirement or separation which is
the GSIS and approved by the President compensable under this Act.
of the Philippines in accordance with the For the purpose of this section,
rules and regulations prescribed by the the term service shall include full-time
GSIS: Provided, however, that the basic service with compensation: Provided,
monthly pension shall not be less than that part-time and other services with
One thousand and three hundred pesos compensation may be included under
(P1,300.00): Provided, further, that the such rules and regulations as may be
basic monthly pension for those who prescribed by the GSIS.
have rendered at least twenty (20) years
of service after the effectivity of this Act SEPARATION BENEFITS
shall not be less than Two thousand four SEC. 11. Separation Benefits. - The
hundred pesos (P2,400.00) a month. separation benefits shall consist of:
(a) a cash payment equivalent to one
SEC. 10. Computation of Service. – hundred percent (100%) of his average
(a) The computation of service for the monthly compensation for each year of
purpose of determining the amount of service he paid contributions, but not
benefits payable under this Act shall be less than Twelve thousand pesos
from the date of original (P12,000) payable upon reaching sixty
appointment/election, including periods (60) years of age upon separation,
of service at different times under one or whichever comes later: Provided, that
more employers, those performed the member resigns or separates from
overseas under the authority of the the service after he has rendered at
Republic of the Philippines, and those least three (3) years of service but less
that may be prescribed by the GSIS in than fifteen (15) years; or
coordination with the Civil Service (b) a cash payment equivalent to
Commission. eighteen (18) times his basic monthly
(b) All service credited for retirement, pension at the time of resignation or
resignation or separation for which separation, plus an old-age pension

benefit equal to the basic monthly 9 or more years but less than 11
pension payable monthly for life upon years = 5 months
reaching the age of sixty (60): Provided, 11 or more years but less than
that the member resigns or separates 15 years = 6 months
from the service after he has rendered The first payment shall be equivalent
at least fifteen (15) years of service and to two (2) monthly benefits. A seven-
is below sixty (60) years of age at the day (7) waiting period shall be
time of resignation or separation. imposed on succeeding monthly
payments.
SEC. 12. Unemployment or All accumulated unemployment
Involuntary Separation Benefits. - benefits paid to the employee during
Unemployment benefits in the form of his entire membership with the GSIS
monthly cash payments equivalent to shall be deducted from voluntary
fifty percent (50%) of the average separation benefits.
monthly compensation shall be paid to a The GSIS shall prescribe the
permanent employee who is detailed guidelines in the
involuntarily separated from the service operationalization of this section in
due to the abolition of his office or the rules and regulations
position usually resulting from implementing this Act.
reorganization: Provided, That he has
been paying integrated contributions for RETIREMENT BENEFITS
at least one (1) year prior to separation. SEC. 13. Retirement Benefits. –
Unemployment benefits shall be paid in (a) Retirement benefits shall be:
accordance with the following 1. the lump sum payment as
schedules: defined in this Act payable at
Contributions Made Benefit the time of retirement plus an
Duration old-age pension benefit equal
1 year but less than 3 years = 2 to the basic monthly pension
months payable monthly for life,
3 or more years but less than 6 starting upon expiration of the
years = 3 months five-year (5) guaranteed period
6 or more years but less than 9 covered by the lump sum; or
years = 4 months 2. cash payment equivalent to
eighteen (18) months of his

basic monthly pension plus recommended by the GSIS actuary and
monthly pension for life approved by the Board in accordance
payable immediately with no with the rules and regulations prescribed
five-year (5) guarantee. by the GSIS.
(b) Unless the service is extended by
appropriate authorities, retirement shall PERMANENT DISABILITY
be compulsory for an employee of sixty- BENEFITS
five (65) years of age with at least fifteen SEC. 15. General Conditions for
(15) years of service: Provided, That if Entitlement. - A member who suffers
he has less than fifteen (15) years of permanent disability for reasons not due
service, he may be allowed to continue to his grave misconduct, notorious
in the service in accordance with negligence, habitual intoxication, or
existing civil service rules and willful intention to kill himself or another,
regulations. shall be entitled to the benefits provided
for under Sections 16 and 17
SEC. 13-A. Conditions for immediately following, subject to the
Entitlement. - A member who retires corresponding conditions thereof.
from the service shall be entitled to the
retirement benefits enumerated in SEC. 16. Permanent Total Disability
paragraph (a) of Section 13 hereof: Benefits. –
Provided, That: (a) If the permanent disability is total, he
1. he has rendered at least fifteen shall receive a monthly income benefit
years of service; for life equal to the basic monthly
2. he is at least sixty (60) years of age pension effective from the date of
at the time of retirement; and disability: Provided, That:
3. he is not receiving a monthly 1. he is in the service at the time of
pension benefit from permanent total disability; or
disability. 2. if separated from the service, he
has paid at least thirty-six (36)
SEC. 14. Periodic Pension monthly contributions within the
Adjustment. - The monthly pension of five (5) year period immediately
all pensioners including all those preceding disability, or has paid
receiving survivorship pension benefits a total of at least one hundred
shall be periodically adjusted as may be eighty (180) monthly

contributions, prior to his 2. he recovers from his disability
disability: Provided, further, That as determined by the GSIS,
if at the time of disability, he was whose decision shall be final
in the service and has paid a and binding; or
total of at least one hundred 3. he fails to present himself for
eighty (180) monthly medical examination when
contributions, in addition to the required by the GSIS.
monthly income benefit, he shall
receive a cash payment (d) The following disabilities shall be
equivalent to eighteen (18) times deemed total and permanent:
his basic monthly pension: 1. complete loss of sight of both
Provided, finally, That a member eyes;
cannot enjoy the monthly income 2. loss of two (2) limbs at or
benefit for permanent disability above the ankle or wrist;
and the old-age retirement 3. permanent complete paralysis
simultaneously. of two (2) limbs;
(b) If a member who suffers permanent 4. brain injury resulting in
total disability does not satisfy incurable imbecility or insanity;
conditions (1) and (2) in paragraph (a) of and
this section but has rendered at least 5. such other cases as may be
three (3) years of service at the time of determined by the GSIS.
his disability, he shall be advanced the
cash payment equivalent to one SEC. 17. Permanent Partial Disability
hundred percent (100%) of his average Benefits. –
monthly compensation for each year of (a) If the disability is partial, he shall
service he paid contributions, but not receive a cash payment in accordance
less than Twelve thousand pesos with a schedule of disabilities to be
(P12,000.00) which should have been prescribed by the GSIS: Provided, that
his separation benefit. he satisfies either conditions (1) or (2) of
(c) Unless the member has reached the Section 16 (a);
minimum retirement age, disability (b) The following disabilities shall be
benefit shall be suspended when: deemed permanent partial:
1. he is reemployed; or 1. complete and permanent loss
of the use of:

(i) any finger (2) if separated, he has rendered
(ii) any toe at least three (3) years of
(iii) one arm service and has paid at least
(iv) one hand six (6) monthly contributions in
(v) one foot the twelve-month period
(vi) one leg immediately preceding his
(vii) one or both ears disability.
(viii) hearing of one or Provided, however, That a
both ears member cannot enjoy the
(ix) sight of both eyes temporary total disability benefit
2. such other cases as my be and sick leave pay simultaneously:
determined by the GSIS. Provided, further, That if the
disability requires more extensive
TEMPORARY DISABILITY treatment that lasts beyond one

hundred twenty (120) days, the
BENEFITS
payment of the temporary total
SEC. 18. Temporary Total Disability
disability benefit may be extended
Benefits. –
by the GSIS but not to exceed a
(a) A member who suffers temporary
total of two hundred forty (240)
total disability for reasons not due to
days.
any of the conditions enumerated in
(b) The temporary total disability benefit
Section 15 hereof shall be entitled to
shall in no case be less than
seventy-five percent (75%) of his
Seventy pesos (P70.00) a day.
current daily compensation for each
(c) The notices required of the member
day or fraction thereof of temporary
and the employer, the mode of
disability benefit not exceeding one
payment, and the other
hundred twenty (120) days in one
requirements for entitlement to
calendar year after exhausting all his
temporary total disability benefits
sick leave credits and collective
shall be provided in the rules and
bargaining agreement sick leave
regulations to be prescribed by the
benefits, if any, but not earlier than
GSIS.
the fourth day of his temporary total
disability: Provided, That:
SEC. 19. Non-scheduled Disability. -
(1) he is in the service at the time
For injuries or illnesses resulting in a
of his disability; or

disability not listed in the schedule of monthly contributions
partial/total disability provided herein, within the five-year period
the GSIS shall determine the nature of immediately preceding
the disability and the corresponding his death; or has paid a
benefits therefor. total of at least one
hundred eighty (180)
SURVIVORSHIP BENEFITS monthly contributions
SEC. 20. Survivorship Benefits. - prior to his death; or
When a member or pensioner dies, the
beneficiaries shall be entitled to (2) the survivorship pension plus a
survivorship benefits provided in cash payment equivalent to
Sections 21 and 22 hereunder subject to one hundred percent (100%) of
the conditions therein provided for. The his average monthly
survivorship pension shall consist of: compensation for every year of
(1) the basic survivorship pension service: Provided, That the
which is fifty percent (50%) of deceased was in the service at
the basic monthly pension; and the time of his death with at
(2) the dependent children’s pension least three (3) years of service;
not exceeding fifty percent (50%) or
of the basic monthly pension (3) a cash payment equivalent to
one hundred percent (100%) of
SEC. 21. Death of a Member. – his average monthly
(a) Upon the death of a member, the compensation for each year of
primary beneficiaries shall be service he paid contributions,
entitled to: but not less than Twelve
(1) survivorship pension: Provided, thousand pesos (P12,000.00):
That the deceased: Provided, That the deceased
(i) was in the service at the has rendered at least three (3)
time of his death; or years of service prior to his
(ii) if separated from the death but does not qualify for
service, has at least three the benefits under item (1) or
(3) years of service at the (2) of this paragraph.
time of his death and has (b) The survivorship pension shall be
paid thirty-six (36) paid as follows:

(1) when the dependent spouse is (1) the cash payment equivalent to
the only survivor, he/she shall one hundred percent (100%) of
receive the basic survivorship his average monthly
pension for life or until he/she compensation for each year of
remarries; service he paid contributions,
(2) when only dependent children but not less than Twelve
are the survivors, they shall be thousand pesos (P12,000.00):
entitled to the basic Provided, That the member is
survivorship pension for as in the service at the time of his
long as they are qualified, plus death and has at least three (3)
the dependent children’s years of service; or
pension equivalent to ten (2) in the absence of secondary
percent (10%) of the basic beneficiaries, the benefits
monthly pension for every under this paragraph shall be
dependent child not exceeding paid to his legal heirs.
five (5), counted from the (d) For purposes of the survivorship
youngest and without benefits, legitimate children shall
substitution; include legally adopted and
(3) when the survivors are the legitimated children.
dependent spouse and the
dependent children, the SEC. 22. Death of a Pensioner. - Upon
dependent spouse shall the death of an old-age pensioner or a
receive the basic survivorship member receiving the monthly income
pension for life or until he/she benefit for permanent disability, the
remarries, and the dependent qualified beneficiaries shall be entitled to
children shall receive the the survivorship pension defined in
dependent children’s pension Section 20 of this Act, subject to the
mentioned in the immediately provisions of paragraph (b) of Section
preceding paragraph (2) 21 hereof. When the pensioner dies
hereof. within the period covered by the lump
(c) In the absence of primary sum, the survivorship pension shall be
beneficiaries, the secondary paid only after the expiration of the said
beneficiaries shall be entitled to: period.

FUNERAL BENEFITS (1) for those employed after the
SEC. 23. Funeral Benefits. - The effectivity of this Act, their insurance
amount of the funeral benefits shall be shall take effect on the date of their
determined and specified by the GSIS in employment;
the rules and regulations but shall not (2) for those whose insurance will
be less than Twelve thousand pesos mature after the effectivity of this
(P12,000.00): Provided, That it shall be Act, their insurance shall be deemed
increased to at least Eighteen thousand renewed on the day following the
pesos (P18,000.00) after five (5) years maturity or expiry date of their
and shall be paid upon the death of: insurance;
(a) an active member as defined under (3) for those without any life insurance
Section 2 (e) of this Act; or as of the effectivity of this Act, their
(b) a member who has been separated insurance shall take effect following
from the service, but who may be said effectivity.
entitled to future benefit pursuant to
Section 4 of this Act; or SEC. 25. Dividends. - An annual
(c) a pensioner, as defined in Section 2 dividend may be granted to all members
(o) of this Act; or of the GSIS whose life insurance is in
(d) a retiree who at the time of his force for at least one (1) year in
retirement was of pensionable age accordance with a dividends allocation
under this Act but who opted to retire formula to be determined by the GSIS.
under Republic Act No. 1616.
SEC. 26. Optional Insurance. - Subject
LIFE INSURANCE BENEFITS to the rules and regulations prescribed
SEC. 24. Compulsory Life Insurance. by the GSIS, a member may apply for
- All employees except for Members of insurance and/or pre-need coverage
the Armed Forces of the Philippines embracing life, health, hospitalization,
(AFP) and the Philippine National Police education, memorial plans, and such
(PNP) shall, under such terms and other plans as may be designed by the
conditions as may be promulgated by GSIS, for himself and/or his
the GSIS, be compulsorily covered with dependents. Any employer may likewise
life insurance, which shall automatically apply for group insurance coverage for
take effect as follows: its employees. The payment of the

premiums/installments for optional

insurance and pre-need products may date of the policy or when he is
be made by the insured or his employer considered as a case of PTD.
and/or any person acceptable to the 18.3 Death Benefit, which is the face
GSIS. value of the policy payable to
designated
SEC. 27. Reinsurance. - The GSIS beneficiary/beneficiaries or legal
may reinsure any of its interests or part heirs, in the absence of the former,
thereof with any private company or upon the death of a member.
reinsurer whether domestic of foreign: 18.4 Accidental Death Benefit (ADB)
Provided, That the GSIS shall submit an is an additional benefit equivalent
annual report on its reinsurance to the amount of Death Benefit
operations to the Insurance when the member dies by
Commission. accident.
In this connection, proof must
be presented to sufficiently
ACCORDING TO THE I.R.R. establish that the cause of the
RULE IV member’s death is accidental. The
BENEFITS right to present sufficient proof to
Section 18 Compulsory Life show that death was accidental
Insurance Benefits under the Life shall prescribe if the claim for ADB
Endowment Policy (LEP). A member is filed four (4) years after the
under this policy may be entitled to any death of the member.
of the following benefits, depending on 18.5 Cash Dividend. A policyholder is
the circumstances: entitled to dividends subject to the
18.1 Maturity benefits, which is the guidelinesas approved by the
face amount payable to the GSIS Board. This is not a
member upon maturity of the guaranteed benefit.
policy.
18.2 Cash Surrender Value, which Section 19 Compulsory Life
are earned values during the term Insurance Benefits under the
of the insurance payable to the Enhanced Life Policy (ELP). A
member when he is separated member under this policy may be
from the service before maturity entitled to any of the following benefits,
depending on the circumstances:

19.1 Death Benefit equivalent to the with the GSIS in accordance
latest annual salary multiplied by with CLIP.
amount of insurance (AOI) factor 19.3 Cash Dividend. A policyholder is
which is 1.5 or 18 times the current entitled to dividends, subject to the
monthly salary of the member or guidelines as approved by the
as determined by the GSIS, GSIS Board. This is not a
payable to the legal heirs, less all guaranteed benefit.
outstanding obligations of the
member in accordance with the Section 20 Retirement Benefits.
CLIP. Under this Act, the retirement benefit
19.2 Termination Value. The policy consists of a monthly pension which is
earns a Termination Value during computed based on years of creditable
the life of the policy computed from service and AMC for the last 3 years.
the percentage of life insurance 20.1 Eligibility
premiums actually remitted and 20.1.1 has rendered at least
paid to GSIS. Fifteen (15) years of service;
19.2.1 Termination value is 20.1.2 is at least Sixty (60) years
equivalent to a percentage of of age; and
monthly life insurance 20.1.3 is not receiving a monthly
premiums as determined by pension benefit from
the GSIS, due and paid in permanent total disability.
full, either by direct
remittance or through an APL 20.2 Retirement Benefit Options. A
facility. retiring member has the following
19.2.2 The accumulated options:
termination value will grow 20.2.1 Five (5) year lump sum
at such rate as determined equivalent to sixty (60) months of
by the Actuary. the BMP, subject to qualification
19.2.3 The termination value requirements, less all
shall be paid to the member outstanding obligations of the
upon his separation from the member in accordance with the
government service less all CLIP, plus an old-age pension
indebtedness of the member benefit equal to the BMP

payable for life, starting on the on the member’s records in the
first day of the GSIS database.
month following the expiration of
the five-year guaranteed period; 20.5 Processing of Retirement
or Benefits of Members Who Died
20.2.2 A cash payment benefit While their Claims are Being
equivalent to eighteen (18) times Processed
of the BMP, subject to 20.5.1 For those qualified for
qualification requirements, less retirement benefits:
all outstanding obligations of the a. If the deceased member
member in accordance with the opted for five-year lump
CLIP, plus monthly pension for sum benefit as
life payable on the first month indicated in his/her
following the date of retirement; claim for retirement
20.3 Conversion in the Mode of application, his legal
Retirement. Conversion in the heirs shall be entitled to
mode of retirement from R.A. No. five-year lump sum
8291 to any other retirement laws benefit equivalent to
and vice versa administered by the sixty (60) months basic
GSIS shall not be allowed. Those monthly pension
who became GSIS members prior (BMP). However, the
to the implementation of this Act survivorship pension to
shall have the option to retire qualified primary
under PD 1146, RA 660, or RA beneficiaries, if any,
1616, subject to eligibility. shall be granted after
20.4 Change of Retirement Benefit the end of the 5-year
Option under RA 8291. Change of guaranteed period, but
retirement benefit option from filing of claim for
eighteen (18) months cash survivorship benefit
payment plus immediate pension should be done before
to five (5) year lump sum, or vice the end of the 4-year
versa, shall not be allowed. prescription period.
The GSIS shall process the b. If the deceased member
claim for retirement benefits based opted for immediate

pension as indicated in under the Civil Code of
his/her claim for the Philippines.
retirement benefit his 20.5.2 For those not qualified for
legal heirs shall be retirement benefits, the GSIS
entitled to retirement shall determine if he/she is
benefits equivalent to qualified to other applicable
eighteen (18) months of benefits under RA 8291 or
BMP, plus accrued such other laws administered
pension, if any, up to by the GSIS.
the date of death of the
retiree. The 20.6 Effects of Re-Employment
corresponding 20.6.1 When a retired/separated
survivorship pension member is re-employed or
shall be paid to the reinstated in the service,
qualified primary his/her previous services
beneficiaries, if any, credited at the time of his/her
and shall be computed retirement/separation for which
from the date of death a corresponding benefit had
of the retiree, subject to been awarded, shall be
filing of claim. excluded in the computation of
c. In case the deceased service. In effect, he/she shall
member failed to be considered a new entrant.
indicate in his/her 20.6.2 However, for those who
retirement option, it retired prior to the enactment
shall be computed as if of RA 8291, the previous
he/she opted for services of a retired/separated
immediate pension. member may be added in the
d. The proceeds of computation of his creditable
retirement benefits shall services (subject to premium-
be paid and distributed based policy) upon subsequent
to the legal heirs in retirement under RA 8291 only
accordance with the when both conditions are met:
law on succession a. the retiree re-entered
government service

before June 24, 1997; the required premium
and contributions.
b. the total amount of
benefit previously 20.9 Computation of Average
received, if any, Monthly Compensation (AMC)
including the prescribed 20.9.1 The AMC shall be
interest was refunded to computed on the basis of the
GSIS on or before average salary of the member
March 2, 2006 for the last 36 months of
creditable service immediately
20.7 Basis of Computation of Total preceding his retirement or
Service separation.
20.7.1 Total Length of Service 20.9.2 The basis for computing the
(TLS) is the number of years in AMC of a separated or retired
government service regardless member requesting for
of status of employment, with computation of benefits shall
or without premium be the prevailing policy on
contributions. AMC at the time the claim is
20.7.2 For purposes of computing being processed.
the total length of service
under part-time status of 20.10 Computation of Revalued
employment, services shall be Monthly Compensation = AMC
converted to their full-time plus Seven Hundred Pesos
equivalent using forty-hour (P700.00).
week and fifty two-week a year
as basis. 20.11 Computation of Basic
Monthly Pension – the formula
20.8 Computation of Creditable for computing the BMP may be
Service. The computation of adjusted subject to the approval of
creditable service for the purpose the Board upon the
of determining the amount of recommendation by the President
benefits payable shall include the and General Manager.
period or periods of service with As a general rule, the BMP
shall only be computed for those

members or dependents/heirs of 20.13.3 Effects of Non-renewal
members who are eligible to of Active Status as
receive benefits under this law. It Pensioner
shall be computed on the basis of a. Suspension of payment
a percentage of the RAMC at the of monthly pension
rate of 2.5% for every year of b. Non-entitlement to cash
creditable service, but in no case gift if status is suspended
shall it exceed 90% of the AMC of at the time of declaration
the member. The formula for c. Non-entitlement to
computing BMP shall be: BMP = pension increase if status
RAMC x (2.5% x RCS) is suspended at the time
of declaration
20.12 Adjustment/Increase in
Pension - Periodic adjustments of Section 21 Separation Benefit. - Is
the monthly pension of all existing either one of the following:
pensioners shall be done on the 21.1 For those members who are
basis of what is sustainable and separated from service and who
prudent for the GSIS as have at least 3 years of service but
recommended by its Actuary and less than 15 years shall be entitled
approved by the Board. to cash payment equivalent to
100% of the member’s AMC for
20.13 Policies Affecting Pension each year of creditable service, but
Administration not less than P12,000.00, payable
20.13.1 Regardless of the date of upon reaching age 60, or upon his
retirement, the monthly separation if he is already 60 years
pension shall commence on of age at the time of separation.
the 1st day of the month
following the month of 21.2 A cash payment equivalent to
retirement. eighteen (18) times the basic
20.13.2 Annual Renewal of Active monthly pension payable at the
Status (ARAS) of Old Age and time of resignation or separation,
Survivorship Pensioners is provided the member resigns or
required on their birth month separates from the service after he
every year. has rendered at least 15 years of

service and is below 60 years of 21.4.2 If the member dies during
age, plus an old-age pension the pendency of his claim for
benefit equal to the basic monthly separation benefit and he has
pension payable monthly for life rendered less than 15 years of
upon reaching the age of sixty creditable service, his legal
(60). heirs shall be entitled to cash
payment equivalent to one
21.3 Reckoning Date of Separation of hundred percent (100%) of
Uniformed PNP, BJMP and BFP AMC for each year of
Personnel shall be February 1, creditable service, but not less
1996. The computation of benefit than Twelve Thousand Pesos
shall be based on their basic (P12,000.00).
monthly salary (premium-based)
when they ceased to be members Section 22 Unemployment Benefit
of the GSIS. 22.1 Conditions for Entitlement to
Unemployment Benefit. A
21.4 Processing of Separation Benefit member shall be entitled to the
of Members Who Died While Their unemployment benefits if the
Claims are Being Processed following conditions are met:
21.4.1 If the member dies during 22.1.1 he/she was a permanent
the pendency of his claim for employee at time of
separation benefit and he has separation;
rendered at least 15 years of 22.1.2 his/her separation was
creditable service, his legal involuntary due to the abolition
heirs shall be entitled to of his/her office or position
receive cash payment resulting from reorganization;
equivalent to eighteen (18) and
times the basic monthly 22.1.3 he/she has been paying the
pension, plus accrued BMP, if required premium contributions
any, up to the date of death of for at least one (1) year but
the member. Thereafter, the less than 15 years prior to
primary beneficiaries shall be separation.
entitled to survivorship 22.2 Amount, Duration and Payment
pension. of Unemployment Benefit. - The

amount of unemployment benefit separation or retirement benefits,
is equivalent to 50% of the AMC as the case maybe, to which the
and shall be paid in accordance member may be entitled to upon
with the following Schedule: his voluntary resignation,
Contributions Made = Benefit separation or retirement.
Duration
One year but less than three C. DISABILITY AND DEATH
years = 2 months BENEFITS
Three or more years but less Section 23 Disability Benefits.
than six years = 3 months 23.1 Disability refers to any loss or
Six or more years but than nine impairment of the normal functions
years = 4 months of the physical and/or mental
Nine or more years but less faculties of a member, which
than 11 years = 5 months permanently or temporarily
Eleven or more years but less prevents him to continue with his
than fifteen = 6 months work or engage in any other
gainful occupation resulting in the
22.3 Those entitled to more than two loss of income. The corresponding
(2) months of Unemployment disability benefits for each kind of
Benefits shall initially receive two disability shall be granted to a
(2) monthly payments. A seven- member based on the duration of
day (7-day) waiting period shall be incapacity to work and actual loss
imposed on succeeding monthly of income.
payments to determine whether There are three (3) kinds of
the separated member has found disability which shall be
gainful employment either in the determined by the GSIS based on
public or private sector. established medical standards:
• Permanent Total Disability
22.4 In cases of reemployment, all • Permanent Partial Disability
accumulated unemployment • Temporary Total Disability
benefit paid to the employee
during his/her entire membership 23.2 Policies Governing Disability
with the GSIS shall be deducted Benefits:
without interest from the

23.2.1 Permanent Total b. any toe
Disability (PTD) – disability c. one arm;
due to injury or disease d. one hand;
causing complete, irreversible e. one foot;
and permanent incapacity that f. one leg;
will permanently disable a g. one or both ears;
member to work or to engage h. hearing of one or both
in any gainful occupation ears;
resulting to loss of income. i. sight of one eye;
The following disabilities j. such other cases as
shall be deemed total and may be determined and
permanent: approved by the GSIS
a. complete loss of sight 23.2.3 Temporary Total
for both eyes; Disability (TTD) – accrues or
b. loss of two limbs at or arises when the impaired
above the ankle or physical and/or mental
wrists; faculties can be rehabilitated
c. permanent complete and/or restored to their normal
paralysis of two limbs; functions, but such disability
and shall result in temporary
d. brain injury resulting in incapacity to work or to engage
incurable imbecility or in any gainful occupation.
insanity. 23.2.4 Any disability or injury as a
e. such other cases as result of, or due to grave
may be determined and misconduct, participation in
approved by the GSIS riots, gross and inexcusable
23.2.2 Permanent Partial negligence, under the influence
Disability (PPD) – arises due of drugs or alcohol or willful
to the complete and permanent intention to injure or kill himself
loss of the use of any of the or another, shall not be
following resulting to the compensable.
disability to work for a limited 23.2.5 The actual loss of income
period of time: shall refer to the number of
a. any finger days when a member went on

leave of absence without pay d. is receiving any other
(LWOP) reckoned immediately pension either from
from the date of GSIS or another local
commencement of disability or foreign institution or
and for the duration of organization.
entitlement thereto, based on 23.3 Computation of Benefit:
medical evaluation. Any LWOP 23.3.1 Permanent Total
incurred after the duration of Disability (PTD) - A member
entitlement to the benefit shall who becomes permanently and
not be compensable. totally disabled shall be entitled
23.2.6 If the member has two or to the monthly income benefits
more different contingencies for life equivalent to the basic
during the same period of monthly pension (BMP)
benefit entitlement, he shall be effective from the date of
compensated only once for the disability.
overlapping periods. 23.3.2 Permanent Partial
23.2.7 All injuries, disabilities, Disability (PPD) - The period
illnesses and all other of entitlement to PPD benefit
infirmities compensable under shall be determined after due
PD 626 shall not be medical evaluation; but such
compensable under this Act. period of entitlement to the
23.2.8 Any applicable disability benefit shall not exceed 12
benefit shall be suspended months for the same
when he/she: contingency. Only the leave of
a. is re-employed; or absence/s without pay incurred
b. recovers from his/her during the period of
disability as determined entitlement, duly certified by
by the GSIS, whose the authorized officer of the
decision shall be final agency where he is employed,
and binding; or shall be compensable. The
c. fails to present himself amount of PPD benefit shall be
for medical examination computed by dividing the BMP
when required by GSIS; by 30 days and multiplying the
or quotient by the number of

compensable calendar days of number of days of disability
leave of absence without pay based on the medical
(LWOP). evaluation but not to exceed
23.3.3 Temporary Total 240 days for the same
Disability (TTD) - The period contingency. However, the
of entitlement to TTD benefit computed daily salary shall not
shall be determined after due be less than seventy pesos
medical evaluation and proof of (P70.00) but not to exceed
actual loss of work resulting in P340.00 per day.
loss of income by way of the 23.3.4 For the purpose of
incurred actual number of days computing the corresponding
of leave of absence/s without benefit of inactive members for
pay duly certified by the each kind of disability, the
authorized officer of the BMP, with respect to PTD and
agency where he is employed; PPD, and daily salary, with
but such period of entitlement respect to TTD, shall be
to the benefit shall not exceed computed as of the time of
120 days in one calendar year. separation from GSIS.
However, if the disability
requires more extensive 23.4 Conditions for Entitlement:
treatment that lasts beyond 23.4.1 Permanent Total
120 days, the payment of the Disability (PTD)
TTD may be extended by the 23.4.1.1. A member who
GSIS but not to exceed a total becomes permanently
of 240 days. Only the leave of and totally disabled
absence/s without pay incurred shall be entitled to the
during the period of entitlement PTD benefits when:
shall be compensable. a. he/she is in the
Entitlement, however, shall service at the time
start from the fourth day of the of disability; or
disability. The amount of TTD b. if separated from
benefit shall be computed by the service, he
multiplying 75% of the daily has paid at least
salary of the member by the thirty-six (36)

months social insurance
contributions institution; and
within the five • he/she is not
year (5) period receiving any
immediately other pension
preceding his/her either from
disability; or has GSIS or another
paid a total of at local or foreign
least one hundred institution or
eighty (180) organization
months 23.4.1.2. In addition to the
contributions prior monthly income
to his/her benefits for life, a cash
disability; payment equivalent to
Provided, eighteen (18) times
however, that the his/her basic monthly
following pension (BMP), shall be
conditions shall paid to a member who
be met: was in the service at
• he/she is the time of his/her
gainfully permanent total
employed prior disability and who has
to the paid a total of one
commencement hundred eighty (180)
of disability monthly contributions.
resulting in loss 23.4.1.3. A separated
of income as member who has at
evidenced by least three (3) years of
any service and becomes
incontrovertible permanently and totally
proof thereof; disabled but has not
• he/she is not a paid a total of at least
registered one hundred eighty
member of any (180) monthly

contributions prior to however, that the
his/her disability shall following conditions
be entitled only to cash shall be met:
payment equivalent to • he/she is gainfully
one hundred percent employed prior to
(100%) of his/her the commencement
average monthly of disability
compensation for each resulting in loss of
year of service with income as
paid contributions but evidenced by any
not less than twelve incontrovertible
thousand pesos proof thereof;
(P12,000.00). • he/she is not a
23.4.2 Permanent Partial registered member
Disability (PPD) of any social
A member whose disability is insurance
partial shall be entitled to the institution; and
PPD benefit when: • he/she is not
a. he/she is in the service receiving any other
at the time of disability; pension either from
or GSIS or another
b. if separated from the local or foreign
service, he has paid at institution or
least thirty-six (36) organization
months contributions 23.4.3 Temporary Total
within the five year (5) Disability (TTD)
period immediately 23.4.3.1. A member shall
preceding his/her be entitled to the TTD
disability; or has paid a benefit when:
total of at least one a. he/she is in the
hundred eighty (180) service at the time
months contributions of disability; or
prior to his/her b. if separated from
disability; Provided, the service, he

has paid at least • he/she is not a
thirty-six (36) registered
months member of
contributions any social
within the five- insurance
year (5) period institution; and
immediately • he/she is not
preceding his/her receiving any
disability; or has other pension
paid a total of at either from
least one hundred GSIS or
eighty (180) another local
months or foreign
contributions prior institution or
to his/her organization
disability; 23.4.3.2. The payment of
Provided, TTD benefit may be
however, that the extended by the GSIS
following up to a maximum of two
conditions shall hundred forty (240)
be met: days, subject to
• he/she is medical evaluation.
gainfully
employed 23.4.4 Notice and Filing of
prior to the Claims and Other
commenceme Documents Required. – A
nt of disability written notice of sickness or
resulting in injury shall be given by a
loss of income member or anybody in his/her
as evidenced behalf within one (1) month
by any from the date of the occurrence
incontrovertibl of the contingency. If the
e proof member is in the service, the
thereof; notice shall be given to the

GSIS; if separated from the that, he/she is found still entitled
service, the member shall to the benefits. The benefit
notify the GSIS directly. The corresponding to the period of
notice must contain the suspension shall also be paid.
following information:
a. Name and address of 23.4.6 Forfeiture of Disability
the member; Benefits. - All the foregoing
b. His/Her agency if in the provisions notwithstanding, any
government or member who is enjoying
employer if in the disability benefits shall
private sector; automatically forfeit his/her right
c. Date and nature of to the continued enjoyment
sickness or injury; thereof if he/she refuses or
d. Place of confinement; deliberately fails to:
and a. have himself/herself
e. Any other pertinent medically treated by a
information that may be physician when
required by the GSIS. required by the GSIS;
or
23.4.5 Periodic Medical Report b. take the prescribed
– The disabled member, except medications ; or
those with permanent partial c. have himself/herself
disability, shall submit annual confined in a hospital
medical reports on his/her without justifiable
impairment, duly certified by reason, when such
his/her attending physician, confinement is required
and/or submit himself/herself to by the GSIS; or
annual medical and physical d. avail himself/herself of
examination. If he/she fails to such rehabilitation
comply with this requirement, the facilities as may be duly
payment of his/her benefit shall recommended by the
be suspended and shall be GSIS and made
resumed only upon his/her available for him/her; or
compliance thereto provided

e. Observe such 24.1.2. Cash payment equivalent
precautionary and /or to eighteen (18) months BMP;
preventive measures as 24.1.3. Cash payment equivalent
prescribed by a to one hundred percent (100%)
physician or expressly of the AMC for every year of
required of him/her to service with paid contributions
prevent the aggravation but not less than Twelve
or continuance of Thousand Pesos (P12,000.00).
his/her disability.
However, upon 24.2 Survivorship Benefits of
compliance with the Members in Active Service.
requirements, his/her 24.2.1. If at the time of death, a
benefits shall be member was in the service and
resumed if he/she is has rendered at least fifteen
still qualified. (15) years of creditable
service:
Section 24 Survivorship Benefits a. his primary beneficiaries
24.1 When a member or pensioner shall receive the
dies, the beneficiaries shall be survivorship pension
entitled to the following and cash payment
survivorship benefits, whichever is equivalent to 18 x the
applicable: BMP; or
24.1.1. Survivorship pension b. in the absence of
consisting of: primary beneficiaries,
a. the basic survivorship his secondary
pension which is fifty beneficiaries shall
percent (50%) of the receive the cash
BMP; and payment equivalent to
b. the dependent children’s 18 x the BMP; or
pension equivalent to c. in the absence of
10% of the BMP for secondary
each child but not to beneficiaries, the legal
exceed fifty percent heirs shall receive the
(50%) of the BMP. cash payment

equivalent to 18 x the b. Primary beneficiaries of
BMP. inactive members who
24.2.2. If at the time of death, the have less than 15 years
member was in the service of creditable service but
with less than fifteen (15) years were at least 60 years
of creditable service; his old at the time of
primary beneficiaries shall separation and have
receive the cash payment received the
equivalent to 100% of the AMC corresponding
for every year of creditable separation benefit, shall
service. not be entitled to
survivorship benefits.
24.3 Survivorship Benefits of However, if the member
Inactive Members has not received yet his
24.3.1. Primary beneficiaries of separation benefit
inactive members who have at within four years after
least 15 years of creditable his/her separation, the
service shall receive the primary beneficiaries
survivorship pension only. shall receive the cash
a. Primary beneficiaries of benefit equivalent to
inactive members who 100% of the inactive
have at least 3 years member’s AMC for
but less than 15 years every year of creditable
of creditable service service, but not less
and were less than 60 than P12,000.00.
years old at the time of
death shall receive the 24.4 Payment of Survivorship
cash payment Benefits
equivalent to 100% of 24.4.1. The survivorship benefits
the AMC for every year shall be paid as follows:
of creditable service, a. When the dependent
but not less than spouse is the only
P12,000.00. survivor, he shall

receive the basic respectively, any
survivorship pension; subsequent death,
b. When only the emancipation or
dependent children are disqualification of any
the survivors, they shall one of them shall not
be entitled only to the entitle the other
dependent children’s beneficiaries to the
pension equivalent to forfeited share.
10% of the BMP for e. In the absence of a
every dependent child, natural guardian, the
not exceeding five (5), guardian de facto of
counted from the dependent children, as
youngest and without well as the physically or
substitution; mentally incapacitated
c. When the survivors are dependent children,
the dependent spouse must file a Petition for
and the dependent Guardianship to be able
children, the dependent to claim the
spouse shall receive survivorship benefits on
the basic survivorship behalf of the dependent
pension for life or until children.
he remarries or f. When the pensioner dies
cohabits, and the within the 5-year period
dependent children after receiving the five-
shall receive the year lump sum, the
dependent children’s survivorship pension
pension. shall be paid only after
d. When the dependent the end of the said five-
spouse and dependent year period. However,
children are already filing of claim for
receiving the basic survivorship benefit
survivorship pension should be done before
and dependent the end of the 4-year
children’s pension, prescription period.

present immediately preceding
24.5 Conditions for Entitlement to the death of the member or
Survivorship Benefits pensioner.
The primary and secondary
beneficiaries, except dependent Section 25 Funeral Benefits
children, shall be entitled to 25.1. Funeral benefit is intended to
applicable survivorship benefits, help defray the expenses incident
subject to the following: to the burial and funeral of the
a. not engaged in any gainful deceased member, pensioner or
occupation as defined in Sec 2 retiree under RA 660, RA 1616,
(p) of RA 8291; PD 1146 and RA 8291. It is
b. the surviving spouse and the payable to any qualified individual,
deceased member were living in accordance with the following
together as husband and wife; order of priority:
c. not gainfully engaged in a a. Legitimate spouse,
business or economic activity b. Legitimate child who spent for
(self- employed); the funeral services, or
d. employed/engaged in a c. Any other person who can show
business or economic activity incontrovertible proof that he
but receiving income less than shouldered the funeral
the minimum compensation of expenses of the deceased
government employees.
e. not receiving any other pension 25.2. Amount of Funeral Benefit.-
from the GSIS or another local The amount of funeral benefit are
or foreign institution or as follows:
organization; and a. The prevailing amount approved
f. In the case of the dependent by the Board of Trustees at the
spouse, payment of the basic time of death of the member or
survivorship pension shall pensioner.
discontinue when he remarries, b. For uniformed members of the
cohabits, or engages in PNP, BJMP and BFP, the
common-law relationship. amount of funeral benefit is
The foregoing conditions, fixed at P10,000.00.
except the last one, must be

25.3 Conditions for Entitlement.- • Published in the Official
Funeral benefit shall be paid upon the Gazette, Vol. 93 No. 29 page 4360
death of: on July 21, 1997.
a. an active member; or
b. a member who has been
HISTORY
separated from the service with
 COMMONWEALTH ACT NO. 186
more than 15 years of
(Government Service Insurance
creditable service, but entitled
to future separation or Act)
retirement benefits; or “AN ACT TO CREATE AND
c. old age or disability pensioner; ESTABLISH A “GOVERNMENT
or SERVICE INSURANCE SYSTEM,”
d. a retiree who at the time of his TO PROVIDE FOR ITS
retirement is at least 60 years ADMINISTRATION, AND TO
of age and with at least 20
APPROPRIATE THE
years of service but who opts
NECESSARY FUNDS THEREFOR
to retire under RA 1616 on or
“
after June 24, 1997; or
e. a member who retired under RA
1616 prior to June 24, 1997  PRESIDENTIAL DECREE No.
with at least twenty (20) years 1146 (Revised Government

of service, regardless of age. Service Insurance Act of 1977)
“AN ACT AMENDING,
EXPANDING, INCREASING AND
GENERAL PRIMER ON RA 8291 INTEGRATING THE SOCIAL
REPUBLIC ACT NO. 8291 (The SECURITY AND INSURANCE
Government Service Insurance BENEFITS OF GOVERNMENT
System Act of 1997) EMPLOYEES AND FACILITATING
• Approved: May 30, 1997 THE PAYMENT THEREOF
• Published in Malaya, The UNDER COMMONWEALTH ACT
Philippine Star, Philippine Daily NO. 186, AS AMENDED, AND
Inquirer, and the Manila Bulletin on FOR OTHER PURPOSES “
June 9, 1997. July 28, 1997.

 REPUBLIC ACT NO. 8291 (The relationship with the agencies
Government Service Insurance they serve.
System Act of 1997) • Members of the
“AN ACT AMENDING judiciary and constitutional
PRESIDENTIAL DECREE NO. commissions who shall have life
1146, AS AMENDED, insurance only
EXPANDING AND INCREASING All members of the GSIS shall
THE COVERAGE AND BENEFITS have life insurance, retirement,
OF THE GOVERNMENT and all other social security
SERVICE INSURANCE SYSTEM, protection such as disability,
INSTITUTING REFORMS survivorship, separation, and
THEREIN AND FOR OTHER unemployment benefits.
PURPOSES”
“SECTION 4. Effect of Separation
MEMBERSHIP from the Service. — A member
“SECTION 3. Compulsory separated from the service shall
Membership. — Membership in the continue to be a member, and shall
GSIS shall be compulsory for all be entitled to whatever benefits he
employees receiving compensation who has qualified to in the event of any
have not reached the compulsory
contingency compensable under this
retirement age, irrespective of
Act.”
employment status”
Except:
SOURCE OF FUNDS
• Members of the
“SECTION 5. Contributions. —
Armed Forces of the
(a) It shall be mandatory for the
Philippines and the Philippine
member and the employer to
National Police, subject to the pay the monthly contributions
condition that they must settle specified in the following
first their financial obligation with schedule:
the GSIS, and Monthly Compensation
• Contractuals who Percentage of Monthly
have no employer and employee

Compensation Payable by (a) The employer shall report to
Member Employer the GSIS the - (1) names of all
xxx its employees, (2) their
(b) The employer shall include in
corresponding employment
its annual appropriation the
status, (3) positions, (4)
necessary amounts for its share
salaries and (5) such other
of the contributions indicated
pertinent information, including
above, plus any additional
premiums that may be required
subsequent changes therein, if
on account of the hazards or any, as may be required by the

risks of its employees’ GSIS;
occupation. The employer shall deduct
(c) It shall be mandatory and each month from the monthly
compulsory for all employers salary or compensation of
to include the payment of each employee the
contributions in their annual
contribution payable by him in
appropriations. Penal sanctions
accordance with the schedule
shall be imposed upon employers
prescribed in the rules and
who fail to include the payment of
regulations implementing this
contributions in their annual
appropriations or otherwise fail to Act.
remit the accurate/exact amount (b) Each employer shall remit

of contributions on time, or delay directly to the GSIS the
the remittance of premium employees’ and employers’
contributions to the GSIS. The contributions within the first
heads of offices and agencies ten (10) days of the calendar
shall be administratively liable month following the month
for non-remittance or delayed
to which the contributions
remittance of premium
apply. The remittance by the
contributions to the GSIS.
employer of the contributions
to the GSIS shall take priority
“SECTION 6. Collection and
over and above the payment of
Remittance of Contributions. —
any and all obligations, except

salaries and wages of its the basic monthly pension shall
employees. not exceed ninety percent (90%)
of the average monthly
“SECTION 7. Interests on Delayed compensation.
Remittances. — Agencies which (b) The basic monthly pension may be
delay the remittance of any and all adjusted upon the recommendation
monies due the GSIS shall be charged of the President and General
interests as may be prescribed by the Manager of the GSIS and approved
Board but not less than two percent by the President of the Philippines in
(2%) simple interest per month. Such accordance with the rules and
interest shall be paid by the employers regulations prescribed by the GSIS:
concerned.” Provided, however, That the

basic monthly pension shall not be
less than One thousand and three
“SECTION 8. Government Guarantee.
hundred pesos (P1,300.00):
— The government of the Republic of
Provided, further, That the basic
the Philippines hereby guarantees the
monthly pension for those who have
fulfillment of the obligations of the GSIS
rendered at least twenty (20) years
to its members as and when they fall
of service after the effectivity of this
due.
Act shall not be less than Two
thousand four hundred pesos
BENEFITS
(P2,400.00) a month.
SECTION 9. Computation of the Basic
Monthly Pension. —
BMP is computed as follows:
(a) the basic monthly pension is equal
a. If period with paid premiums is
to:
(1) thirty-seven and one-half percent less than 15 years:
(37.5%) of the revalued average • BMP = .375 x RAMC
monthly compensation; plus (Revalued Average Monthly
(2) two and one-half percent (2.5%) Compensation)
of said revalued average b. If period with paid premiums is 15
monthly compensation for each years and more:
year of service in excess of
fifteen (15) years: Provided, That

• BMP = .375 x RAMC BMP (3) those that may be prescribed by
= .025 x RAMC x Period with the GSIS in coordination with
Paid Premiums the Civil Service Commission.

(b) All service credited for retirement,
resignation or separation for which
BMP, however, shall NOT
corresponding benefits have been
exceed 90% of the Average
awarded under this Act or other laws
Monthly Compensation.
shall be excluded in the computation
of service in case of reinstatement in
RAMC stands for Revalued the service of an employer and
Average Monthly Compensation subsequent retirement or separation
and is computed as follows : which is compensable under this
• RAMC = Php700 + AMC Act.
(Average Monthly
Compensation) BENEFITS
• AMC=Total Monthly • Separation Benefits (Sec
Compensation received 11)
during the last 36 months of • Retirement Benefits (Sec
service divided by 36 13)
• Permanent Disability
SECTION 10. Computation of Service. Benefits (Sec 15)
(a) The computation of service for the • Temporary Disability
purpose of determining the amount Benefits (Sec 18)
of benefits payable under this Act • Survivorship Benefits (Sec
shall be from the date of original
20)
appointment/election, including
• Life Insurance Benefits (Sec
(1) periods of service at different
23)
times under one or more
employers,
Separation Benefits
(2) those performed overseas
under the authority of the SECTION 11. Separation Benefits. —
Republic of the Philippines, and The separation benefit shall consist of:
(a) a cash payment equivalent to one
hundred percent (100%) of his

average monthly compensation for involuntarily separated from the service
each year of service he paid due to the abolition of his office or
contributions, but not less than position usually resulting from
Twelve thousand pesos (P12,000) reorganization:
payable upon reaching sixty (60) Provided, That he has been paying
years of age or upon separation, integrated contributions for at least one
whichever comes later: (1) year prior to separation.
Provided, That the member resigns Unemployment benefits shall be paid in
or separates from the service after accordance with the following schedule:
he has rendered at least three (3) Contributions Made Benefit Duration
years of service but less than fifteen • 1 year but less than 3
(15) years; or years 2 months
(b) A cash payment equivalent to • 3 or more years but less
eighteen (18) times his basic than 6 years 3 months
monthly pension payable at the time • 6 or more years but less
of resignation or separation, plus an than 9 years 4 months
old-age pension benefit equal to the • 9 or more years but less
basic monthly pension payable than 11 years 5 months
monthly for life upon reaching the • 11 or more years but less
age of sixty (60): than 15 years 6 months
Provided, That the member resigns The first payment shall be equivalent to
or separates from the service after two (2) monthly benefits. A seven-day
he has rendered at least fifteen (15) (7) waiting period shall be imposed on
years of service and is below sixty succeeding monthly payments.
(60) years of age at the time of All accumulated unemployment
resignation or separation. benefits paid to the employee during his
entire membership with the GSIS shall
SECTION 12. Unemployment or be deducted from voluntary separation
Involuntary Separation Benefits. — benefits.
Unemployment benefits in the form of The GSIS shall prescribe the
monthly cash payments equivalent to detailed guidelines in the
fifty percent (50%) of the average operationalization of this section in the
monthly compensation shall be paid to a rules and regulations implementing this
permanent employee who is Act.

from the service shall be entitled to the
Retirement Benefits retirement benefits in paragraph (a) of
“SECTION 13. Retirement Benefits. Section 13 hereof:
Retirement Packages: Provided, That:
Option 1: 5-Year Lump Sum and Old (1) he has rendered at least fifteen (15)
Age Pension years of service;
Under this option, retirees can get their (2) he is at least sixty (60) years of age
five-year pension in advance. The lump at the time of retirement; and
sum is equivalent to 60 months of the (3) he is not receiving a monthly
Basic Monthly Pension (BMP) payable pension benefit from permanent total
at the time of retirement. After five disability.
years, retirees will start receiving their

monthly pension. “SECTION 14. Periodic Pension
Option 2: Cash payment and Basic Adjustment. — The monthly pension of
Monthly all pensioners including all those
In option 2, retirees will receive a Cash receiving survivorship pension benefits
Payment equivalent to 18 times the shall be periodically adjusted as may be
Basic Monthly Pension (BMP) payable recommended by the GSIS’ actuary and
upon retirement and then a monthly approved by the Board in accordance
pension for life, payable immediately with the rules and regulations prescribed
after retirement date. by the GSIS.
Unless the service is extended by

appropriate authorities, retirement shall “SECTION 15. General Conditions for
be compulsory for an employee at sixty- Entitlement. — A member who suffers
five (65) years of age with at least fifteen permanent disability for reasons not due
(15) years of service: Provided, That if to his grave misconduct, notorious
he has less than fifteen (15) years of negligence, habitual intoxication, or
service, he may be allowed to continue willful intention to kill himself or another,
in the service in accordance with shall be entitled to the benefits provided
existing civil service rules and for under Sections 16 and 17
regulations. immediately following, subject to the

corresponding conditions therefor.
SECTION 13-A. Conditions for

Entitlement. — A member who retires

PERMANENT DISABILITY and the old-age retirement
BENEFITS simultaneously.
SECTION 16. Permanent Total

Disability Benefits. — (b) If a member who suffers
(a) If the permanent disability is permanent total disability does
total, he shall receive a monthly not satisfy conditions (1) and (2)
income benefit for life equal to in paragraph (a) of this section but
the basic monthly pension has rendered at least three (3)
effective from the date of disability; years service at the time of his
Provided, That: disability, he shall be advanced the
(1) he is in the service at the time of cash payment equivalent to one
disability; or hundred percent (100%) of his
(2) if separated from the service, he average monthly compensation for
has paid at least thirty-six (36) each year of service he paid
monthly contributions within the contributions, but not less than
five (5) year period immediately Twelve Thousand pesos (P12,000)
preceding his disability, or has which should have been his
paid a total of at least one separation benefit.
hundred eighty (180) monthly (c) Unless the member has reached
contributions, prior to his the minimum retirement age,
disability: Provided, further, disability benefit shall be
That if at the time of disability, he suspended when:
was in the service and has paid (1) he is reemployed or
a total of at least one hundred (2) he recovers from disability as
eighty (180) monthly determined by the GSIS, whose
contributions, in addition to the decision shall be final and
monthly income benefit, he shall binding; or
receive a cash payment (3) he fails to present himself for
equivalent to eighteen (18) times medical examination when
his basic monthly pension: required by the GSIS.
Provided, finally, That a member (d) The following disabilities shall be
cannot enjoy the monthly income deemed total and permanent:
benefit for permanent disability (1) complete loss of sight of both

eyes;

(2) loss of two (2) limbs at or above percent (75%) of his current daily
the ankle or wrist; compensation for each day or
(3) permanent complete paralysis of fraction thereof of temporary
two(2) limbs; disability benefit not exceeding one
(4) brain injury resulting in incurable hundred twenty (120) days in one
imbecility or insanity; and calendar year after exhausting all his
(5) such other cases as may be sick leave credits and collective
determined by the GSIS. bargaining agreement sick leave
benefits, if any, but not earlier than
SECTION 17. Permanent Partial the fourth day of his temporary total
Disability Benefits. — disability: Provided, That:
(a) If the disability is partial, he shall (1) he is in the service at the time
receive a cash payment in of his disability; or
accordance with a schedule of (2) if separated, he has rendered
disabilities to be prescribed by the at least three (3) years of
GSIS: service and has paid at least
Provided, That he satisfies either six (6) monthly contributions in
conditions (1) or (2) of Section the twelve-month period
16(a); immediately preceding his
(b) The following disabilities shall be disability.
deemed permanent and partial: Provided, however, That a member
(1) complete and permanent loss of cannot enjoy the temporary total
the use of: disability benefit and sick leave pay
(2) such other cases as may be simultaneously: Provided, further,
determined by the GSIS. That if the disability requires more
extensive treatment that lasts
Temporary Disability Benefit beyond one hundred twenty (120)

days, the payment of the temporary
SECTION 18. Temporary Total
total disability benefit may be
Disability Benefit. —
extended by the GSIS but not to
(a) A member who suffers
exceed a total of two hundred forty
temporary total disability for reasons
(240) days.
not due to any of the conditions
enumerated in Section 15 hereof
shall be entitled to seventy-five

(b) The temporary total disability (2) the dependent children’s pension not
benefit shall in no case be less exceeding fifty percent (50%) of the
than Seventy pesos (P70.00) a basic monthly pension.
day.
(c) The notices required of the SECTION 21. Death of a Member. —
member and the employer, the (a) Upon the death of a member, the
mode of payment, and the other primary beneficiaries shall be
requirements for entitlement to entitled to:
temporary total disability benefits (1) survivorship pension:
shall be provided in the rules and Provided, That the deceased:
regulations to be prescribed by (i) was in the service at the
the GSIS. time of his death; or
(ii) if separated from the
SECTION 19. Non-scheduled service, has at least
Disability. — For injuries or illnesses three (3) years of
resulting in a disability not listed in the service at the time of
schedule of partial/total disability, as his death and has paid
provided herein, the GSIS shall thirty-six (36) monthly
determine the nature of the disability contributions within the
and the corresponding benefits therefor. five-year period
immediately preceding
Survivorship Benefits his death; or has paid a
SECTION 20. Survivorship Benefits. total of at least one
— When a member or pensioner dies, hundred eighty (180)
the beneficiaries shall be entitled to monthly contributions
survivorship benefits provided in prior to his death; or
Sections 21 and 22 hereunder subject to (3) the survivorship pension plus a
the conditions therein provided for. The cash payment equivalent to
survivorship pension shall consist of: one hundred percent (100%) of
(1) the basic survivorship pension which his average monthly
is fifty percent (50%) of the basic compensation for every year of
monthly pension; and service: Provided, That the

deceased was in the service at
the time of his death with at

least three (3) years of service; (3) when the survivors are the
or a cash payment equivalent dependent spouse and the
to one hundred percent (100%) dependent children, the
of his average monthly dependent spouse shall
compensation for each year of receive the basic survivorship
service he paid contributions, pension for life or until he/she
but not less than Twelve remarries, and the dependent
thousand pesos (P12,000.00): children shall receive the
Provided, That the deceased dependent children’s pension
has rendered at least three (3) mentioned in the immediately
years of service prior to his preceding paragraph (2)
death but does not qualify for hereof.
the benefits under the item (1)
or (2) of this paragraph. (c) In the absence of primary
(b) The survivorship pension shall be beneficiaries, the secondary
paid as follows: beneficiaries shall be entitled to:
(1) when the dependent spouse is (1) the cash payment equivalent to
the only survivor, he/she shall one hundred percent (100%) of
receive the basic survivorship his average monthly
pension for life or until he/she compensation for each year of
remarries; service he paid contributions,
(2) when only dependent children but not less than Twelve
are the survivors, they shall be thousand pesos (P12,000):
entitled to the basic Provided, That the member is
survivorship pension for as in the service at the time of his
long as they are qualified, plus death and has at least three (3)
the dependent children’s years of service; or
pension equivalent to ten (2) in the absence of secondary
percent (10%) of the basic beneficiaries, the benefits
monthly pension for every under this paragraph shall be
dependent child not exceeding paid to his legal heirs.
five (5), counted from the (d) For purposes of the survivorship
youngest and without benefits, legitimate children shall
substitution;

include legally adopted and (c) a pensioner, as defined in Section
legitimate children. 2(o) of this Act; or
(d) a retiree who at the time of his
SECTION 22. Death of a Pensioner. — retirement was of pensionable age
Upon the death of an old-age pensioner under this Act but who opted to retire
or a member receiving the monthly under Republic Act No. 1616.
income benefit for permanent disability,
the qualified beneficiaries shall be SECTION 24. Compulsory Life
entitled to the survivorship pension Insurance. — All employees except
defined in Section 20 of this Act, for Members of the Armed Forces of
subject to the provisions of the Philippines (AFP) and the
paragraph (b) of Section 21 hereof. Philippine National Police (PNP)
When the pensioner dies within the shall, under such terms and
period covered by the lump sum, the conditions as may be promulgated by
survivorship pension shall be paid only the GSIS, be compulsorily covered
after the expiration of the said period. with life insurance, which shall
automatically take effect as follows:
SECTION 23. Funeral Benefit. — The (1) for those employed after the
amount of funeral benefit shall be effectivity of this Act, their insurance
determined and specified by the GSIS in shall take effect on the date of their
the rules and regulations but shall not employment;
be less than Twelve thousand pesos (2) for those whose insurance will
(P12,000.00): mature after the effectivity of this
Provided, That it shall be increased to at Act, their insurance shall be deemed
least Eighteen thousand pesos renewed on the day following the
(P18,000.00) after five (5) years and maturity or expiry date of their
shall be paid upon the death of: insurance;
(a) an active member as defined under (3) for those without any life insurance
Section 2(e) of this Act; or as of the effectivity of this Act, their
(b) a member who has been separated insurance shall take effect following
from the service, but who may be said effectivity.
entitled to future benefit pursuant to
Section 4 of this Act; or Life Insurance Benefits

SECTION 25. Dividends. — An annual SECTION 28. Prescription. — Claims
dividend may be granted to all members for benefits under this Act except for
of the GSIS whose life insurance is in life and retirement shall prescribe
force for at least one (1) year in after four (4) years from the date of
accordance with a dividend allocation contingency.
formula to be determined by the GSIS.
SECTION 26. Optional Insurance. — SECTION 29. Facility of Payment. —
Subject to the rules and regulations The GSIS shall prescribe rules and
prescribed by the GSIS, a member may regulations to facilitate payment of
apply for insurance and/or pre-need benefit, proceeds, and claims under this
coverage embracing life, health, Act and any other laws administered by
hospitalization, education, memorial the GSIS. Payments made by the GSIS
plans, and such other plans as may be prior to its receipt of an adverse claim,
designed by the GSIS, for himself to a beneficiary or claimant
and/or his dependents. Any employer subsequently found not entitled thereto,
may likewise apply for group insurance shall not bar the legal and eligible
coverage for its employees. The recipient to his right to demand the
payment of the premiums/installments payment of benefits, proceeds, and
for optional insurance and pre-need claims from the GSIS, who shall,
products may be made by the insured or however, have a right to institute the
his employer and/or any person appropriate action in a court of law
acceptable to the GSIS. against the ineligible recipient.
SECTION 27. Reinsurance. — The SECTION 30. Settlement of Disputes.

GSIS may reinsure any of its interests or — The GSIS shall have original and
part thereof with any private company or exclusive jurisdiction to settle any
reinsurer whether domestic or foreign: dispute arising under this Act and any
Provided, That the GSIS shall submit an other laws administered by the GSIS.
annual report on its reinsurance
operations to the Insurance SECTION 31. Appeals. — Appeals
Commission. from any decision or award of the Board
shall be governed by Rules 43 and 45 of
Adjudication of Claims and the 1997 Rules of Civil Procedure
Disputes adopted by the Supreme Court on April

8, 1997 which will take effect on July 1, application by the GSIS, be punished for
1997: contempt.
Provided, That pending cases and those
filed prior to July 1, 1997 shall be SECTION 33. Oaths, Witnesses, and
governed by the applicable rules of Production of Records. — When
procedure: Provided, further, That the authorized by the Board, an official or
appeal shall take precedence over all employee of the GSIS shall have the
other cases except criminal cases when power to administer oath and
the penalty of life imprisonment or death affirmation, take depositions, certify to
or reclusion perpetua is imposable. The official acts, and issue subpoena ad
appeal shall not stay the execution of testificandum and subpoena duces
the order or award unless ordered by tecum to compel the attendance of
the Board, by the Court of Appeals or by witnesses and the production of books,
the Supreme Court and the appeal shall papers, correspondences, and other
be without prejudice to the special civil records deemed necessary as evidence
action of certiorari when proper. in connection with any question arising
under this Act. Any case of contumacy
SECTION 32. Execution of Decision. shall be dealt with in accordance with
— When no appeal is perfected and the provisions of Section 580 of the
there is no order to stay by the Board, Revised Administrative Code.
by the Court of Appeals or by the
Supreme Court, any decision or award Funds of the GSIS
of the Board shall be enforced and SECTION 34. Funds. — All
executed in the same manner as contributions payable under Section 5 of
decisions of the Regional Trial Court. this Act together with the earnings and
For this purpose, the Board shall have accruals thereon shall constitute the
the power to issue to the city or GSIS Social Insurance Fund. The said
provincial sheriff or its appointed sheriff Fund shall be used to finance the
such writs of execution as may be benefits administered by the GSIS
necessary for the enforcement of such under this Act. In addition, the GSIS
decision or award, and any person who shall administer the optional insurance
shall fail or refuse to comply with such fund for the insurance coverage
decision, award, writ or process after described in Section 26 hereof, the
being required to do so, shall, upon employees’ Compensation Insurance

Fund created under P.D. 626, as the basis of actuarial and management
amended, the General Insurance Fund studies.
created under Act No. 656, as
amended, and such other special funds SECTION 36. Investment of Funds. —
existing or that may be created for The funds of the GSIS which are not
special groups or persons rendering needed to meet the current obligations
services to the government. The GSIS may be invested under such terms and
shall maintain the required reserves to conditions and rules and regulations as
guarantee the fulfillment of its may be prescribed by the Board:
obligations under this Act. Provided, That investments shall satisfy
The funds of the GSIS shall not be the requirements of liquidity,
used for purposes other than what are safety/security and yield in order to
provided for under this Act. Moreover, ensure the actuarial solvency of the
no portion of the funds of the GSIS or funds of the GSIS:
income thereof shall accrue to the Provided, further, That the GSIS shall
General Fund of the national submit an annual report on all
government and its political investments made to both Houses of
subdivisions, instrumentalities and other Congress of the Philippines, to wit:
agencies including government-owned (a) in interest-bearing bonds or
and controlled corporations except as securities or other evidence of
may be allowed under this Act. indebtedness of the Government of
the Philippines;
SECTION 35. Deposits and (b) In interest-bearing deposits or
Disbursements. — All revenues securities in any domestic bank
collected and all accruals thereto shall doing business in the Philippines:
be deposited, administered and Provided, That in the case of such
disbursed in accordance with the law. A deposits, these shall not exceed at
maximum expense loading of twelve any time the unimpaired capital and
percent (12%) of the yearly revenues surplus or total private deposits of
from all sources may be disbursed for the depository bank, whichever is
administrative and operational expenses smaller: Provided, further, That said
except as may be otherwise approved bank has prior designation as a
by the President of the Philippines on depository for the purpose by the

Monetary Board of the Central (f) In debt instruments and other
Monetary Authority; securities traded in the secondary
(c) in direct housing loans to members markets;
and group housing projects secured (g) In loans to, or in bonds, debentures,
by first mortgage, giving priority to promissory notes or other evidence
the low income groups and in short- of indebtedness of any solvent
and-medium-term loans to members corporation created or existing under
such as salary, policy, educational, the laws of the Philippines;
emergency, stock purchase plan and (h) In common and preferred stocks of
other similar loans: Provided, That any solvent corporation or financial
no less than forty percent (40%) of institution created or existing under
the investable fund of the GSIS the laws of the Philippines listed in
Social Insurance Fund shall be the stock exchange with proven
invested for these purposes; track record or profitability over the
(d) in bonds, securities, promissory last three (3) years and payment of
notes or other evidence of dividends at least once over the
indebtedness of educational or same period;
medical institutions to finance the (i) In domestic mutual funds including
construction, improvement and investments related to the
maintenance of schools and operations of mutual funds; and
hospitals; (j) In foreign mutual funds and in
(e) in real estate property including foreign currency deposits or foreign
shares of stocks involving real estate currency-denominated debts, non-
property and investments secured speculative equities and other
by first mortgages on real estate or financial instruments or other assets
other collaterals acceptable to the issued in accordance with existing
GSIS: Provided, That such laws of the countries where such
investments shall, in the financial instruments are issued:
determination of the Board, redound Provided, That these instruments or
to the benefit of the GSIS, its assets are listed in bourses of the
members, as well as the general respective countries where these
public; instruments or assets are issued:
Provided, further, That the issuing
company has proven track record of

profitability over the last three (3) System as created under
years and payment of dividends at Commonwealth Act No. 186 shall
least once over the same period. implement the provisions of this Act.
SECTION 37. Records and Reports. SECTION 41. Powers and Functions
— The GSIS shall keep and cause to of the GSIS. — The GSIS shall exercise
keep such records as may be the following powers and functions:
necessary for the purpose of making (a) to formulate, adopt, amend and/or
actuarial studies, calculations and rescind such rules and regulations
valuations of the funds of the GSIS as may be necessary to carry out
including such data needed in the the provisions and purposes of this
computation of rates of disability, Act, as well as the effective
mortality, morbidity, separation and exercise of the powers and
retirement among the members and any functions, and the discharge of
other information useful for the duties and responsibilities of the
adjustment of the benefits of the GSIS, its officers and employees;
members. The GSIS shall maintain (b) to adopt or approve the annual
appropriate books of accounts to and supplemental budget of
record its assets, liabilities, income, receipts and expenditures
expenses, receipts and including salaries and allowances
disbursements of funds and other of the GSIS personnel; to
financial transactions and authorize such capital and
operations. operating expenditures and
disbursements of the GSIS as may
SECTION 38. Examination and be necessary and proper for the
Valuation of the Funds. — The GSIS effective management and
shall make a periodic actuarial operation of the GSIS;
examination and valuation of its funds in (c) to invest the funds of the GSIS,
accordance with accepted actuarial directly or indirectly, in accordance
principles. with the provisions of this Act;
(d) to acquire, utilize or dispose of, in
Administration any manner recognized by law,
SECTION 40. Implementing Body. — real or personal property in the
The Government Service Insurance Philippines or elsewhere

necessary to carry out the office in every province where
purposes of this Act; there exists a minimum of fifteen
(e) to conduct continuing actuarial and thousand (15,000) membership;
statistical studies and valuations to (k) to borrow funds from any source,
determine the financial condition of private or government, foreign or
the GSIS and taking into domestic, only as an incident in
consideration such studies and the securitization of housing
valuations and the limitations mortgages of the GSIS and on
herein provided, re-adjust the account of its receivables from any
benefits, contributions, premium government or private entity;
rates, interest rates or the (l) to invest, own or otherwise
allocation or re-allocation of the participate in equity in any
funds to the contingencies establishment, firm or entity;
covered; (m)to approve appointments in the
(f) to have the power of succession; GSIS except appointments to
(g) to sue and be sued; positions which are policy
(h) to enter into, make, perform and determining, primarily confidential
carry out contracts of every kind or highly technical in nature
and description with any person, according to the Civil Service rules
firm or association or corporation, and regulations: Provided, That all
domestic or foreign; positions in the GSIS shall be
(i) to carry on any other lawful governed by a compensation and
business whatsoever in pursuance position classification system and
of, or in connection with the qualifications standards approved
provisions of this Act; by the GSIS Board of Trustees
(j) to have one or more offices in and based on a comprehensive job
outside of the Philippines, and to analysis and audit of actual duties
conduct its business and exercise and responsibilities: Provided,
its powers throughout and in any further, That the compensation
part of the Republic of the plan shall be comparable with the
Philippines and/or in any or all prevailing compensation plans in
foreign countries, states and the private sector and shall be
territories: Provided, That the subject to the periodic review by
GSIS shall maintain a branch the Board no more than once

every four (4) years without this Act during the preceding year
prejudice to yearly merit reviews or including information and
increases based on productivity recommendations on broad
and profitability; policies for the development and
(n) to design and adopt an Early perfection of the programs of the
Retirement Incentive Plan (ERIP) GSIS;
and/or financial assistance for the (s) to maintain a provident fund, which
purpose of retirement for its own consists of contributions made by
personnel; both the GSIS and its officials and
(o) to fix and periodically review and employees and their earnings, for
adjust the rates of interest and the payment of benefits to such
other terms and conditions for officials and employees or their
loans and credits extended to heirs under such terms and
members or other persons, conditions as it may prescribe;
whether natural or juridical; (t) to approve and adopt guidelines
(p) to enter into agreement with the affecting investments, insurance
Social Security System or any coverage of government
other entity, enterprise, corporation properties, settlement of claims,
or partnership for the benefit of disposition of acquired assets,
members transferring from one privatization or expansion of
system to another subject to the subsidiaries, development of
provision of Republic Act No. housing projects, increased benefit
7699, otherwise known as the and loan packages to members,
Portability Law; and the enforcement of the
(q) to be able to float proper provisions of this Act;
instrument to liquefy long-term (u) any provision of law to the contrary
maturity by pooling funds for short- notwithstanding, to authorize the
term secondary market; payment of extra remuneration to
(r) to submit annually, not later than the officials and employees directly
June 30, a public report to the involved in the collection and/or
President of the Philippines and remittance of contributions, loan
the Congress of the Philippines repayments, and other monies due
regarding its activities in the to the GSIS at such rates and
administration and enforcement of under such conditions as it may

adopt. Provided, That the best savings and provide additional
interest of the GSIS shall be resources for social security
observed thereby; expansion and at the same time
(v) to determine, fix and impose afford individual members
interest upon unpaid premiums appropriate returns on their
due from employers and savings/investments. The
employees; programs shall be so designed as
(w) to ensure the collection or to spur socio-economic take-off
recovery of all indebtedness, and maintain continued growth;
liabilities and/or accountabilities, and
including unpaid premiums or (y) to exercise such powers and
contributions in favor of the GSIS perform such other acts as may be
arising from any cause or source necessary, useful, incidental or
whatsoever, due from all obligors, auxiliary to carry out the provisions
whether public or private. The of this Act, or to attain the
Board shall demand payment or purposes and objectives of this
settlement of the obligations Act.
referred to herein within thirty (30)
days from the date the obligation General Provisions
becomes due, and in the event of SECTION 49. Dispensation of Social
failure or refusal of the obligor or Insurance Benefits. —
debtor to comply with the demand, (a) The GSIS shall pay the retirement
to initiate or institute the necessary benefits to the employee on his last
or proper actions or suits, criminal, day of service in the government:
civil or administrative or otherwise, Provided, That all requirements are
before the courts, tribunals, submitted to the GSIS within a
commissions, boards, or bodies of reasonable period prior to the
proper jurisdiction within thirty (30) effective date of the retirement;
days reckoned from the expiry (b) The GSIS shall discontinue the
date of the period fixed in the processing and adjudication of
demand within which to pay or retirement claims under R.A. No.
settle the account; 1616 except refund of retirement
(x) to design and implement programs premium and R.A. No. 910. Instead,
that will promote and mobilize all agencies concerned shall process

and pay the gratuities of their punished by a fine of not less than
employees. The Board shall adopt Five thousand pesos (P5,000.00)
the proper rules and procedures for nor more than Twenty thousand
the implementation of this provision. pesos (P20,000.00), or by
imprisonment of not less than six
Penal Provisions (6) years and one (1) day to twelve
(a) Any person found to have (12) years, or both, at the
participated directly or indirectly in discretion of the court.
the commission of fraud, collusion, (d) The treasurer, finance officer,
falsification, or misrepresentation cashier, disbursing officer, budget
in any transaction with the GSIS officer or other official or employee
whether for him or for some other who fails to include in the annual
persons, shall suffer the penalties budget the amount corresponding
provided for in Article 172 of the to the employer and employee
Revised Penal Code. contributions, or who fails or
(b) Whoever shall obtain or receive refuses or delays by more than
any money or check invoking any thirty (30) days from the time such
provision of this Act or any amount becomes due and
agreement thereunder, without demandable, or to deduct the
being entitled thereto with the monthly contributions of the
intent to defraud any member, any employee shall, upon conviction by
employer, the GSIS, or any third final judgment, suffer the penalties
party, shall be punished by a fine of imprisonment from six (6)
of not less than Five thousand months and one (1) day to six (6)
pesos (P5,000.00) nor more than years, and a fine of not less than
Twenty thousand pesos Three thousand pesos (P3,000.00)
(P20,000.00) or by imprisonment but not more than Six thousand
of not less than six (6) years and pesos (P6,000.00), and in addition
one (1) day to twelve (12) years, or shall suffer absolute perpetual
both, at the discretion of the court. disqualification from holding public
(c) Whoever fails or refuses to comply office and from practicing any
with the provisions of this Act or profession or calling licensed by
with the rules and regulations the government.
adopted by the GSIS shall be

(e) Any employee or member who Revised Penal Code, and in
receives or keeps fund or property addition shall suffer absolute
belonging, payable or deliverable perpetual disqualification from
to the GSIS and appropriates the holding public office and from
same, or takes or misappropriates practicing any profession or calling
or uses the same to any purpose licensed by the government.
other than that authorized by this (g) The heads of the offices of the
Act, or permits another person to national government, its political
take, misappropriate or use said subdivisions, branches, agencies
fund or property by expressly and instrumentalities, including
consenting thereto, or through government-owned or controlled
abandonment or negligence, or is corporations and government
otherwise guilty of the financial institutions, and the
misappropriation of said fund or personnel of such offices who are
property, in whole or in part, shall involved in the collection of
suffer the penalties provided in premium contributions, loan
Article 217 of the Revised Penal amortization and other accounts
Code, and in addition shall suffer due the GSIS who shall fail, refuse
absolute perpetual disqualification or delay the payment, turnover,
from holding public office and from remittance or delivery of such
practicing any profession or calling accounts to the GSIS within thirty
licensed by the government. (30) days from the time that the
(f) Any employee, who after same shall have been due and
deducting the monthly contribution demandable shall, upon conviction
or loan amortization from a by final judgment, suffer the
member’s compensation, fails to penalties of imprisonment of not
remit the same to the GSIS within less than one (1) year nor more
thirty (30) days from the date they than five (5) years and a fine of not
should have been remitted under less than Ten thousand pesos
Section 6(a) shall be presumed to (P10,000.00) nor more than
have misappropriated such Twenty thousand pesos
contribution or loan amortization (P20,000.00), and in addition shall
and shall suffer the penalties suffer absolute perpetual
provided in Article 315 of the disqualification from holding public

office and from practicing any Criminal actions arising from violations
profession or calling licensed by of the provisions of this Act may be
the government. commenced by the GSIS or by the
(h) The officers and/or personnel aggrieved member, either under this Act
referred to in paragraph (g) of this or, in appropriate cases, under the
section shall be liable not only Revised Penal Code.
criminally but also civilly to the
GSIS or to the employee or SECTION 53. Implementing Rules and
member concerned in the form of Regulations. — The implementing rules
damages, including surcharges and regulations to carry out the
and interests. provisions of this Act shall be adopted
(i) For the charges or complaints and promulgated by the GSIS not later
referred to in paragraph (g) of this than ninety (90) days after the approval
Section, the liabilities therein set of this Act.
forth shall be construed as waiver
of the State of its immunity from SECTION 54. Non-impairment of
suit, hence, the above-mentioned Benefits, Powers, Jurisdiction,
officials and/or personnel may not Rights, Privileges, Functions and
invoke the defense of non-suability Activities. — Nothing in this Act shall
of the State. be construed to repeal, amend or limit
(j) Failure of the Members of the any provision of existing laws.
GSIS Board, including the Presidential Decrees and Letters of
chairman and the vice-chairman, Instructions, not otherwise specifically
to comply with the provisions of inconsistent with the provisions of this
paragraph (w) of Section 41 Act.
hereof, shall subject them to
imprisonment of not less than six SECTION 55. Exclusiveness of
(6) months nor more than one (1) Benefits. — Whenever other laws
year or a fine of not less than Five provide similar benefits for the same
thousand pesos (P5,000.00) nor contingencies covered by this Act, the
more than Ten thousand pesos member who qualifies to the benefits
(P10,000.00) without prejudice to shall have the option to choose which
any civil or administrative liability benefits will be paid to him. However, if
which may also arise therefrom. the benefits provided by the law chosen

are less than the benefits provided the view of establishing within a
under this Act, the GSIS shall pay only reasonable period a unitary social
the difference. security system.
SECTION 56. Appropriations. — The Sec. 2. Definition of Terms.

amount necessary to carry out the (a) “Contributions” shall refer to the
provisions of this Act shall be included in contributions paid by the employee
the respective budgets of the agencies or worker to either the Government
in the national government obligation Service Insurance System (GSIS) or
program of the year following its the Social Security System (SSS) on
enactment into law and thereafter.” account of the worker’s membership;
(b) “Portability” shall refer to the
LIMITED PORTABILITY LAW (RA transfer of funds for the account and
7699) benefit of a worker who transfers
“AN ACT INSTITUTING LIMITED from one system to the other;
PORTABILITY SCHEME IN THE (c) “Sector” shall refer to employment
SOCIAL SECURITY INSURANCE either in the public or private sector;
SYSTEMS BY TOTALIZING THE (d) “System” shall refer to either the
WORKERS’ CREDITABLE SERVICES SSS as created under Republic Act
OR CONTRIBUTIONS IN EACH OF No. 1161, as amended or the GSIS
THE SYSTEMS.” as created under Presidential
Approved: May 1, 1994 Decree No. 1146, as amended; and

(e) “Totalization” shall refer to the
SECTION 1. It is hereby declared the process of adding up the periods of
policy of the State to promote the creditable services or contributions
welfare of our workers by under each of the Systems, for
recognizing their efforts in purposes of eligibility and
productive endeavors and to further computation of benefits.
improve their conditions by providing

benefits for their long years of Sec. 3. Provisions of any general or
contribution to the national economy. special law or rules and regulations to
Towards this end, the State shall the contrary notwithstanding, a covered
institute a scheme for totalization and worker who transfers employment
portability of social security benefits with from one sector to another or is

employed in both sectors shall have Sec. 6. The Department of Labor and
his credible services or contributions Employment for the private sector
in both Systems credited to his service and the Civil Service Commission for
or contribution record in each of the the government sector, together with
Systems and shall be totalized for the SSS and the GSIS shall, within
purposes of old-age, disability, ninety (90) days from the effectivity of
survivorship and other benefits in this Act, promulgate the rules and
case the covered member does not regulations necessary to implement
qualify for such benefits in either or the provisions hereof: Provided, That
both Systems without totalization: any conflict in the interpretation of the
Provided, however, That overlapping law and the implementing rules and
periods of membership shall be credited regulations shall be resolved in favor of
only once for purposes of totalization. the workers.
Sec. 4. All contributions paid by such Sec. 7. All laws, decrees, orders, rules
member personally, and those that and regulations, or parts thereof, which
were paid by his employers to both are inconsistent with the provisions of
Systems shall be considered in the this Act are hereby repealed or modified
processing of benefits which he can accordingly.
claim from either or both Systems:
Provided, however, That the amount of Sec. 8. This Act shall take effect fifteen
benefits to be paid by one System shall (15) days after its complete publication
be in proportion to the number of in the Official Gazette or in at least two
contributions actually remitted to that (2) national newspapers of general
System. circulation, whichever comes earlier.
Sec. 5. Nothing in this Act shall be REPUBLIC ACT NO. 8972

construed to diminish or reduce the
SOLO PARENTS
benefits being enjoyed by a covered
worker arising from existing laws,
“AN ACT PROVIDING FOR
issuances, and company policies or BENEFITS AND PRIVILEGES TO

practices or agreements between the SOLO PARENTS AND THEIR
employer and the employees. CHILDREN, APPROPRIATING

FUNDS THEREFOR AND FOR (a) "Solo parent" - any individual
OTHER PURPOSES” who falls under any of the following
Took Effect November 28, 2000 categories:

(1) A woman who gives birth as a
result of rape and other crimes
Section 1. Title. - This Act shall be
against chastity even without a
known as the "Solo Parents' Welfare Act
final conviction of the offender:
of 2000."
Provided, That the mother
keeps and raises the child;
Section 2. Declaration of Policy. - It is
(2) Parent left solo or alone with
the policy of the State to promote the
the responsibility of parenthood
family as the foundation of the
due to death of spouse;
nation, strengthen its solidarity and
ensure its total development.
Towards this end, it shall
while the spouse is detained or
develop a comprehensive program of
is serving sentence for a
services for solo parents and their
criminal conviction for at least
children to be carried out by the
one (1) year;
Department of Social Welfare and
Development (DSWD), the Department
of Health (DOH), the Department of
due to physical and/or mental
Education, Culture and Sports (DECS),
incapacity of spouse as
the Department of the Interior and Local
certified by a public medical
Government (DILG), the Commission on
practitioner;
Higher Education (CHED), the Technical
Education and Skills Development
Authority (TESDA), the National
due to legal separation or de
Housing Authority (NHA), the
facto separation from spouse
Department of Labor and Employment
for at least one (1) year, as
(DOLE) and other related government
long as he/she is entrusted
and nongovernment agencies.
with the custody of the
children;
Section 3. Definition of Terms.

due to declaration of nullity or (b) "Children" - refer to those living
annulment of marriage as with and dependent upon the solo
decreed by a court or by a parent for support who are
church as long as he/she is unmarried, unemployed and not
entrusted with the custody of more than eighteen (18) years of
the children; age, or even over eighteen (18)
(7) Parent left solo or alone with years but are incapable of self-
the responsibility of parenthood support because of mental and/or
due to abandonment of spouse physical defect/disability.
for at least one (1) year; (c) "Parental responsibility" - with
(8) Unmarried mother/father who respect to their minor children shall
has preferred to keep and rear refer to the rights and duties of the
her/his child/children instead of parents as defined in Article 220 of
having others care for them or Executive Order No. 209, as
give them up to a welfare amended, otherwise known as the
institution; "Family Code of the Philippines."
(9) Any other person who solely (d) "Parental leave" - shall mean
provides parental care and leave benefits granted to a solo
support to a child or children; parent to enable him/her to perform
(10) Any family member who parental duties and responsibilities
assumes the responsibility of where physical presence is required.
head of family as a result of the (e) "Flexible work schedule" - is the
death, abandonment, right granted to a solo parent
disappearance or prolonged employee to vary his/her arrival and
absence of the parents or solo departure time without affecting the
parent. core work hours as defined by the
A change in the status or employer.
circumstance of the parent
claiming benefits under this Section 4. Criteria for Support. - Any
Act, such that he/she is no solo parent whose income in the
longer left alone with the place of domicile falls below the
responsibility of parenthood, poverty threshold as set by the
shall terminate his/her eligibility National Economic and Development
for these benefits. Authority (NEDA) and subject to the

assessment of the DSWD worker in counseling. This will focus on the
the area shall be eligible for assistance: resolution of personal relationship
Provided, however, That any solo parent and role conflicts.
whose income is above the poverty (c) Parent effectiveness services
threshold shall enjoy the benefits which include the provision and
mentioned in Sections 6, 7 and 8 of this expansion of knowledge and skills of
Act. the solo parent on early childhood
development, behavior
BENEFITS management, health care, rights and
Section 5. Comprehensive Package duties of parents and children.
of Social Development and Welfare (d) Critical incidence stress
Services. - A comprehensive package debriefing which includes
of social development and welfare preventive stress management
services for solo parents and their strategy designed to assist solo
families will be developed by the parents in coping with crisis
DSWD, DOH, DECS, CHED, TESDA, situations and cases of abuse.
DOLE, NHA and DILG, in coordination (e) Special projects for individuals in
with local government units and a need of protection which include
nongovernmental organization with temporary shelter, counseling, legal
proven track record in providing services assistance, medical care, self-
for solo parents. concept or ego-building, crisis
The DSWD shall coordinate with management and spiritual
concerned agencies the implementation enrichment.
of the comprehensive package of social

development and welfare services for Section 6. Flexible Work Schedule. -
solo parents and their families. The The employer shall provide for a flexible
package will initially include: working schedule for solo parents:
(a) Livelihood development services Provided, That the same shall not affect
which include trainings on livelihood individual and company
skills, basic business management, productivity: Provided, further, That any
value orientation and the provision of employer may request exemption from
seed capital or job placement. the above requirements from the DOLE
(b) Counseling services which include on certain meritorious grounds.
individual, peer group or family

Section 7. Work Discrimination. - No parental leave shall be non-
employer shall discriminate against any cumulative.
solo parent employee with respect to
terms and conditions of employment on
The parental leave, it should be
account of his/her status.
noted, is in addition to the legally
mandated leaves, namely, the SIL,
Section 8. Parental Leave. - In addition
the SSS sick leave, the SSS
to leave privileges under existing laws,
parental leave of not more than seven
maternity leave and the paternity
(7) working days every year shall be leave under R.A. No. 8187.
granted to any solo parent employee
who has rendered service of at least A solo parent is entitled to the
one (1) year. parental leave if the following
conditions are met:
Notes: (a) He/She has rendered at least one
The wording is "not more than (1) year of service whether
seven," so even a one-day leave is continuous or broken at the time
legal compliance. But Section 8 of the effectivity of the Act;
means to grant a maximum of seven (b) He/She has notified his/her
days in a year. employer of the availment thereof
within a reasonable time period;
The employee decides whether to and
utilize less than seven or up to seven (c) He/She has presented a Solo
days of leave. Thus, each application Parent Identification Card to
for leave may specify the number of his/her employer.
days requested, But the cumulative Unutilized parental leave is not
total each year cannot exceed seven convertible to cash unless otherwise
days. agreed.
The rules and regulations Noncompliance with the law may

implementing R.A. No. 8972 state in make the employer liable for
Section 8 that the seven-day damages.

prioritizing applicants below the poverty
Other than the paid leave, the law line as declared by the NEDA.
grants other benefits such as

Section 11. Medical Assistance. - The
educational benefit, flexible work
DOH shall develop a comprehensive
schedule, and housing benefits.
health care program for solo parents
and their children. The program shall be
The law prohibits discrimination
implemented by the DOH through their
against any solo parent with respect retained hospitals and medical centers
to terms and conditions of and the local government units (LGUs)
employment on account of his/her through their
status. provincial/district/city/municipal hospitals
and rural health units (RHUs).
Section 9. Educational Benefits. - The
DECS, CHED and TESDA shall provide Section 12. Additional Powers and
the following benefits and privileges: Functions of the DSWD. — The DSWD
(11) Scholarship programs for shall perform the following additional
qualified solo parents and their powers and functions relative to the
children in institutions of basic, welfare of solo parents and their
tertiary and technical/skills families:
education; and (1) Conduct research necessary to:
(12) Nonformal education (2) develop a new body of
programs appropriate for solo knowledge on solo parents;
parents and their children. (3) define executive and legislative
The DECS, CHED and TESDA shall measures needed to promote
promulgate rules and regulations for the and protect the interest of solo
proper implementation of this program. parents and their children; and
(4) assess the effectiveness of
Section 10. Housing Benefits. - Solo programs designed for
parents shall be given allocation in disadvantaged solo parents and
housing projects and shall be provided their children;
with liberal terms of payment on said (5) Coordinate the activities of
government low-cost housing projects in various governmental and
accordance with housing law provisions nongovernmental organizations

engaged in promoting and the personal comfort and enjoyment
protecting the interests of solo of the employer's family.
parents and their children; and Method of payment of wages agreed
(6) Monitor the implementation of
upon by the employer and
the provisions of this Act and
househelper:
suggest mechanisms by which
a. Whether it be hourly;
such provisions are effectively
b. Daily;
implemented.
c. Weekly;
Section 13. Implementing Rules and d. Monthly;

Regulations. - An interagency e. In piece or output basis.
committee headed by the DSWD, in Children of househelpers.—The
coordination with the DOH, DECS, children and relatives of a
CHED, TESDA, DOLE, NHA, and DILG househelper who live under the
is hereby established which shall employer's roof and who share the
formulate, within ninety (90) days upon
accommodations provided for the
the effectivity of this Act, the
househelpers by the employer shall
implementing rules and regulations in
NOT be deemed as househelpers
consultation with the local government
if they are not otherwise engaged
units, nongovernment organizations and
people's organizations. as such and are not required to
perform any substantial
KASAMBAHAY LAW household work.
Employment of Househelpers
‘’Househelpers’’- as used herein is Employment contract. — The initial
synonymous to the term "domestic contract for household service shall
servant" and shall refer to any not last for more than two (2) years.
person, whether male or female, who Exception: Such contract may be
renders services in and about the renewed from year to year.
employer's home and which services Equivalent daily rate. — The
are usually necessary or desirable equivalent minimum daily wage rate
for the maintenance and enjoyment of househelpers shall be determined
thereof, and ministers exclusively to

by dividing the applicable minimum industrial or agricultural enterprise at
monthly rate by thirty (30) days. a wage or salary rate lower than that
provided for agricultural and
Payment by results. — Where the nonagricultural workers.
method of payment of wages agreed
upon by the employer and the Opportunity for education. — If the
househelper is on piece or output househelper is under the age of
basis, the piece of output rates shall EIGHTEEN YEARS, the employer
be such as will assure the shall give him or her an opportunity
househelper of the minimum monthly for at least elementary education.
or the equivalent daily rate as The cost of such education shall be
provided in this issuance. part of the househelper's
compensation, unless there is a
Minimum cash wage. —shall be stipulation to the contrary.
basic cash wages which shall be
paid to the househelpers in addition Treatment of househelper.—The
to lodging, food and medical employer shall treat the househelper
attendance. in a JUST AND HUMANE
MANNER.
Time and manner of payment. — In no case shall physical violence be
Wages shall be paid directly to the used upon the househelper.
househelper to whom they are due
at least once a month. Board, lodging and medical
No deductions therefrom shall attendance. —The employer shall
be made by the employer unless furnish the househelper free of
authorized by the househelper charge suitable and sanitary living
himself or by existing laws. quarters as well as adequate food
and medical attendance.
Assignment to nonhousehold
work. — No househelper may be Indemnity for unjust termination
assigned to work in a commercial, of service. — If the period for

household service is fixed, neither transfer or use of the body of a
the employer nor the househelper deceased househelper for purposes
may terminate the contract before other than burial is prohibited.
the expiration of the term, except for When so authorized by the
a just cause. househelper, the transfer, use and
If the househelper is unjustly disposition of the body shall be in
dismissed, he or she shall be paid accordance with the provisions of
the compensation already earned Republic Act No. 349.
plus that for fifteen (15) days by way
of indemnity. Employment records. —The
If the househelper leaves without employer may keep such records as
justifiable reason, he or she shall he may deem necessary to reflect
forfeit any unpaid salary due him or the actual terms and conditions of
her not exceeding fifteen (15) days. employment of his househelper
which the latter shall authenticate by
Employment certification. the signature or thumbmark upon
househelper may demand from the request of the employer.
employer a written statement of the
nature and duration of the service Prohibited reduction of pay. —
and his or her efficiency and conduct When the compensation of the
as househelper. househelper before the promulgation
of these regulations is HIGHER than
Funeral expenses. — the employer that prescribed in the Code and in
shall bear the funeral expenses this issuance, the same shall not be
commensurate to the standards of reduced or diminished by the
life of the deceased. employer on or after said date.
Disposition of househelper's Relation to other laws and

body. — Unless so desired by the agreements. — Nothing in these
househelper or by his or her rules and regulations shall deprive a
guardian with court approval, the househelper of the right to seek

higher wages, shorter working hours regularly, in whole or in part, as a
and better working conditions than dwelling place
those prescribed herein, nor justify Exception: Those situated within the
an employer in reducing any benefit premises or compound of an
or privilege granted to the employer, contractor or
househelper under existing laws, subcontractor and the work
agreements or voluntary employer performed therein is under the active
practices, with terms more favorable or personal supervision by or for the
to the househelper than those latter.
prescribed in this Rule.
"Employer" means any natural or
EMPLOYMENT OF artificial person who, for his own
HOMEWORKERS account or benefit, or on behalf of
General statement of coverage. — any person residing outside the
This Rule shall apply to any person Philippines, directly or indirectly, or
who performs industrial homework through any employee, agent,
for an employer, contractor or contractor, subcontractor or any,
subcontractor. other person:
1. Delivers or causes to be
"Industrial Homework" is a system delivered any goods, articles or
of production under which work for materials to be processed or
an employer or contractor is carried fabricated
out by a homeworker at his/her 2. Sells any goods, articles or
home. materials for the purpose of
"Industrial Homeworker" means a having such goods or articles
worker who is engaged in industrial processed
homework.
"Contractor" or "subcontractor"
"Home" means any room, house, means any person who, for the
apartment or other premises used account or benefit of an employer,
delivers or causes to be delivered to

a homeworker goods or articles to be the rights and privileges granted by
processed in or about his home and law to legitimate labor organizations
thereafter to be returned, disposed of upon issuance of the certificate of
or distributed in accordance with the registration
direction of the employer. Registration of employer,
contractor and subcontractor. —
"Processing" means manufacturing, The Department shall, as soon as
fabricating, finishing, repairing, possible, conduct consultation
altering, packing, wrapping or meetings with government agencies
handling in any way connected with requiring registration of employers
the production or preparation of an and determine if the data being
article or material. supplied by the registration forms of
such agencies are the same as or
"Cooperative" is an association similar to those needed by the
registered under the Cooperative Department in the implementation of
Code of the Philippines. these regulations.
"Department" means the Payment for homework. —

Department of Labor and Immediately upon receipt of the
Employment. finished goods or articles, the
employer shall pay the homeworker
Self-organization. — Homeworkers or the contractor or subcontractor, as
shall have the right to form, join or the case may be, for the work
assist organizations of their own performed less the corresponding
choosing, in accordance with law. homeworker's share of SSS,
MEDICARE and ECC premium
Registration of homeworkers' contributions which shall be remitted
organization. — Any applicant by the contractor/subcontractor or
homeworker organization or employer to the SSS with the
association shall acquire legal employers' share.
personality, and shall be entitled to

However, where payment is
made to a contractor or Deductions. — No employer,
subcontractor, the homeworker shall contractor, or subcontractor shall
likewise be paid immediately after make any deduction from the
the goods or articles have been homeworker's earnings for the value
collected from the workers. of materials which have been lost,
destroyed, soiled or otherwise
Standard rates. — At the initiative of damaged unless the following
the Department or upon petition of conditions are met:
any interested party, the Secretary (a) (a)the homeworker concerned is
of Labor and Employment or his clearly shown to be responsible
authorized representative shall for the loss or damage;
establish the standard output rate or (b) the homeworker is given
standard minimum rate in reasonable opportunity to show
appropriate orders for the particular cause why deductions should not
work or processing to be performed be made;
by the homeworkers. (c) the amount of such deduction is
The standard output rates or piece fair and reasonable and shall not
rates shall be determined through exceed the actual loss or
any of the following procedures: damage; and
(a) time and motion studies; (d) the deduction is made at such
(b) an individual/collective rate that the amount deducted
agreement between the employer does not exceed 20% of the
and its workers as approved by homeworker's earnings in a
the Secretary or his authorized week.
representative;
(c) consultation with representatives Conditions for payment of work.
of employers and workers (a) The employer may require the
organizations in a tripartite homeworker to redo the work
conference called by the which has been improperly
Secretary.

executed without having to pay wages or earnings of his
the stipulated rate again. employees or homeworkers as
(b) An employer, contractor, or specified in this Rule, such
subcontractor need not pay the employer shall be jointly and
homeworker for any work which severally liable with the
has been done on goods and contractor or subcontractor to the
articles which have been returned workers of the latter, to the extent
for reasons attributable to the that such work is performed
fault of the homeworker. under such contract, in the same
manner as if the employees or
Enforcement Power. — The homeworkers were directly
Regional Director shall have the engaged by the employer.
power to order and administer 5. The employer, contractor or
compliance with the provisions of the subcontractor shall assist the
law and regulations affecting the homeworkers in the maintenance
terms and conditions of employment of basic safe and healthful
of homeworkers and shall have the working conditions at the
jurisdiction in cases involving homeworkers' place of work.
violations of this Rule.
Employment of minors as
Duties of employer, contractor homeworkers. — The provisions
and subcontractor: governing the employment of minors
3. It shall be the duty of such under this Code as well as the
employer to provide in such provisions on working children under
contract that the employees or the Child and Youth Welfare Code
homeworkers of the contractor shall govern the employment of
and the latter's subcontractor minors as homeworkers.
shall be paid in accordance with
the provisions of this Rule. Prohibitions for homework. — No
4. In the event that such contractor homework shall be performed on the
or subcontractor fails to pay the following:

(1) explosives, fireworks and articles (f) Facilitation of loans with
of like character; government and nongovernment
(2) drugs and poisons; and financial institutions; and
(3) other articles, the processing of (g) Information on availment of
which requires exposure to toxic housing programs under PAG-
substances. IBIG.
Assistance to registered Effect on other regulations. — This

homeworkers' organizations, Department Order shall be known as
employers, contractors and Rule XIV, Book III of the Rules
subcontractors. — The Regional Implementing the Labor Code
Office shall provide technical entided Employment of
assistance to registered Homeworkers and shall not be
homeworkers organizations, construed as authorizing the
employers, contractors and withdrawal or reduction of any
subcontractors relative to the existing benefit of homeworkers
following: provided under any law, order,
(a) Information on wages and other agreement, and employer practice or
benefits; policy.
(b) Conduct of time and motion
studies to ensure fair and Effectivity. — This Rule shall take
reasonable output rates; effect fifteen (15) days after
(c) Skills training; publication of its adoption in two (2)
(d) Maintenance of safe and newspapers of general circulation.
healthful conditions at the
workplace; AGRARIAN RELATIONS
(e) Information on entidement to REPUBLIC ACT NO. 6657:
social security and employees Comprehensive Agrarian Reform
compensation benefits; Law

TRANSFER OF LANDS TO percent (6%) per annum, shall be
TENANT-WORKERS paid by the tenant in fifteen (15)
Being a valid part of the labor force, years of fifteen (15) equal annual
tenant-farmers on private amortizations.
agricultural lands primarily devoted In case of default, the
to rice and corn under a system of amortizations due shall be paid by
share crop or lease tenancy whether the farmers' cooperative in which the
classified as landed estate or not defaulting tenant-farmer is a
shall be deemed owner of a portion member, with the cooperative having
constituting a family-size farm of five a right of recourse against him. The
(5) hectares if not irrigated and three government shall guarantee such
(3) hectares if irrigated. amortizations with shares of stock in
In all cases, the landowners government-owned and government-
may retain an area of not more than controlled corporations.
seven (7) hectares if such landowner
is cultivating such area or will now CONDITIONS OF OWNERSHIP
cultivate it. No tide to the land acquired by the
tenant-farmer under Presidential
DETERMINATION OF LAND Decree No. 27 shall be actually
VALUE issued to him unless and until he has
For the purpose of determining the become a full-fledged member of a
cost of the land to be transferred to duly recognized farmers'
the tenant-farmer, the value of the cooperative.
land shall be equivalent to two and Tide to the land acquired pursuant to
one-half (2-1/2) times the average Presidential Decree No. 27 or the
harvest of three (3) normal crop Land Reform Program of the
years immediately preceding the Government shall not be transferable
promulgation of Presidential Decree except by hereditary succession or
No. 27 on October 21, 1972. to the Government in accordance
The total cost of the land, with the provisions of Presidential
including interest at the rate of six Decree No. 27, the Code of Agrarian

Reforms and other existing laws and declared share tenancy relationships
regulations. as contrary to public policy.
IMPLEMENTING AGENCY The landowner cannot use the

The Department of Agrarian enactment of the Agrarian Reform
Reform shall promulgate the Code as the basis to set back or
necessary rules and regulations to eliminate the tenurial rights of the
implement the provisions of this tenant.'
Chapter.
Republic Act 3844 and Republic
COMMENTS AND CASES Act 6389, being social legislations,
"Land for the landless" is a slogan are designed to promote economic
that underscores the acute and social stability and must be
imbalance in the distribution of this interpreted liberally to give full force
precious resource among our and effect to their clear intent, not
people. But it is more than a slogan. only in favor of the tenant-farmers
It has become a battlecry but also of landowners.
dramatizing the increasingly urgent
demand of the dispossessed for a CONSTITUTIONAL PROVISIONS
plot of earth as their place under the In Article XIII about Social Justice
sun. and Human Rights, the Constitution
provides:
SHARE TENANCY ABOLISHED "Sec. 4. The State shall, by
Republic Act No. 3844 (8 August law, undertake an Agrarian
1963) abolished and outlawed share Reform Program founded on
tenancy and put in its stead the the right of farmers and
agricultural leasehold system. regular farmworkers who are
landless, to own directly or
Republic Act 6389 (10 September collectively the lands they till
1971) amending Republic Act 3844 or, in the case of other
farmworkers, to receive a just

share of the fruits thereof. To No. 27 shall enjoy the retention
this end, the State shall rights granted by Republic Act No.
encourage and undertake the 6657 under the conditions therein
just distribution of all described.
agricultural lands, subject to
such priorities and reasonable RETENTION LIMITS
retention limits as the The argument that Proclamation
Congress may prescribe, No. 131 and Executive Order No.
taking into account ecological, 229 should be invalidated because
developmental, or equity they do not provide for retention
considerations, and subject to limits as required by Article XIII,
the payment of just Section 4 of the Constitution is no
compensation. In determining longer tenable.
retention limits, the State shall
respect the right of small Republic Act No. 6657 now
landowners. The State shall provides for such limits in Section 6
further provide incentives for of the Law.
voluntary land-sharing." It declares:
Except as otherwise provided in this
COMPENSATION SCHEME Act, no person may own or retain
The Supreme Court declared that directly or indirectly, any public or
the content and manner of the just private agricultural land, the size of
compensation provided for in which shall vary according to factors
Section 18 of the CARP Law does governing a viable family-sized farm,
not violate the Constitution. such as commodity produced,
All rights previously acquired terrain, infrastructure, and soil fertility
by tenant-farmers under Presidential as determined by the Presidential
Decree No. 27 are retained and Agrarian Reform Council (PARC)
recognized. Landowners who were created hereunder, but in no case
unable to exercise their rights of shall retention by the landowner
retention under Presidential Decree exceed five (5) hectares.

necessary for subsistence and for
Three (3) hectares may be awarded the satisfaction of life's other needs.
to each child of the landowner, The Philippine Constitution
subject to the following qualifications: respects the superiority of the
(1) that he is at least fifteen (15) homesteaders' rights over the rights
years of age; and of the tenants guaranteed by the
(2) that he is actually tilling the land Agrarian Reform statute.
or directly managing the farm: Article XIII, Sec. 6 of the
Provided, That landowners 1987 Philippine Constitution
whose lands have been covered provides that "the State shall apply
by Presidential Decree No. 27 the principles of agrarian reform or
shall be allowed to keep the area stewardship, whenever applicable in
originally retained by them accordance with law, in the
thereunder: Provided further, disposition or utilization of other
that original homestead grantees natural resources, including lands of
or direct compulsory heirs who public domain under lease or
still own the original homestead concession suitable to agriculture,
at the time of the approval of this subject to prior rights, homestead
Act shall retain the same rights of small settlers, and the rights
of indigenous communities to their
LANDS NOT COVERED: ancestral lands."
1. Lands Obtained Through The Comprehensive
Homestead Patent Presidential Agrarian Reform Law of 1988 or
Decree No. 27. Republic Act 6657 supports the
The Homestead Act has been inapplicability of P.D. No. 27 to lands
enacted for the welfare and covered by homestead patents like
protection of the poor. The law gives those of the property in question.
a needy citizen a piece of land where Thus, Sec. 6 of Republic Act 6657
he may build a modest house for states: "Provided further, That
himself and family and plant what is original homestead grantees or their
direct compulsory heirs who still own

the original homestead at the time of conversion into a residential
the approval of this Act shall retain subdivision.
the same areas as long as they
continue to cultivate said 3.Livestock, Poultry and Swine
homestead."1 Raising Lands
Section II of R.A. 6657 which
2.Residential Subdivisions includes "private agricultural lands
Gonzales vs. Court of Appeals, G.R. devoted to commercial livestock,
No. 36213, June 29, 1989 — There poultry and swine raising" in the
is no merit in the petitioner's definition of "commercial farms" is
argument that in as much as invalid, to the extent that the
residential commercial lots may be aforecited agro-industrial activities
considered "agricultural,"' an are made to be covered by the
agricultural tenancy can be agrarian reform program of the
established on land in a residential State.
subdivision.
The Krivenko decision EMPLOYEE COMPENSATION
interpreting the constitutional PROGRAM
prohibition against transferring RULE 1. MEDICAL AND DENTAL
private agricultural land to SERVICES SECTION
individuals, corporations, or As used in this Rule, the following terms
associations not qualified to acquire shall have the meanings indicated
or hold lands of the public domain, hereunder unless the context clearly
save in the case of hereditary indicates otherwise:

"First-aid treatment" means adequate,
succession has nothing to do with
immediate and necessary medical and
agricultural tenancy.
dental attention or remedy given in case
An agricultural leasehold
of injury or sudden illness suffered by a
cannot be established on land which
worker during employment, irrespective
has ceased to be devoted to of whether or not such injury or illness is
cultivation or farming because of its work-connected, before more extensive
medical and/or dental treatment can be

secured. It does not include continued medical and dental services and
treatment or follow-up treatment for any facilities in the following cases and
injury or illness. manner:
(a) When the number of workers is
"Workplace" means the office, from 10 to 50 in a workplace, the
premises or worksite where the workers services of a graduate first-aider
are habitually employed and shall shall be provided who may be one of
include the office or place where the the workers in the workplace and
workers who have no fixed or definite who has immediate access to the
worksite regularly report for assignment first-aid medicines prescribed in
in the course of their employment. Section 3 of this Rule.
(b) Where the number of workers
"First-aider" means any person trained exceeds 50 but not more than 200,
and duly certified as qualified to the services of a full-time registered
administer first aid by the Philippine nurse shall be provided.
National Red Cross or by any other However, if the workplace is
organization accredited by the former. nonhazardous, the services of a full-
time first-aider may be provided if a
Medicines and facilities. — Every nurse is not available.
employer shall keep in or about his (c) Where the number of workers in
workplace the first-aid medicines, the workplace exceeds 200 but
equipment and facilities that shall be not more than 300, the services of
prescribed by the Department of Labor a full-time registered nurse, a part-
within 5 days from the issuance of these time physician and a parttime
regulations. dentist, and an emergency clinic
The list of medicine, equipment and shall be provided, regardless of the
facilities may be revised from time to nature of the undertaking therein.
time by the Bureau of Labor Standards, The physician and dentist engaged
subject to the approval of the Secretary for such workplace shall stay in the
of Labor. premises for at least two (2) hours a
day.
Emergency medical and dental (d) Where the number of workers in a
services. — Any employer covered by hazardous workplace exceeds
this Rule shall provide his employees 300, the services of a full-time nurse,

a full-time physician, a full-time Training and qualifications of medical
dentist, a dental clinic and an and dental personnel. — The health
infirmary or emergency hospital with personnel required to be hired by an
one bed capacity for every 100 employer pursuant to the Code and
workers shall be provided. these Rules shall have the following
The physician and dentist shall stay minimum qualifications:
in the premises of the workplace for (a) A first-aider must be able to read
at least eight (8) hours a day. and write and must have completed
(e) In all workplaces where there are a course in first aid duly certified by
more than one (1) workshift in a the National Red Cross or any other
day, the employer shall, in addition organization accredited by the same.
to the requirements of this Rule, (b) A nurse must have passed the
provide the services of a full-time examinations given by the Board of
first-aider for each workshift. Examiners and duly licensed to
practice nursing in the Philippines
Emergency hospital. — An employer and preferably with at least fifty (50)
need not put up an emergency hospital hours of training in occupational
or dental clinic in the workplace as nursing conducted by the
required in these regulations where Department of Health, the Institute of
there is a hospital or dental clinic which Public Health of the University of the
is not more than five (5) kilometers away Philippines or by any organization
from the workplace if situated in any accredited by the former.
urban area or which can be reached by (c) A physician, whether permanent or
motor vehicle in twenty-five (25) minutes part-time, must have passed the
of travel if situated in a rural area and examinations given by the Board of
the employer has facilities readily Examiners for physicians, is licensed
available for transporting a worker to the to practice medicine in the
hospital or clinic in case of emergency; Philippines and preferably a
Provided, That the employer shall enter graduate of a training course in
into a written contract with the hospital occupational medicine conducted by
or dental clinic for the use thereof in the the Bureau of Labor Standards, the
treatment of workers in case of Institute of Public Health of the
emergency. University of the Philippines, or any

organization duly accredited by the issue from time to time a detailed list of
former. hazardous workplaces for purposes of
(d) A dentist, whether permanent or this Rule, in addition to the following:
part-time, must have passed the (a) Where the nature of the work
examinations given by the Board of exposes the workers to dangerous
Examiners for dentists, is licensed to environmental elements,
practice dentistry in the Philippines, contaminants or work conditions
and preferably has completed a including ionizing radiations,
training course in occupational chemicals, fire, flammable
dentistry conducted by the Bureau of substances, noxious components
Dental Services of the Department and the like.
of Health or any organization duly (b) Where the workers are engaged in
accredited by the former. construction work, logging,
firefighting, mining, quarrying,
Opportunity for training. — Nurses, blasting, stevedoring, dock work,
physicians, and dentists employed by deep-sea fishing and mechanized
covered employers on the date the farming.
Code becomes effective and who do not (c) Where the workers are engaged in
possess the special training the manufacture or handling of
qualifications provided in this Rule may explosives and other pyrotechnic
attend the respective training courses products.
pertinent to their field of specialization. (d) Where the workers use or are
exposed to heavy or power-driven
The Bureau of Labor Standards shall machinery or equipment.
initiate the organization and carrying out (e) Where workers use or are exposed
of appropriate training programs for to power-driven tools.
nurses, physicians and dentists in
coordination with the government Health program. — The physician
agencies or private organizations engaged by an employer pursuant to
referred to in the preceding Section. this Rule shall, in addition to providing
medical services to the workers in cases
Hazardous workplaces. — The Bureau of emergency, perform among others
of Labor Standards shall, with the the following duties:
approval of the Secretary of Labor,

(a) Conduct pre-employment medical (b) The employer shall maintain a
examination, free of charge, for the record of all medical examinations,
proper selection and placement of treatments and medical activities
workers; undertaken.
(b) Conduct free of charge annual (c) The employer shall submit reports in
physical examination of the workers; such form and containing such
(c) Collaborate closely with the safety information as the Bureau of Labor
and technical personnel of the Standards may require from time to
establishment to assure selection time.
and placement of workers from the
standpoint of physical, mental, RULE 2. OCCUPATIONAL HEALTH
physiological and psychological AND SAFETY.
suitability, including investigation of This Rule shall apply to all
accidents where the probable establishments, workplaces, and other
causes are exposure to occupational undertakings, including agricultural
health hazards; and enterprises, whether operated for profit
(d) Develop and implement a or not, except to:
comprehensive occupational health (1) those engaged in land, sea and air
program for the employees of the transportation; Provided, That their
establishment. A report shall be dry docks, garages, hangars,
submitted annually to the Bureau of maintenance and repair shops and
Labor Standards describing the offices, shall be covered by this
program established and the Rule; and
implementation thereof. (2) residential places exclusively
devoted to dwelling purposes.
Medical and dental records. — Except as otherwise provided herein, all
(a) The employer shall furnish the establishments, workplaces and
Bureau of Labor Standards with undertakings located in all chartered
copies of all contracts of cities as well as ordinary municipalities
employment of medical personnel shall be subject to the jurisdiction of the
and contracts with hospitals or Department of Labor in respect to the
clinics as provided in Section 5 of administration and enforcement of
this Rule. safety and health standards.

Chartered cities may be allowed to Safety Code as provided herein,
assume responsibility for technical existing safety orders issued by the
safety inspection by the Secretary of Department of Labor shall remain
Labor upon compliance with such effective and enforceable and shall
standards and guidelines as he may apply in full force and effect to all
promulgate. employers covered by this Rule.
Technical safety inspection includes Work condition not covered by

inspection for purposes of safety standards. — Any specific standards
determination of boilers, pressure applicable to a condition, practice,
vessels, internal combustion engines, means, method, operation, or process
elevators (passenger and freight), shall also apply to other similar work
dumbwaiters, escalators, and electrical situations for which no specific
installation in all workplaces. standards have been established.
General occupational health and Training of personnel in safety and

safety standards. — Every employer health. — Every employer shall take
covered by this Rule shall keep and steps to train a sufficient number of his
maintain his workplace free from work supervisors or technical personnel in
hazards that are causing or likely to occupational safety and health. An
cause physical harm to the workers or employer may observe the following of
damage to property. his personnel:
(a) In every nonhazardous
Occupational Health and Safety establishment or workplace
Code; effectivity of the existing having from fifty to four hundred
standards. — workers each shift, at least one of
(a) Within six (6) months from the date the supervisors or technical
of effectivity of this Rule, the Bureau personnel shall be trained in
of Labor Standards shall prepare occupational health and safety and
and adopt an Occupational Health shall be assigned as part-time safety
and Safety Code, subject to the man. Such safety man shall be the
approval of the Secretary of Labor. secretary of the safety committee.
(b) Until the final adoption and approval (b) In every nonhazardous
of an Occupational Health and establishment or workplace

having over four hundred workers Secretary of Labor or his authorized
per shift, at least two of its representatives.
supervisors shall be trained and a
full time safety man shall be General duties of workers. —
provided. (a) Every worker shall cooperate with
(c) In every hazardous establishment the employer in carrying out the
or workplace having from 20 to provisions of this Rule. He shall
200 workers each shift, at least report to his supervisors any work
one of its supervisors or technical hazard that he may discover in his
men shall be trained who shall work workplace without prejudice to the
as part-time safety man. He shall be right of the worker to report the
appointed as secretary of the safety matter to the Regional Office
committee therein. concerned.
(d) In every hazardous establishment (b) Every worker shall make proper use
or workplace having over 200 of all safeguards and safety devices
workers each shift, at least two of furnished in accordance with the
its supervisors or technical provisions of this Rule for his
personnel shall be trained and one protection and the protection of
of them shall be appointed full-time others and shall follow all
safety man and secretary of the instructions made by the employer in
safety committee therein. compliance widi the provisions of
(e) The employment of a full-time safety this Rule.
man may not be required where the
employer enters into a written
contract with a qualified consulting Duties of other persons. — Any
organization which shall develop and person, including builders or
carry out his safety and health contractors, who visits, builds, innovates
activities; Provided, That the or installs devices in establishments or
consultant shall conduct plant visits workplaces shall comply with the
at least four hours a week and is provisions of this Rule and all
subject to call any time to conduct regulations issued by the employer in
accident investigations and is compliance with the provisions of this
available during scheduled Rule and other subsequent issuances,
inspections or surveys by the of the Secretary of Labor.

Administration and enforcement. — The Bureau of Labor Standards shall
1. Every employer shall give to the conduct continuing studies and surveys
Secretary of Labor or his duly of workplaces to study new problems in
authorized representative access to occupational safety and health including
its premises and records at any time those created by new technology as well
of the day or night when there is a as the motivational and behavioral
work being undertaken therein for factors involved therein. The employer
the purpose of determining shall provide all the necessary
compliance with the provisions of assistance and facilities to carry out
this Rule. these activities.
2. Every establishment or workplace
shall be inspected at least once a Training. —
year to determine compliance with The Bureau of Labor Standards shall
the provisions of this Rule. conduct continuing program to increase
the competence of occupational health
Special inspection visits, however, and safety personnel and to keep them
may be authorized by the Regional informed of the latest trends, practices
Office to investigate accidents, conduct and technology in accident prevention.
surveys requested by the Bureau of
Labor Standards, follow-up inspection The Bureau of Labor Standards shall
recommendation or to conduct conduct continuing programs of safety
investigations or inspections upon personnel in all establishments or
request of an employer, worker or a workplaces and for this purpose every
labor union in the establishment. employer shall, take steps as may be
necessary for the participation in such
Research. — programs of at least two of his
The Bureau of Labor Standards, on supervisors or technical personnel for
the basis of experiments, studies, and every two hundred workers per shift,
any other information available to it, provided that in the establishments with
shall develop criteria dealing with toxic less than 200 workers at least one shall
materials and harmful substances which be assigned to participate in the training
will establish safe exposure levels for program.
various periods of employment.

ECC RULES, AMENDED RULES owned or -controlled corporations,
ON EMPLOYEES' the Philippine Tuberculosis Society,
COMPENSATION STATEMENT OF the Philippine National Red Cross

and the Philippine Veterans Bank; or
AUTHORITY
(2) The private sector covered by the
SSS, comprising all employers other
RULE 1. COVERAGE
than those defined in the
Nature. — Coverage shall be
immediately preceding paragraph.
compulsory.
Scope. —
Employee. —
1. Every employer shall be covered.
(a) The term shall mean any person
2. Every employee not over 60 years of
who performs services for an
age shall be covered.
employer as defined in Section 3
3. An employee over 60 years of age
hereof,
shall be covered if he had been
(b) An employee shall belong to either:
paying contributions to the System
(1) The public sector comprising
prior to age 60 and has not been
the employed workers who are
compulsorily retired.
covered by the GSIS, including
4. An employee who is coverable by
the members of the Armed
both the GSIS and SSS shall be
Forces of the Philippines,
compulsorily covered by both
elective officials who are
Systems.
receiving regular salary, and
any person employed as
Employer. —
casual, emergency, temporary,
The term shall mean any person, natural
substitute or contractual.
or juridical, domestic or foreign, who
(2) The private sector comprising
carries on in the Philippines any trade,
the employed workers who are
business, industry, undertaking or
covered by the SSS.
activity of any kind and uses the
services of another person who is under
Foreign employment. —
his orders as regards the employment.
Filipinos working abroad in the service
An employer shall belong to either:
of an employer as shall be covered by
(1) The public sector covered by the
the System, and entided to the same
GSIS, comprising the National
Government, including government-

benefits as are provided for employees SSS. — The following guidelines shall
working in the Philippines. apply to the private sector:
(1) Every employer already registered
Effectivity. — need not register again, for he is
Coverage of employers shall take effect automatically registered;
on the first day of operation but not (2) Every employer not yet registered
earlier than January 1, 1975. shall register not later than the first
Coverage of employees shall take effect day of operation;
on the first day of employment. (3) Every employee already registered
need not register again, for he is
RULE II. REGISTRATION. automatically registered;
Requirement. — (4) Every employee not yet registered
1. Every employer shall register with shall register not later than the date
the System by accomplishing the of employment; and
prescribed forms. (5) Only one registration is needed for
2. Every employee shall be registered SSS, Medicare and Employees'
with the System through his Compensation.
employer by accomplishing the (c) In case the employee has not yet
prescribed forms. been registered, he shall be reported
by his employer according to the
GSIS. — The following guidelines shall following guidelines:
apply to the public sector: (6) Every employee already reported
(1) Every employer operating before need not be reported again, for he is
January 1,1975 shall register not automatically reported.
later than March 31, 1975; (7) Every newly hired employee shall be
(2) Every employer operating on or after reported by his employer not later
January 1,1975 shall register within than 30 days from the date of
one month from the first day of employment; and
operation; and (8) Every employee shall be deemed as
(3) Every employee shall be registered having been duly reported for
through his employer within one coverage if the System has received
month from the date of employment. a report or written communication
about him from his employer or an
EC contribution paid in his name by

his employer, before a compensable For the sickness and the
contingency occurs. resulting disability or death to be
compensable, the sickness must be the
Penalty. — Any violation under this result of an occupational disease listed
Rule shall be penalized as follows: under Annex "A" of these Rules with the
(1) In case of failure or refusal to conditions set therein satisfied;
register employees, the employer or otherwise, proof must be shown that the
responsible official who committed risk of contracting the disease is
the violation shall be punished with a increased by the working conditions.
fine of not less than PI,000 nor more Only injury or sickness that
than PI0,000 and/or imprisonment occurred on or after January 1, 1975
for the duration of the violation or and the resulting disability or death shall
non-compliance or until such time be compensable under these Rules.
that rectification of the violation has
been made, at the discretion of the Occupational diseases. —
Court.  The diseases listed in Annex "A" of
(2) In case a compensable contingency these Rules are occupational when
occurs after 30 days from the nature of employment is as
employment and before the System described therein.
receives any report for coverage  The employer shall require pre-
about the employee or EC employment examination of all
contribution on his behalf, his prospective employees, provide
employer shall be liable to the periodic medical examination to
System for the lump sum equivalent employees who are exposed to
to the benefits to which he or his occupational diseases, and take such
dependents may be entided. other measures as may be necessary.
 The periodic medical examination for
RULE III. COMPENSABILITY. the early detection of occupational
Grounds. — For the injury and the diseases shall be in accordance with
resulting disability or death to be the minimum standards prescribed in
compensable, the injury must be the Annex "B" hereof.
result of accident arising out of and in
the course of the employment. (ECC Authority of the Commission. — The
Resolution No. 2799, July 25, 1984.) Commission is hereby authorized to

determine and approve additional Republic Act numbered forty-eight
occupational diseases and work-related hundred sixty-four, as amended, and
illnesses with specific criteria based on other laws whose benefits are
peculiar hazards of employment. administered by the System or by other
agencies of the government. (ECC
RULE IV. LIABILITY. Resolution No. 2799, July 25, 1984.)
Limitation. — No compensation shall
be allowed to the employee or his Third parties. — When the disability or
dependents when the injury, sickness, death is caused by circumstances
disability or death was occasioned by creating a legal liability against a third
any of the following: party, the disabled employee or the
(1) his intoxication; dependents in case of his death shall be
(2) his willful intention to injure or kill paid benefit from the System under
himself or another; or these Rules. In case benefit is claimed
(3) his notorious negligence. and allowed under these Rules, the
System shall be subrogated to the rights
Extent of liability. — Unless otherwise of the disabled employee or the
provided, the liability of the state dependents in case of his death in
insurance fund shall be exclusive and in accordance with existing laws.
place of all other liabilities of the
employer to the employee or his Unauthorized changes. — The System
dependents or anyone otherwise shall not be liable for compensation for
entided to receive damages on behalf of unauthorized changes in medical
the employee or his dependents. services, appliances, supplies,
The payment of compensation hospitals, rehabilitation services or
under this tide shall not bar the recovery physicians. Should there be any reason
of benefits as provided for in Section for such changes, the employee or his
699 of the Revised Administrative Code, dependents shall notify the System and
Commonwealth Act numbered 186, as secure its prior consent before the
amended, Republic Act numbered sixty changes may be effected.
one hundred eleven, as amended,
Republic Act numbered eleven hundred Medical reports. — An employee
sixtyone, as amended, Republic Act enjoying temporary total disability
numbered six hundred ten, as amended, benefits shall submit to the System a

monthly medical report on his disability (2) For a covered employee in the
certified by his attending physician; private sector, his employer shall
otherwise, his benefit shall be remit to the SSS a monthly
suspended until such time that he contribution equivalent to one
complies with this requirement. percent of his monthly salary credit
An employee enjoying as of the last day of the month, in
permanent disability benefit where the accordance with the following
disability resulted from a disease shall schedule:
submit to the System a quarterly Salary Rang Monthl Employer’s
medical report on his disability certified bracke e of y Contributio
by his physician; otherwise, his benefit t wage Salary n
shall be suspended until such time that salary Credit
he complies with this requirement. I P1- P25 P0.25
P49.9
RULE V. EMPLOYER’S 9
II 50- 75 0.75
CONTRIBUTION.
99.99
Rate and amount. — Subject to the III 100- 125 1.25
following conditions, contributions under 149.9
these Rules shall be paid in their 9
entirety by the employer and any IV 150- 175 1.75
contract or device for the deduction of 199.9
any portion thereof from the wages or 9

V 200- 225 2.25
salary of the employees shall be null
249.9
and void:
9
(1) For a covered employee in the VI 250- 300 3.00
public sector, his employer shall 349.9
remit to the GSIS a monthly 9
contribution equivalent to one VII 350- 425 4.25
percent of the actual wages or salary 499.9
received by him as of the last day of 9
VIII 500- 600 6.00
the month but not to exceed P30 per
699.9
employee. (ECC Resolution No.
9
1451 dated December 27, 1979.) IX 700- 800 8.00
899.9

9 Penalty. — Any violation of the
X 900- 1,000- 10.00 provisions on contribution under these
over 3,000 Rules shall be penalized as follows:
(1) Any employer who is delinquent in
(3) When a covered employee dies
his contributions shall be liable to the
during employment, or is separated
System for the benefits which may
from employment, his employer's
have been paid to his employees or
their dependents, and any benefit
and expenses to which such
employment shall cease on the last
employer is liable shall constitute a
day of the month of contingency.
preferred lien on all his property, real
(4) When a covered employee
or personal, over any credit except
becomes disabled during
taxes;
employment, his employer's
(2) The payment by the employer of the
lump sum equivalent of such liability
shall absolve him from the payment
employment shall be suspended
of the delinquent contributions due
during such months that he is not
and payable during the calendar
receiving salary or wages.
year of the contingency and penalty
(5) No refund of contribution shall be
thereon with respect to the
allowed under these Rules.
employee concerned, but said
employer shall still be subject to
Remittance. — Contributions shall start
criminal liability;
in January 1975 and every month
(3) In case of such delinquency, the
thereafter for as long as the employee
employer or responsible official who
has earnings. The initial contribution for
committed the violation shall be
the month of January 1975 shall be
punished with a fine of not less than
remitted by employer to the System in
PI,000 nor more than P10.000
February 1975, unless some other
and/or imprisonment for the duration
arrangement has been agreed by the
of the violation or noncompliance or
System and the employer.
until such time that a rectification of
the violation has been made, at the
Court's discretion;

(4) If any contribution is not paid to the employments, but not exceeding PI,000
SSS as prescribed under these in the case of SSS and P3.000 in the
Rules, the employer shall pay case of GSIS.
besides the contribution a penalty
thereon of 3 percent a month from Wages or salary. — Insofar as they
the date the contribution falls due refer to the computation of benefits,
until paid. Note: Under ECC means the monthly remuneration as
Resolution No. 1243 dated Jan. 18, defined in Republic Act No. 1161, as
1979, the System shall pay the amended for SSS and Presidential
employee or his dependents all Decree No. 1146, as amended, for
benefits due them under PD 626, as GSIS, respectively, except that part in
amended, without prejudice on its excess of Three thousand pesos. (ECC
part to proceed against the erring Resolution No. 3682, dated July 21
employer. 1987.)
RULE VI. DEFINITIONS RELATED TO Average monthly salary credit. —

CREDITED EARNINGS. In the case of the SSS, it is the result
obtained by dividing the sum of the
Quarter. — A period of three monthly salary credits in the 60-month
consecutive calendar months ending on period immediately preceding the
the last day of March, June, September semester of death or permanent
and December. disability, injury or sickness, by the
number of months of coverage in the
Semester. — A period of two same period, except for the. following
consecutive quarters ending in the cases:
quarter of contingency. (1) Where death or permanent disability
falls within 18 months from the
Monthly salary credit. — The wage month of coverage, it is the result
base for contributions or the actual obtained by dividing the sum of all
salary, as provided in Section 1 of Rule monthly salary credits paid prior to
V hereof. If earnings are derived from the month of death or permanent
more than one employment, it shall be disability by the number of calendar
determined on the basis of the months of coverage in the same
aggregate earnings from all period; and

(2) Where death or permanent disability months of coverage, excluding the
falls within the months of coverage, month of injury; and
it is the actual salary received during (2) Where the injury falls within the
the calendar month or its month of coverage, it is the actual
corresponding monthly salary credit. salary received during the calendar
(3) The day of injury or sickness which month or its corresponding monthly
caused the disability shall be used salary credit divided by 30.
as the reckoning date for the In the case of the GSIS, the average
purpose of computing the average daily salary credit shall be determined
monthly salary credit. as follows:
In the case of the GSIS, the average (1) If the salary or wage is based on an
monthly salary credit is the quotient after hourly rate, it is the hourly rate times
dividing the aggregate compensations the number of hours required to
received by the member or employee for work during the month of
the last three years immediately contingency divided by 22.
preceding his death, permanent (2) If the salary or wage is based on a
disability, injury or sickness, by the daily rate, it is the daily rate times
number of months he received said the number of days required to work
compensation, or Three thousand per month divided by 22.
pesos, whichever is smaller. (3) If the salary or wage is based on a
monthly rate, it is the monthly rate
Average daily salary credit. — divided by 22.
In the case of the SSS, it is the result (4) If the employee has worked for less
obtained by dividing the sum of the 6 than one month, his daily salary
highest monthly salary credits in the 12- credit is the actual daily wage or
month period immediately preceding the salary or the monthly wage or salary
semester of sickness by 180, except for divided by the actual number of days
the following cases: worked during the month of
(1) Where the injury falls within 12 contingency.
calendar months from the month of
coverage, it is the result obtained by Replacement ratio. — In the case of
dividing the sum of all monthly salary the SSS, it is the sum of twenty percent
credits by 30 and by the number of and the quotient obtained by dividing
three hundred by the sum of three

hundred forty and the average monthly monthly income benefit between EC and
salary credit. SSS and the 20% difference in monthly
income benefit between EC and GSIS,
Credited years of service. — For a be maintained. (LOI 1286.) (ECC
member covered prior to January 1975, Resolution No. 2799, July 25, 1984.)
nineteen hundred seventy-five minus
the calendar year of coverage, plus the In the case of the GSIS, the monthly
number of calendar years in which six or income benefit shall be the basic
more contributions have been paid from monthly pension as defined in PD 1146
January 1975 up to the calendar year plus twenty percent thereof, but shall not
containing the semester prior to the be less than P250, nor more than the
contingency. For a member covered in actual salary at the time of contingency.
or after January 1975, the number of (ECC Resolution No. 2799, July 25,
calendar years in which six or more 1984.)
contributions have been paid from the
year of coverage up to the calendar year RULE VII. BENEFITS.
containing the semester prior to the Types of benefits.—The benefits under
contingency. Employees' Compensation are in the
form of income or services, and consist
Monthly income benefit. — of the following:
In the case of the SSS, it is the amount (1) medical services, appliances and
equivalent to one hundred fifteen supplies;
percent of the sum of: The average (2) rehabilitation services;
monthly salary credit multiplied by the (3) temporary total disability benefit;
replacement ratio and one and a half (4) permanent total disability benefit;
percent of the average monthly salary (5) permanent partial disability benefit;
credit for each credited year of service (6) death benefit; and
in excess of ten years: Provided, That (7) funeral benefit.
the monthly income benefit shall in no
case be less than P250;Provided, Disability. —
however, That the monthly pension of (a) A total disability is temporary if as a
surviving pensioners shall be increased result of the injury or sickness the
automatically and simultaneously to the employee is unable to perform any
extent that the 15% difference in gainful occupation for a continuous

period not exceeding 120 days, appliances, supplies and rehabilitation
except as otherwise provided for in services.
Rule X of these Rules.
(b) A disability is total and permanent if Deprivation. — No contract, regulation
as a result of the injury or sickness or device whatsoever shall operate to
the employee is unable to perform deprive the employee or his dependents
any gainful occupation for a of any part of the income benefits, and
continuous period exceeding 120 medical or related services, except as
days, except as otherwise provided provided under these Rules. Existing
for in Rule X of these Rules. medical services being provided by the
(c) A disability is partial and permanent employer shall be maintained and
if as a result of the injury or sickness continued to be enjoyed by his
the employee suffers a permanent employees.
partial loss of the use of any part of
his body. Prescriptive period. — No claim for
compensation shall be given due course
Income benefit. — The disability or unless said claim is filed with the
death resulting from the injury or System within three years from the time
sickness is compensable by cash the cause of action accrued. (ECC
payments, and not the injury or sickness Resolution No. 2799, July 25, 1984.)
itselfi except in the case of permanent
partial disability. RULE VIII. MEDICAL APPLIANCES,
SERVICES AND SUPPLIES.
Income benefit for permanent partial
disability. — In the case where the Condition to entitlement. — Any
period covered for payment of income employee shall be entided to such
benefit for permanent partial disability medical services, appliances and
does not exceed twelve months, the supplies as the nature of his disability
System may pay in lump sum or in and the progress of his recovery may
monthly pension, otherwise, income require, subject to the expense limitation
benefit shall be paid in monthly pension. as contained in Annex "C" hereof, if all
of the following conditions are satisfied:
Services. — The injury or sickness is
compensable by medical services,

(1) He has been duly reported to the necessary for the treatment of the
System; employee at a cost not exceeding
(2) He sustains an injury or contracts the retail prices prevailing in local
sickness; and drug stores.
(3) The System has been duly notified of (c) Payments shall be made directly to
the injury or sickness. the providers of such services in
such amount as are prevailing in the
Period of Entitlement. — The medical community for similar services or
services, appliances and supplies shall provided under the schedule set
be provided to the afflicted employee forth in Annex "C" of these Rules,
beginning on the first day of injury or whichever is less.
sickness, during the subsequent period
of his disability, and as the progress of RULE DC. REHABILITATION
his recovery may require, subject to SERVICES.
Section 5 of Rule IV. As used in this Rule unless otherwise
indicated by the context, the following
definition of terms are hereby adopted:
(a) Rehabilitation. — The process by
Extent of Services. — which there is provided a balanced
(a) The employee is entided to the program of remedial treatment,
benefits only for the ward services of vocational assessment and
an accredited hospital and preparation designed to meet the
accredited physician. However, if the individual needs of each
employee chooses accommodations handicapped employee to restore
better than ward services, the him to suitable employment,
excess of the total amount of including assistance as may be
expenses incurred over the benefits within its resources to help each
provided under Annex *C" hereof, rehabilitee to develop his mental,
shall be borne by the employee. For vocational or social potential.
this purpose, Vard" means a hospital (b) Rehabilitee. — A disabled individual
room that can accommodate 6 or undergoing rehabilitation (student
more patients. rehabilitee or trainee) or who has
(b) The hospital shall provide all the finished a prescribed course in
medicines, drugs or supplies

rehabilitation in which he is known (f) Placement Officer. — A person
as a graduate-rehabilitee or trainee practicing the allied medical
(c) Rehabilitation Center. — An profession or discipline specialized
organized service of varied in psychology of the handicapped
rehabilitation measures usually and whose responsibility is to
located in one site for the personally advise and guide the
rehabilitation of disabled individuals. disabled individual to acceptance
(Example: the WRCC — the into a job.
Center). (g) Suitable Employment. —
(d) Rehabilitation Facility. — An Remunerative occupation giving the
organized service offering one or rehabilitee earning at least equal to
more types of service for the the statutory minimum wage.
rehabilitation of the handicapped
individual. Nature and effectivity of coverage. —
(e) Governing Board. — For this 1. Coverage under this Rule shall be
purpose, the Workers Rehabilitation voluntary.
Center Complex shall receive policy 2. Coverage under this Rule shall take
guidance from, and shall be under effect upon completion of
the general management of, the registration.
Employees' Compensation
Commission, which is hereby Condition to entitlement. — Any
constituted as its Governing Board. employee shall be entitled to
Whenever necessary, the Governing rehabilitation services, if all of the
Board may create an Advisory following conditions are satisfied:
Council that shall act as a (1) He has been reported to the System;
Consultative and Advisory Body, to (2) He sustains a permanent disability
be composed of representatives as a result of a compensable injury
from the National Commission on or sickness
Rehabilitation, the Ministry of Health,
the Institute of Public Health of the Period of entitlement. — Rehabilitation
University of the Philippines, and services shall be provided during the
such other specialized association period of the disability unless such
and organizations on rehabilitation services are suspended or terminated
as may be needed. under any of the following conditions:

(1) Upon suitable employment;
(2) Upon suspension or termination of Liability limitations. — The System
such services by the Rehabilitation shall not be legally responsible when the
Center; injury, sickness, disability or death
(3) By self-termination. during the rehabilitation is occasioned
by any of the following:
Extent of services. — Rehabilitation (1) His intoxication;
services shall consist of medicalsurgical (2) His willful intention to injure or kill
management, hospitalization, necessary himself or another;
appliances and supplies, vocational (3) His notorious negligence.
training and assistance for placement.
(Transportation allowance between Suspension, termination and appeal.
place of residence and the rehabilitation Grounds. — For adequate and duly
facility, lunch, and dormitory allowances proven causes and upon
in appropriate cases may be included in recommendation of the rehabilitation
the extent of services). counselor, the student-rehabilitee may
be suspended or terminated by the
Rehabilitation centers. — There shall Center.
be established a Workers Rehabilitation
Center Complex, and such other Appeal. — The decision of the Center
rehabilitation centers or services as the may be appealed within 15daysfrom
needs of occupationally disabled notice thereof to the Governing Board
employees, whether from private or whose decision shall be final and
public sector, may require. executory.
Accreditation of rehabilitation Placement — Arrangement for

facilities. — Hospitals accredited under placement of the rehabilitee shall be an
Rule XVII of these Rules; rehabilitation integral part of the rehabilitation
facilities, vocational and training centers program.
and their personnel participating in the
work of rehabilitation accredited by the Participation of the System. — As
Philippine Academy of Rehabilitation incentive to the participating employers
Medicine (PARM) may apply for in the on-the-job training and possible
accreditation. employment of the rehabilitee, the

System may enter into agreement with C. The System has been duly notified
the employer to participate in the of the injury or sickness which
payment of wages of the placed caused his disability. His employer
rehabilitee as follows: shall be liable for the benefit if such
(1) 50% of the wages for the first two illness or injury occurred before the
weeks after the start of the onthe-job employee is duly reported for
training; coverage to the System.
(2) 25% of the wages for the third and
fourth weeks of the on-the-job Period of entitlement. —
training; The income benefit shall be paid
(3) 10% of the wages for the fifth and beginning on the first day of such
sixth weeks of the on-the-job disability. If caused by an injury or
training; sickness it shall not be paid longer than
(4) 0% of the wages for the rest of the 120 consecutive days except where
period of the on-the-job training. such injury or sickness still requires
medical attendance beyond 120 days
Reports. — Reports to the Governing but not to exceed 240 days from onset
Board on the progress of activities of of disability in which case benefit for
rehabilitation program shall be temporary total disability shall be paid.
submitted by the Center once every 3 However, the System may declare the
months or as often as necessary. total and permanent status at any time
after 120 days of continuous temporary
RULE X. TEMPORARY TOTAL total disability as may be warranted by
DISABILITY. the degree of actual loss or impairment
Condition to entitlement. — An of physical or mental functions as
employee shall be entided to an income determined by the System.
benefit for temporary total disability if all After an employee has fully covered
of the following conditions are satisfied: from an illness as duly certified to by the
A. He has been duly reported to the attending physician, the period covered
System; by any relapse he suffers, or recurrence
B. He sustains the temporary total of his illness, which results in disability
disability as a result of the injury or and is determined to be compensable,
sickness; and shall be considered independent of, and
separate from, the period covered by

the original disability in the computation (a) An employee shall be entided to an
of his income benefit for temporary total income benefit for permanent total
disability (TTD). (ECC Resolution No. disability if all of the following
1029, August 10, 1978.) conditions are satisfied:
(1) He has been duly reported to the
Amount of benefit. — Any employee System;
entitled to benefit for temporary total (2) He sustains the permanent total
disability shall be paid an income benefit disability as a result of injury or
equivalent to 90 percent of his average sickness; and
daily salary credit, subject to the (3) The System has been duly
following conditions: notified of the injury or sickness
(1) The daily income benefit shall not be which caused his disability. His
less than P10.00 nor more than employer shall be liable for the
P90.00 nor paid longer than 120 benefit if such injury or sickness
days for the same disability, unless occurred before the employee is
the injury or sickness requires more duly reported for coverage to the
extensive treatment that lasts System.
beyond 120 days, but not to exceed (b) The following total disabilities shall
240 days from onset of disability, in be considered permanent:
which case he shall be paid benefit (1) Temporary total disability
for temporary total disability during lasting continuously for more
the extended period. than 120 days, except as
(2) The monthly income benefit shall be otherwise provided for in Rule
suspended if the employee fails to X hereof;
submit a monthly medical report (2) Complete loss of sight of both
certified by his attending physician eyes;
as required under Sec. 5 of Rule IV (3) Loss of two limbs at or above
hereof. (ECC Resolution No. 3682, the ankle or wrist;
July 21, 1987.) (4) Permanent complete paralysis
of two limbs;
RULE XI. PERMANENT TOTAL (5) Brain injury resulting in
DISABILITY. incurable imbecility or insanity;
Condition of entidement. — and

(6) Such cases as determined by (3) Complete or full recovery
the System and approved by from his permanent
the Commission. disability; or
(4) Upon being gainfully
Period of entitlement. — employed.
(a) The full monthly income benefits
shall be paid for all compensable Amount of benefit. —
months of disability. In the case of the SSS:
(b) After the benefit under Employees' (1) Any employee entided to permanent
Compensation shall have ceased as total disability benefit shall be paid
provided under the preceding by the System a monthly income
paragraph, and if the employee is benefit as defined in Sec. 9 (a), Rule
otherwise qualified for benefit for the VI of these Rules.
same disability under another law (2) The number of months of paid
administered by the System, he shall coverage shall be the number of
be paid a benefit in accordance with monthly contributions remitted to the
the provisions of that law. This System including contributions other
paragraph applies to condngencies than for Employees' Compensation if
which occurred prior to May 1,1978. paid before March 31,1975. The full
(c) Except as otherwise provided for in monthly income benefits shall be
other laws, decrees, orders or letters paid for all compensable months of
of instructions, the monthly income disability.
benefit shall be guaranteed for 5 (3) The first day preceding the semester
years and shall be suspended under of temporary total disability shall be
any of the following conditions: considered for purposes of
(1) Failure to present himself computing the monthly income
for examination at least benefit for permanent total disability.
once a year upon notice by
the System; Amount of benefit for dependent
(2) Failure to submit a quarterly children. —
medical report certified by Each dependent child, but not
his attending physician as exceeding five, counted from the
required under Sec. 5 of youngest and without substitution, shall
Rule IV hereof; be entitled to 10 percent of the monthly

income benefit of the employee. These (ECC Resolution No. 2819, August 9,
Rules shall not apply to causes of action 1984.)
which accrued before May 1,1978.
RULE XII. PERMANENT PARTIAL
Entitlement to the new income DISABILITY.
benefit under PD 1641. — Condition to entitlement —
The new amount of the monthly income (a) An employee shall be entitled to an
benefit computed under these amended income benefit for permanent partial
Rules shall be applicable to all disability if all of the following
contingencies occurring on or after conditions are satisfied:
January 1, 1980. However, for (1) He has been duly reported to
contingencies which occurred before the System;
May 1, 1978, the limitation of P12.000 or (2) He sustains the permanent
5 years, whichever comes first, shall be partial disability as a result of
enforced. the injury or sickness; and
In the case of the SSS, the (3) The System has been duly
present monthly income benefit of notified of the injury or
current pensioners shall be increased by sickness which caused his
20 percent effective January 1, 1980. disability. His employer shall
In the case of the GSIS, the be liable for the benefit if such
monthly income benefit of current injury or sickness occurred
pensioners shall be adjusted and before the employee is duly
recomputed to reflect the 20 percent reported for coverage to the
increase over the benefit under PD 1146 System.
effective January 1, 1980. (b) For purposes of entitlement to
income benefits for permanent
Aggregate monthly benefit payable. partial disability, a covered
— Except the benefit to dependent employee shall continue to receive
children under Section 4 of this Rule, the benefits provided thereunder
the aggregate monthly benefit payable, even if he is gainfully employed and
in the case of the GSIS, shall in no case receiving his wages or salary.
exceed the monthly wage or salary
actually received by the employee as of Period of entitlement. —
the date of his permanent total disability.

The income benefit shall be paid Only The First Joint Shall Be
beginning on the first month of such Considered A Loss Of One-Half Of
disability, but not longer than the The Whole Finger Or Toe. Other
designated number of months in the Permanent Partial Disabilities Shall
following schedule: Be Determined By The Medical
Complete and No. of Officer Of The System.
permanent loss of Months: (b) The Degree Of Permanent Disability
the use of Shall Be Equivalent To The Ratio
One thumb 10 That The Designated Number Of

Compensability Bears To 75.
One Index 8
finger
Amount of benefits. —
One middle 6
(a) Any employee entided to permanent
finger
partial disability benefit shall be paid
One ring 5 by the System a monthly income
finger benefit for the number of months
One little 3 indicated in Section 2 hereof. If the
finger indicated number of months
indicated in Section 2 hereof
One big toe 6
exceeds twelve, the income benefit
Any toe 3
shall be paid in monthly pension;
One arm 50 otherwise, the System may pay
income benefit in lump sum or in
(a) A Loss Of A Wrist Shall Be monthly pension.
Considered A Loss Of The Hand, (b) In case of permanent partial
And A Loss Of An Elbow Shall Be disability less than the total loss of
Considered A Loss Of The Arm, A the member, the same monthly
Loss Of An Ankle Shall Be income shall be paid for a portion of
Considered A Loss Of One Foot, the period established for the total
And A Loss Of A Knee Shall Be loss of the member in accordance
Considered A Loss Of The Leg; A with the proportion that the partial
Loss Of More Than One Joint Shall loss bears to the total loss. If the
Be Considered A Loss Of The result is a decimal fraction, the same
Whole Finger Or Toe; And A Loss Of

shall be rounded off to the next In cases of injuries or illnesses not listed
higher integer. in the schedule under Section 2 hereof,
(c) In case of simultaneous loss of more the benefit shall be an income benefit
than one member or a part thereof, equivalent to the percentage of the
the same monthly income shall be permanent loss of the capacity for work.
paid for a period equivalent to the (Non-Scheduled Disabilities)
sum of the periods established for
the loss of the member or part
thereof but not exceeding 75. If the RULE XIII. DEATH
result is a decimal fraction, the same Condition to entidement. —
shall be rounded off to the higher (a) The beneficiaries of a deceased
integer. employee shall be entided to an
(d) The new amount of the monthly income benefit if all of the following
income benefit computed under conditions are satisfied:
these amended Rules shall be (1) The employee had been duly
applicable to all contingencies reported to the System;
occurring on or after January (2) He died as a result of an injury
1,1980. However, for contingencies or sickness; and
which occurred before May 1,1978, (3) The System has been duly
the limitation of PI 2,000 or 5 years, notified of his death, as well as
whichever comes first, shall be the injury or sickness which
enforced. In the case of the SSS, the caused his death. His
present monthly income benefit of employer shall be liable for the
current pensioners shall be benefit if such death occurred
increased by 20 percent effective before the employee is duly
January 1,1980. In the case of the reported for coverage to the
GSIS, the monthly income benefit of System.
current pensioners shall be adjusted (4) If the employee has been
and recomputed to reflect the 20 receiving monthly income
percent increase over the benefit benefit for permanent total
under PD 1146 effective January 1, disability at the time of his
1980. death, the surviving spouse
must show that the marriage
Unlisted injuries and illnesses. —

has been validly subsisting at increased by ten percent for
the time of his disability. each dependent child but not
exceeding five (5), beginning
Period of entitlement. — with the youngest and without
For primary beneficiaries: substitution:
The income benefit shall be paid
beginning at the month of death and Provided, That the aggregate monthly
shall continue to be paid for as long as benefit payable in the case of the GSIS
the beneficiaries are entided thereto. shall in no case exceed the monthly
The monthly income benefit shall be wage or salary actually received by the
guaranteed for five years which in no employee at the time of his death; and
case shall be less than Fifteen thousand Provided, further, That the minimum
pesos (P15.000.00). Thereafter, the income benefit shall not be less than
beneficiaries shall be paid the monthly Fifteen thousand pesos (P15,000.00).
income benefit for as long as they are The death benefit shall be paid during
entided thereto. (ECC Resolution No. the entire period for which they are
2799, July 25, 1984.) entided thereto. If the employee has
been receiving income benefits for
For secondary beneficiaries: permanent total disability at the time of
The income benefit shall be sixty (60) his death, the primary beneficiaries shall
times the monthly income benefit of a be paid the monthly income benefit
primary beneficiary which in no case equivalent to eighty percent plus the
shall be less than PI 5,000.00, which dependent's pension equivalent to 10
shall likewise be paid in monthly percent thereof for every dependent
pension. (ECC Resolution No. 2799, child but not exceeding five counted
July 25, 1984.) from the youngest and without
Amount of benefit. — substitution.
(a) In the case of primary (b) In the case of secondary
beneficiaries, the monthly beneficiaries, the income benefit is
income benefit shall be payable in monthly pension which shall
equivalent to the monthly income not exceed the period of 60 months and
benefit for. permanent total the aggregate income benefit shall not
disability, which shall be be less than PI 5,000.00. If the
guaranteed for five years, employee has been receiving monthly

income benefit for permanent total thereto shall be governed by the
disability at the time of his death, the immediately preceding Section.
secondary beneficiaries shall be paid
the monthly pension, excluding the RULE XIV. FUNERAL BENEFIT.
dependent's pension of the remaining Entidement to funeral benefit — A
balance of the five-year guaranteed funeral benefit of Three thousand
period. (ECC Resolution No. 2799, July (P3.000.00) pesos shall be paid upon
25, 1984.) the death of a covered employee or
permanendy totally disabled pensioner
Entitlement to the new income to one of the following: (a) the surviving
benefit under PD 1641. — The new spouse; or (b) the legitimate child who
amount of the monthly income benefit spent for the funeral services; or (c) any
computed under these amended Rules other person who can show
shall be applicable to all contingencies incontrovertible proof or proofs of his
occurring on or after January 1, 1980. having borne the funeral expenses.
However, for contingencies which (ECC Resolution No. 3682, July 21,
occurred before May 1, 1978, the 1987.) Note: ECC Res. No. 3903
limitation of P12.000 or 5 years, increased the funeral benefit for the
whichever comes first, shall be private sector to P6.000 effective May 1,
enforced. In the case of the SSS, the 1988.
present monthly income benefit of
current pensioners shall be increased by RULE XV. BENEFICIARIES.
20 percent effective January 1, 1980. In Definition. —
the case of the GSIS, the monthly Beneficiaries shall be either primary or
income benefit of current pensioners secondary, and determined at the time
shall be adjusted and recomputed to of the employee's death.
reflect the 20 percent increase over the The following beneficiaries shall be
benefit under PD 1146 effective January considered primary:
1, 1980. SEC. 5. The new amount of (1) The legitimate spouse living with the
lump sum benefit computed under these employee at the time of the
Amended Rules shall be applicable to employee's death until he remarries;
all contingencies occurring on or after and
May 1,1980; otherwise, entidement (2) Legitimate, legitimated, legally
adopted or acknowledged natural

children, who are unmarried, not mental defect which is congenital or
gainfully employed, not over 21 acquired during minority.
years of age, or over 21 years of
age; Provided, That he is Priority. —
incapacitated and incapable of self- 1. Primary beneficiaries shall have
support due to physical or mental priority claim to death benefit over
defect which is congenital or secondary beneficiaries. Whenever
acquired during minority; Provided, there are primary beneficiaries, no
further, That dependent death benefit shall be paid to his
acknowledged natural child shall be secondary beneficiaries.
considered as a primary beneficiary 2. If the deceased employee has no
only when there are no other primary beneficiaries at the time of
dependent children who are qualified his death, the death benefit shall be
and eligible for monthly income paid to his secondary beneficiaries.
benefit; Provided finally, That if there 3. If the deceased employee has no
are two or more acknowledged beneficiaries at the time of his death,
natural children, they shall be the death benefit shall accrue to the
counted from the youngest and Employees' Compensation fund.
without substitution, but not
exceeding five. (ECC Resolution No. Benefits payable. — Primary
2799, July 25, 1984.) beneficiaries shall be entided to a
monthly income benefit. In their
The following beneficiaries shall be absence, the secondary beneficiaries
considered secondary: shall be entided to a monthly income
(1) The legitimate parents wholly benefit not to exceed 60 months and the
dependent upon the employee for death benefit shall not be less than
regular support; P15.000.00. (ECCResolution No. 2799,
(2) The legitimate descendants and July 25, 1984.)
illegitimate children who are
unmarried, not gainfully employed, RULE XVI. EMPLOYER’S RECORDS
and not over 21 years of age, or AND NOTICES.
over 21 years of age; Provided, That
he is incapacitated and incapable of Notice by employee. — The notice of
self-support due to physical or sickness, injury or death shall be given

to the employer by the employee, his gives false information, or withholds
dependents or anybody on his behalf, material information already in his
within 5 days from the occurrence of the possession, shall be liable to 50 percent
contingency. Said notice is not of the lump sum equivalent of the
necessary where the employer or his income benefit to which the employee
representative already had knowledge may be found to be entided and/or a fine
thereof, or the contingency occurred of not less than P500 nor more than
during working hours at the workplace. P5.000 and imprisonment for not less
than 6 months or more than one year, at
Employer's logbook. — Every the discretion of the Court. The sum
employer shall keep a logbook to record paid by the employer under this Section
chronologically the sickness, injury or shall accrue to the Employees'
death of his employees, within 5 days Compensation fund of the System.
from due notice thereof.
RULE XVII. ACCREDITATION.
Notice by employer. — The notice of Minimum requirements for
sickness, injury or death for cases which accreditation. —
the employer deems to be work- A physician may be accredited for
connected shall be submitted to the purposes of the Employees'
System by the employer within 5 days Compensation Program upon his
from due entry thereof in his logbook in application if he is a doctor of medicine
a form prescribed by the System. duly licensed to practice in the
Philippines and an active member in
Visitorial power. — The employer's good standing of the Philippine Medical
logbook prescribed in these Rules shall Association.
be made available for inspection to any
duly authorized representative of the A hospital may likewise be accredited
System during working hours. upon application if:
(1) it is an institution primarily engaged
Penalty. — Any employer who fails to in providing to in-patients, by or
record in his logbook the sickness, injury under the supervision of physicians,
or death of any of his employees within diagnostic and therapeutic services
5 days from knowledge or receipt of due for their medical diagnosis,
notice thereof as prescribed herein, treatment and care;

(2) it is adequately equipped with medicine, in neurology, or in neuro-
facilities for physicians to treat surgery, or in internal medicine, or in
injured or sick persons; orthopedic surgery), diagnostic or
(3) it maintains clinical records on all therapeutic services in rehabilitation
patients; practice;
(4) it has by-laws concerning its medical (2) it is adequately equipped with
staff; facilities for physical medicine
(5) it provides 24-hour nursing services rehabilitation (PMR);
by itself or supervised by a (3) it maintains clinical records on all
registered professional nurse; and patients;
has a licensed practical nurse or (4) it has by-laws concerning its medical
registered professional nurse on staff;
duty at all times; (5) it requires that every patient must be
(6) it requires that every patient must be under the care of a physician;
under the care of a physician; (6) it is licensed by the Bureau of
(7) it is licensed by the Bureau of Medical Services of the Department
Medical Services of the Department of Health;
of Health; (7) it meets the health and safety
(8) it meets the health and safety requirements of the Department of
requirements of the Department of Health and Department of Labor and
Health and Department of Labor; Employment; and
(9) it maintains a utilization review (8) it maintains a Utilization Review
committee as provided for in Section Committee as provided for in
3 of this Rule; and Section 3 of this Rule.
(10) it is a member in good standing The above requirements may be
of the Philippine Hospital modified by the Commission from time
Association. to time as circumstances may warrant.
A rehabilitation facility may be Conditions on accredited hospitals or

accredited upon application if: rehabilitation facilities and
(1) it is an institution engaged in physicians or rehabilitation
providing to in-patients, by or under specialists. —
the supervision of physicians (a) An accredited hospital or
(specialized in rehabilitation rehabilitation facility binds itself:

(1) not to collect from the patient (a) Every hospital or rehabilitation
any amount for ward services; facility shall have a Utilization
(2) to provide adequate services Review Committee, composed of at
on a non-discriminating basis; least two physicians or rehabilitation
(3) to limit charges for ward specialists, to help assure the most
services to the rates approved effective use of rehabilitation
by the Commission, , but not facilities, hospitals and services by
limited to, laboratory ward reviewing admissions each day on a
rates, laboratory facilities, x- sample basis and all long-stay
rays, stools, drugs, medical cases.
attendance and the Relative (b) The Committee shall decide in every
Value Scale (RVS) for surgical specific case being reviewed,
procedures, etc.; whether or not care in a hospital is
(4) to abide by these rules on medically necessary. In every case,
accreditation; the Committee shall discuss its
(5) to have its house rules conform findings with the patient's doctor
to the requirements of the before making a decision.
Commission; (c) The Committee shall advise in
(6) to subject its facilities to writing the patient, his doctor and the
inspection at anytime by duly hospital of its decision only if it has
authorized representatives of been decided that care in a hospital
the Commission or the System. is not medically necessary, in which
case no payment for room and
(b) An accredited physician binds board shall be made by the System.
himself:
(1) not to collect from the patient Coverage of services. —
any amount for ward services; (a) Payment for services shall ordinarily
(2) to provide adequate services on be made only to accredited
a nondiscriminating basis; and rehabilitation facilities or hospitals
(3) to abide by these rules on and accredited physicians.
accreditation. (b) Non-accredited rehabilitation facility
or hospitals and nonaccredited
Utilization review. — physicians shall be paid only for
emergency services. No payment

can be made to them for services state that the services rendered were
rendered after the emergency has necessary to prevent the death of the
ended. individual or the serious impairment of
his health. A bare
Emergency services. —  statement that an emergency existed
 Those services which are necessary is not sufficient. In addition, when in-
to prevent the death or serious patient services are involved, the
impairment of the health of the statement shall include the date when,
individual, and which necessitate the in the physician's judgment, the
use of the most accessible hospital emergency ceased.
available and equipped to furnish such
services. Referral. — Immediately upon
 An emergency no longer exists when it knowledge by the employer of his
becomes safe from a medical employee's injury or sickness at the
standpoint to move the patient to an workplace, he shall, in addition to the
accredited hospital, or to discharge medical and dental facilities which the
him whichever occurs first. pertinent provisions of the Code and
 The determination that the padent's these Rules on Accreditation may
condition requires emergency services require him to furnish, cause the
or that an emergency has ended shall employee to be brought by the fastest
be based on the physician's evaluation available means of transportation to the
and, when appropriate, on the duly accredited physician or hospital
patient's medical record and other nearest or most accessible to the
additional data furnished by the employee's place of work.
hospital.
 Claims filed by non-accredited Violation of conditions and
hospitals and non-accredited requirements, penalties. —
physicians for payment of emergency (a) An accredited hospital or physician
services shall be accompanied by a shall be disaccredited for violation of
physician's statement. any of the conditions and
 The physician's statement shall requirements under Sections 1 and
describe the nature of the emergency, 2 hereof without prejudice to the
furnish relevant clinical information imposition of penalties under Rule
about the condition of the patient, and XIX if applicable or to any other

penalty which the Commission may Income benefit. — The claim for
impose. income benefit shall be filed in a
(b) The cancellation or invalidation of prescribed form by the employee, his
accreditation of a physician or dependents or his employer, on his
hospital shall be effective on the behalf, direcdy with the System. Failure
date of notice of the disaccreditation. to file the claim within three years from
(c) In case of disaccreditation, the the time the cause of action accrued,
physician or the hospital shall carry shall forever bar the right to benefits
the disqualification wherever its granted under these Rules. (ECC
physical identity is found. Mere Resolution No. 2799, July 25, 1984.)
change of legal personality shall not
defeat the disqualification imposed. Adjudication. — Upon receipt of the
(d) Disaccreditation shall be lifted only claim, the System shall process the
on application and upon showing of same and determine whether or not the
good cause and effective upon injury, sickness, disability or death is
approval by the Commission. As compensable.
soon as accreditation is duly
restored, the hospital or physician Additional requirements. — If the
concerned shall be allowed to supporting papers of the claim are
participate in the Employees' insufficient to make proper
Compensation Program. determination, the System shall require
the submission of additional proofs from
RULE XVIII. SETTLEMENT OF the employee or his dependents, or from
CLAIMS. any office, entity or agency, public or
Services. — private, or from any person, having
(a) The claim for medical benefits shall knowledge of the contingency.
be filed in a prescribed form by the
accredited physician or accredited Appeal. — Within 10 days from receipt
hospital direcdy with the System. of the letter of denial or the affirmation of
(b) The claim for emergency services the denial, as the case may be, the
shall be filed in a prescribed form by claimant shall inform the System in
any physician or hospital. writing of his desire to appeal the
decision of the System. Upon receipt of
such appeal, the System shall within 5

days forward the entire record of the same manner as decisions of the Court
case to the Commission for review. of First Instance, and the Commission
Note: Period of appeal was increased shall have the power to issue to the City
from ten (10) to thirty (30) days by Rule or Provincial Sheriff or to the Sheriff it
IV. 1 of Suppletory Rules [Annex D may appoint, such writs of execution as
hereof]. may be necessary for the enforcement
of such decisions, orders or resolutions.
RULE XIX. REVIEW BY THE
COMMISSION. Failure to comply. — Any person or
Decision en banc. — Within 20- persons who fail or refuse to comply
working days from receipt of an with the writ of execution issued by the
appealed case, the Commission shall Commission shall be punished for
review and decide said case. Four contempt by the proper court. In the
affirmative votes shall decide the case. case of a corporation, trust, firm,
However, if only a quorum of four partnership, association or any other
members are present, three affirmative entity, the manager or officer-in-charge
votes shall decide the case. No motion when the offense was committed, shall
for reconsideration of the decision or be responsible.
resolution of the Commission en banc
shall be entertained. RULE XX. PENALTIES.
Penalty for failure to install and
Payment of awards. — Decisions, maintain safety devices, etc. — The
orders, or resolutions of the Commission System shall determine for purposes of
en banc awarding compensation shall imposing the penalty provided in Art 200
be complied with by the System within of the Code, whether the employee's
15 days from receipt of the notice sickness, injury or death was due to the
thereof. failure of the employer to comply with
any health and safety law, or failure to
Other decisions. — In all other cases install and maintain safety devices in
involving payments to be made by the accordance with standards set by the
employer, decisions, orders and Commission, or take other precautions
resolutions of the Commission en banc for the prevention of the sickness, injury
which have become final and executory or death. The requisite standards shall
shall be enforced and executed in the be set by the Commission within 6

months after the effectivity of these imprisonment shall not be less than
Rules. one year; if committed by a lawyer,
physician or other professional, he
Penal provisions. — shall in addition to the penalty
(a) The penal provisions of R.A. No. prescribed herein be disqualified
1161, as amended, and C.A. No. from the practice of his profession;
186, as amended, with regard to the and if committed by an official,
funds as are thereunder being paid employee or personnel of the
to, collected or disbursed by the Commission, System or any
System shall be applicable to the government agency, he shall in
collection, administration and addition to the penalty prescribed
disbursement of Employees' herein, be dismissed with prejudice
Compensation fund of the System. to reemployment in the government
The penal provisions on coverage service.
shall also be applicable.
(b) Any person who, for the purpose of RULE XXI. IMPPLEMENTING
securing entidement to any benefit PROVISION.
or payment under these Rules or the Effectivity. — These amended Rules
issuance of any certificate or and Regulations shall take effect June
document for any purpose whether 1,1987.
for him or for some other persons, Approved: July 21, 1987
commits fraud, collusion,
falsification, misrepresentation of
facts or any other kind of anomaly
shall be punished with a fine of not
less than P500 nor more than
P5.000 and imprisonment for not
less than 6 months nor more than
one year, at the discretion of the
Court.
(c) If the act penalized is committed by
any person who has been or is
employed by the Commission or
System or a recidivist, the

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UNIVERSITY OF MAKATI SCHOOL OF LAW

Centralized Bar Operations

Subject: LABOR LAW AND SOCIAL LEGISLATION

Labor Standards & Special Laws, Subject Head:

Labor Relations, Subject Head:

2021 University of Makati School of Law Centralized Bar Operations | 1

PART I. LABOR LAW

Chapter I – General Provisions

BOOK ONE – PRE-EMPLOYMENT

TITLE I – RECRUITMENT AND PLACEMENT OF WORKERS

TITLE II – EMPLOYMENT OF NON-RESIDENT ALIENS

BOOK TWO – HUMAN RESOURCES DEVELOPMENT PROGRAM

TITLE I – NATIONAL MANPOWER DEVELOPMENT PROGRAM

TITLE II – TRAINING AND EMPLOYMENT OF SPECIAL WORKERS

2 | University of Makati School of Law Centralized Bar Operations 2021

TITLE I – WORKING CONDITIONS AND REST PERIODS

TITLE III- WORKING CONDITIONS FOR SPECIAL GROUPS OF EMPLOYEES

Chapter I – Employment of Women

BOOK FOUR – HEALTH, SAFETY, AND SOCIAL WELFARE BENEFITS

TITLE I – MEDICAL, DENTAL, AND OCCUPATIONAL SAFETY

TITLE II – EMPLOYEES COMPENSATION AND STATE INSURANCE FUND

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TITLE III – MEDICARE

TITLE IV- ADULT EDUCATION

BOOK FIVE – LABOR RELATIONS

TITLE I – POLICY AND DEFINITIONS

TITLE II – NATIONAL LABOR RELATIONS COMMISSION

TITLE III – BUREAU OF LABOR RELATIONS

TITLE IV – LABOR ORGANIZATIONS

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TITLE VI – UNFAIR LABOR PRACTICES

TITLE VII – COLLECTIVE BARGAINING AND ADMINISTRATION OF

TITLE VII-A – GRIEVANCE MACHINERY AND VOLUNTARY ARBITRATION

TITLE VIII – STRIKE AND LOCKOUTS AND FOREIGN INVOLVEMENT IN

TITLE IX – SPECIAL PROVIONS

BOOK SIX – POST-EMPLOYMENT

TITLE I – TERMINATION OF EMPLOYMENT

TITLE II – RETIREMENT FROM THE SERVICE

BOOK SEVEN – TRANSITORY AND FINAL PROVISIONS

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TITLE II – PRESCRIPTION OF OFFENSES AND CLAIMS

TITLE III – TRANSISTORY ANF FINAL PROVISIONS

PART II. SOCIAL LEGISLATION

SOCIAL SECURITY LAW (RA 8282)

GSIS LAW (RA 8291)

GENERAL PRIMER ON RA 8291

LIMITED PORTABILITY LAW (RA 7699)

EMPLOYEE COMPENSATION PROGRAM

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management and labor is not merely organized and unorganized, and

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Art. 4. Construction in favor of labor.

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Art. 218. [211] Declaration of policy. B. To encourage a truly democratic

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