Labor Code of The Philippines Presidential Decree No. 442 of 1974, As Amended and Renumbered

Labor Code of the Philippines
PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED
A Decree Instituting a Labor Code Thereby Revising and Consolidating Labor and Social Laws to
Afford
Protection to Labor, Promote Employment and Human Resources Development and Insure
Industrial Peace Based on Social Justice
(Art. 1 – 6) social justice. In that sense, labor

laws are necessarily social
LABOR LEGISLATION; legislation.
1. DEFINITIONS:
3. SOCIAL JUSTICE AS THE AIM
Broadly divided into labor standards and • The aim, reason, and justification
labor relations: for labor laws is social justice.
• Labor standards law is that which • Section 3 of Article XIII says that
sets out the minimum terms, “the State shall afford full
conditions, and benefits of protection to labor, local and
employment that employers must overseas, organized and
provide and comply with and to unorganized, and promote full
which employees are entitled to as employment and equality of
a matter of right. employment opportunities for all.”
• Labor relations law is that which • This is because “without the
defines the status, rights and improvement of economic
duties, and the institutional conditions, there can be no real
mechanisms, that govern the enhancement of the political rights
individual and collective of the people.”
interactions of employers,
employees or their representatives.
4. CONSTITUTIONAL RIGHTS
Labor
understood as physical toil, A. of
is the familiar knowledge The basic rights of workers
any
guaranteed by the Constitution are:
although it does not necessarily art or science, united with
involve the application of skill readiness and dexterity in • the rights to organize
themselves,
execution or performance or in
• to conduct collective bargaining
the application of the science or
or negotiation with
art to practical purposes.
management,
• to engage in peaceful concerted
activities, including to strike in
2. LABOR LAW AND SOCIAL accordance with law,
LEGISLATION: • to enjoy security of tenure,
 Social legislation includes laws that • to work under humane
provide particular kinds of conditions,
protection or benefits to society or • to receive a living wage, to
segments thereof in furtherance of
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Afford
• participate in policy and • Must substitute rationality for

decision making processes confrontation in times of
affecting their rights and national emergencies
benefits as may be provided by • Must be made expeditious
law. without sacrificing due process
B. Balancing of Rights; the • Manpower development and
Constitutional Principle of Shared employment must be regarded
Responsibility as a major dimension of labor
policy
Question: what is the concept of
shared responsibility in labor? • Availability of a global labor
market to qualified Filipinos
5. POLICE POWER AS THE BASIS • Must command adequate
• The right of every person to resources and acquire capable
pursue a business, occupation machinery for effective and
or profession is subject to the sustained implementation
paramount right of the • There should be popular
government as a part of its participation in national policy
police power to impose such making through what is now
restrictions and regulations as called tripartism
the protection of the public may
require.
8. SOME LABOR LAWS BEFORE THE
PASSAGE OF THE CODE
6. BIRTH OF THE LABOR CODE • Act 1874 or the Employer’s
• Writing began under former Liability Act
Minister of Labor Blas Ople, • Act 2549 which prohibited
Father of the Labor Code payment of wages in non-cash
• The objective was not merely to form
consolidate the then existing • RA 1054 which required
pieces of social legislation, but emergency medical treatment
also to reorient them to the for employees
needs of economic
• CA 444 or the Eight Hour Labor
development and justice.
Law
• CA 103 which created the Court
7. PRINCIPLES UNDERLYING THE CODE of Industrial Relations (pre-
• Must be both responsive and NLRC)
responsible to national • PD 21 which created the NLRC
development
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Afford
• RA 875 or the Industrial Peace • The ILO formulates

Act/ Magna Carta of Labor international labor standards in
• RA 946 Blue Sunday Law the form of Conventions and
Recommendations setting
• RA 1052 or the Termination Pay
minimum standards of basic
Law
labor rights.
• An essential characteristic of
9. RELATED LAWS
ILO is tripartism, that is, it is
A. The Civil Code: composed not only of
• Labor relations not merely government representatives but
contractual, but must yield to also of employers’ and workers’
the common good. organizations. A. International
• Prohibition against involuntary Commitments:
servitude (Art. 1703) • By being an ILO member, the
• Also contains provisions country thereby subscribes t
regarding wages, house helpers the fundamental principles on
and liabilities of employers. which the ILO is based. Also, as
an ILO member, the Philippines
B. The Revised Penal Code
imbibes the obligation of the
• Punishes the use of violence or ILO to further programs that
threats by either employer or will achieve ILO objectives.
employee (Art. 289)
B. ILO Core Conventions
C. Special Laws
• SSS law, GSIS law, Agrarian The eight core conventions are as
Reform Law, 13th month Pay follows:
Law, etc.
• Forced Labor Convention (1930);
• Freedom of Association and
10. INTERNATIONAL ASPECT of LABOR
Protection of the Right to Organize
• On June 15, 1948, the Convention (1948);
Philippines became a member
• Freedom to Organize and Collective
of the International Labor
Bargaining Convention (1949);
Organization (ILO), which is the
UN specialized agency which • equal remuneration Convention
seeks the promotion of social (1951);
justice and internationally • Abolition of Forced Labor
recognized human and labor Convention (1957);
rights. • Discrimination (Employment and
Occupation) Convention (1958);
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Afford
• Minimum Age Convention (1973); • The working man’s welfare should

and be the primordial and paramount
• Worst Forms of Child Labor consideration. The policy is to
Convention (1999). extend the Decree’s applicability to
a greater number of employees to
Question: what is the significance of the enable them to avail of the benefits
Philippines’ adherence to international under the law, in consonance with
conventions on labor? the State’s avowed policy to give
maximum aid and protection to
DECLARATION OF BASIC POLICY (Art. 3) labor.
1. LABOR LAWS AND SOCIAL- b. Concern for Lowly Worker:
ECONOMIC GOALS • in various SC decisions, the SC
• Labor laws are devices for social reaffirms its concern for the lowly
equity. They may, depending on worker who, often at his employer’s
their provisions, make the rich mercy, must look up to the law for
richer and the poor poorer. protection. (Those who has less in
life, must have more of law)
• The value of labor laws is in their
contribution to national growth in c. Reason for According Greater
the context of social justice. Protection to Employees:
2. INTERDEPENDENCE • In the matter of employment
bargaining, there is no doubt that
• It should not be deduced that
the employer stands on higher
the basic policy is to favor labor
footing than the employee. This is
to prejudice capital. The plain
because there is a greater supply
reality is that both sectors need
than demand for labor. Also, the
each other. They are
need for employment comes from
interdependent- one is inutile
vital, even desperate, necessity.
without the other.
• The better understanding is that APPLICABILITY (Art. 6)
the basic policy is to balance or
coordinate the rights and A. APPLICABILITY TO GOVERNMENT
interests of both workers and CORPORATIONS
the employers. • The ruling now is that the Labor
Code applies to a corporation
CONSTRUCTION IN FAVOR OF LABOR incorporated under the Corporation
(Article 4) Code.
1. INTERPRETATION AND CONSTRUCTION • Government corporations created
by special charter from Congress
a. Laborer’s Welfare: Liberal Approach are subject to civil service rules,
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Afford
while those incorporated under the NOTE:

Corporation Code are covered by
the Labor code. The Labor Code consists of seven (7) books.
B. NON-APPLICABILITY TO Book One: Pre-employment
GOVERNMENT AGENCIES Book Two: Human Resources Development
• The terms governmental Program
“agency” or “instrumentality” Book Three: Conditions of Employment
are synonymous in the sense
Book Four: Health, Safety and Social
that either of them is a means
Welfare
by which a government acts, or
by which a certain government Benefits
act or function is performed.
• The word “instrumentality” Book Five: Labor Relations
with respect to the state, Book Six: Post Employment
contemplates an authority to Book Seven: Transitory and Final Provisions
which the state delegates Book Seven: Pre-employment (Art. 12 – 42)
government power for the
performance of a state
function.
o Example: The National
Parks Development
Committee is an agency
of the government, not
a government-owned
or controlled
corporation. Its
employees are covered
by civil service rules and
regulations, since they
are civil service
employees.
o But if function is
proprietary in nature,
its employees are
governed by the Labor
Code.
WEEK 2
5
A Decree Instituting a Labor Code Thereby Revising and Consolidating Labor and Social Laws to Afford
Protection to Labor, Promote Employment and Human Resources Development and Insure Industrial
Peace Based on Social Justice
Books One to Fours are covered under Labors Standards while Books five to seven deals with Labor
Relations
BOOK ONE: PRE-EMPLOYMENT (ARTS. 12 – 42)
RECRUITMENT AND PLACEMENT OF WORKERS
1. DEFINITIONS: for purposes of discussion, the following definitions are highlighted (this does
not mean however that the other terms found in Art. 13 are not important, do remember the
other definitions as well.
(b) "Recruitment and placement" refers to any act of canvassing, enlisting, contracting, transporting,
utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising
for employment, locally or abroad, whether for profit or not: Provided, that any person or entity which,
in any manner, offers or promises for a fee, employment to two or more persons shall be deemed
engaged in recruitment and placement.
WHAT CONSTITUTES RECRUITMENT AND PLACEMENT?
The number of persons is not an essential ingredient of the act of recruitment and placement of
workers. Any of the acts mentioned in the basic rule in Article 13 (b) will constitute recruitment and
placement even if only one prospective worker is involved.(People vs. Panis)
(c) "Private fee-charging employment agency" means any person or entity engaged in recruitment and
placement of workers for a fee which is charged, directly or indirectly, from the workers or employers
or both.
(e) "Private recruitment entity" means any person or association engaged in the recruitment and
placement of workers, locally or overseas, without charging, directly or indirectly, any fee from the
workers or employers.
(d) "License" means a document issued by the Department of Labor authorizing a person or entity to
operate a private employment agency.
(f) "Authority" means a document issued by the Department of Labor authorizing a person or
association to engage in recruitment and placement activities as a private recruitment entity.
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Art. 14. EMPLOYMENT PROMOTION
To pursue its responsibility to promote employment opportunities, the DOLE carries out programs for
local and overseas employment.
Art. 15: BUREAU OF EMPLOYMENT SERVICES
LOCAL EMPLOYMENT
• The Bureau of Employment Services has been replaced by the Bureau of Local Employment (BLE)
through EO 797 (May 1, 1982)
The PESO (Public Employment Service Office)

• Intended to serve as employment service and information center in its area of operation. It
regularly obtains a list of job vacancies from employers, publicizes them, invites and evaluates
applicants, and refers them for probable hiring.
Article 16: PRIVATE RECRUITMENT
AUTHORIZED ENTITIES
 Based on the Rules Implementing the Code, the following entities are authorized to
recruit and place workers for local or overseas employment:
1. public employment offices
2. Private recruitment entities
3. Private employment agencies
4. Shipping or manning agents or representatives
5. POEA
6. Construction contractors if authorized to operate by DOLE and the Construction Industry Authority
7. Members of the diplomatic corps although hirings done by them have to be processed through the
POEA
8. Other persons or entities as may be authorized by the DOLE Secretary.
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Article 17: OVERSEAS EMPLOYMENT DEVELOPMENT BOARD
1. OVERSEAS EMPLOYMENT, A BRIEF HISTORY
• Labor migration in the Philippines began in the 1900s when Hawaii experienced severe manpower
shortage. The 200 Filipinos that initially went there were followed by many more until they formed
about 70% of Hawaii’s plantation labor.
• Other countries such as the US, Canada, Australia, Japan and Saudi Arabia eventually followed suit.
2. LEGISLATIVE BACKGROUND OF OVERSEAS EMPLOYMENT

a. Act 2486: first law passed by Philippine Congress relating to overseas employment
b. PD 442: Labor code, paved the way for stricter government regulation of the overseas
employment industry.
c. PD 1412: revived private sector participation in the recruitment and placement of Filipino
migrant workers.
d. EO 797: Enacted to streamline operations in the overseas employment program.
e. EO 247: Reorganization Act of the POEA
f. RA 8042: Migrant Workers and Overseas Filipinos Act of 1995
3. OVERSEAS EMPLOYMENT POLICY
R.A. No. 8042
• “…The State does not promote overseas employment as a means to sustain economic growth and
achieve national development.”
• “… The existence of overseas employment program rests solely on the assurance that the dignity
and fundamental human rights and freedoms of the Filipino citizen shall not, at any time, be
compromised or violated.”
A. Selective Deployment
1. RA 8042 requires certain guarantee of protection for the overseas worker before they are
deployed in countries that meet some criteria:
a. It has existing labor and social laws protecting the rights of migrant workers;
b. It is a signatory to multilateral conventions, declarations or resolutions relating to the protection
of migrant workers;
c. It has concluded a bilateral agreement or arrangement with the government protecting the rights
of
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Filipino migrant workers;

d. It is taking positive, concrete measures to protect the rights of migrant workers.
2. Notwithstanding this… the government, in pursuit of national interest or when public
welfare so requires, may, at any time, terminate or impose a ban on the deployment of
migrant workers.
4. THE POEA: OVERVIEW OF ITS FUNCTIONS AND POWERS

a. Among the principal functions of the POEA are the formulation, implementation, and
monitoring of the overseas employment of the Filipino workers and the protection of their
rights to fair and equitable employment practices.
b. Overseas Filipino Worker (OFW) is understood as a Filipino worker who is to be engaged, is
engaged, or has been engaged in a remunerated activity in a country of which he/she is not a
legal resident.
c. OFWs are classified by DOLE as either land-based or sea-based.
A. REGULATORY FUNCTION OF POEA

 POEA regulates the private sector participation in the recruitment and overseas
placement of workers through its licensing and registration system.
B. ADJUDICATORY FUNCTIONS OF POEA
 POEA had original and exclusive jurisdiction to hear and decide the ff cases:
1. Recruitment violation and related cases consisting of all pre-employment cases which
are administrative in character, involving or arising out of recruitment laws, rules and
2. regulations, including money claims therefrom or violations of the conditions for
issuance of license to recruit workers.
3. Employer-employee relations cases consisting of all claims arising out of an
employeremployee relationship or by virtue of any law or contract involving Filipino
workers in overseas employment.
4. Disciplinary action cases consisting of all complaints against a contract worker for
breach of discipline.
Article 18: BAN ON DIRECT-HIRING
• Direct hiring of Filipino workers by a foreign employer is not allowed except direct hiring by
members of the diplomatic corps and others mentioned in this article.
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• Also excepted are “name hirees” or those individual workers who are able to secure contracts for
overseas employment on their own efforts and representations without the assistance or
participation of any agency.
ART. 22. Mandatory Remittance of Foreign Exchange Earnings.
• It shall be mandatory for all Filipino workers abroad to remit a portion of their foreign exchange
earnings to their families, dependents, and/or beneficiaries in the country in accordance with rules
and regulations prescribed by the Secretary of Labor.
• As a general rule, 50% of the foreign exchange earnings must be remitted
ART. 26. Travel Agencies Prohibited to Recruit.
 Travel agencies and sales agencies of airline companies are prohibited from engaging in
the business of recruitment and placement of workers for overseas employment whether for
profit or not.
Who are disqualified from being issued a license?
a. Travel agencies and sales agencies of airline companies

b. Officers or members of the Board of any corporation or members in a partnership engaged in the
business of a travel agency.
c. Corporations and partnerships, when any of its officers, members of the board or partners, is also
an officer, member of the board or partner of a corporation or partnership engaged in the business
of a travel agency.
d. Persons, partnerships or corporations which have derogatory records.
e. Any official or employee of the DOLE, POEA, OWWA, DFA and other government agencies directly
involved in the implementation of RA 8042, otherwise known as Migrant Workers and Overseas
Filipino Act of 1995 and/or any of his/her relatives within the fourth civil degree of consanguinity or
affinity.
f. Persons or partners, officers and Directors of corporations whose licenses have been previously
cancelled or revoked for violation of recruitment law.
Private Sector Participation in the Recruitment and Placement of Workers
a. Citizenship Requirement.
 Only Filipino citizens or corporations, partnerships or entities at least seventy-five
percent (75%) of the authorized and voting capital stock of which is owned and controlled by
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Filipino citizens shall be permitted to participate in the recruitment and placement of workers,
locally or overseas.
b. Capitalization.
• All applicants for authority to hire or renewal of license to recruit are required to have such
substantial capitalization as determined by the Secretary of Labor.
• The required capitalization, according to POEA rules, is a minimum of two million pesos in case
of single proprietorship or partnership and a minimum paid-up capital of the same amount for
a corporation.
What are the fees/costs chargeable to the workers?
1. placement fee
• It refers to the amount charged by a private employment agency from a worker for its
recruitment and placement services, which is equivalent to one-month salary, exclusive of
documentation costs.
2. documentations costs
• Documentation costs to be paid by the worker shall include, but not limited to, expenses for
the following:
a. Passport f. Trade Test, if necessary
b. NBI/Policy/Barangay Clearance g. Inoculation, when required by the host
c. Authentication country
d. Birth Certificate h. Medical Examination fees e. Medicare NOTE:
• The abovementioned placement and documentation costs are the only authorized payments
that may be collected from a hired worker. No other charges in whatever form, manner or
purpose, shall be imposed on and be paid by the worker without prior approval by the POEA.
• Such fees shall be collected from the hired worker only after he has obtained employment
through the facilities of the recruitment agency.
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Article 35: SUSPENSION AND/OR CANCELLATION OF LICENSE OR AUTHORITY
1. SUSPENSION OR CANCELLATION OF LICENSE
• The grounds for imposition of administrative sanctions include engaging in acts of

misrepresentation for the purpose of securing a license or renewal thereof, etc.
• The acts prohibited under Art. 34 are not just grounds for suspension or cancellation of license or
authority. They likewise constitute illegal recruitment under RA 8042.
2. PERSONS LIABLE; DURATION OF LIABILITY

• A recruitment agency is solidarily liable for the unpaid salaries of a worker it recruited for
employment with a foreign principal.
• Even if the recruitment agency and the principal had already severed their agency agreement at
the time the worker was injured the recruitment agency may still be sued for violation of the
employment contract, if no notice of the agency agreement’s termination was given to the
employee.
• The responsibilities of the recruitment agency and the principal to the worker extends up to and
until the expiration of the employment contracts of the employees recruited and employed
pursuant to the said employment agreement.
3. SOLIDARY LIABILITY ASSUMED BY RECRUITMENT AGENT
• Contract contained a provision empowering the agency to sue and be sued jointly and solidarily
with the foreign principal for any of the violations of the recruitment agreement and the contracts
of employment.
• These contractual undertakings constitute the legal basis for private agencies being liable jointly
and severally with its principal, for all claims filed by recruited workers which may arise in
connection with the implementation of the service agreements or employment contracts. (Royal
Crown Inernationale vs. NLRC)
Art. 38 – ILLEGAL RECRUITMENT
• Amended by Republic Act 8042 or The Migrant Workers and Overseas Filipinos Act of 1995 As
stated in the Code:
• Any recruitment activities, including prohibited practices enumerated under Art. 34 of this
Code, to be undertaken by non-licensees or nonholders of authority shall be deemed illegal
and punishable under Art. 39 of this Code
• (b) Illegal Recruitment, when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage and shall be penalized in accordance with Art. 39 hereof.
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Illegal Recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more
persons conspiring and/or confederating with one another in carrying out any unlawful of illegal
transaction, enterprise or scheme, defined under the first paragraph hereof.
Illegal Recruitment is deemed committed in large scale if committed against three (3) or more persons
individually or as a group.
NOTE: Under RA 8042, the abovementioned definition has been amended to also include LICENSED or
AUTHORIZED entities;
• the list of ACTS CONSIDERED AS ILLEGAL RECRUITMENT has also been EXPANDED as found in
SECTION 6, RA 8042:
Definition: xxx Illegal Recruitment shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers and includes referring contract services, promising
or advertising for employment abroad, whether for profit or not, when undertaken by a non-licensee or
non-holder of authority as contemplated under the Labor Code; Provided, that any such non-licensee or
non-holder who, in any manner, offers or promises for a fee employment abroad to two or more
persons shall be deemed so engaged.
It shall likewise include the following acts whether committed by any person, WHETHER A
NONLICENSEE, NON-HOLDER, LICENSEE OR HOLDER OF AUTHORITY:
a. To change or accept directly or indirectly any amount greater than that specified in the
schedule of allowable fees prescribed by the DOLE Secretary, or to make a worker pay any
amount greater than that actually received by him as a loan or advance;
b. To furnish of publish any false notice or information or document in relation to recruitment or
employment;
c. To give any false notice, testimony, information or document or commit any act of
misrepresentation for the purpose of securing a license or authority under the Labor Code;
d. To induce or attempt to induce a worker already employed to quit his employment in order to
offer him another unless the transfer is designed to liberate a worker from oppressive terms
and conditions of employment;
e. To influence or attempt to influence any person or entity not to employ any worker who has
not applied for employment through his agency;
f. To engage in the recruitment or placement of workers in jobs harmful to public health or
morality or to the dignity of the Republic of the Philippines;
g. To obstruct or attempt to obstruct inspection by the DOLE Secretary or by his duly authorized
representative;
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h. To fail to submit reports on the status of employment, placement vacancies, remittance of

forex earnings, separation from jobs, departures and such other information as may be
required by the DOLE Secretary;
i. To substitute or alter to the prejudice of the worker, employment contracts approved and
verified by the DOLE from the time of the actual signing thereof by the parties up to and
including the period of the expiration of the same without the approval of the DOLE;
j. For an officer or agent of a recruitment or placement agency to become an officer or member
of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly
in the management of a travel agency;
k. To withhold or deny travel documents from applicant workers before departure for monetary
or financial considerations other than those authorized under the provisions of the Labor Code
and its IRR’s;
l. Failure to actually deploy without valid reason as determined by the DOLE;
m. Failure to reimburse expenses incurred by the worker in connection with his documentation
and processing for purposes of deployment, in cases where the deployment does not actually
take place without the worker’s fault.
NOTE: Illegal Recruitment when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage.
• Illegal Recruitment is deemed committed by a SYNDICATE if carried out by a group of three (3)
or more persons conspiring and/or confederating with one another.
• It is deemed committed in LARGE SCALE if committed against three (3) or more persons
individually or as a group
Persons Liable:
• Principals, Accomplices, and Accessories;

• for Juridical Persons: the officers HAVING CONTROL, MANAGEMENT, OR DIRECTION of their
business
PENALTY:
Section 7, RA 8042 provides:
• Any person found guilty of IR shall suffer the penalty of IMPRISONMENT of NOT LESS THAN SIX
(6) YEARS AND ONE (1) DAY BUT NOT MORE THA TWELVE (12) YEARS and A FINE OF NOT LESS
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THAN TWO HUNDRED THOUSAND PESOS (P200,000.00) NOR MORE THAN FIVE HUNDRED
THOUSAND PESOS (P500,000.00)
• The penalty of LIFE IMPRISONMENT and a FINE NOT LESS THAN FIVE HUNDRED THOUSAND
PESOS (P500,000.00) NOR MORE THAN ONE MILLION PESOS (P1,000,000.00) shall be imposed
if IR CONSTITUTES ECONOMIC SABOTAGE Provided however, That the MAXIMUM PENALTY
shall be imposed if the PERSON ILLEGALLY RECRUITED is LESS THAN 18 YEARS OF AGE or
committed by a non-licensee or non-holder of authority
• VENUE (Sec. 9, RA 8042): Criminal Action arising from IR shall be filed with the REGIONAL TRIAL
COURT of the province or city WHERE THE OFFENDED PARTY ACTUALLY RESIDES AT THE TIME
OF THE COMMISSION OF THE OFFENSE
• PRESCRIPTIVE PERIODS (Sec. 12, RA 8042): General IR: five (5) years; IR involving Economic
Sabotage: twenty (20)
years
Art. 40 EMPLOYMENT OF NON-RESIDENT ALIENS
EMPLOYMENT PERMIT OF NON-RESIDENT ALIENS
• Any alien seeking admission to the Philippines for employment purposes and any domestic or
foreign employer who desires to engage an alien for employment in the Philippines shall obtain an
employment permit from the DOLE.
• The employment permit may be issued to a nonresident alien or to the applicant employer after a
determination of non-availability of a person in the Philippines who is competent, able and willing
at the time of the application to perform the services for which the alien is desired. For an
enterprise registered in preferred areas of investments, said employment permit may be issued
upon recommendation of the government agency charged with the supervision of said registered
enterprise.
Art. 41 – Prohibition against transfer of employment
• After the issuance of the employment permit, the alien shall not transfer to another job or change
his employer without prior approval from the Secretary of DOLE
• Any non-resident alien who shall take up employment in violation of provision of this Title and its
IRR’s shall be punished in accordance with Arts. 2894 and 290 of the Labor Code. In addition, the
alien worker shall be subject to deportation after service of his sentence.
RESIDENT ALIENS: NOT required to have employment permits; instead, they need an ALIEN
EMPLOYMENY REGISTRATION CARD (AERC)
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• NATIONALIZED INDUSTRIES and the ANTI-DUMMY LAW (C.A. no. 108 as amended by PD715) –
Foreigners may not be employed in certain “nationalized” industries; law provides and subjects
reservation of ownership and control of such corporations to the 60% requirement, i.e. public
utility, natural resources; financing companies; however, media and advertising requires 100%
Filipino ownership and management (Consti)
• DOJ OPINION 143, series 1976: provides instances when aliens may be allowed to engage in
employment within nationalized industries: a.) where the DOJ Secretary specifically authorizes the
employment of foreign technical personnel, or, b.) where the aliens are elected members of the
Board of Directors or governing body of corporations or associations in proportion to their
allowable participation in the capital of such entities
WEEK 3 and 4
NOTE:
Book Two on Human Resources Development Program covers RA 7796 or the TESDA Act of 1994.
TRAINING AND EMPLOYMENT OF SPECIAL WORKERS (Art. 57 – 81)
APPRENTICE LEARNER
 a worker who is covered by a written  persons hired as trainees in semi-skilled
apprenticeship agreement with an individual and other industrial occupations which are
employer or any entities recognized under this non-apprenticeable and which may be
Chapter; learned through practical training on the
job in a relatively short period of time
which shall not exceed three (3) months.
Apprenticeship Learners may be hired when:
• any practical training on the job supplemented by a. no experienced workers are available,
related theoretical instruction; b. the employment of learners is necessary to
• the arrangement and the period when an prevent curtailment of opportunities; and
upcoming worker undergoes hands-on training, c. the employment does not create unfair
more or less formal, to learn the ropes of a skilled competition in terms of labor costs or
job. It is usually the point of entry to the world of impair or lower working standards
work.
Apprenticeable Occupation learnership agreement, shall include:

• any trade, form of employment or occupation a. the names and addresses of the learners;
which requires more than three (3) months of b. the duration of the learnership period,
practical training on the job supplemented by
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related which shall not exceed three (3) months;

theoretical instruction; c. the wages or salary rates of the learners
Apprenticeship Agreement which shall begin at not less than seventy-
• an employment contract wherein the employer five (75%) percent of the applicable legal
binds himself to train the apprentice and the minimum wage; and
apprentice in turn accepts the terms of training. d. a commitment to employ the learners if
• To qualify as an apprentice, a person shall: they so desire, as regular employees upon
a. Be at least fourteen (14) years of age; completion of the learnership.
(but under the IRR, it’s 15 years)  NOTE: All learners who have been
allowed or suffered to work during the first
two (2) months shall be deemed regular
employees if training is terminated by the
employer before the
b. Possess vocational aptitude and end of the stipulated period through no
capacity for appropriate tests; and fault of the learner
c. Possess the ability to comprehend
and follow oral and written
instructions
SUMMARY O F DISTINCTION
• training in highly-skilled job; job found • training in semi-skilled job;
 in highly technical industry; training • industrial occupations that require
• period exceeds 3 months minimum training for less than 3 months
period is 6 months no commitment to • job is non-apprenticeable because its
• hire an apprentice even after practical skills can be learned in 3 (not 6)
completion of period prior DOLE months

approval required for hiring • commitment to hire a learner after the
apprentices period
•
• no need for prior approval from DOLE in
terms of hiring
Training periods for jobs requiring skills that can be acquired through actual work
experience; both learner and apprentice may be paid wages twenty-five (25%) percent
lower than the applicable legal minimum wage
Learner is not an apprentice, but an apprentice is considered a learner.
17
NOTE:
• Art 72 refers to On-the-job training of students required by schools as part of a training program
or curriculum or as a requisite for graduation or board examination.
• Such “apprenticeship is without compensation.
• Working student: an agreement between the student and the school where the former agree to
work for the latter in exchange for the privilege to study free of charge, provided the student is
given real opportunities, including such facilities as may be reasonable and necessary to finish
their chosen course under such agreement.
HANDICAPPED WORKERS
 Those whose earning capacity is impaired by age, or physical or mental deficiency or injury.
1. Handicapped workers may be employed when:

a. their employment is necessary to prevent curtailment of employment opportunities;
and
b. it does not create unfair competition in labor costs or impair or lower working
standards.
2. Any employer who employs handicapped workers shall enter into an employment agreement
with them, which agreement shall include:
a. the names and addresses of the handicapped workers to be employed;
b. the rate to be paid the handicapped workers to be employed which shall be
not less than seventy-five (75%) percent of the applicable legal minimum
wage;
c. the duration of the employment period; and d.) the work to be performed by
the handicapped workers.
3. Subject to the appropriate provisions of this Code, handicapped workers may be hired as
apprentices or learners if their handicap is not such as to effectively impede the performance
of job operations in the particular occupations for which they are hired.
EMPLOYMENT OF WOMEN (Art. 130/132 – 136/138)
 NOTE: RA 10161 repealed art. 130 (night work prohibition) and 131 (Exceptions) of the Labor
Code
1. Facilities for Women:
18
a. Provide seats proper for women and permit them to use such seat when they are free
from work and during working hours, provided they can perform their duties in this
position without detriment to efficiency;
b. To establish separate toilet rooms and lavatories for men and women and provide at least
a dressing room for women;
c. To establish a nursery in a workplace for the benefit of the women employees therein;
and
d. To determine appropriate minimum age and other standards for retirement or
termination in special occupations such as those of flight attendants and the like.
Maternity Leave Benefit (RA 8282, as amended by RA 11210)
 It shall be unlawful for any employer to discriminate against any woman employee with
respect to terms and conditions of employment solely on account of her sex.
Discrimination Prohibited
 The following are acts of discrimination:

a. Payment of a lesser compensation, including wage, salary or other form of remuneration and
fringe benefits, to a female employee as against a male employee, for work of equal value; and
b. Favoring a male employee over a female employee with respect to promotion, training
opportunities, study and scholarship grants solely on account of their sexes.
Stipulation Against Marriage.
• It shall be unlawful for an employer to require as a condition of employment or continuation

of employment that a woman employee shall not get married, or to stipulate expressly or
tacitly that upon getting married, a woman employee shall be deemed resigned or separated,
or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee
merely by reason of her marriage.
• It shall be unlawful for any employer:

a. To deny any woman employee the benefits provided for in this Chapter or to discharge any
woman employed by him for the purpose of preventing her from enjoying any of the benefits
provided under this Code;
b. To discharge such woman on account of her pregnancy, or while on leave or in confinement
due to her pregnancy;
19
c. To discharge or refuse the admission of such woman upon returning to her work for fear that
she may again be pregnant.
For reference, read the following cases:
1. G.R. No. 162994, September 17, 2004, DUNCAN ASSOCIATION OF DETAILMAN-PTGWO AND
PEDRO A. TECSON, VS. GLAXO WELLCOME PHILIPPINES, INC
2. G.R. No. 168081, October 17, 2008, ARMANDO G. YRASUEGUI, VS. PHILIPPINE AIRLINES, INC.
3. G.R. No. 118978, May 23, 1997, PHILIPPINE TELEGRAPH AND TELEPHONE COMPANY, VS.
NATIONAL LABOR RELATIONS COMMISSION AND GRACE DE GUZMAN
ART. 136. [138] Classification of Certain Women Workers.

• Any woman who is permitted or suffered to work, with or without compensation, in any
night club, cocktail lounge, massage clinic, bar or similar establishments under the effective
control or supervision of the employer for a substantial period of time as determined by the
Secretary of Labor and Employment, shall be considered as an employee of such establishment
for purposes of labor and social legislation. EMPLOYMEN OF MINORS (Art. 137/139 – 138/140)
Reference: Sec 12, RA 7610:
• Children below fifteen (15) years of age shall not be employed except:
1) When a child works directly under the sole responsibility of his/her parents or legal guardian
and where only members of his/her family are employed
Provided, however, That his/her employment neither endangers his/her life, safety, health,
and morals, nor impairs his/her normal development: Provided, further, That the parent or
legal guardian shall provide the said child with the prescribed primary and/or secondary
education; or
2) Where a child's employment or participation in public entertainment or information through
cinema, theater, radio, television or other forms of media is essential:
Provided, That the employment contract is concluded by the child's parents or legal
guardian, with the express agreement of the child concerned, if possible, and the approval of
the Department of Labor and Employment: Provided, further, That the following
requirements in all instances are strictly complied with:
a. The employer shall ensure the protection, health, safety, morals and normal development of
the child;
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b. The employer shall institute measures to prevent the child's exploitation or discrimination
taking into account the system and level of remuneration, and the duration and arrangement
of working time; and
c. The employer shall formulate and implement, subject to the approval and supervision of
competent authorities, a continuing program for training and skills acquisition of the child.
• In the above-exceptional cases where any such child may be employed, the employer shall first
secure, before engaging such child, a work permit from the Department of Labor and
Employment which shall ensure observance of the above requirements.
• Note: For purposes of this Article, the term "child" shall apply to all persons under eighteen
(18) years of age
• R.A. No. 7658 also added the following new sections to R.A. No. 7610:
a. Sec. 12-A (Hours of Work of a Working Child),
b. Sec. 12-B (Ownership, Usage and Administration of the Working Child's Income),
c. Sec. 12-C (Trust Fund to Preserve Part of the Working Child's Income), and
d. Sec. 12-D (Prohibition Against Worst Forms of Child Labor).
KASAMBAHAY LAW (The Domestic Workers Act of 2013)
• As amended by P.D. No. 570-A (1974), Amending Certain Sections of P.D. No. 442.
• The Domestic Workers Act (2013) applies to all domestic workers employed and working
within the country.
• domestic work:
o work performed in or for a household or households;  domestic worker or
kasambahay:
o any person engaged in domestic work within an employment relationship such as but
not limited to the following: general house help, nursemaid or yaya, cook, gardener
or laundry person;
o shall exclude any person who performs domestic work only occasionally or
sporadically and not on an occupational basis.
o The term shall not include children who are under foster family arrangement, and are
provided access to education and given an allowance incidental to education, i.e.
baon, transportation, school projects and school activities.
21
The Beginning of Employer-Employee Relationship
• The determination of the existence of employer-employee relationship is very important in the

understanding and discussion of labor laws. Generally, any act that involves the existence of
employer-employee relationship will prompt the application of labor laws, either labor standards
or labor relations or both. The existence of the relationship also determines the extent of the
rights of the employee that has to be respected and upheld by the employer and the existence of
labor dispute (to be discussed later)
• While there is no article in the Labor Code that describes the relationship between an employer-
employee (which could have been easier and definitive, but it is not the case. Why kaya?),
• Supreme Court decisions on the other hand are replete of jurisprudence on how to gauge the
existence of employer-employee relationship.
• Contracts cannot stipulate that there is or there is no employer-employee relationship if the
opposite is true.
1. Test of Determining the Existence of Employer-Employee Relationship (EER)
1. Four-Fold Test
The following are the elements that are considered in determining EER:
(a) selection and engagement of the employee;
 refers to the "choice" of the employer to hire the services of a worker based on
certain qualification standards and his commitment to keep the latter as his
employee.
(b) payment of wages;
 compensation that an employee gets for work performed.
(c) power of dismissal; and
 a component of the employer's power to move or organize employees.
(d) power to control the employee both as to the means and methods by which his work is
accomplished.
• refers to the employer's power to regulate how the work is done NOTE: The control
test is considered the most important element.
• whether the employer controls or has reserved the right to control the employee not
only as to the result of the work to be done but also as to the means and methods by
which the same is to be accomplished. Stated otherwise, an employer-employee
relationship exists where the person for whom the services are performed reserves
22
the right to control not only the end to be achieved but also the means to be used in
reaching such end.
• The fact that one had been designated "branch manager" does not make such person
an employee. Employment is determined by the right-of-control test and certain
economic parameters. Titles are weak indicators.
2. Two-Tiered Test
 appropriate whenever there is no written agreement to base the EER on and when the
relationship of the parties is complicated due to several positions and responsibilities of
the worker. The two two-tiered test considers the following:
(a) power to control the employee with respect to the means and methods by which the
work is accomplished;
(b) underlying economic realities of the activity or the relationship.
3. Economic Test
 The economic realities test considers the whole economic activity, some circumstances
that can be considered are:
(a) the extent to which the services performed are an integral part of the employer’s
business;
(b) the extent of the worker’s investment in equipment and facilities;
(c) the nature and degree of control exercised by the employer;
(d) the worker’s opportunity for profit and loss;
(e) the amount of initiative, skill, judgment or foresight required for the success of the
claimed independent enterprise;
(f) the permanency and duration of the relationship between the worker and the employer;
and
(g) the degree of dependency of the worker upon the employer for his continued
employment in that line of business.
• the standard of economic dependence is whether the person is dependent on the
prospective employer for his continued employment in that line of business.
23
• the benchmark in analyzing whether employment relation exists between the parties is
the economic dependence of the worker on his employer. That is, whether the worker is
dependent on the alleged employer for his continued employment in the latter’s line of
business. For reference, read the following cases:
1. G.R. No. 202015, July 13, 2016, ANTONIO VALEROSO AND ALLAN LEGATONA, v. SKYCABLE
CORPORATION.
2. G.R. No. 121605, February 2, 2000, PAZ MARTIN JO and CESAR JO vs. NATIONAL LABOR
RELATIONS COMMISSION and PETER MEJILA
2. Complexities of EE Relationship (Art. 106 -109 and DOLE DEPARTMENT ORDER NO. 174,
SERIES OF 2017)
NOTE:
The succeeding discussions focuses on the practice of contracting out a particular job or
service of a PRINCIPAL by a contractor or sub-contractor.
While the provisions are found within the chapter on wages, it is proper to discuss these
provisions as it affects primarily EER, consequently affects other labor code provisions hence,
as early, it is proper to discuss these provisions for better understanding and
contextualization of topics.
1. (JOB) Contracting / Independent contractor arrangement:
• As a rule, job contracting or outsourcing is allowed by law.

• A typical example would be the janitors and security guards of USLT. In here, USLT
(PRINCIPAL) hires or enters into an agreement (service contract) with an agency (JOB
CONTRACTOR or INDEPENDENT CONTRACTOR) for the latter to supply janitors and/or
security guards (EMPLOYEE/S) and work in USLT doing janitorial or security services.
• In this kind of arrangement, there are three (3) players in a trilateral relationship:
a. EE relationship between the contractor and the employee it engages or hires to
perform the contracted work based on a service contract;
b. Contractual relationship between the contractor and the principal which is usually
governed by the Civil Code on contracts and obligations
c. To the employee (janitors or security guards, their direct employer is the Agency or
contractor and the indirect employer will be the Principal (USLT)
24
A. JOB CONTRACTING (DEFINITION):
Someone,
a. who carries on an independent business and undertakes the contracted work on

his own account under his own responsibility according to his own manner and
method, free from the control and direction of his principal in all matters
connected with the performance of the work except as to results. And,
b. Who has substantial capital or investment in the form of tools, equipment,
machineries, work premises and other materials necessary to the conducttrhe
business  Contractor:
Any person or entity including a cooperative, engaged in a legitimate contracting or sub-
contracting arrangements providing either services, skilled workers, temporary workers
or a combination of services to principal under a service agreement
ABSENT ANY OF THE ELEMENTS OF A JOB CONTRACTING, would refer to a LABOR-ONLY

CONTRACTING which is ABSOLUTELY PROHIBITED.
B. LABOR-ONLY CONTRACTOR
a. the person supplying workers to an employer does not have substantial capital or
b. the person supplying workers to an employer does not have investment in the form of tools,
equipment, machineries, work premises, among others; and
c. the workers recruited and placed by such person are performing activities which are directly
related to the principal business of such employer or
d. the person supplying workers to an employee does not exercise the right to control over the
performance of the employee.
C. Liabilities:
Rules:
1. For legitimate job contractors, they remain to be primarily liable to its employees for
payment of wages and compliance with provisions of the Labor Code since the
contractor is considered the employer.
2. However, the Principal shall be deemed to be the direct employer of the contractor’s
employees if there is a finding thst the contractor is engaged in labor-only contracting
and other illicit forms of employment arrangements a provided in DAO No. 174.
25
3. In the event of violation of any provisions of the Labor Code, including the failute to
pay wages, there exists a SOLIDARY LIABILITY on the part of the principal and the
contractor.
(see DAO NO. 174 in pdf file in the resources of our LMS class)
1. G.R. No. 79004-08, October 04, 1991; FRANKLIN BAGUIO, et. al., VS. NATIONAL LABOR
RELATIONS COMMISSION
2. G.R. NO. 161115, November 30, 2006 DOLE PHILIPPINES, INC., VS. MEDEL ESTEVA, et. al.
KINDS OF EMPLOYMENT (ART. 295/280 – 295/281)
1. Regular or permanent employment
2. Casual Employment
3. Fixed period or term employment
4. Project employment
5. Seasonal Employment
6. Probationary Employment
1. REGULAR OR PERMANENT EMPLOYMENT
Two kinds of regular employee:
a. Those who are engaged to perform activities which are necessary or desirable in the usual
business or trade of an employer, (except when the employment is fixed for a specific term or
project or is seasonal in nature) and
b. Those casual employees who have rendered at least one year of service, whether continuous
or broken, with respect to the activity in which they are employed.
Standards in determining regular employment:
a. Activities performed are necessary or desirable in the usual business of the employer
b. Length of performance of the activity performed
26
2. CASUAL EMPLOYMENT
a. An employee is deemed to be a casual employee when he is engaged to work on an activity
which is not necessary or desirable in the usual business or trade of the employer;
b. The employee is engaged to perform a job, work or service which is merely incidental to the
business of the employer and such job. Work or service is for a definite period made known to
the employee at the time of engagement
Example:
When an employer is engaged in the manufacture and distribution of longganisa, an employee

who is engaged to paint the employer’s place of business is a casual employee.
c. When casual employees acquire the status of regular employment:

1. By operation of law, a casual employee becomes regular employee with respect to the activity
in which he is employed as soon as he has completed one year of service and his employment
shall continue while such activity exists.
2. Using the same example, the employee who paints the place of business of the employer
engaged in the manufacture and distribution of longganisa becomes a regular employee with
respect to painting the place of business of the employer as soon as he completes one year of
service
3. FIXED-PERIOD OR TERM EMPLOYMENT

a. An employee is deemed to be a fixed-period when a day certain is agreed upon by the employer
and employee for the commencement and termination of their employment relationship.
b. May perform work necessary or desirable in the usual business or trade of the employer
c. The determining factor of fixed period employment is NOT constituted by the activities that the
employee us called to perform BUT BY THE DAY AGREED UPON BY THE PARTIES FOR THE
COMMENCEMENT AND TERMINATION OF THE EE RELATIONSHIP.
4. PROJECT EMPLOYMENT
a. Those whose work or employment is coterminous with the project for which they were hired.
b. Concept of project:
i. Could refer to a particular job or undertaking that is within the regular or usual business
of the employer but which is distinct and separate and identifiable as such, from the
other undertakings of the employer where such job or undertaking begins and ends at a
determined or determinable times.
27
ii. A particular job or undertaking that is not within the regular business of the employer
but is identifiably separate and distinct from the ordinary or regular business operations
of the employer. (sometimes referred to as fixed period or term employment)
c. Project employees whose aggregate period of continuous employment (specially in construction)
is at least one year shall be considered regular employee, in the absence of a day certain agreed
upon by the parties for the termination of their relationship.
5. SEASONAL EMPLOYMENT
a. Employees who perform work or service that is seasonal by nature; their employment is for the
duration of the season.
b. When the seasonal employee is repeatedly re-employed by the employer every season, the
seasonal employee is deemed regular seasonal employee. As such during off-season, they are not
considered as separated from service but rather as being on leave of absence without pay until
they are re-employed.
6. PROBATIONARY EMPLOYMENT
a. Those who are on trial by an employer during which the employer determines whether or not
they are qualified for regular employement
b. Probationary period:
i. Trial period where the employer observes the fitness, propriety and efficiency of a probationary
employee
ii. Period to ascertain whether or not he is qualified for regular appointment in accordance with
reasonable standards made known by the employer to the employee at the time of his
engagement
iii. Period by which the probationary employee seeks to prove to the employer that he has the
qualifications to meet the reasonable standards for regular employment
iv. Generally, 6 months but may vary according to the requirements of a particular job. What is
important is the period is set or agreed upon and explained by the employer to the employee
before the commencement of the probationary period Exceptions:
i. By stipulation in the original contract of employment
ii. By extension agreed upon at or prior to the expiration of the six-month period.
28
1. G.R. No. 186439, January 15, 2014 UNIVERSAL ROBINA SUGAR MILLING CORPORATION, vs.
FERDINAND ACIBO,
2. G.R. No. 207613, January 31, 2018 - REYMAN G. MINSOLA, v. NEW CITY BUILDERS, INC. AND
ENGR. ERNEL
WEEK 5
BOOK III: CONDITIONS OF EMPLOYMENT (Art. 82 – 129): Working Conditions and Rest
Periods
WORKING CONDITIONS
• The Bureau of Working Conditions

(culled from, https://bwc.dole.gov.ph/about-us)
The Bureau of Working Conditions (BWC) is a staff bureau of the Department of Labor and
Employment (DOLE), primarily performing policy and program development and advisory functions for
the Department in the administration and enforcement of laws relating to working conditions.
Vision
The Bureau of Working Conditions envisions well-guided employers and workers committed to a safe,
healthful and productive work environment, adaptive to industry trends and developments, and
equitably enjoying the gains of joint endeavors.
Mission
• - To formulate policies and initiate legislatives on labor standards, based on relevant information
culled from monitoring, consultations, networking, and researches.
• - To standardize the use of enforcement instruments and to clothe the inspectorate system with
strong enforcement authority to ensure compliance with laws and regulations.
• - To develop and sustain the capability of enterprises toward self-management of safety and
health in workplaces, thus, upholding the principle of shared responsibility between workers
and employers.
• - To enhance the capability of small enterprises in implementing practical and efficient methods
of improving working conditions and productivity.
• - To inform and advise the public on labor standards, including occupational safety and health,
and on innovative work practices or arrangements.
History
• Started as the Bureau of Industrial Safety (BIS) on June 10, 1949 through Republic Act 367.
29
• The Bureau underwent several structural changes. After a year of existence, BIS was changed to
Division of Industrial Safety in 1950. It became the Bureau of Labor Standards (BLS) on
December 10, 1956 by virtue of Executive Order 218 providing for the Implementing Details for
Reorganization Plan 20-A.
• The Bureau of Labor Standards (BLS) is recognized as the mother of other Bureaus in the
Department. In 1960, the Women and Minors Division of then BLS under the Rat Plan BWYW
and BRW are now merged to Bureau of Workers with Special Concerns.
• BLS was renamed the Bureau of Working Conditions (BWC) on May 1, 1982 by virtue of
Executive Order No. 797 and a new Labor Standards Research Division (LSRD) was added to the
existing divisions of the Bureau, namely Inspection Standards Division (ISD), Wage and Hour
Standards Division (WHSD) and Occupational Safety and Health Division (OSHD). The purpose or
concept was to expand the functions of the Bureau to generate relevant studies and information
on occupational safety and health in aid of policy formulation.
The BWC has the following functions:
Develops and prescribes labor standards as well as policies, programs and devices on its administration
and enforcement;
1. Exercises technical and functional supervision over the regional offices on the administration
and enforcement activities including developmental programs, projects and activities;
2. Conducts researches in aid of safety standards, policy programs, measures and devices
development on labor standards and its administration and enforcement;
3. Provides knowledge and information services on labor standards data, programs and
enforcement activities; an
4. Performs other functions as may be required by law or assigned by the Secretary of Labor and
Employment in the administration and enforcement of labor standards.
RIGHTS TO SAFE & HEALTHFUL CONDITIONS OF WORK
(culled from, https://bwc.dole.gov.ph/rights-to-safe-healthful-conditions-of-work)
30
• What does safety and health in the workplace mean?
Safety refers to the physical or environmental conditions of work which comply with prescribed
Occupational Safety and Health (OSH) Standards and which allow the workers to perform the job
without or within acceptable exposure limit to hazards. Occupational safety also refers to practices
related to production and work process.
Health means a sound state of the body and mind of the workers that enables the worker or
employee to perform the job normally.
• What does OSH Standards mean?
OSH Standards are mandatory rules and standards set and enforced to eliminate or reduce
occupational safety and health hazards in the workplace.
• What is the purpose of OSH Standards?
OSH Standards aim to provide at least the minimum acceptable degree of protection that must be
afforded to every worker in relation to the working conditions and dangers of injury, sickness or death
that may arise by reason of the worker's occupation. The provision of OSH Standards by the State is an
exercise of police power, with the intention of promoting the welfare and well-being of the workers.
• What are covered by the General OSH Standards?
All establishments, workplaces and other undertakings are covered, including agricultural enterprises
whether operating for profit or not, except:
Residential places exclusively devoted to dwelling purposes.
• What does right to safe and healthful conditions of work mean?
It means that the worker shall be assured of effective protection against the danger of injury, sickness
or death through safe and healthful working conditions.
• What is the minimum standard on safety and health in the workplace?
The OSH Standards provide that every company shall keep and maintain its workplace free from work
hazards that are likely to cause physical harm to the workers or damage to property. Thus, the worker is
entitled to be provided by the employer with:
• Appropriate seats, lighting and ventilation;
31
• Adequate passageways, exits and fire fighting equipment;

• Separate facilities for men and women;
• Appropriate safety devices like protective gears, masks, helmets, safety boots, coats or first-aid
kits;
• Medicines, medical supplies or first-aid kits;
• Free medical and dental services and facilities.
• What other safety requirements should employers provide their employees?
Employers must provide their employees with the following instruments and/or working stations:
• Appropriate protective equipment and clothing such as overall head coverings, goggles, gloves
aprons and respirators;
• A properly designed exhaust system and waste disposal, local exhaust or general ventilation to
keep toxic fumes or gases, away from workers' breathing zone;
• Adequate number of fire extinguishers in the workplace;
• Designated safe smoking and welding areas far from combustible, flammable or explosive
materials, containers filled with explosives or flammable substances, and containers that have
held explosives or flammable materials;
• What safety measures must be observed within the premises of establishments
Establishments must observe the following safety measures:
• Building premises shall have adequate fire, emergency or danger signs and safety instructions of
standard colors and sizes visible at all times;
• Other visible signs that may be needed to direct the driver of motorized vehicle such as STOP,
YIELD, and DO NOT ENTER, properly positioned within the compound of the establishment shall
be used to increase safety especially during the night;
• Handicapped employees shall be restricted only to designated workplaces. As far as practicable
and feasible they shall be provided with facilities for safe and convenient movement within the
establishment;
32
• Good housekeeping shall be maintained at all times through cleanliness of building, yards,
machines, equipment, regular waste disposal, and orderly arrangement of process operations,
storage and filing materials;
• Adequate dressing rooms, locker rooms, comfort rooms and lavatories separate for male and
female workers shall be provided.
• Who enforces OSH Standards?
The Secretary of Labor and Employment, through the Regional Director or his other authorized
representative, enforces the OSH Standards in the exercise of visitorial and enforcement
powers.
• What is visitorial power?
Visitorial power refers to the authority to conduct inspections or investigations in the premises of an
employer at any time of the day or night whenever work is being undertaken. This is necessary to
determine violations or to enforce the rights of workers under the Labor Code. Under this power, the
employer may be required to submit reports and other documents to determine any violation.
• What is enforcement power?
Enforcement power refers to the authority of the Secretary or the Regional Director to order an
erring employer, after due notice and hearing, to comply with labor standards and issue a writ of
execution in case of non-compliance. If the violation poses grave and imminent danger to the health and
safety of workers, suspension or cessation of the operations may be effected within 24 hours from the
issuance of the order.
• How are these Standards enforced?
These standards are enforced through the inspectorate system. Thus, every employer shall provide to
the Secretary or to his/her duly authorized representative access to its premises or records at any time
of the day or night whenever there is work to determine and effect compliance.
Every establishment or workplace shall be inspected at least once a year. However, special inspection
visits may be authorized by the Regional Office to investigate workrelated accidents, occupational illness
or dangerous occurrences, conduct surveys, follow-up inspection recommendations, or to conduct
investigations or inspections upon request of an employer, worker or labor union in the establishment.
33
• If a worker or representative of workers or any concerned person believes that such a

violation of the OSH Standards exists which threatens with physical harm or poses
imminent danger to life, what shall he do to correct the danger?
The said worker or workers’ representative shall request the RO for an inspection of their area by
giving full particulars or details regarding such violation or danger.
• What does the Regional Office do in such a case?

The Regional Office evaluates the report and conducts a special inspection or investigation
immediately in the subject establishment. The complainant is notified in writing of the outcome of such
investigation.
• What is considered hazardous workplace? A workplace is deemed hazardous if:
• The nature of the work exposes workers to dangerous environmental elements, contaminants
or work conditions, including ionizing radiation, chemicals, fire, flammable substances, noxious
components, and the like;
• The workers are engaged in construction work, logging, fire-fighting, mining, quarrying, blasting,
stevedoring, dock work, deep-sea fishing and mechanized farming;
• The workers use or are exposed to heavy or power-driven machinery or explosive powder-
actuated equipment;
• The workers are engaged in the manufacture or handling of explosives and other pyrotechnic
products;
• The workers use or are exposed to biological agents such as bacteria, viruses and other
parasites.
• What are the duties and responsibilities of the employers and the employees in relation
to enforcement and compliance with OSH Standards in the workplace?
DUTIES OF THE EMPLOYERS
• Adopt administrative policies on safety in accordance with the provisions of the Standards;
• Report to the Regional Director or his/her duly authorized representative the policies adopted
and the safety organization established;
• Submit reports to the Regional Director or his/her duly authorized representative once in every
three months on the safety performance, safety committee meetings and its recommendations
and measures taken to implement the recommendation;
34
• Act on recommended safety measures;

• Provide access to appropriate authorities.
DUTIES OF THE EMPLOYEES
• Follow safety policies;
• Report unsafe conditions and practices to the Supervisor;
• Serve as member of the Health and Safety Committee;  Cooperate with Health and
Safety Committee;
• Assist government agencies in the conduct of safety and health inspection.
• What is a Safety and Health Committee?
A Safety and Health Committee is a group of employees or workers and management that plans and
makes policies in all matters pertaining to safety and health in the workplace. All establishments are
required to have a Safety and Health Committee.
• When shall an establishment organize a Safety and Health Committee?
In every workplace, a Safety and Health Committee shall be organized within sixty days after the
Standards take effect, and for new establishments, within one month from the date business starts
operating. In both cases the Safety and Health Committee shall reorganize every January of the
following year:
• What are the types and composition of a Safety and Health Committee? The types and
composition of the Safety and Health Committee shall be organized according to the number of
employees or workers in a workplace.
• What are the duties of the Safety and Health Committee? Safety and Health Committee
shall:
• Plan and develop accident prevention programs in the workplace;
• Inspect workplace to detect unsafe conditions;
• Review reports of inspection, results of accident investigations and implementation of accident
prevention program;
• Conduct safety meetings at least once a month;
• Submit reports to the manager/owner on its meetings and activities;
• Provide necessary assistance to government inspecting authorities in the proper conduct of
activities relating to enforcement of the provisions of the Standards;
35
• Train workers in safe work habits and procedures;

• Develop and maintain a disaster contingency plan and organize such emergency service units as
may be necessary to handle disaster situations pursuant to the
Emergency Preparedness Manual for Establishments of the Office of Civil Defense
WEEK 6
BOOK III: CONDITIONS OF EMPLOYMENT (Art. 82 – 129): Working Conditions and Rest Periods
REST PERIODS
Art. 82: Who are covered; exceptions.
 Employees in all establishments and undertakings whether for profit or not BUT NOT TO
(Excluded employees):
1. govt employees,
2. managerial employees [those whose primary duty consists of the management of the establishment
in which they are employed or of a dept or subdivision thereof, and to other officers or members of
the managerial staff],
3. field personnel [refer to non-agricultural employees who regularly perform their duties away from
the principal place of business or branch office of the employer and whose actual hours of work in
the field cannot be determined with reasonable certainty],
4. members of the family who are dependent on him for support,
5. domestic helpers,
6. persons in the personal service of another,
7. workers who are paid by results
Art. 83 – Normal Hours of Work
 8-hour law o prescribes the minimum
Art. 84 – Hours worked Shall include:
36
a. all the time during which an employee is required to on duty or to be at a

prescribed workplace; and
b. all the time during which an employee is suffered or permitted to work
• all hours are hours worked which the employee id required to give his employer, regardless of
whether or not such hours are spent in productive labor, or involved physical or mental exertion
• Prelim and postlim activities are deemed performed during working hours, where such activities
are controlled or required by the employer and are pursued necessarily and primarily for the
employer’s benefit
• Whether waiting time constitutes working time depends on the circumstances of each case
o whether it is spent predominantly for the employer’s benefit or for the employee’s;
o considered as working time if waiting is an integral part of his work or if the employee is
required or engaged by an employer to wait
• Working while eating o not compensable if completely freed from duites even though he
remains in the workplace
• Working while sleeping o may be considered working if it is subject to interruption or takes
place under conditions substantially less desirable than would likely to exist at employee’s home
• “on call”
• An employee required to remain on call in the emplyer’s premises or so close to the premises
that he cannot use the time effectively and gainfully for his own purpose
 compensable; “within reach through cellphone or other contact device”
• Travel from home to work o not worktime

o EXCEPT when employee receives an emergency call outside of his regular working hours
and is required to travel to his regular place of business or some other work site, all of
the time spent in such travel is working time
• travel away from home o travel that keeps an employee away from home overnight; worktime
• attendance at lectures, meetings, training programs and other similar activities not considered
worktime if it is outside employee’s regular working hours, it is voluntary, and the employee
does not perform productive work during such attendance
• time spent in grievance meetings considered worktime
• regular full-time teachers are entitled to salary and emergency cost-of-living allowance during
semestral breaks (UPang Faculty Union vs UPANG)
• a laborer need not leave the premises of the workplace in order that his rest period shall not be
counted; it is enough that he ceases to work (case in point:
seamen)
• hours worked: employer has burden of proof
37
Art. 85 – Meal Periods
• GR: not compensable o Exception: predominantly spent for employer’s benefit or where it is
less than 60 minutes (but in no case shall it be shorter than 20 minutes)
• Continuous shifts o E to E: shortened break is upon employee’s request Requisites:
1. agree in writing to a shortened meal break and waive overtime pay for such shortened
period
2. no diminution in the salary and other fringe benefits
3. work does not involve strenuous physical exertion and are provided w/ coffee breaks
4. value of the benefits derived by the employees from the proposed work arrangement is
equal to or commensurate with the compensation due them
5. overtime pay of the employees will become due and demandable if ever they are
permitted or made to work beyond 4:30pm
6. effectivity of proposed working time arrangement shall be of temporary duration as
determined by DOLE
REST PERIODS
• sometimes refered to as coffee breaks, are periods of short duration, running from 5 to 20
minutes during working hours
• they are counted as hourse worked. Hence considered as compensable working time
Art. 86 – Night Shift Differential (GRAVEYARD SHIFT)
• additional compensation paid to employees for each hour of work performed between 10 pm to
6 am
• not less than 10% of regular wage for each hour of work performed b/w 10pm to 6am
• NSD not waivable since it is founded on public policy
• Burden of proof of payment rests upon the employer
Art. 87 – Overtime Work
• Compensation for work rendered in excess of 8 hours a day

• Multiply the overtime hourly rate by the number of hours worked in excess of 8
38
• Receipt of overtime pay does not preclude right to NSD

• Overtime rate based on regular wage (excludes money received in different concepts and other
fringe benefits)
• How “work day” is counted o 24-hour period which commences from the time the employee
regularly starts to work
• Work in excess of 8 hours w/n a work day is considered as overtime regardless of whether this is
performed in a work shift other than at which employee regularly works
• Estoppel and laches cannot be invoked against employees in an action for the recovery of
compensation for overtime work
• Overtime pay in arrears retroacts to the date when services were actually rendered
• GR: NO waiver or quitclaim of overtime pay o Exception: waiver is in exchange for certain
benefits
• Agreement that overtime pay will be integrated in basic salary is not per se illegal; however,
there should have been express agreement to that effect and that the mathematical result
shows that the agreed legal wage rate and the overtime pay computed separately, are equal to
or higher than the separate amounts legally due
• Compressed workweek (45 hours in 5 days) as an exception to the non-waiver of overtime pay if
the following requisites are present:
1. agree in writing to work 9 hours a day from Monday to Friday
2. no diminution in the salary and other fringe benefits
3. value of the benefits that will accrue to the employees under the proposed work schedule is
more than or at least commensurate with or equal to the one-hour overtime pay that is due
them during weekdays
4. overtime pay of the employees will become due and demandable if ever they are permitted or
made to work on weekend
5. work does not involve strenuous physical exertion and are provided w/ coffee breaks
6. effectivity of proposed working time arrangement shall be of temporary duration as determined
by DOLE
Art. 88 – Undertime not offset by Overtime
Art. 89 – Emergency Overtime Work (compulsory overtime work)
1. country is at war or when any national or local emergency has been declared by Congress or the
President
39
2. necessary to prevent loss of life or property or in case of imminent danger to public safety due to
impending emergency caused by accidents, fire, flood, typhoon, earthquake, epidemic, or other
disaster or calamity
3. urgent work to be performed on the machines, ect. In order to avoid loss or damage to employer
4. to prevent loss or damage to perishable goods
5. to prevent serious obstruction ot prejudice to the business or operations of the employer
6. to avail of favorable weather or environmental conditions where performance or quality of work is
dependent thereon
Art. 90 – Computation of Additional Compensation
• regular wage shall include cash wage only, w/o deduction on account of facilities provided by
employer
WEEKLY REST PERIODS

Art. 91 – Right to weekly rest day
• rest period of not less than 24 hours after every 6 consecutive normal work days
• employer shall determine an schedule the weekly rest day of the employees; subject to the
agreement entered into by the parties
•
Art. 92 – When employer may require work on a rest day necessary to prevent loss of life
or property or in case of imminent danger to public safety due to impending emergency
caused by accidents, fire, flood, typhoon, earthquake, epidemic, or other disaster or
calamity
2. urgent work to be performed on the machines, ect. In order to avoid loss or damage to
employer
3. abnormal pressure of work due to special circumstances, where the employer cannot
ordinarily be expected to resort to other measures
4. prevent loss or damage to perishable goods
5. nature of work requires continuous operations and stoppage of work may result in
irreparable injury or loss to the employer
40
6. similar circumstances as determined by DOLE Sec.
Art. 93 – Compensation for rest day, Sunday, or holiday work
• at least 30% of regular wage

• when such holiday falls on his rest day, add’l compensation of at least 50%
HOLIDAYS, SERVICE INCENTIVE LEAVES, AND SERVICE CHARGES
Art. 94 – Right to (Regular) Holiday 
100% add’l compensation
• 10 regular holidays
1. New Year (Jan.1)
2. Maundy Thursday
3. Good Friday
4. Araw ng Kagitingan (Apr 9)
5. Labor Day (May 1)
6. Independence Day (Jun 12)
7. National Heroes Day (Last Sunday of Aug)
8. Bonifacio Day (Nov 30)
9. Christmas Day (Dec 25)
10. Rizal Day (Dec 30)
11. Eidul Fitras - 1 st day after 30-day fasting period
12. Eidul Adha – reg’l holiday in the ARMM Special Non-Working Holiday
1. Chinese New Year

2. Edsa
3. Black Saturday
4. Ninoy Aquino day
5. Immaculate Conception (Dec. 8)
41
• a legal holiday falling on a Sunday creates no legal obligation for the employer to pay extra,
aside from the usual holiday pay, to its monthly-paid employees (Wellington Investment vs
Trajano)
• double holiday: 2 regular holidays on same day o if unworked: covered employees are entitled
to at least 200% of their basic wage even if said holiday is unworked
o if worked: entitled to compensation equivalent to at least 300% of his basic wage
• double holiday rule for monthly-paid employees o if worked, additional 100% of regular salary
o successive regular holidays:
 an employee may not be paid for both holidays if he absents himself from work
on the day immediately preceding the 1st holiday, unless he works on the 1st
holiday, in which case, he is entitled to his holiday pay on the 2nd holiday
• holiday pay of hourly-paid faculty members during semestral break o employer-school is
exempted from paying hourly paid faculty members their pay for regular holidays, whether the
same be during the regular semester or during semestral, Christmas, or Holy Week vacations
o employer-school must pay said faculty members their regular hourly rate on days
declared as special holidays or for some reason classes are called off or shortened for
the hours they are supposed to have taught, whether extension of class days be ordered
or not; in case of extensions said faculty mems shall likewise be paid their hourly rates
should they
teach during said extension (JRC vs NLRC)
• field personnel not entitled to holiday pay
Art. 95 – Right to Service Incentive Leave
• coverage: every employer who has rendered at least 1 year of service shall be entitled to a
yearly SIL of 5 days with pay
• shall be commutable or converted to its money equivalent if not used or
exhausted at the end of the year
• SIL not applicable to those already enjoying the benefit herein provided, those enjoying vacation
leave with pay of at least 5 days, and those employed in establishments regularly employing less
than 10 employees
• ” 1 year of service” o service within 12 months, whether continuous or broken, reckoned from
the date the employee started working, including authorized absences and paid regular
holidays, unless the number of working days in the establishment as a matter of practice or
policy, or provided ini the employment contract is less than 12 months, in which case said period
shall be considered as 1 year for the purpose of determining entitlement to the SIL
42
• SIL of part-time workers  proportionate to the daily work rendered and the regular salary,
respectively (DOLE Explanatory Bulletin dated January 2, 1996)
• ” on contract” workers entitled to SIL
• Commutation of SIL valid; basis of conversion shall be the salary rate at the date of
commutation; availment and commutation of the SIL benefit may be on a prorata basis
• SIL is mandatory
• Vacation and sick leaves are voluntary benefits
• Leave credits are normally converted into their cash equivalent based on the last prevailing
salary received by the employee
Paternity leave
• available only for the 1st four deliveries of the legitimate spouse with whom the husband is
cohabiting; delivery includes childbirth, miscarriage, or abortion
• shall not exceed 7 calendar days for each delivery
• entitled to full pay
• non-commutation of benefits Requisites:
1. he is an employee at the time of delivery of his child

2. he is cohabiting with his spouse at the time she gives birth or suffers a miscarriage
3. he has applied for paternity leave
4. his wife has given birth or suffered a miscarriage Maternity leave
• see other discussions
Parental (Solo Parent) Leave
• not more than 7 working days each year  non-convertible to cash if unused
• Requisites:
1. has rendered at least 1 year of service
2. has notified employer of the availment thereof w/n a reasonable period of time
3. has presented a Solo Parent ID to employer
• who is a solo parent?

1. woman gives birth as result of rape or crime against chastity, provided she keeps and raises the
child
2. spouse has died
43
3. spouse is detained or is serving sentence for at least 1 year

4. legally separated or de facto separated for at least 1 year, provided s/he is entrusted with
custody
5. physical/mental incapacity of spouse
6. abandoned by spouse for at least 1 year
7. unmarried mother/father
8. any other person who solely provides parental care and support to a child
9. any family mem who assumes the responsibility of head of family
Art. 96 – Service Charges (table charge)
• Establishments collecting service charge: hotels, restaurants, lodging houses, night clubs,
cocktail lounge, massage clinics, bar, casinos and gambling houses and similar enterprises
• TO BE DISTRIBUTED IN FULL to all covered employees except managerial employees
NOTE: see RA 11360:
And DOLE Department Order 206 (IRR of RA 11360)
WEEK 7
BOOK III: CONDITIONS OF EMPLOYMENT (Art. 82 – 129): Working Conditions and Rest
Periods
NOTE:
For purposes of week 7 discussions, please refer to the following from the 2020 Handbook of Worker’s
Statutory Monetary Benefits (Feb 2020).
Computation for:
1. Holiday pay (Art. 94, p. 12 – 15)

2. Premium pay (Art. 91 – 93, p. 16 – 18)
3. Overtime Pay (Art. 87, p. 19 – 20)
4. Night Shift Differential (Art. 86, p. 21 – 22)
44
Illustration:
1. Holiday pay (Art. 94, p. 12 – 15)
1. If Juan’s rate as employee is P500 per day, how much should he be paid on April 9, Araw ng
Kagitingan, if he does not render work on the said day? Answer: P500 (100% of regular rate)
2. If Juan’s rate as employee is P500 per day, how much should he be paid on April 9, Araw ng
Kagitingan, if he does not render work on the said day?
Answer: P1000 (200% of P500, or double pay)
2. Premium Pay (Art. 91 – 93, p. 16 – 18)
a. If Juan’s rate as employee is P500 per day, how much should he be paid if he worked for 8
hours during the Edsa People Power Revolution anniversary?
Answer: P500 (rate per day)

+ P150 (30% of P500)
P650 (130% of rate per day: P500 x 130%)
3. Overtime Pay (Art. 87, p. 19 – 20)
a. If Juan’s rate as employee is P500 per day, how much should he be paid if he rendered 2
hours’ overtime?
Answer: P62.50 (rate per hour on a regular day)

+ P15.625 (25% of P62.50)
P78.125 (125% of rate per hour on a regular day:
P62.50 x 125%)
x 2 (2 hours of overtime)
P156.25 (overtime pay for 2 hours)
+ P500 (daily wage for 8 hours)
P656.25
4. Night Shift Differential (Art. 86, p. 21 – 22)
45
a. If Juan’s rate as employee is P500 per day, how much should he be paid if he rendered 1
hour of his working hours from 10 pm to 11 pm?
Answer: P62.50 (rate per hour on a regular day) + P6.25 (10% of

P62.50)
P68.75 (hourly rate on a night shift)
P62.50
X 7 (no. of hours rendered outside the night shift)
P437.5
+ P68.75
P506.25
NB: these are just computation with given ordinary facts. Please see page 22 and 23 of the
2020 handbook of computing wages for possible combinations.
TITLE II: WAGES

(Art. 97 – 129) “fair day’s wage for fair
day’s labor”
“equal pay for equal work”
• Art. 97,(f) "Wage" paid to any employee shall mean the remuneration or earnings, however
designated, capable of being expressed in terms of money, whether fixed or ascertained on a time,
task, piece, or commission basis, or other method of calculating the same, which is payable by an
employer to an employee under a written or unwritten contract of employment for work done or to
be done, or for services rendered or to be rendered and includes the fair and reasonable value, as
determined by the Secretary of Labor and Employment, of board, lodging, or other facilities
customarily furnished by the employer to the employee. "Fair and reasonable value" shall not
include any profit to the employer, or to any person affiliated with the employer
• applies to the compensation for manual labor, skilled or unskilled, paid at stated times, and
measured by the day, week, month, or season
• includes sales commissions
46
• includes facilities (include articles or services for the benefit of the employee or his family but shall
not include tools of the trade or articles or service primarily for the benefit of the employer or
necessary to the conduct of the employer’s business) or commodities (employer may provide them
but he may deduct their values from the employee’s wages
supplements Facilities
constitute extra remuneration or special privileges items of expense necessary for the laborer’s and
or benefits given to or received by the laborers his family’s existence and subsistence so that by
over and above their ordinary earnings or wages. express provision of law, they form part of the
wage and when furnished by the employer are
deductible therefrom
Requirements for deducting value of facilities (Mabeza v NLRC):
1. proof must be shown that such facilities are customarily furnished by the trade
2. provision of deductible facilities must be voluntarily accepted in writing by the employee
3. facilities must be charged at fair and reasonable value NOTE:
In determining whether a benefit or privilege is a supplement or a facility, it must be borne in mind that
the standard does not refer to the kind of benefit or item but its PURPOSE.
The benefit or privilege given to the employees which constitutes extra remuneration over and
above his basic or ordinary earnings is a supplement; but if it forms part of the employee’s basic wage,
then it is a facility.
A benefit or privilege granted to an employee for the convenience of the employer is not a facility.
Art. 99 - Regional Minimum Wages
For Agricultural and non-agricultural employees/workers:
 prescribed by the Regional Tripartite Wages and Productivity Boards
MINIMUM WAGE
• lowest wage rate fixed by law that an employer can pay his worker
• adopted to reduce the evils of the “sweating system”
• raises standard of competition among employers
• employer’s ability to pay is immaterial; can’t exempt himself to pay minimum wages
47
• acceptance by an employee of the wages paid him without objection does not give rise to
estoppel precluding him from suing for the difference between the amount received and the
amount he should have received pursuant to a valid minimum wage law
Art. 100 – Prohibition against elimination or diminution of benefits
NONDIMINUTION OF BENEFITS
Requisites for application of nondiminution rule
1. grant of the benefit is founded on a policy or has ripened into a practice over a long period
2. the practice is consistent and deliberate
3. the practice is not due to error in the construction or application of a doubtful or difficult question
of law
4. the diminution or discontinuance is done unilaterally by the employer Extent of the Rule
1. food and meal allowances

2. noncontributory retirement plan
3. monthly emergency allowance
Exceptions to the non-diminution rule
3. not established practice

4. benefit on reimbursement basis
5. negotiated benefits (i.e. CBA)
6. reclassification of position/promotion made in good faith
7. contingent or conditional benefits/bonus
BONUS
• amount granted and paid to an employee for his industry and loyalty whick contributed to the
success of the employer’s business ad made possible the
realization of profits
• an act of generosity of the employer for which the employee should be thankful and grateful
• also granted by an enlightened employer to spur the employee ro greater efforts for the success
of the business and the realization of bigger profits
• a gratuity or act of liberality of the giver which the recipient cannot demand as a matter of right
• it is something given in addition to what is ordinarily received by or strictly due the recipient
48
When a bonus is part of wage?
A bonus may be considered part of the wage in the following instances:
a. if it is an additional compensation which the employer promised and agreed to give

without any conditions imposed for its payment, such as success of business or greater
production or output
b. when the granting of the bonus becomes a company practice by reason of its long and
regular concession. Hence applying the principle of nondiminution of benefits, the
bonus can no longer be withdrawn by the employer.
Basic salary
• include all remunerations or earnings paid by an employer to an employee for services rendered but
may not include cost-of-living allowances, profit-sharing payments and all allowances and monetary
benefits which are not considered or integrated as part of the basic salary of the employee;
• overtime pay and other remunerations are excluded as part of basic salary and in the computation
of the 13th month pay (San Miguel Corp v Inciong)
• commissions are included or excluded, depending on what kind of commissions are involved;
a. if wage -or -sales - percentage type [intimately related to the extent or energy of an employee’s
endeavors], includible in the 13th month pay computation (Phil.
Duplicators v NLRC);
b. if profit -sharing or productivity bonus type [something extra for which no specific additional
services are rendered by any particular employee], excluded (Boie - Takeda Chemicals v Dela
Serna)
• employees w/ guaranteed wages/commissions entitled to 13th month pay based on their total
earnings during the calendar year on both their fixed and guaranteed wage and commissions (Phil.
Agricultural and Industrial Workers’ Union v NLRC – drivers and conductors)
Commissions
• recompense, compensation, reward of an employee, agent, salesman, executor, broker or bailee,

when the same is calculated as a percentage on the amount of his transactions or on the profit of
the principal
• teacher’s overload pay performed during or within the 8 hours in a day [the load in excess of the
normal load of private school teachers as prescribed by DECS or the policies, rules, and standard of
particular private schools; work in excess of the regular teaching load; may be performed within or
outside 8 hours in a day] part of basic pay for computing 13th month pay
49
• an employee who has resigned or whose services were terminated at any time before the time for
payment of the 13th month pay is entitled to this monetary benefit in proportion to the length of
time he worked during the year, reckoned from the time he started working during the calendar
year up to the time of his resignation or termination from service (Int’l School of Speech v NLRC)
Art. 101 – Payment by Results
• Workers paid by results [pay is calculated not on the basis of time spent on the job but of
the quantity and quality or the kind of work they turn out] grouped into 2:
1. those whose time and performance is supervised by the employer
 embodies an element of control and supervision over the manner as to how the work
is to be performed ex: piece-rate worker
2. those whose time and performance is unsupervised ex: pakiaw and takay workers
• payment by result not determinative of er-ee rel., only a method of compensation
• basis of output rate – the performance of an ordinary worker of minimum skill or ability [aka
the average worker of the lowest producing group representing 50% of the total number of
employees engaged in similar employment in a particular establishment, excluding learners,
apprentices, and handicapped workers employed therein
• unsupervised piece-rate workers are not entitled to night differential pay and service
incentive leaves
• re: yearly commutation or cash conversion of the service incentive leave of piece-rate
workers o based on their average daily earnings during the particular year of service which
can be derived by dividing the amount earned during the year by the actual number of
working days or the statutory minimum rate, whichever is higher
• in the absence of any agreement which provides otherwise, the amount earned during the
year may exclude COLA, overtime pay, and premium pay, holiday pay, night differential pay
and company fringe benefits
• Other entitlements:
1. holiday pay
2. 13th month pay (if he has rendered at least 1 month work or service during the calendar
year)
Summation of benefits payable to Piece-rate workers
1. minimum wage
2. service incentive leave of 5 days with pay
50
3. night differential pay

4. holiday pay
5. meal and rest periods
6. overtime pay (conditional)
7. premium pay (conditional)
8. 13th month pay
9. other benefits granted by law, by individual or collective agreement or company policy or
practice
Payment of Wages
Art 102. Forms of Payment Forms of payment
1. wages shall be paid only by legal tender or legal currency.

2. Payment of wages by means of promissory notes, vouchers, coupons, tokens, tickets, chits or any
object other than legal tender, even when expressly requested by the employee, is ABSOLUTELY
PROHIBITED.
3. Proof of wage payment
 Where the employee alleges non-payment of wages and/or commission, the employer has the
burden to prove payment
4. Payment of wages by checks
May be allowed subject to the following conditions:
a. There is a bank or other facility for enchashment within a radius of one kilometer from the
workplace
b. The employer or any of his agents or representatives does not receive any pecuniary benefit
directly or indirectly from the arrangement
c. Employees are given reasonable time during banking hours to withdraw their wages from
the bank, the time of which shall be considered as compensable hours worked if done
during working hours
d. Payment by check is with written consent of the employees concerned
Art. 103. Time of Payment
 Wages shall be paid at least once every two weeks or twice a month at intervals not exceeding 16
days.
51
Art. 104. Place of Payment

 Place of Payment
General Rule – should be near place of undertaking Exception:
1. Payment cannot be effected at or near the place of work:

a. because of deterioration of peace & order
b. by reason of actual or impending emergencies caused by fire, flood, epidemic or other
calamity rendering payment thereat impossible; 2. When employer provides free transportation
back & forth
3. Under any analogous circumstances, provided:
• Time spent by employee in collecting their wages shall be considered as compensable hours
worked
• No employer shall pay his employees in any bar, night or day club, drinking
establishment, massage clinic, dance hall or other similar places, or in places
where games are played with stakes of money or things representing money;
except in the case of persons employed in said places
• Payment through bank:
o Upon written permission of the majority of the employee or workers concerned,

o Entities with 25 or more employees and Located within 1 km radius to a bank
o Shall pay wages & other benefits through any of said banks
o Within period of payment of wages fixed by Labor Code (Wage
Rationalization act RA 6727) o Whenever applicable and Upon request of a concerned
worker or union, Bank shall issue a cert of the record of payment of wages Of particular
worker/workers For a particular pay period. (Wage Rationalization act RA 6727)
• Payment through ATM allowed. (under a labor advisory dated Nov 25, 1996)
Art. 105. Direct Payment of Wages
• Wages shall be paid directly to the employees to whom they are due, except:
• When employee gives a written authorization for a member of the famly or representative
• In case of death of employee
52
Art. 110 Worker Preference in case of bankruptcy
Worker preference in case of bankruptcy
• Prerequisite: declaration of bankruptcy or judicial liquidation of employer’s business

• Unpaid wages earned prior to declaration/liquidation shall be given 1st preference for payment,
even ahead of claims of govt.
• Preference even to claims of govt for taxes (DBP v. NLRC)
• Coverage of Preference Termination pay, separation pay, all other monetary claims.
Art. 111 Atty’s Fees
Attorney’s fees
1. Atty’s fees assessed” a. cases of unlawful withholding of wages b. arising from CBA negotiations
(Reahs Corp)
2. Awarded Atty’s fee may not exceed 10%, but between lawyer and client quantum meruit may
apply (TRB EU v. NLRC)
3. Non lawyers not entitled to atty’s fees (Five J Taxi v. NLRC)
4. Since the union president is not the lawyer for the workers, he cannot be allowed to share in the
atty fees. (Amalgated Laborers Assoc v. CIR)
5. Pao Lawyers PAO lawyers disqualified from being awarded atty fees (Lambo v. NLRC)
Prohibition Regarding Wages
a. Interference in the disposal of wages

b. Wage deduction
c. Demanding deposits for future potential loss or damage
d. Withholding of wages and kickbacks
e. Effecting deductions to ensure employment
f. Inflicting retaliatory measures
Art. 112. Non-interference in disposal of wages
1. Civil Code Provisions

a. Art 1705 CC: paid in legal currency
53
b. Art 1706 CC: withholding of wages, except for a debt due, shall not be made by the employer
c. Art 1707 CC: Labor’s wages shall be a lien on goods manufactured or work done.
d. Art 1708 CC: wages not subject to execution or attachment, except for debts incurred for food,
shelter, clothing and medical attenda.ce
e. Art 1709 CC: Employer shall neither seize nor retain any tool or other articles belonging to the
laborer.
Art. 113. Wage Deduction
Wage deduction
• Authorized deductions by law:

a. Value of means and other facilities
b. Premium paid by employer where insured with employee’s consent
c. Union to check off recognized by employer/ authorized in writing by indiv employee
d. Employee is indebted to employer, due & demandable
e. Subject to exection for debts incurred for food, shelter clothing and medical attendance
f. Withholding tax
g. Salary deductions  cooperative
h. SSS, Medicare, Pag-ibig
• Payment to 3rd person:
a. Authorized in writing by employee
b. Employer agrees to make deduction
c. Employer must not receive any pecuniary benefit, directly or indirectly from transaction.
Art. 114. Deposits for Loss or Damage

 provides the rule on deposits for loss or damage to tools, materials or equipment supplied by
employer. Art. 115. Limitations
 Deductions for Loss or Damage

1. employee clearly shown to be responsible for loss or damage
2. employee given ample opprotunity to show cause why deduction should not be made
3. deduction fair and reasonable and shall not exceed actual loss or damage
4. deduction not exceed 20% of employee’s wages in a week  Deductions for unpaid absences are
allowed.
54
 Illegal Deposit
Art. 116 Withholding of wages and kickbacks prohibited
Art. 117. Deduction to Ensure employment
Art. 118 Retaliatory Measures
• Are retaliatory measures (Art 118) strike-able?

o Acts under Art 118 are broad, and can lead to a ULP case if employer retaliated against
testifying employee. If ULP, striekable.
• Reprisal for Silent Testimony
• Art 118 equally applies to implicit or unspoken testimony by an employee. Art. 119. False
Reporting
Wage studies, wage agreements and wage determination Art. 120 Creation of
National Wages and Productivity Commission  created by RA 6727.
Art. 121. Powers and Functions of the Commission
Art. 122. Creation of the RTWPB Regional Tripartite Wages and Producticity Boards
 Composed of: o DOLE Regional

Director o NEDA Regional
Director o DTI Regional Director o
2 workers’ representative
o 2 employers’ representative
NOTE:
While the RTWPB has the power to issue wage orders under Art 122 (b) of the Labor
Code, such orders are subject to the guidelines prescribed by the National Wages and
Productivity Commission (NWPC), who has the power to prescribe the rules and
guidelines for the determination of appropriate wages in the country.
55
Art. 123 Wage Order
• Takes effect after complete publication in at least 1 newspaper of gen circulation in region.
• Not be disturbed for a period of 12 months from effectivity.
• Public Hearing required
• Wage increase cannot be retroactive to effectivity of wage order (Cagayan Sugar Milling v.
Secretrary of Labor)
Art. 124. Standards/Criteria for Min Wage Fixing
 Standards/Criteria for Min wage fixing

a. Living Wage
b. Consumer price index
c. Cost of living
d. Needs of workers and their families
e. Induce industries to invest in countryside
f. Improvements in standards of living
g. Prevailing wage levels
h. Fair return of capital
i. Effects on employment generation and family income
j. Equitable distribution of income and wealth
Wage distortion – situation where an increase in prescribed wage rates results in the elimination or
severe contraction of intentional quantitative differences in wage of salary rates among employee
groups, obliterating the distinctions as to skills, length of service or other logical bases of differentiation.
Distortion adjustment formula (Metro Bank v. NLRC):
Minimum wage / actual salary = % x prescribed increase = distortion adjustment
See also equitable bank case
Art. 125 Freedom to Bargain
Art. 126 Prohibition against Injunction
Art. 127. Non-Diminution of Benefits
56
Administration and Enforcement
Art. 128. Visitorial and Enforcement Power
• If employer-employee relationship still exists – regional director has power to order and
administer, after due notice and hearing, compliance with labor standards provision of Labor
Code/other laws
• DOLE regional director must endorse case to Labor arbiter
• Where employer contests finding of labor standards and welfare officers and  Raises issues
which cannot be resolved without considering evidentiary matters  That are not verifiable in
the normal course of inspection.
• Regional director can enforce a labor standards law even if the compliance issue is not raised in
the complaint. (Aboitiz Shipping v. dela Serna)
• See also Univ of Immaculate Conception case
• But Regional director without authority to declare an order or law unconstitutiional; only duty to
enforce the laws, which stands valid. Double Indemnity
• Fine of double prescribed wage increase when employer refuses or fails to pay prescribed
adjustment in wage rates. (RA 6727).
• Based on unpaid benefits, where benefits defined to be prescribed wage rates which employer
failed to pay upon effectivity of wage order, exclusive of other wafe related benefits.
Labor Standards Cases
• DOLE Regional Director exercises both visitorial and enforcement power over labor standard
cases
o empowered to adjudicate money claims, provided employer-employee relationship exists
and finding are not contested by employer (Maternity Children’s Hospital v. sec of labor)
Art. 129. Recovery of wages, simple money claims and other benefits
• Money claims arising from complaint/routine inspection

• Regional director refers case to Labor Standards and Welfare Officer for field inspection.
• LSWO to submit report to Regional Director through the Chief of the Labor Standards
Enforcement Division (LSED) with 24 hrs after investigation or within a reasonable period as
determined by Regional Director.
Restitution Plant Level
• restitution may be effected for money claims not exceeding P50T.
57
• Report submitted to Regional Director for verification and confirmation.

• Compromise agreement In writing, signed by parties in the presence of Regional Director or his
duly authorized rep. Hearing
• Where no proof of compliance submitted by employer after 7 days from receipt of inspection,
Regional director to summon employer & complainants to a summary investigation.
• Enforcement under Art 128 are beyond injunctive power of an inferior court.  Appeal
Appealable to DOLE sec. Then to CA through certiorari.
DO 57-04 New system for enforcement of labor laws
3 approaches
1. self-assessment – voluntary compliance applicable for shops >= 200 workers or those with CBA
2. Inspection – 10 to 199 workers; hazardous, construction projects; labor standards complaints
3. advisory - < 10 workers; micro business enterprises; not punitive; assistance to increase
productivity; relaxed
 DOLE may delegate to Lgu the inspection for enforcement of labor laws (ex boiler).
WEEK 9
LABOR RELATIONS
BOOK V
I. Labor Relations and Arbitrations ART. 218.
• “Labor Relations” refers to the interactions between employer and employees or their
representatives and the mechanism by which the standards and other terms and conditions of
employment are negotiated, adjusted and enforced.
• The government labor relations policy is declared in Art. 218/211 which is a focused elaboration
of the basic labor policy announced in Art.3 which, in turn, echoes the constitutional mandates.
The policy intends to attain social justice through industrial peace and progress. The latter is
founded on employee participation and collective interactions between employer and
employees. In Management parlance, the input is the parties’ rights and duties, the process is
worker’s organization and collective bargaining, and the output is industrial peace and progress
towards social justice as the end goal.
58
• Labor relations is essentially inter-party, which means that, basically the employer and
employee themselves must deal with their problems in a manner that mutually suits them. This
is the reason why the policy promotes “free” bargaining and negotiation between employers
and employees. The law encourages a democratic and self-devisd method of regulating labor-
management relations. Free agreement between the parties is the rule; government
intervention, the exception.
• The principle behind labor unionism in private industry is that industrial peace cannot be
secured through compulsion by law. Relations between private employers and their employees
rest on an essentially voluntary basis. Subject to the minimum requirements of wage laws and
other labor and welfare legislation, the terms and conditions of employment in the unionized
private sector are settled through the process of collective bargaining. Because labor relations
are primarily “domestic,” third parties, even the Government, shy away from meddling, as much
as it can be helped. This is why an in-house problem solving structure, called grievance
machinery, is a requirement in CBAs. If this machinery fails, the parties themselves are free to
select any third party, called voluntary arbitrator, to resolve their differences. The government
steps in only when the parties themselves fail to reach an agreement to the prejudice of public
interest or when one disregards the defined rights of the other. So when the legal boundaries
are transgressed, the injunctive power of the Stare may be invoked.
WORKERS’ ORGANIZATION [Refer to Art. 219/212, par. (g), (h)]
• A labor or trade union is a combination of workmen organized for the ultimate purpose of
securing through united action the most favourable conditions as regards wages, hours of labor,
conditions of employment, etc., for its members.
• In the popular sense a labor union is understood to be a completely organized body of dues-
paying members, operating through elected officers and constituting a militant, vital and
functioning organ. It may be said that while every labor union is a labor organization, not every
labor organization is a labor union. The difference is one of organ9hization, composition and
operation.
59
WHY WORKERS ORGANIZE
• Self-help through economic action necessarily requires increasing the bargaining power of
employees; hence one of the basic purposes of a labor union is to eliminate competition among
employees in the labor market.
• Three other human desires should be noted among the forces that led workers to organize:
1. One is the desire for job security.
2. Employees wished to substitute what we should term “the rule of law” for the arbitrary and
often capricious exercise of power by the boss.
3. Finally, unions helped to give employees a sense of participation in the business enterprises of
which they are part—a function of labor unions which became important as organizations
spread into mass production industries.
 The union is the recognized instrumentality and mouthpiece of the laborers.
ART. 219/212 ON DEFINITION OF TERMS:
A. COMMISSION J. BARGAINING REPRESENTATIVE

B. BUREAU K. UNFAIR LABOR PRACTICE
C. BOARD L. LABOR DISPUTE
D. COUNCIL M. MANAGERIAL EMPLOYEE
E. EMPLOYER N. VOLUNTARY ARBITRATOR
F. EMPLOYEE O. STRIKE
G. LABOR ORGANIZATION P. LOCKOUT
H. LEGITIMATE LABOR ORGANIZATION Q. INTERNAL UNION DISPUTE
I. COMPANY UNION R. STRIKE-BREAKER
S. STRIKE AREA
II. NLRC (National Labor Relations Commission)
Mandate
The National Labor Relations Commission is a quasi-judicial body tasked to promote and maintain
industrial peace by resolving labor and management disputes involving both local and overseas workers
through compulsory arbitration and alternative modes of dispute resolution. It is attached to the
Department of Labor and Employment for program and policy coordination.
60
Overview:
1. Principal government agency that hears and decides labor-management disputes 2. Labor court of
the Philippies (formerly known as Court of Industrial Relations)
3. NLRC rules of procedure not bound by strict and technical rules of procedure; procedures are
less technical
4. Acts as a body, either the whole commission of 24 (en banc) or division of 3 commissioners
each.
a. En banc actions:
i. Promulgate rules and regulations governing hearing and disposition of cases
ii. Formulate policies affecting administration and operations
iii. Allow cases within the jurisdiction of any division to be heard and decided by
another division iv. Recommend appointment of a labor arbiter
Composition:
1. 1 Chairman and 23 member-commissioners (en banc)

2. 8: 8:8 ratio for members of the commission
• 8 from among the workers and employer' representative; the
final 8 shall consist of the chairman and remaining member who
are coming from the public sector
3. 8 divisions with 3 members each, 1 from each sector and the representative of the public sector
shall be the chair of every division
4. The Chairman shall have the same rank with that of the presiding justice of the Court of Appeals
and the other commissioners as that of an Associate Justice of the Court of Appeals.
5. The Labor Arbiter shall have the same rank with that of a judge of a regional trial court
6. Headquarters/offices:
a. First to sixth division (manila)
b. Seventh division (cebu)
c. Eighth division (Cagayan de oro)
7. Each commissioner shall be assisted by (3) Commission Attorneys in their appellate and
adjudicatory functions
• Commission Attorneys o Coterminous with their assigned
commissioner
o Member of the bar with at least 1-year experience or exposure in the field of
labor-management relations
61
Appointment and qualification
1. Chairman, division presiding commissioners and other commissioners are appointed by the
President
2. Labor arbiter – appointed by the President upon recommendation of the commission en banc
3. The chairman and the commissions and labor arbitrators shall hold office until they reach the
age 65 subject to extension until 70
QUALIFICATIONS:
.1. CHAIRMAN AND COMMISSIONERS”
 Member of the bar and has been engaged in the practice of law for at least 15 years
and at least 5 years’ experience or exposure to in the field of labor-management
relations
2. Labor Arbiter
 member of the bar and has for at least 10 years practice of law and at least 5 years’
experience or exposure to in the field of labor-management relation
WEEK 10
LABOR RELATIONS
BOOK V
JURISDICTIONAL ISSUES
(https://www.chanrobles.com/laborlaw/2009_laborlaw3.php#:~:text=The%20NLRC
%20has%20exclusive%20appellate,decided%20by%20the%20Labor%20Arbiters.& text=If
%20a%20claim%20does%20not,20._) COMPULSARY ARBITRATION:
the process of settlement of labor disputes by government agency that has the authority to
investigate and make an award which is binding on all the parties
Labor Arbiter – has the original and exclusive authority to conduct compulsory arbitration.
62
1. What are the quasi-judicial bodies which exercise jurisdiction over labor cases?
• With Original Jurisdiction:
• Labor Arbiters;
• National Labor Relations Commission (NLRC);
• Secretary of Labor and Employment/his duly authorized representatives;
• DOLE Regional Directors/duly authorized hearing officers;
• Grievance Machinery and Voluntary Arbitrators;
• Bureau of Labor Relations (BLR)/Regional Office;
• Med-Arbiters;
• National Conciliation and Mediation Board (NCMB); and • Philippine Overseas
Employment Administration (POEA).
• With Appellate Jurisdiction:
• Secretary of Labor and Employment; and • Director of the Bureau of Labor Relations.
• With Special Powers:
• Secretary of Labor and Employment;
• National Conciliation and Mediation Board (NCMB);
• President of the Philippines; and chanrobles virtual law library
• Regional Tripartite Wages and Productivity Board (RTWPB) / National Wages and Productivity
Commission (NWPC).
• Jurisdiction over social security benefits claims:
• Social Security System (SSS);
• Government Service Insurance System (GSIS); and
• Philippine Health Insurance Corporation (PHIC).
2. What is the nature of jurisdiction of Labor Arbiters?

• The jurisdiction is original and exclusive in nature.
• Labor Arbiters have no appellate jurisdiction.
3. What are the cases falling under the jurisdiction of the Labor Arbiters?
• Labor Arbiters have jurisdiction over the following cases
a. Unfair labor practice (ULP) cases;
b. Termination disputes (or illegal dismissal cases);
c. Cases that workers may file involving wages, rates of pay, hours of work and other terms and
conditions of employment, if accompanied with claim for reinstatement;
63
d. Claims for actual, moral, exemplary and other forms of damages arising from the employer-
employee relations;
e. Cases arising from any violation of Article 264 of this Code, including questions involving the legality
of strikes and lockouts; and
f. Except claims for Employees’ Compensation, Social Security, Medicare and maternity benefits, all
other claims arising from employer-employee relations, including those of persons in domestic or
household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of
whether accompanied with a claim for reinstatement.
g. Wage distortion disputes in unorganized establishments not voluntarily settled by the parties
pursuant to Republic Act No. 6627;
h. Enforcement of compromise agreements when there is non-compliance by any of the parties
pursuant to Article 227 of the Labor Code, as amended;
i. Money claims arising out of employer-employee relationship or by virtue of any law or contract,
involving Filipino workers for overseas employment, including claims for actual, moral, exemplary
and other forms of damages as provided by Section 10 of
R.A. No. 8042, as amended by R.A. No. 10022;
(NOTE: The POEA continues to have jurisdiction over recruitment or preemployment cases
which are administrative in nature, involving or arising out of recruitment laws, rules and
regulations, including money claims arising therefrom or violation of the conditions for issuance
of license to recruit workers).
j. Contested cases under the exception clause of Article 128(b) of the Labor Code, as amended by R.A.
7730; and
k. Other cases as may be provided by law.
NOTE: ART. 273 AND 274 provides that the above-mentioned cases can BY AGREEMENT O F
PARTIES, be presented and decided with finality by a voluntary arbitrator or panel of voluntary
arbitrators.
4. Do Labor Arbiters have jurisdiction over wage distortion cases?
• Labor Arbiters have jurisdiction over wage distortion cases only in unorganized establishments.
In organized establishments, jurisdiction is vested with Voluntary Arbitrators.
5. Do Labor Arbiters have jurisdiction over legality of strikes and lockouts?
• Labor Arbiters have jurisdiction over the issue of legality of strikes and lockouts, except in strikes
and lockouts in industries indispensable to the national interest, in which case, either NLRC (in
certified cases) or DOLE Secretary (in assumed cases) has jurisdiction.
6. What are the cases which do not fall under the jurisdiction of the Labor Arbiters?
a. JURISDICTION OVER INTRA-CORPORATE DISPUTES.
o Labor Arbiters have no jurisdiction over termination of corporate officers and stockholders
which, under the law, is considered intra-corporate dispute. o It must be emphasized that a
corporate officer’s dismissal is always a corporate act and/or intra-corporate controversy
64
and that nature is not altered by the reason or wisdom which the Board of Directors may
have in taking such action. o The Regional Trial Courts (not SEC) now have jurisdiction
under R. A.
8799 (Securities Regulation Act of 2000). o Jurisdiction of RTC includes adjudication
of monetary claims of the corporate officer who was dismissed, (such as unpaid salaries,
leaves, 13th month pay, bonuses, etc.), damages and attorney's fees.
b. JURISDICTION OVER GOVERNMENT CORPORATIONS WITH ORIGINAL
CHARTERS.
o Labor Arbiters have jurisdiction over cases involving employees of government-owned or
controlled corporations without original charters (organized under the Corporation
Code). They have no jurisdiction if entity has original charter.
c. JURISDICTION OVER IMMUNED ENTITIES.
o Labor Arbiters have no jurisdiction over labor cases involving entities immuned from suit.
Exception: when said entities perform proprietary activities (as distinguished from
governmental functions).
d. JURISDICTION OVER LOCAL WATER DISTRICTS.
• local water districts are quasi-public corporations and, therefore, the dismissal of their
employees are governed by the civil service laws, rules and regulations
e. JURISDICTION OVER TORTS.
 As earlier emphasized, Labor Arbiters and the NLRC have no power or authority to grant
reliefs from claims that do not arise from employeremployee relations. They have no
jurisdiction over quasi-delict or tort per Article 2176 of the Civil Code that have no
reasonable causal connection to any of the claims provided for in the Labor Code, other
labor statutes,
or collective bargaining agreements. chanrobles virtual law library
7. SUMMARY OF OTHER ISSUES BEYOND JURISDICTION OF THE LABOR ARBITERS
OR NLRC.
 In addition to the foregoing, other issues over which the Labor
Arbiter or NLRC has no jurisdiction may be summed up as follows:
a. Cases involving claims for Employees Compensation, Social Security, Medicare and
maternity benefits. (Article 217 [6], Labor Code).
b. Issue of replevin intertwined with a labor dispute. (Basaya, Jr. vs. Militante, 156 SCRA
299).
c. Cases arising from violation of training agreement. (Singapore Airlines vs. Hon. Ernani
Cruz Pano, G. R. No. L-47739, June 22, 1983; 122 SCRA 671).
65
d. Cases involving claim for liquidated damages for breach of a contractual obligation. Also
the issue of liability in suretyship. (Singapore Airlines vs. Hon. Ernani Cruz Pano, G. R.
No. L-47739, June 22, 1983; 122 SCRA 671).
e. Cases involving issue of whether sale of property being levied on
execution was done in bad faith. (Asian Footwear vs. Soriano, 142 SCRA 49).
f. Cases of contempt involving a judge of the regular court. (Tolentino vs. Inciong, 91 SCRA
563).
g. Cases involving an injunction filed by a third party with the regular court against the
sheriff enforcing a decision in a labor case. (Philippine Association of Free Labor Unions
[PAFLU] vs. Salas, 158 SCRA 53).
h. Cases involving claim of employee for cash prize offered under the
Innovation Program of a company which, although arising from employer-
employee relationship, require the application of general civil law on contracts. (San Miguel
Corporation vs. NLRC, 161 SCRA 719).
i. Cases initiated by employer against an employee for sum of money and damages for
cost of repair jobs made on an employee’s personal cars as well as for the purchase
price of parts and vehicles. (Molave Motor Sales, Inc. vs. Laron, 129 SCRA 485).
j. Claims for commissions and certain reimbursements made by an independent
contractor. (Sara vs. Agarrado, 166 SCRA 625).
k. Cases filed by government-owned corporations performing governmental
functions. (National Housing Corporation vs. Juco, 134 SCRA 172; Metropolitan Waterworks
and Sewerage System vs. Hernandez, 143 SCRA 602; PNOCExploration Corporation vs. NLRC,
164 SCRA 501).
l. Violation of labor laws which are penal in nature. Examples are illegal
recruitment cases, (Section 10, Rule X, Book II, Rules and Regulations Governing Overseas
Employment) or criminal offenses or felonies committed in the course of strikes and lockouts.
(Article 264, Labor Code).
m. Insolvency proceedings in the enforcement of the worker preference
ordained under Article 110 of the Labor Code.
n. Exercise of equity jurisdiction to enjoin activities for purposes of compelling an
employer to ignore a clear mandate of the law. (Bulletin Publishing Corporation vs.
Sanchez, 144 SCRA 678).
o. Administrative action against the licensee or holder of authority cognizable
by the POEA which could proceed independently from the criminal action. (Section 12, Rules
and Regulations Implementing the Migrant Workers and Overseas Filipinos Act of 1995).
p. Review of recruitment violation cases and other related cases decided by
66
the POEA. The Secretary of Labor and Employment has exclusive jurisdiction over these cases.
(Section 1, Rule IV, Book VI, Rules and Regulations Governing Overseas Employment).
q. Cases involving issues which do not arise from, or has no reasonable causal connection
with, employer-employee relationship. (Pepsi-Cola Distributors vs. Galang, 201 SCRA
695; Grepalife Assurance Corporation vs. NLRC, 187 SCRA 694; Cosmopolitan Funeral
Homes vs. Maalat, 187 SCRA 773; Insular Life vs. NLRC, 179 SCRA 459).
JURISDICTION OF THE NLRC

8. What are the two kinds of jurisdiction of the NLRC?
The National Labor Relations Commission exercises two (2) kinds of jurisdiction:
a. original jurisdiction; and

b. exclusive appellate jurisdiction.
1. Original jurisdiction.
a. Injunction in ordinary labor disputes to enjoin or restrain any actual or threatened commission of
any or all prohibited or unlawful acts or to require the performance of a particular act in any labor
dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to
any party.
b. Injunction in strikes or lockouts under Article 264 of the Labor Code.
c. Certified labor disputes causing or likely to cause a strike or lockout in an industry indispensable
to the national interest, certified to it by the Secretary of Labor and Employment for compulsory
arbitration.
2. Exclusive appellate jurisdiction.
a. All cases decided by the Labor Arbiters including contempt cases.
b. Cases decided by the DOLE Regional Directors or his duly authorized Hearing Officers
(under Article 129) involving recovery of wages, simple money claims and other benefits not
exceeding P5,000 and not accompanied by claim for reinstatement.
NOTE: ART. 225 AND 226, powers f the NLRC may be summed up into:
a. Power to make rules and regulations pertaining to its functions

b. Power to administer oaths and issue subpoena and summons
c. The power to investigate, hear and decided disputes within its jurisdiction
d. Power to hold persons in contempt
e. Power to issue restraining orders and injunctions
f. Power to conduct ocular inspection
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g. Power to decide appealed cases

9. What is the distinction between the jurisdiction of the Labor Arbiters and the
NLRC?
• The NLRC has exclusive appellate jurisdiction on all cases decided by the Labor Arbiters. The
NLRC does not have original jurisdiction on the cases over which Labor Arbiters have original and
exclusive jurisdiction (see above enumeration). If a claim does not fall within the exclusive
original jurisdiction of the Labor Arbiter, the NLRC cannot have appellate jurisdiction there over.
POWERS OF THE DOLE SECRETARY AND HIS DULY AUTHORIZED REPRESENTATIVES
10. What is the visitorial and enforcement power of the DOLE Secretary and his duly
authorized representatives under Article 128 of the Labor Code?
a. Power to inspect employer’s records and premises at any time of the day or night whenever
work is being undertaken therein, and the right to copy therefrom, to question any employee
and investigate any fact, condition or matter which may be necessary to determine violations or
which may aid in the enforcement of the Labor Code and of any labor law, wage order or rules
and regulations issued pursuant thereto.
b. Power to issue compliance orders to give effect to the labor standards provisions of this Code
and other labor legislation based on the findings of labor employment and enforcement officers
or industrial safety engineers made in the course of inspection.
c. Power to issue writs of execution to the appropriate authority for the enforcement of their
orders, except in cases where the employer contests the findings of the labor employment and
enforcement officer and raises issues supported by documentary proofs which were not
considered in the course of inspection. chanrobles virtual law library
d. Power to order stoppage of work or suspension of operations of any unit or department of an
establishment when non-compliance with the law or implementing rules and regulations poses
grave and imminent danger to the health and safety of workers in the workplace.
11. What is the power to assume jurisdiction or certify “national interest” labor disputes
to NLRC?
• When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in
an industry indispensable to the national interest, the Secretary of Labor and Employment may
assume jurisdiction over the dispute and decide it or certify the same to the Commission for
compulsory arbitration. (Article 263 [g], Labor Code).
12. What are the cases falling under the DOLE Secretary’s appellate power?
a. Orders issued by the duly authorized representative of the Secretary of Labor and
Employment under Article 128 (Visitorial and Enforcement Power) may be appealed to the
latter. (Art. 128).
68
b. Denial of application for union registration or cancellation of union registration originally

rendered by the Bureau of Labor Relations (BLR) may be appealed to the Secretary of Labor
and Employment. (NOTE: If originally rendered by the Regional Office, appeal should be
made to the BLR).
c. Decisions of the Med-Arbiter in certification election cases are appealable to the DOLE
Secretary. (Art. 259). (NOTE: Decisions of Med-Arbiters in intraunion disputes are
appealable to the BLR).
JURISDICTION OF THE DOLE REGIONAL DIRECTORS / DULY AUTHORIZED HEARING

OFFICERS.
13. What are the money claims falling under the jurisdiction of DOLE Regional
Directors?
• Under Article 129, the Regional Director or any of the duly authorized hearing officers of DOLE
have jurisdiction over claims for recovery of wages, simple money claims and other benefits,
provided that:
a. the claim must arise from employer-employee relationship;
b. the claimant does not seek reinstatement; and
c. the aggregate money claim of each employee does not exceed P5,000.00.
JURISDICTION OF GRIEVANCE MACHINERY IN THE CBA
14. What are the cases falling under the jurisdiction of the Grievance Machinery?
• Any grievance arising from:
a. the interpretation or implementation of the Collective Bargaining Agreement
(CBA); and
b. the interpretation or enforcement of company personnel policies.
(NOTE: All grievances submitted to the grievance machinery which are not settled within seven (7)
calendar days from the date of its submission shall automatically be referred to voluntary arbitration
prescribed in the CBA)
JURISDICTION OF VOLUNTARY ARBITRATORS OR PANEL OF VAs
15. What are the cases falling under the jurisdiction of the Voluntary Arbitrator or panel
of Voluntary Arbitrators?
• The Voluntary Arbitrator (or panel of Voluntary Arbitrators) has original and exclusive
jurisdiction over the following:
69
a. all unresolved grievances arising from the interpretation or implementation of the collective
bargaining agreement after exhaustion of the grievance procedure; and
b. all unresolved grievances arising from the implementation or interpretation of company
personnel policies. (Article 261).
c. all other labor disputes including unfair labor practices and bargaining deadlocks, upon
agreement of the parties. (Article 262).
16. How should cases falling under the jurisdiction of the Voluntary Arbitrator but
erroneously filed with the Labor Arbiters or DOLE Regional Offices be processed?
• They shall immediately be disposed and referred to the Grievance Machinery or Voluntary
Arbitration provided in the CBA.
17. In case of conflict, who has jurisdiction over termination disputes, Labor Arbiter or
Voluntary Arbitrator?
• Jurisdiction over termination disputes belongs to Labor Arbiters and NOT with Grievance
Machinery nor Voluntary Arbitrator
• Case at point: ATLAS FARMS, INC. VS. NLRC (G.R. NO. 142244; Nov. 18, 2002) [cited Maneja vs.
NLRC, 290 SCRA 603, 616, (1998)].
JURISDICTION OF THE BUREAU OF LABOR RELATIONS (BLR)/MED-ARBITERS
18. What are the cases falling under the jurisdiction of the BLR?
• The BLR has original and exclusive jurisdiction over the following:
a. “Inter-union disputes” or “representation disputes” which refer to cases involving petition for
certification election filed by a duly registered labor organization which is seeking to be
recognized as the sole and exclusive bargaining agent of the rank-and-file employees in the
appropriate bargaining unit of a company, firm or establishment.
b. “Intra-union disputes” or “internal union disputes” which refer to disputes or grievances arising
from any violation of or disagreement over any provision of the constitution and by-laws of the
union, including any violation of the rights and conditions of union membership provided for in
the Labor Code.
c. All disputes, grievances or problems arising from or affecting labor-management relations in all
workplaces, except those arising from the interpretation or implementation of the CBA which
are subject of grievance procedure and/or voluntary arbitration.
19. What are the relevant administrative functions of the BLR?
• The BLR has the following administrative functions:
a. registration of labor unions;
b. keeping of registry of labor unions; and
c. maintenance and custody of CBAs.
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ART. 228. Non lawyers may appeat before the commission or labor arbiter only:
1. if they represent themselves

2. if they represent their organization or members thereof.
APPEALS
20. What are the modes of appeal from the decisions of the various labor tribunals?
a. DECISION OF LABOR ARBITERS: Appeal from the decision of the Labor Arbiter is
brought by ordinary appeal to the NLRC within ten (10) calendar days from receipt by the party
of the decision. From the decision of the NLRC, there is no appeal. The only way to elevate the
case to the Court of Appeals is by way of the special civil action of certiorari under Rule 65 of the
Rules of Civil Procedure. From the ruling of the Court of the Appeals, it may be elevated to the
Supreme Court by way of ordinary appeal under Rule 45 of the Rules of Civil Procedure. (St.
Martin Funeral Home vs. NLRC, et al., G. R. No. 130866, September 16, 1998).
b. DECISION OF VOLUNTARY ARBITRATORS: The decision of a Voluntary Arbitrator or
panel of Voluntary Arbitrators is appealable by ordinary appeal under Rule 43 of the Rules of
Civil Procedure directly to the Court of Appeals. From the Court of Appeals, the case may be
elevated to the Supreme Court by way of ordinary appeal under the same Rule 45. (Luzon
Development Bank vs. Association of Luzon Development Bank Employees, et al., G. R. No.
120319, October 6, 1995).
c. DECISION OF THE BLR:
i. A. Denial of application for registration of a union. If the denial is issued by the
Regional Office, it may be appealed to the BLR. If the denial is originally made by the
BLR, appeal may be had to the Secretary of Labor and Employment.
ii. B. Cancellation of registration of a union. If the cancellation of union registration is
ordered by the Regional Office, the same may be appealed to the BLR. If the
cancellation is done by the BLR in a petition filed
directly therewith, the BLR’s decision is appealable to the Secretary of Labor and
Employment by ordinary appeal.
iii. The decision of the BLR rendered in its original jurisdiction may be appealed to the
Secretary of Labor and Employment whose decision thereon may only be elevated to
the Court of Appeals by way of certiorari under Rule 65.
iv. The decision of the BLR rendered in its appellate jurisdiction may not be appealed to
the Secretary of Labor and Employment but may be elevated directly to the Court of
Appeals by way of certiorari under Rule 65. (Abbott Laboratories Philippines, Inc. vs.
Abbott Laboratories Employees Union, et al., G. R. No. 131374, January 26, 2000).
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d. DECISION OF THE MED-ARBITER IN CERTIFICATION ELECTION CASES – The

decision is appealable to the DOLE Secretary of Labor and Employment.
e. DECISION OF THE DOLE REGIONAL DIRECTORS OR HIS DULY
AUTHORIZED HEARING OFFICERS UNDER ARTICLE 129 INVOLVING
RECOVERY OF WAGES, SIMPLE MONEY CLAIMS AND OTHER BENEFITS
NOT EXCEEDING P5,000 AND NOT ACCOMPANIED BY CLAIM FOR
REINSTATEMENT - The decision is appealable to the NLRC and not to the DOLE Secretary.
(NOTE: Appeal from CA to SC should be under Rule 45 (Petition for Review on

Certiorari) and not Rule 65 (Special Civil Action for Certiorari)
APPEAL TO THE NLRC FROM DECISIONS OF LABOR ARBITERS
21. What are the grounds for appeal?

• There are four (4) grounds, to wit:
a. If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter;
b. If the decision, order or award was secured through fraud or coercion, including graft
and corruption;
c. If made purely on questions of law; and
d. If serious errors in the findings of facts are raised which would cause grave or
irreparable damage or injury to the appellant.
What are the requisites for perfection of appeal?
• Requisites for perfection of appeal.
a. the appeal should be filed within the reglementary period;
b. the Memorandum of Appeal should be under oath;
c. payment of appeal fee;
d. posting of cash or surety bond, if judgment involves monetary award; and
e. proof of service to the adverse party.
What is the reglementary period to perfect the appeal?
• The reglementary period is ten (10) calendar days.
a. Saturdays, Sundays and Legal Holidays included in reckoning 10-day reglementary period.
b. Exceptions to 10-calendar day period rule.
i. Appeal filed before the Vir-Jen case (G. R. Nos.
58011-12, July 20, 1982) at a time when the rule
was 10 working days.
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ii. 10th day falling on a Saturday. iii. 10th day falling

on a Sunday or holiday. iv. Reliance on erroneous
notice of decision.
v. Appeal from decision of Labor Arbiter on third-party claim (10 working days).
vi. Appeal from decision of Labor Arbiter in direct contempt cases (5 calendar days).
vii. When allowing the appeal "in the interest of justice."
viii. Allowing the appeal for other compelling reasons (due to typhoon falling on the 10th day;
or excusable negligence).
c. The 10-calendar day reglementary period to appeal is not extendible.
d. Motion for reconsideration of Labor Arbiter’s decision is not allowed.
e. 10 calendar-day period is counted from receipt of decision by counsel of party.
f. Failure to appeal or perfect appeal within 10-calendar day reglementary period will make the
Labor Arbiter's decision final and executory.
g. Date of mailing (by registered mail) is date of filing.
h. Receipt by one of two counsels is receipt by the party.
i. Effect of perfection of appeal - Labor Arbiter loses jurisdiction.
j. Lack of verification of the memorandum of appeal is not fatal nor jurisdictional.
k. Failure to pay appeal docketing fee, not fatal to the validity of appeal.
l. Submission of new or additional evidence on appeal may be allowed.
m. Raising new issues or changing theory on appeal is not allowed.
What is the reinstatement aspect of the Labor Arbiter's decision?

a. If reinstatement is ordered by the Labor Arbiter in an illegal dismissal case, it is immediately
executory even pending appeal. Such award does not require a writ of execution.
b. it is the employer who is duty-bound to inform employee of the reinstatement (either in the
payroll or in the position previously held or in a substantially equivalent position if no longer
available, at the option of the employer).
c. The employee ordered reinstated need not secure a writ of execution from the Labor Arbiter.
d. If employer refuses to reinstate, the employee may file a motion to cite the former in contempt.
The posting of bond does not stay reinstatement.
e. Options of the employer.
• The employer is practically left with no effective contra-remedy that may forestall or stay the
execution of a Labor Arbiter’s order for immediate reinstatement pending appeal. All that the
employer has is to avail of any of the following options:
i. actual reinstatement of the employee to his work under the same terms and conditions
prevailing prior to his dismissal or separation; or
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ii. reinstatement of the employee in the payroll of the company, without requiring him to
report back to his work. (Article 223, Labor Code;
25. What are the rules in case of appeal involving monetary award?
• The following basic principles are worth mentioning:
a. No monetary award, no appeal bond required.
b. Labor Arbiter’s decision or order is required to state the amount awarded. If the amount of the
monetary award is not included in the judgment, the appeal bond equivalent to the amount of
the monetary award is not required to be posted.
(Orozco vs. The Fifth Division of the Honorable Court of Appeals, [G. R. No.
155207, April 29, 2005])
c. Cash, property or surety bond is required for perfection of appeal from monetary award. The
surety bond should be issued by an accredited surety company.
d. Bond should be posted within the 10-calendar day reglementary period.
e. Award of moral and exemplary damages and attorney’s fees, excluded from computation of
bond.
i. If bond is not genuine, appeal is not perfected.
ii. Non-posting of bond will not perfect the appeal.
iii. Remedy of employee in case employer failed to post bond is to file a motion to
dismiss the appeal.
WEEK 11
LABOR RELATIONS
BOOK V
BUREAU OF LABOR RELATIOS/LABOR RELATIONS DIVISION (Art. 232)
Have original and exclusive authority to act, at their own initiative or upon request of either
parties on all inter-union and intra-union conflicts and all disputes, grievances or problems
arising from or affecting labor-management relations in all workplaces
The Bureau was established on January 16, 1957 pursuant to Executive Order No. 213 and the
Organization Plan 20-A. It took over the Conciliation Service and the Registrar of Labor
Organizations created under R.A. 875 and served as a planning, policy making, consultative and
advisory body in the promotion and maintenance of industrial peace.
MANDATE
1. National registry of unions and CBAs;
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2. Formulate regulatory and developmental policies, standards, guidelines and programs

promoting the right to organize, including collective bargaining and improvement of the income
of workers and their organizations;
3. Lead agency in workers and employers’ education;
4. Adjudicate inter- and intra-union disputes;
5. Promote bipartism and tripartism; and
6. Formulation and implementation of programs that strengthen trade unionism to achieve

industrial peace.
MED-ARBITER (mediator-arbitrator)
Refers to an officer authorized to hear and decide representation cases, inter/intraunion

disputes and related labor relations disputes except cancellation of union registration cases.
REPRESENTATION CASES
Refers to the proceeding intended to determine which one, among rival unions, should be
officially designated or certified as the exclusive representative of the employees in bargaining
collectively with their employer.
INTER-UNION DISPUTE
Refers to any conflict between and among legitimate labor unions involving representation
questions for purposes of collective bargaining or to any dispute between legitimate labor
unions
INTRA-UNION DISPUTE
Refers to any conflict between and among members of a union. It may involve grievances
arising from any violation of the rights and conditions of membership, violation of or
disagreement over any provision of the union’s constitution and by-laws or disputes arising from
chartering or affiliation of union.
LABOR ORGANIZATIONS (ART. 239)
A “labor organization” is not always a union; it may be an “association of employees.” And,

the purpose is not only or necessarily “collective bargaining” but also dealing with employers
concerning terms and conditions of employment.
"Labor Organization" refers to any union or association of employees in the private sector
which exists in whole or in part for the purpose of collective bargaining, mutual aid, interest,
cooperation, protection, or other lawful purposes.
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"Legitimate Labor Organization" refers to any labor organization in the private sector
registered or reported with the Department
"Union" refers to any labor organization in the private sector organized for collective
bargaining and for other legitimate purposes.
We should note that not every union is “legitimate;” only those properly registered are considered LLO.
But non-registration does not mean it is “illegitimate;” it simply is unregistered and has no legal
personality. It exists legally but does not possess the rights of an LLO.
"Exclusive Bargaining Representative" refers to a legitimate labor union duly recognized
or certified as the sole and exclusive bargaining representative or agent of all the employees in a
bargaining unit.
"Workers' Association" refers to an association of workers organized for the mutual aid and
protection of its members or for any legitimate purpose other than collective bargaining.
"Legitimate Workers' Association" refers to an association of workers organized for
mutual aid and protection of its members or for any legitimate purpose other than collective
bargaining registered with the Department
Distinction Between “Collective Bargaining” and “Dealing with Employer”
To bargain collectively is a right that may be acquired by a labor organization after registering
itself with the Department of Labor and Employment and after being recognized or certified by
DOLE as the exclusive bargaining representative (EBR) of the employees.
Dealing with employer, on the other hand, is a generic description of interaction between
employer and employees concerning grievances, wages, work hours and other terms and
conditions of employment, even if the employee’s group is not registered with the Department
of Labor and Employment
CLASSIFICATION OF LABOR ORGANIZATIONS
"National Union/Federation" means any labor organization with at least ten (10) locals or
chapters each of which must be a duly recognized collective bargaining agent. “Industry
Union” means any group of legitimate labor organizations operating within an identified
industry, organized for collective bargaining or for dealing with employers concerning terms and
conditions of employment within an industry, or for participating in the formulation of social
and employment policies, standards and programs in such industry, which is duly registered
with the Department. D.O. No. 40-03, however, does not carry this term and this definition,
although under Rule III, Section 2-B, “labor organizations operating within an identified industry
may also apply for registration as a federation or national union within the specified industry by
submitting to the Bureau the same set of documents (as required of federations and national
unions.)”
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“Trade Union Center” means any group of registered national unions or federations
organized for the mutual aid and protection of its members, for assisting such members in
collective bargaining, or for participating in the formulation of social and employment policies,
standards and programs, which is duly registered with the Department.
An “alliance” is an aggregation of unions existing in one line of industry, or in a conglomerate,
a group of franchises, a geographical area, or an industrial center.
A “company-union” is a labor organization which, in whole or in part, is employercontrolled
or employerdenominated. Article 248(d) prohibits being a company union.
Unions at Enterprise Level
A labor union at the enterprise level may be created either by (a) independent registration or
(b) chartering. Independent registration is obtained by the union organizers in an enterprise
through their own action instead of through issuance of a charter by a federation or national
union. An independent union has a legal personality of its own not derived from that of a
federation.
"Independent Union" refers to a labor organization operating at the enterprise level that
acquired legal personality through independent registration under Article 234 of the Labor Code
and Rule III, Section 2-A of these Rules.
Chartering, on the other hand, takes place when a duly registered federation or national union
issue a charter to a union in an enterprise and registers the creation of the chapter with the
Regional Office where the applicants operates. The union recipient of the charter s called a
chapter or local or chartered local. Its legal personality is derived from the federation/ national
union but it may subsequently register itself independently.
REGISTRATION AND CANCELLATION

REQUIREMENTS OF REGISTRATION (Art. 239)
1. P50 registration fee

2. Names of officers and their addresses; principal address of the labor organization; minutes of
the organizational meetings and the list of workers who participated in the meetings
3. In case of independent union, the names of all its members comprising at least 20% of all the
employees in the bargaining unit where it seeks to operate
4. If the applicant union has been in existence for one or more years, copies of its annual financial
reports, and
5. 4 copies of the constitution and by-laws of the applicant union, minutes of its adoption or
ratification and the list of the members who participated in it.
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REGISTRATION RATIONALE
A labor organization may be registered or not. If registered with DOLE, it is considered

“legitimate labor organization” (LLO). But the reverse us not true, that is, a labor organization is
not “illegitimate” just because it is unregistered. It is still lawful organization and can deal with
the employer, but it has no legal personality to demand collective bargaining with the employer.
It cannot petition for a certification election and cannot hold a legal strike.
Registration is merely a condition sine qua non for the acquisition of legal personality by labor
organizations, associations or unions and the possession of the rights and privileges granted by
law to legitimate labor organizations.
Such requirement is a valid exercise of the police power, because the activities in which labor
organizations, associations and union of workers are engaged affect public interest, which
should be protected.
COLLECTIVE BARGAINING UNIT (CBU)
"Bargaining Unit" refers to a group of employees sharing mutual interests within a given
employer unit, comprised of all or less than all of the entire body of employees in the employer
unit or any specific occupational or geographical grouping within such employer unit.
While officers lead and represent a union, a union represents a CBU. The representative is the
union; the group represented is the CBU. The representative union, once determined, will
represent even the members of other unions as long as they are part of the CBU. This is why the
representative union (also called bargaining agent or majority union) is called “exclusive
bargaining representative” (EBR)
AFFILIATION
An affiliate is an independently registered union that enters into an agreement of affiliation

with a federation or a national union.
It also refers to a chartered local which applies for and is granted an independent registration
but does not disaffiliate from its mother federation or national union.
A union, either an independent or a local, affiliates with a federation or national union for a
number of reasons. The most common ones are to secure support or assistance particularly
during the formative stage of unionization; or to utilize expertise in preparing and pursuing
bargaining proposals; or to marshal mind and manpower in the course of a group action such as
strike.
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The relationship between a local or chapter and the labor federation or national union is
generally understood to be that of agency, where the local is the principal and the federation
the agent.
DISAFFILIATION
The sole essence of affiliation is to increase, by collective action, the common bargaining power
of local unions for the effective enhancement and protection of their interests. Admittedly,
there are times when without succor and support local unions may find it hard, unaided by
other support groups, to secure justice for themselves.
Yet the local unions remain the basic units of association, free to serve their own interests
subject to the restraints imposed by the constitution and bylaws of the national federation, and
free also to renounce the affiliation upon the terms laid down in the agreement which brought
such affiliation into existence.
To disaffiliate is a right, but to observe the terms of affiliation is an obligation
REVOCATION OF CHARTER
A federation, national union or workers’ association may revoke the charter issued to a
local/chapter or branch by serving on the latter a verified notice of revocation, copy furnished
the Bureau, on the ground of disloyalty or such other grounds as may be specified in the
constitution and bylaws of the federation, national union or workers’ association. The
revocation shall divest the local/chapter of its legal personality upon receipt of the notice by the
Bureau, unless in the meantime the local/chapter has acquired independent registration in
accordance with the Rules
Effect of Cancellation of Registration of Federation or National Union on
Locals/Chapter
The cancellation of registration of a federation or national union shall operate to divest its
local/chapter of their status as legitimate labor organizations, unless the locals/chapters are
covered by a duly registered collective bargaining agreement.
MERGER AND CONSOLIDATION
Effect of merger or consolidation. - Where there is a merger of labor organizations, the legal
existence of the absorbed labor organization(s) ceases, while the legal existence of the
absorbing labor organization subsists. All the rights, interests and obligations of the absorbed
labor organizations are transferred to the absorbing organization.
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Where there is consolidation, the legal existence of the consolidating labor organizations shall
cease and a new labor organization is created. The newly created labor organization shall
acquire all the rights, interests and obligations of the consolidating labor organizations.
Consolidation usually occurs between two unions that are approximately the same size, whereas
merger often involves a larger union merging with a smaller union.
Why do unions merge? They merge for reasons similar to those behind corporate mergers.
First, a small union may merge with a larger union in order to gain access to greater resources
and expertise.
Second, unions that have traditionally competed with each other for members may merge in
order to eliminate inter-organizational conflicts.
Third, unions whose members’ skills have been outmoded by technological and economic
changes may merge with a stronger union in order to maintain job security and institutional
survival.
Art. 246 (239). Grounds for Cancellation of Union Registration.
- The following may constitute grounds for cancellation of union registration:

(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification of
the constitution and by-laws or amendments thereto, the minutes of
ratification, and the list of members who took part in the ratification;
(b) Misrepresentation, false statements or fraud in connection with the election of officers, minutes
of the election of officers, and the list of voters;
(c) Voluntary dissolution by the members. (As amended by Republic Act No. 9481, May 25, 2007)
NOTE:
While registration is the act that converts a labor organization to a legitimate labor organization,
cancellation is the government act that [divests] it of that status. It thereby reverts to its
character prior to the registration. Although it does not cease to exist or become an unlawful
organization, its juridical personality as well as its statutory rights and privileges [are]
suspended. It loses entitlement to the rights enumerated in Article 242 of the Labor Code. It
cannot demand recognition by or bargaining with the employer, cannot file a petition for
certification election, and cannot strike.
RIGHTS AND CONDITIONS OF MEMBERSHIP (ART. 249)

SUMMARY POINTS:
The rights and conditions of membership laid down in Art. 241 may be summarized as follows:
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1. Political right – the member’s right to vote and be voted for, subject to lawful provisions on
qualifications and disqualifications.
2. Deliberative and decision-making right – the member’s right to participate in deliberations on
major policy questions and decide them by secret ballot.
3. Rights over money matters – the member’s right against excessive fees; the right against
unauthorized collection of contributions or unauthorized disbursements; the right to require
adequate records of income and expenses and the right of access to financial records; the right
to vote on officers’ compensation; the right to vote on proposed special assessments and be
deducted a special assessment only with the member’s written authorization.
4. Right to Information – the member’s right to be informed about the organization’s constitution
and by-laws and the collective bargaining agreement and about labor laws.
Although not so denominated, Article 241 of the Labor Code carries the character of a bill of
rights of union members.
RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS [ART. 250 (242)]
A legitimate labor organization shall have the right:

a. To act as the representative of its members for the purpose of collective bargaining;
b. To be certified as the exclusive representative of all the employees in an appropriate bargaining unit
for purposes of collective bargaining;
c. To be furnished by the employer, upon written request, with its annual audited financial statements,
including the balance sheet and the profit and loss statement, within thirty (30) calendar days from
the date of receipt of the request, after the union has been duly recognized by the employer or
certified as the sole and exclusive bargaining representative of the employees in the bargaining unit,
or within sixty (60) calendar days before the expiration of the existing collective bargaining
agreement, or during the collective bargaining negotiation;
d. To own property, real or personal, for the use and benefit of the labor organization and its
members;
e. To sue and be sued in its registered name; and
f. To undertake all other activities designed to benefit the organization and its members, including
cooperative, housing, welfare and other projects not contrary to law.
Notwithstanding any provision of a general or special law to the contrary, the income and the
properties of legitimate labor organizations, including grants, endowments, gifts, donations and
contributions they may receive from fraternal and similar organizations, local or foreign, which
are actually, directly and exclusively used for their lawful purposes, shall be free from taxes,
duties and other assessments. The exemptions provided herein may be withdrawn only by a
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special law expressly repealing this provision. (As amended by Section 17, Republic Act No.
6715, March 21, 1989
NOTE: The first three rights mentioned in this article do not pertain to just about any union but
only to the union that has been selected as the bargaining representative of the employees in
the bargaining unit. This article must be read in relation to Article 255.
REPORTORIAL REQUIREMENTS [251(242-A)]
The following are required to be submitted by LLOs:

a. Constitution and by-laws, or amendments thereto; the minutes of ratification and the list of
members who took part in the ratification within 30 days from adoption or ratification thereto
b. List of officers, minutes of the election of officers and list of voters within 30 days from election
c. Annual financial report within 30 days after the close of every fiscal year
d. List of members at least once a year or whenever required by the Bureau
Failure to comply with the above-requirements shall not be a ground for cancellation of union
registration but shall subject the erring officers or members of suspension, expulsion from membership
or any appropriate penalty
WEEK 12
LABOR RELATIONS
BOOK V
COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENT (Art. 261
(250) - 272 (259))
PRELIMINARY MATTERS:
(https://blr.dole.gov.ph/2014/12/11/collectivebargaining/)
1. What is Collective Bargaining?

It is a process where the parties agree to fix and administer terms and conditions of
employment which must not be below the minimum standards fixed by law, and set a
mechanism for resolving their grievances.
2. What is Collective Bargaining Agreement (CBA)?
It is a contract executed upon request of either the employer or the exclusive bargaining
representative of the employees incorporating the agreement reached after negotiations with
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respect to wages, hours of work and all other terms and conditions of employment, including
proposals for adjusting any grievances or questions under such agreement.
3. Is the ratification of the CBA by the majority of all the workers in the bargaining
unit mandatory?
Yes. The agreement negotiated by the employees’ bargaining agent should be ratified or
approved by the majority of all the workers in the bargaining unit.
4. Is there any exception to the requirement of mandatory ratification by the majority
of all the workers in the bargaining unit?
Yes. Ratification of the CBA by the employees in the bargaining unit is not needed when the CBA
is a product of an arbitral award by appropriate government authority or by a voluntary
arbitrator.
5. What constitutes CBA registration?
It is a process of determining whether the application for registration of a Collective Bargaining
Agreement complies with the Rules on CBA registration specifically Rule XVII of the Department
Order No. 40-03 or the Rules amending the Implementing Rules of Book V of the Labor Code of
the Philippines.
6. What is the effect of the CBA registration?
The registration of the CBA will bar a certification election except within the last sixty days
(freedom period) before the expiration of the five-year CBA.
7. What is the lifetime of a CBA?
With respect to representation aspect, the CBA lasts for 5 years. However, not later than 3 years
after the execution of the CBA, the economic provisions shall be renegotiated.
8. What is the freedom period?
It refers to the last sixty days immediately preceding the expiration of the five-year CBA. A
petition for certification election may be filed during the freedom period.
9. Where to file the application for CBA registration?
The application for CBA registration shall be filed at the Regional Office that issued the
certificate of registration or certificate of creation of chartered local of the labor unionparty to
the agreement.
10. When to file the application for CBA registration?
The application for registration of the CBA shall be filed within thirty (30) days from the
execution of such CBA.
11. What are the requirements for CBA registration?
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The following are the requirements for CBA registration (original and two (2) duplicate copies
which must be certified under oath by the representative of the employer and labor union
concerned):
a) The Collective Bargaining Agreement;
b) A statement that the Collective Bargaining Agreement was posted in at least two (2) conspicuous
places in the establishment concerned for at least five (5) days before its ratification; and
c) A statement that the Collective Bargaining Agreement was ratified by the majority of the employees
in the bargaining unit of the employer concerned.
12. Is registration fee required?

Yes. The certificate of CBA registration shall be issued by the DOLE Regional Office only upon
payment of the prescribed registration fee.
13. How long will it take to process the CBA registration?
The application for CBA registration shall be processed within one day from receipt thereof.
14. What is the ground for denial of the CBA registration?
Failure of the applicant to complete the requirements for CBA registration but such denial is
without prejudice for the filing of another application for registration.
Collective bargaining may be viewed:
1. A system of relations among the industrial ‘actors’ as the government, employers and their
associaitons and employees and their associations (John Dunlop)
2. Refers to the process of formulating and administering at the enterprise a binding collective
contract between the employer and employees.
Note:
Art. 261 (procedure in collective bargaining)
Art. 268 and 269 (identification/process of choosing employees’ bargaining

representative)
1. DUTY TO BARGAIN collectively arises only between the employer and the employee.
2. The refusal or violating the duty to bargain is considered an Unfair Labor Practice. (Art. 259 (g))
3. However, where there is no duty to bargain collectively the refusal to bargain violates no right.
4. While it is a mutual obligation of the parties to bargain the employer however, is not under any
legal duty to initiate contract negotiation
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5. The mechanics of collective bargaining are set in motion only when the following conditions are
present (jurisdictional preconditions):
a. Possession of the status of majority representation of the employees’ representative in
accordance with any of the means of selection or designation provided for
b. Proof of majority representation
c. Demand to bargain
If these conditions are present, the collective bargaining should begin within the “certification year”
– the 12 months following the determination and certification of the employees’ exclusive bargaining
representative
2 SITUATIONS WHEN THE DUTY TO BARGAIN EXISTS:
1. WHERE THERE IS YET NO COLLECTIVE

BARGAINING AGREEMENT (ART.
262)
2. WHERE A CBA EXISTS (ART. 264) SITUATION
ONE:
WHERE THERE IS YET NO COLLECTIVE BARGAINING AGREEMENT (ART. 262)
THE DUTY to bargain means in essence the performance of an obligation to meet and convene.
It is a mutual obligation devolving upon both the employer and the employee’s majority union.
The meeting and convening is for the purposes of:
1. Negotiating an agreement on the subjects of:
a. Wages
b. Hours of work
c. All other terms and conditions of employment including proposals for adjusting
grievances or questions arising under such agreement; and
2. Executing a contract incorporating such agreement if requested by either party
SITUATION TWO:
WHERE A CBA EXISTS (ART. 264)
The DUTY to bargain means all in situation one and the obligation not to terminate or modify
the CBA during its lifetime.
Exception: FREEDOM PERIOD
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60 days before the CBA expires, either party may notify the other, in writing, that it desires to
terminate or modify the negotiable provisions of the agreement. During the 60day period and
until a new agreement is reached, the CBA remains in full force and effect and the parties are
duty-bound to keep the status quo.
CONTENTS OF A COLLECTIVE BARGAINING AGREEMENT:
1. Enumeration or reservation of management rights.

2. Union recognition and security
3. Wage and fringe benefits and their administration (economic provisions)
4. Physical working conditions
5. Selected personnel management and plant operation practices
6. Grievance and arbitration
7. Duration of contract
a. 5 years (in so far as representation is concerned)
b. Not more than 3 years for other provisions (economic)
NOTE:
1. The CBA should be ratified or approved by the majority of all the workers in the
bargaining unit not just the members of the bargaining union.
2. The CBA should be posted for at least 5 days in two conspicuous places in the
establishment before ratification to enable the workers to inform themselves of its
provisions.
3. The CBA to be submitted to the DOLE should carry the sworn statement of the
union secretary, attested to by the union president, that the CBA has been duly
posted and ratified.
4. The CBA, after ratification should be registered with the BLR or DOLE Regional
Office.
5. Registration should be done within 30 days from execution of the agreement
6. Effectivity date of CBA
a. If CBA is new, that is, not a renegotiated or extended CBA, the date the
contract will take effect is not covered by any rule in the Labor code, hence
the parties may agree on the date
b. If the CBA is an extension or renegotiation of an expiring one, the rule on
Art. 265 will apply.
REPRESENTATION ISSUES:
COLLECTIVE BARGAINING UNIT:
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Refers to a group of employees sharing mutual interests within a given employer unit,
comprised of all or less than all of the entire body of employees in the employer unit or any
specific occupational or geographical grouping within such employer unit
The CBU is that group of jobs that serves as the election constituency in the employer
enterprise.
The Unit therefore is not the same as the Union and the Unit tends to be bigger than a Union. A
Union gets its members from the Unit. Within one Unit, there may be one or several Unions, but
only one Union may act as the bargaining representative of the whole Unit. THE UNIT IS THE
GROUP REPRESENTED; THE UNION IS THE REPRESENTATIVE OF THAT UNIT
Significant effect of determining the scope or ‘membership’ of the bargaining unit:
It leads to the determination of:
a. The employees to be represented in bargaining with the employer
b. The employees who will be covered by the resulting CBA
c. The employees who will vote to decide certain actions:
i. In a Certification Election, the voters are the unit members, whether union or
non-union members
ii. In strike voting, the voters are only the members of the union iii. In CBA
ratification the voters are the unit, not just the union members
IN ORGANIZED ESTABLISHMENTS:
ART. 268. [256] Representation Issue in Organized Establishments.
In organized establishments, when a verified petition questioning the majority status of the
incumbent bargaining agent is filed by any legitimate labor organization including a national
union or federation which has already issued a charter certificate to its local chapter
participating in the certification election or a local chapter which has been issued a charter
certificate by the national union or federation before the Department of Labor and Employment
within the sixty (60)-day period before the expiration of the collective bargaining agreement,
the Med-Arbiter shall automatically order an election by secret ballot when the verified petition
is supported by the written consent of at least twenty-five percent (25%) of all the employees in
the bargaining unit to ascertain the will of the employees in the appropriate bargaining unit.
To have a valid election, at least a majority of all eligible voters in the unit must have cast their
votes. The labor union receiving the majority of the valid votes cast shall be certified as the
exclusive bargaining agent of all the workers in the unit.
When an election which provides for three or more choices results in no choice receiving a
majority of the valid votes cast, a run-off election shall be conducted between the labor unions
receiving the two highest number of votes: Provided, That the total number of votes for all
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contending unions is at least fifty percent (50%) of the number of votes cast. In cases where the
petition was filed by a national union or federation, it shall not be required to disclose the
names of local chapters’ officers and members.
At the expiration of the freedom period, the employer shall continue to recognize the majority
status of the incumbent bargaining agent where no petition for certification election is filed.
ART. 269. [257] Petitions in Unorganized Establishments.
In any establishment where there is no certified bargaining agent, a certification election shall
automatically be conducted by the Med-Arbiter upon the filing of a petition by any legitimate
labor organization, including a national union or federation which has already issued a charter
certificate to its local/chapter participating in the certification election or a local/chapter which
has been issued a charter certificate by the national union or federation. In cases where the
petition was filed by a national union or federation, it shall not be required to disclose the
names of the local chapters’ officers and members.
EXCLUSIVE BARGAINING REPRESENTATIVE (Sole and Exclusive Bargaining Agent,
SEBA)
The union chosen by the CBU to represent them in bargaining with the employer.
HOW DETERMINED:
1. Certification election, run-off or consent election

2. Voluntary recognition
a. Allowed only in an enterprise being unionized for the first time and where there is only
one legitimate labor organization seeking recognition to represent the bargaining unit
CERTIFICATION ELECTION: who may file, where and when may happen?
1. may take place in either an organized company or an unorganized company (unorganized –

there is yet no duly recognized or certified bargaining union)
2. in a nonunionized company, after DOLE’s approval of a petition for certification election, CE may
be held at anytime, except within the 12 months of a previous CE
3. in an organized company, a petition for CE can only be filed within the freedom period
CERTIFICATION ELECTION IN ORGANIZED COMPANY
1. PCE is filed by a union (LLO) that wants to replace the incumbent union
2. Filed with the med-arbiter
3. Supported by a written consent of at least 25% of the employees in the bargaining unit
4. After filing the med-arbiter calls the parties to a preliminary conference ro identify the
bargaining unit to be represented, explore possibility of a consent election, verify the existence
of any bars or legal objections in the holding of a CE
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a. Consent election: election voluntarily agreed upon by the contending unions, with or
without DOLE’s intervention, to determine which union carries the majority of the
workers in the appropriate collective bargaining unit.
b. Election bars:
i. Certification bar: no CE may be held within 12 months from a previous CE (one
CE is allowed in a 12-month period)
ii. Deadlock bar: no CE may be held if there is no pending bargaining deadlock
which has been submitted to conciliation or arbitration or has become the
subject of a valid notice of strike or lockout
iii. Contract bar: where there is an exisiting CBA which has been duly registered, a
petition for CE may be fled only within the freedom period. In the period before
that, no petition for CE may be entertained.
Other Q and A on Certification election

(https://blr.dole.gov.ph/2014/12/11/certificationelection/#:~:text=1.,the%20purpose%20of
%20collective%20bargaining.):
1. What is Certification Election?

Certification election is a process of determining through secret ballot the sole and exclusive
bargaining agent (SEBA) of all the employees in an appropriate bargaining unit for the purpose
of collective bargaining.
2. Where does a union file a petition for certification election (PCE)?
A PCE is filed at the Regional Office which issued the certificate of petitioning union’s certificate
of registration/certificate of creation of chartered local.
3. What are the requirements in filing a PCE? Among
the important requirements are the following: a) A statement
indicating any of the following:
• That the bargaining unit is unorganized or that there is no registered CBA covering the
employees in the bargaining unit;
• If there exists a duly registered CBA, that the petition is filed within the sixtyday
freedom period of such agreement;
• If another union had been previously recognized voluntarily or certified in a valid

certification, consent or run-off election, that the petition is filed outside the one-year
period from entry of voluntary recognition or conduct of certification or run-off election
and no appeal is pending thereon.
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b) In an organized establishment, the signature of at least twenty-five (25%) percent of all

employees in the appropriate bargaining unit shall be attached to the petition at the time of its
filing (Section 4, Rule VIII, of the Department Order No. 40-03).
4. What happens after receipt of the PCE?
The petition will be raffled to the Med-Arbiter for preliminary conference to determine, among
others, the bargaining unit to be represented, the contending unions, and the possibility of
consent election.
5. What happens upon approval of the conduct of certification election by the
Mediator-Arbiter?
The PCE will be endorsed to an election officer for the conduct of pre-election conference
wherein the date, time and place of election will be identified, the list of challenged and eligible
voters will be made, as well as the number and location of polling places.
6. 6.May a PCE be denied?
Yes, a PCE may be denied if:
a) it was filed before or after the freedom period of a registered CBA;
b) the petitioner union is not listed in the DOLE Registry of legitimate labor organization; or
c) the legal personality of the petitioner-union has been revoked or cancelled with finality.
7. Who will conduct the CE?
The DOLE Regional Office through the election officer conducts the certification election.
8. How is the SEBA determined?
The union that garners majority of the valid votes cast in a valid certification election shall be
certified as the SEBA.
9. May election protest be entertained?
Yes, but protest should have been first recorded in the minutes of the election proceedings.
10. What happens if the petitioner union fails to garner the majority of the valid votes
cast?
There will be no SEBA, but another PCE may be filed one year thereafter.
11. What are the requisites for certification election in
organized establishments?
Certification election in organized establishments requires that:
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a) a petition questioning the majority status of the incumbent bargaining agent is filed before
the DOLE within the 60-day freedom period; b) such petition is verified; and
c) the petition is supported by the written consent of at least twenty-five percent (25%) of all
employees in the bargaining unit.
12. What is the requirement for certification election in unorganized establishments?
Certification election in unorganized establishments shall “automatically” be conducted upon
the filing of a petition for certification election by an independent union or a federation in behalf
of the chartered local or the local/chapter itself.
13. May an employer file a PCE?
Yes, the employer may file a PCE if it is requested to bargain collectively.
14. May an employer extend voluntary recognition to a legitimate labor organization
without filing a PCE?
Yes, management may voluntarily recognize a union if there is no other union in the company
and if other requirements are complied with (Sec. 2, Rule 7 of D.O. 40-03).
15. What is the role of employer in certification election?
The employer shall not be considered a party to a petition for certification election, whether it is
filed by an employer or a legitimate labor organization, and shall have no right to oppose it. Its
participation shall be limited only to being notified or informed of petition for certification
election and submitting the certified list of employees or where necessary, the payrolls
(Employer as Bystander Rule).
RUN-OFF ELECTION
1. To have a valid election, a majority (50% plus 1) of the qualified voters should vote
2. But the winning vote is not majority of the voters, nor majority of the votes cast, but majority of
the valid votes cast; in other words, the valid votes should be segregated from the invalid ones
and only the valid votes should decide the winner.
3. When an election which provides for three (3) or more choices results in none of the contending
unions receiving a majority of the valid votes cast, and there are no objections or challenges
which if sustained can materially alter the results, the election officer shall motu proprio
conduct a run-off election within 10 days from the close of the election proceedings between
the labor unions receiving the two highest number of votes; provided that the total number of
votes for all contending unions is at least 50% of the number of votes cast.
Requisites (summary) for run-off election:
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a. There has been enough turn-out of voters (at least majority of the CBU actually voted)
b. There are at least 2 contending unions
c. Not one of the unions obtained the majority of the valid votes
d. The votes for the unions, added together, equal at least one-half of the total votes cast
e. There is no pending challenge or objection to the election
LABOR RELATIONS
BOOK V
GRIEVANCE MACHINERY AND VOLUNTARY ARBITRATION (ART. 273 – 277)
(https://rcmb13.ncmb.gov.ph/primer-on-grievance-machinery-and-voluntary-arbitration/)
1. What is grievance?
A grievance is defined as “any question by either the employer or the union regarding the
interpretation or application of the collective bargaining agreement or company personnel
policies or any claim by either party that the other party is in violation of any provision of the
CBA or company personnel policies”.
2. What is the grievance referred to in Title VII-A of the Labor Code?
The grievance referred to in the technical or restricted sense, is a dispute or controversy
between the employer and the collective bargaining agent arising from the interpretation or
implementation of their CBA and/or those arising from the interpretation or enforcement of
company personnel policies, for the adjustment and resolution of which the parties have
agreed to establish a machinery or a series of steps commencing from the lowest level of
decision-making in the management hierarchy (usually between the shop steward of the
employee or employees aggrieved and the supervisor/ foreman/ manager which exercises
control and supervision over the grievants or who is responsible for executing the management
action that have given rise to the grievance) and usually terminating at the highest official of the
Company. If such dispute remains unresolved after exhausting the grievance machinery or
procedure, it shall automatically be referred to voluntary arbitration prescribed in the CBA.
3. When is there a grievance?
In the technical or restricted sense, there is a grievance when a dispute or controversy arises
over the implementation or interpretation of a collective bargaining agreement or from the
implementation or enforcement of company personnel policies, and either the union or the
employer invokes the grievance machinery provision for the adjustment or resolution of such
dispute or controversy.
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4. Could there be a grievance without a union or a CBA?

If the term grievance is to be applied in the loose or generic sense, any dispute or controversy
respecting terms and conditions of employment which an employee or group of employees may
present to the employer can be a grievance, even without a union or CBA. Under this
interpretation, any complaint, question or problem that an employee or group of employees
may wish to take up or discuss with the employer respecting terms and conditions of
employment for the purpose of resolving or satisfying the same, constitutes a grievance. The
expansion of the original and exclusive jurisdiction of voluntary arbitrators to include questions
arising from the interpretation and enforcement of company personnel policies has
the effect of widening the meaning and interpretation of a grievance to include a situation
where there is no collective bargaining agent and no CBA.
5. Are all grievances arising from the implementation or interpretation of the
collective bargaining agreement and/or interpretation and enforcement of
company personnel policies compulsory subject to the grievance machinery?
Yes. This is clear from Article 260 and Art. 261 of the Labor Code, as amended by Republic Act
6715.
Art. 260 is emphatic on the duty of the parties to a collective bargaining agreement to establish
a machinery for the adjustment and resolution of grievances arising from the interpretation and
enforcement of the CBA and/or company personnel policies, and for the mandatory use of the
said machinery.
Art. 261, on the other hand, directs the NLRC, its Regional Arbitration Branches and the Regional
Directors of the Department of Labor and Employment not to entertain disputes, grievances or
matters under the exclusive and original jurisdiction of the voluntary arbitrator or panel of
voluntary arbitrators and to immediately dispose of and refer the same to the grievance
machinery or voluntary arbitration provided in the collective bargaining agreement.
Moreover, in Rule XI of the Implementing Rules of the Code, the Regional Branches of the
National Conciliation and Mediation Board are enjoined, in case issues arising from the
interpretation or implementation of the collective bargaining agreements or those arising from
the interpretation or enforcement of company personnel policies are raised in notices of strikes
or lockouts or requests for preventive mediation, to advise the parties to submit the issue/s to
voluntary arbitration.
6. What usual provisions of a collective bargaining agreement whose violation/s
arising from interpretation and implementation, may constitute grievance/s or the
so-called rights disputes?
Every collective agreement usually contains non-economic and economic provisions.

Non-economic provisions are those whose monetary cost cannot be directly computed such as
no-strike-no-lockout, union security, management security, check-off clauses, grievance
procedures, etc. Economic provisions, on the other hand, are those which have direct and
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measurable monetary cost consequences such as wage rates, paid vacations, pensions, health
and welfare plans, penalty premiums and other fringe benefits. Any violation arising from rights
established under collective agreements, laws, rules and regulations and customary practices
may constitute as grievance and is often referred to as rights dispute.
7. Has the new labor relations law strengthened the legal basis of the use of
grievance machinery and voluntary arbitration in settling labor disputes?
Definitely. Republic Act 6715 now provides for the mandatory use of the grievance
machinery as a prerequisite step to voluntary arbitration of disputes arising from CBA
interpretation and implementation, as well as those disputes arising from the interpretation and
enforcement of company personnel policies. Article 262 of the Labor Code, before it was
amended by Republic Act 6715, merely provided that” … (whenever) a grievance arises from the
interpretation or implementation of a collective agreement, including disciplinary actions
imposed on members of the bargaining unit, the employer and the bargaining representative
shall meet to adjust the grievance”.
Secondly, it is now the policy of the State to encourage voluntary arbitration of all
labor-management disputes other than those arising from the interpretation and
implementation of collective bargaining agreement and company personnel policies. This
policy is operationalized by the following provisions:
a. Article 260 of the Labor Code, as amended by Republic Act 6715, which provides that: “All
grievances submitted to the grievance machinery which are not settled within seven (7)
calendar days from the date of its submission shall automatically be referred to
voluntary arbitration prescribed in the CBA. The seven calendar days shall be reckoned
from the date the grievance machinery is submitted to the last step in the grievance
machinery immediately prior to voluntary arbitration.
b. Article 261, which provides for the original and exclusive jurisdiction of voluntary arbitrators
over unresolved grievances arising from the interpretation or implementation of the CBA
arising from the interpretation or enforcement of company personnel policies. With this
amendment, the original and exclusive jurisdiction of voluntary arbitrators has been
tremendously expanded.
c. Article 261 provides that CBA violations are to be treated as grievances instead of unfair
labor practice acts except when the violation is gross, meaning it involves flagrant and /or
malicious refusal to comply with the economic provisions of the CBA.
d. The same article enjoins the NLRC, its Regional Arbitration Branches, and the Regional
Directors of the Department of Labor and Employment from entertaining disputes,
grievances or matters under the exclusive and original jurisdiction of the voluntary
arbitrator. If any of such cases is filed before them, they have to immediately dispose and
refer the same to the grievance machinery or voluntary arbitrator provided in the CBA.
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e. Moreover, under Article 262, upon agreement of the parties, voluntary arbitrators may also
hear and decide all other labor disputes including unfair labor practices and bargaining
deadlocks.
f. Lastly, in case issues arising from the CBA interpretation and implementation or those
arising from the interpretation or enforcement of company personnel policies are made as
grounds for notices of strikes or lockouts or requests for preventive mediation, the NCMB
shall advise the parties to submit the issue/s to voluntary arbitration (Rule XI, Section 2,
Implementing Rules, Labor Code).
THE GRIEVANCE PROCEDURE
8. What is the Grievance Procedure?

The grievance procedure is the series of formal steps that parties to a collective bargaining
agreement agreed to take for the adjustment of grievances or questions arising out of the
interpretation or implementation of the CBA or company personnel policies including voluntary
arbitration as the terminal step. The grievance procedure provides the parties a first crack in
addressing problems in the CBA administration and its use is an essential requisite before a
voluntary arbitrator can take cognizance of the unresolved grievance. It usually consists of a
multi-step procedure starting from or discussion of the grievance between the employee and/or
the Union Steward on the one-hand and the foreman and supervisor on the other hand, and
ending with the highest decision-making officials of the company, reflecting the hierarchy of
command or responsibility.
Legally speaking, the grievance procedure is an appeal procedure and is a “must” provision in
every collective agreement. It is that part of the agreement which provides for a peaceful way of
settling differences and misunderstanding between the parties.
9. Are there minimum legal requirements for the establishment of the grievance
procedure referred to in Title VII-A of the Labor Code?
Yes. The following are the minimum legal requirements:

1. The grievance machinery established by the parties should be sufficient to ensure mutual
observance of the CBA’s terms and conditions, for the resolution and adjustment of grievances
arising from the CBA interpretation or implementation; and those arising from the
interpretation or enforcement of company personnel policies;
A. The parties should include in the agreement a procedure for the selection of voluntary arbitrator
or panel of voluntary arbitrators or name and designate in advance a voluntary arbitrator or
panel of voluntary arbitrators.
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In most collective agreements, the provision of Grievance Procedure contains: 1) definition of

grievance, 2) statement of guiding principles in the resolution of grievances, and 3) procedural
steps in the settlement and resolution of grievances.
10. Can there be a collective bargaining agreement entered into by the parties and
later on duly registered with the DOLE which does not provide for a grievance
procedure?
Legally, none. A grievance procedure is a “must” provision in any CBA and no collective
agreement can be registered in the absence of such procedure. In the event that a CBA without
such provision is submitted for registration, the registrar shall advise the parties to include a
grievance procedure the CBA is considered duly registered.
11. What standards may be used as guides in formulating an effective grievance
procedure?
The following standards are suggested in the formulation of effective grievance procedure:
A. Collective bargaining agreements should contain provisions that grievances and disputes
involving the interpretation or application of the terms of the agreement are to be settled
without resort to strikes, lockouts, or other interruptions to normal operations by an
effective grievance procedure with arbitration as its final step.
B. To be effective, the procedure established for the settlement of such grievances and
disputes should meet at least the following standards:
a. The successive steps in the procedure, the method of presenting grievances or disputes, and
the method of taking an appeal from one step to another should be so clearly stated in the
agreement as to be readily understood by all employees, union officials, and management
representatives.
b. The procedure should be adaptable to the handling of various types of grievance and
disputes which come under the terms of the agreement.
c. The procedure should be designed to facilitate the settlement of grievances and disputes as
soon as possible after they arise. To this end:
d. The agreement should provide adequate stated time limits for the presentation of
grievances and disputes, the rendering of decisions, and the taking of appeals.
e. Issues should be clearly formulated at the earliest possible moment. In all cases which
cannot be settled in the first informal discussions, the positions of both sides should be
reduced to writing.
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f. Management and union should encourage their representatives to settle at the lower steps
grievances which do not involve broad questions of policy or of contract interpretation and
should delegate sufficient authority to them to accomplish this end.
g. Provision should be made for priority handling of grievances involving discharge,

suspension, or other disciplinary action.
h. The procedure should be open to the submission of grievances by all parties to the
agreement.
C. Management and unions should inform and train their representatives in the proper functioning
of the grievance procedure and in their responsibilities under it. In such a program, it should be
emphasized:
a. That the basic objective of the grievance procedure is the achievement of sound and fair
settlements and not the “winning” of cases;
b. That the filing of grievances should be considered by foreman or supervisors as aids in
discovering and removing causes of discontent in their departments;
c. That any tendency by either party to support the earlier decisions of its representatives
when such decisions are wrong should be discouraged;
d. That the willingness of management and union officials to give adequate time and attention
to the handling and disposition of grievances and dispute is necessary to the effective
functioning of the procedure;
e. That for sound handling of grievances and disputes both management and union
representatives should be thoroughly familiar with the entire collective bargaining
agreement.
12. What are the usual steps in the Grievance Procedure?
A grievance procedure usually consists of a series of steps to be taken within the specified time
limits. The nature of the procedure will depend upon the structure of the company and on the
needs and desires of the parties, but there is a tendency to follow a fairly definite pattern. Small
companies can be expected to have short, simple grievance procedures, sometimes with only
one or two steps. Larger companies usually have multi-step procedures. Three-step and four-
step procedures probably are most common.
Commissioner Jesus B. Diamonon of the Tripartite Voluntary Arbitration Advisory Council
elaborated that the reason for having a number of steps is to provide a method of appeal to
higher authority from the decision of a lower supervisory official. Each step is as important as
the other. The intermediate steps are not merely a transmission belt for passing grievances
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along to the top authorities. The representatives therein as in any other steps must have
adequate authority either to uphold or reverse decisions made at the lower level.
According to him, the grievance procedure has two (2) periods: the period of persuasion, from
the first step to the last step immediately prior to arbitration, where labor and management,
with the use of arguments and evidence, persuade one another to give in to one’s position or
agree to a compromise, and the period of arbitration which begins when the act of persuasion
has been exhaustively used and no settlement has been reached. Once and for all, the dispute
must be resolved and the parties will have to persuade the arbitrator for a favorable decision or
award.
13. What is the interrelationship between the grievance procedure and voluntary
arbitration?
Professor Fernandez quotes Bernstein:

“It is of vital importance that the interrelationship of the two procedures-grievance and
arbitration-be borne in mind by those who study and practice arbitration. A grievance procedure
in which few disputes are settled inevitably overloads arbitral machinery. Arbitration procedures
and awards that undermine the grievance machinery by permitting serious disregard of its
prescribed procedures can invite more arbitration and fewer settlements by negotiation. Or
arbitration that encourages overemphasis on technical procedural requirements will thwart
settlement on the merits so that pressure builds for resort to self-help. Obviously the balance to
be struck requires judgment, preeminently on the part of the representatives of unions and
management, who have initial and primary responsibility. How they discharge their functions
may be affected by what arbitrators do. Arbitration is a powerful tool that can, on occasion,
send reverberations through the larger organism, the grievance procedure and shop office
relations’”
14. What are the advantages and disadvantages of fewer stages in the grievance
procedure?
The advantages of fewer stages in the grievance procedure are (1) greater speed in processing,
and (2) savings in personnel time. Its disadvantages are (1) vulnerability to grievance overload;
(2) excessive involvement of senior officials and (3) inadequate consideration of the merits by
lower level supervisors who are in a much better position to make an effective adjustment.
15. What are the advantages and disadvantages of a multi-stage procedure?
The multi-stage procedure has the following advantages: (1) it enables the management-
supervisory personnel at all levels to contribute their know-how to the adjustment of
grievances; (2) a more adequate consideration of the grievance is likely; (3) involvement of
senior officials in grievance processing, is greatly reduced, thereby freeing them for other
managerial tasks.
Its disadvantages are: (1) it is wasteful of personnel time and effort and (2) it is less expeditious.
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16. What should be the proper attitude of parties to the Grievance Procedure?
The parties’ attitude in handling grievances, probably more than in any other aspect of the
labor-management relationship, indicates their good faith. Nowhere in that relationship is
mutual good faith more important. The attitude of the parties is even more important than the
type of grievance provisions contained in the agreement. This view has been shared by unions
and management alike in most cases in which the grievance procedure has been considered
successful and in the majority of cases in which the procedure has broken down. Good
grievance machinery is important, but such machinery alone will not insure success. The
attitude, judgment, experience and training of the individuals involved are of prime importance.
Moreover, a desire to settle grievances, rather than to win them, is essential.
17. What is the responsibility of the union stewards and foreman in handling
grievances?
Union stewards and foreman must see to it that grievances are presented only when there is a
real basis for complaint or there is a need for a decision. If stewards are convinced that the
worker does not have a real case, it is better to tell him so right from the beginning. In
borderline cases where it is felt that the worker has considerable justice on his side, he should
be told of the uncertainty of the decision before the case is processed to get a definite ruling
through the grievance procedure.
Foreman, on the other hand, should be trained in the human relations aspects of their jobs.
They should be ready to listen first before they start debating with the employee. They should
note what is being said rather than how the matter is said. This way, gripes are separated from
grievances, or gripes are prevented from becoming grievances.
Both stewards and foreman should make every effort to settle grievances at the lowest step.
Management has a legal duty to provide all information that will explain the specific details and
basis of its action to enable the shop steward to determine whether to proceed with the
grievance.
18. May parties to a collective bargaining agreement stipulate that certain matters or
questions arising under the contract be exempt from the grievance procedure?
The Labor Code fixes the scope or coverage of the grievance procedure and voluntary arbitration
in Article 261, to wit:
“The voluntary arbitrator or panel of voluntary arbitrators shall have original and exclusive
jurisdiction to hear and decide all unresolved grievances arising from the interpretation or
implementation of the collective bargaining agreement and those arising from the
interpretation or enforcement of company personnel policies referred to in the immediately
preceding Article. Accordingly, violations of a collective bargaining agreement, except those
which are gross in character, shall no longer be treated as unfair labor practice and shall be
resolved as grievances under the collective bargaining agreement. For purposes of this Article,
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gross violations of a collective bargaining agreement shall mean flagrant and/or malicious
refusal to comply with the economic provisions of such agreement.
“The Commission, its Regional Offices and the Regional Directors of the Department of Labor
and Employment shall not entertain disputes, grievances or matters under the exclusive and
original jurisdiction of the voluntary arbitrator or panel of voluntary arbitrator or panel of
voluntary arbitrators and shall immediately dispose and refer the same to the grievance
machinery or voluntary arbitration provided in the collective bargaining agreement.”
It is the law which confers to voluntary arbitrators their original and exclusive jurisdiction and
the parties cannot diminish their jurisdiction by stipulation as this would conflict with the basic
directive of the Labor Code.
19. May questions concerning terms and conditions actually obtaining but not
referred to in the CBA, although provided for in company manuals or policy
statements, be subject to the grievance procedure?
With the expansion of the scope of the original and exclusive jurisdiction of voluntary arbitrators
to include questions arising out of the interpretation or implementation of company personnel
policies, the answer to the above is decidedly “yes”.
But even before this expansion of jurisdiction brought about by RA 6715, under the theory of
implied incorporation, existing terms and conditions, though not dealt with in specific
provisions, were already deemed part of the agreement and thus, grievable.
Fernandez quotes Cox and Dunlop in explaining the so-called theory of implied incorporation:
“A collective bargaining agreement should be deemed, unless an intention is manifest, to carry
forward for its term the major terms and conditions of employment not covered by the
agreement, which prevailed when the agreement was executed.”
20. How is grievance presented?
Grievances ordinarily are brought by the aggrieved employee, usually with the union
representative called the shop steward or grievance officer, to the foreman either orally or in
writing. Usually a Grievance Form is provided for the purpose. If no settlement is reached at first
level, the aggrieved employee or the grievance officer may bring the grievance through the
successive steps in the grievance procedure provided for in the CBA.
As mandated by the Labor Code, as amended by Republic Act 6715, all grievances that remain
unresolved after exhausting all the internal procedures shall automatically be referred to
voluntary arbitration prescribed in the CBA if they are not settled within seven (7) days from the
date of its submission to the last step in the internal grievance machinery.
21. Who can file a grievance?
Generally, employees initiate a grievance. This is recognized by Article 255 of the Labor Code
which provides, among others, that “… an individual employee or group of employees shall have
the right at any time to present grievances to their employer.”
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Secondly, the grievance procedure being part and parcel of the “continuous collective
bargaining process” and the union designated or selected by the majority of the employees
being their exclusive bargaining representative, unions are generally recognized as having the
right to initiate, file or present a grievance, either with regard to their rights as unions under the
contract, or with regard to the rights of employees, whether collective or individual.
Thirdly, while employers do not as a general rule initiate a grievance, it would be prudent to
include a provision in the CBA granting the employer such right, especially in cases where the
employer may wish to use the grievance machinery to resolve a question over a vague or
indefinite provision of a CBA.
22. How is grievance processed?
Professor Fernandez suggests the following approach in the processing and adjustment of
grievances:
“Processing of grievances involves a joint effort on (1) identification of the issue or issues
involved (2) developing its factual basis or background (3) determining the contract provisions
involved (4) evaluating the merits of the grievance in the light of the factual background and
applicable rules and (5) working out a fair and just settlement.”
23. What preparations should be undertaken in order that the grievance can
effectively be presented by the grievant
The Trade Union Congress of the Philippines in its Manual for Shop
Stewards recommends the following steps in preparing for the presentation of a grievance:
A. Determine first if there is a genuine grievance and if there is, whether the same
is justified or not. Has the contract been violated? Has the worker been treated unfairly
by some action of the company? Is the employer responsible? Is the problem covered by
the contract or personnel policies in any way?
B. Study the CBA and company personnel policies. A Steward or a grievant who is not
familiar with the CBA and company personnel policies is like a navigator without a compass.
Most grievances are contract violations and if the steward or the grievant does not know
the contract or the company personnel policies, he will not recognize a violation when he
sees one.
C. Get all facts of the case. Be sure to investigate the five W’s – the WHO, WHEN, WHERE,
WHY and WHAT.
WHO, refers to that part of the form that clearly identifies the worker with the grievance. On
this form is included: 1) employee’s name, 2) clock number (or chapa number) 3) department, 4)
shift, 5) classification.
WHEN, refers to the time element. Often, information regarding more than one date is needed
to properly complete the form: 1) the date on which the grievance is officially written, 2) the
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time and date on which the grievance actually happened, 3) the date on which the grievance
was filed in the first step with the foreman, and 4) the date on which the foreman gave his
decision. It is particularly important in matters involving back pay that all dates be clearly stated.
WHERE, refers to the exact place where the grievance took place-the department aisle, or
miracle.
WHY, refers to the reasons why the complaint is considered a grievance. This is the heart of the
grievance and should be written under the section that carries the heading “Nature of
Grievance.” It is important to remember that it is possible to have a legitimate grievance
without being able to point to a violation of a specific clause of the contract.
WHAT, refers to what should be done about the grievance – the settlement desired.
Many grievance forms do not have a separate section headed, “Settlement Desired.” In those
cases, it is customary for the Steward to list his settlement request at the end of the section
Nature of Grievance.” It is extremely important that this be done since an arbitrator will often
base his award solely on the original request.
D. Discuss the grievance with the Union or other stewards in order to learn how the
contract should be interpreted and what kind of settlement or adjustment will be
demanded.
E. It may be important to know about past grievance settlements of similar nature as the
grievance to be presented.
24. What preparations should be undertaken by the respondent and his advocates in a
grievance to effectively present his action such that they may be understood and
appreciated?
In the same manner that a grievant or a steward has to prepare for the presentation of a
grievance, the employer and his advocates down the line in the management hierarchy, has to
prepare its “defense” of its action which gave rise to the grievance. They must also prepare by
getting all the facts. If it was a disciplinary action, what has the grievant done to deserve the
disciplinary action? When? Where? It is the employer who will have the burden of proof in
justifying its action after the grievant and /or the Union has presented the grievance.
The employer or respondent has to be thoroughly familiar with the CBA and its own personnel
policies. Although the administration of the CBA is a joint effort between the Union and the
employer, the primary source or the originator of these policies is the employer and he is
therefore expected to be more well-versed with the provisions of the CBA and its own personnel
policies.
The employer must be ready to justify its action and convince the union or grievant of its
reasonableness and fairness. He may point to a clear CBA provision as the legal basis of its
action. He may refer to a known company policy or practice that has been clearly and manifestly
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violated by the grievant or he may point to precedents of similar grievances that were resolved
or adjusted in favor of the employer.
The bottom line is: if both parties agree to the facts, the road ahead is much clearer and wider.
25. What remedy is available to a party if the other refuses to attend or appear in the
grievance hearing?
Art. 252 of the Labor Code prescribes attendance in grievance hearings as part of the parties’
duty to bargain collectively, to wit:
“The duty to bargain collectively means the performance of a mutual obligation to meet and
convene promptly and expeditiously in good faith for the purpose of negotiating an agreement
with respect to wages, hours of work and all other terms and conditions of employment
including proposals for adjusting any grievances or questions arising under such agreement and
executing a contract incorporating such agreements if requested by either party, but such duty
does not compel any party to agree to a proposal or to make any concession.
Any party guilty of non-attendance may therefore be charged of unfair labor practice, pursuant
to Art. 248 (g) or Art. 249 ©. The other party may, as a matter of choice, file request for
preventive mediation or a notice of strike with the NCMB, or file a ULP charge with the NLRC but
not simultaneously. Art. 264 enjoins a strike or lockout over a dispute that has been certified or
submitted to compulsory or voluntary arbitration or during the pendency of cases involving the
same grounds for the strike or lockout.
The other school of thought presents this proposition: Non-attendance in grievance hearings
implies that the non-attending party is not convinced that the grievance machinery will be
useful or effective in adjusting or resolving the grievance and that, therefore, he is deemed to
have dispensed with the preliminary step to voluntary arbitration. Under this theory, the parties
may then be deemed to have submitted the grievance to voluntary arbitration.
26. May a union go on strike over an unfair labor practice act despite a no strike/no
lockout provision in the CBA providing for the resolution of such dispute through
the grievance procedure and voluntary arbitration? Is such a CBA provision
providing for arbitration in case of ULP by either party valid?
There are two conflicting decisions of the Supreme Court on this matter.
One, promulgated on May 15, 1979, in the case of Philippine Metal Foundries, Inc., vs.
CIR, et. al, declared that a no strike prohibition in a Collective Bargaining
Agreement is applicable only to economic strikes. In other words, ULP is not covered and
workers may go on strike based on ULP despite the no strike provision.
The other, issued on September 10, 1979, in the case of GOP-CCP Workers Union vs. CIR,
which pronounced as not illegal the stipulation in the collective bargaining agreement that “in
case of any alleged unfair labor practice on the part of either party, there will be no strikes,
lockouts, or prejudicial action … until the question or grievance
is resolved by thee proper court if not settled through a grievance procedure therein outlined.”
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In the light of the fact that the latter case is more recent and in view of the present state policy
of preference for voluntary modes of dispute settlement, it is submitted that the latter decision
is more conducive to industrial stability, unless the Unfair Labor Practice act of the company is
so gross and so patent as to threaten the existence of the union.
SELECTION OF VOLUNTARY ARBITRATOR
1. What general considerations should guide the parties in their choice of a

voluntary arbitrator?
The choice of an arbitrator must take into account the following general considerations: 1) field
of choice, or the problem of availability of desired persons; 2) legal qualification; 3) legal
disqualification; and 4) criteria and attributes of a suitable arbitrator.
2. What attributes or criteria should a voluntary arbitrator possess?
Every arbitrator must possess certain attributes that make him acceptable to the parties
interested in naming him as arbitrator: 1) he must be without prejudice or bias, 2) he must be
intelligent, 3) he must be capable of exercising sound judgment, 4) he must be immune to
pressures from parties to the dispute and from others, 5) he must be experienced in the field of
labor relations.
SCOPE OF VOLUNTARY ARBITRATION
3. What are the types of labor disputes that may be submitted to voluntary
arbitration?
Under Article 261 of the Labor Code, as amended, the following disputes are subject to the
original and exclusive jurisdiction of voluntary arbitrator or panel of voluntary arbitrators: 1)
unresolved grievances arising from CBA interpretation or implementation. These include CBA
violations which are not gross in character, meaning, flagrant and/or malicious refusal to comply
with the economic provisions of the CBA; 2) unresolved grievances arising from personnel policy
enforcement and interpretation including disciplinary cases. These disputes are often referred
to as “rights disputes”.
Under Article 262 of the same Code, all other labor disputes including unfair labor practices and
bargaining deadlocks may also be submitted to voluntary arbitration upon agreement of the
parties. Bargaining deadlocks are often referred to as “interest disputes.”
Article 263 (h) likewise allows the parties upon agreement, to submit even the so-called
“national interest cases” to voluntary arbitration, before or any stage of the compulsory
arbitration process prior to the submission of the resolution.
Republic Act Nos. 6727 and 6971 enacted on 7 July 1989 and 22 November 1990, respectively,
also expanded the jurisdiction of voluntary arbitration to include: 1) all unresolved wage
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distortion cases as a result of the application of wage orders issued by any Regional Tripartite
Wages and Productivity Board in establishments where there is collective bargaining agreement
or recognized labor union, and 2) all unresolved disputes, grievances or other matters arising
from the interpretation and implementation of a productivity incentives program which remains
unresolved within twenty (20) calendar days from the time of the submission to labor-
management committee.
WEEK 13 and 14
LABOR RELATIONS
BOOK V
STRIKE AND LOCKOUT (ART. 277 – 280)
1. Strike is a coercive activity resorted to by employees to enforce their demands. The idea behind
a strike is that a company engaged in a profitable business cannot afford to have its production
or activities interrupted, much less, paralyzed because it will spell loss or even disaster.
2. Fundamentally, a strike can validly take place only in the presence of and in relation to a labor
dispute between the employer and employees involved.
3. By definition, strike “means any temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute. On the other hand, labor dispute,
“includes any controvery or matter concerning terms and conditions of employment or the
association or representation of persons in negotiating, fixing, maintaining, changing or
arranging the terms and condtions of employment, regardless of whether the disputants stand
in the proximate relation of employee and employer.
4. Read together, it would mean that strike is recognized and protected only if the work stoppage
is brought about by disagreements regarding terms and conditions of employment or regarding
ways to arrange or adjust those terms and conditions. in other words, these grounds refer to the
economic provisions in a CBA.
AVOIDANCE OF STRIKE: THE NCMB
Similar to the doctrine of exhaustion of administrative remedies, pacific measures or remedies must first
be exhausted before strikes are delared. Strikes and other coercive acts are deemed justified only when
peaceful alternatives have proved unfruitful in settling disputes.
The National Conciliation and Mediation Board
1. is the dispute-resolution arm under the administrative supervision of the Secretary of the DOLE
2. created by E.O. No. 126, 1987
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3. main task is to help settle labor disputes to prevent actual work stoppage LEGALITY OF
STRIKE: THE SIX FACTORS AFFECTING LEGALITY (Ludwig Teller)
An illegal strike is one which:
1. Is contrary to a specific prohibition of law, such as a strike by employees performing

governmental functions; or (this means that in order to be legal, a strike is based on law)
2. Violates a specific requirement of law; or (a legal strike is one that complies with legal
procedures)
a. A notice of strike is filed with the NCMB to be filed by the EBR if reason is bargaining
deadlock and the EBR or LLO for ULP
b. Cooling off period must be observed. 30 days for bargaining deadlock and 15 days for
ULP. However, in case of union busting, the cooling off period shall not apply and the
union may take action immediately 7 days after a strike vote is conducted.
c. NCB conducts mediation and conciliation with the parties
d. 7 days before the actual strike, a strike vote is conducted and to be submitted to the
NCMB
e. No strike shall be declared after certification or submission of the disputeto compulsory
or voluntary arbitration
3. Is declared for an unlawful purpose; or (purpose of strike is based on law)
a. Reasons for strike: bargaining deadlock or ULP
4. Employs unlawful means in the pursuit of tis objective; or (conduct of strike must be within the
bounds of the law)
5. Is declared in violation of an existing injunction; or (labor disputes are generally not subject to
injunction)
a. Exception: In National interest cases (par. G, Atrt. 277), were the President or the
Secretary of the DOLE assumes jurisdiction, (automatic) injunction is expressly allowed.
6. Is contrary to an existing agreement (no strike policy can be subject to an agreement in a CBA,
but only for economic strike)
CONCEPT OF PICKETING (Please read Art. 278 on prohibited acts/activities during strike)
1. Picketing (art. 278, b): consists in walking or patrolling in the vicinity of a place of business
involved in a labor dispute to inform the public about a ongoing dispute.
2. Picketing usually accompanies a strike but picketing as a form of protest action, may happen
even if there is no strike or work stoppage.
3. The right to picket as a means of communicating the facts of a labor dispute is a phase of the
freedom of speech guaranteed by the Constitution.
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4. Permissible activities of the picketing workers do not include obstruction of access of customers
or may not aggressively interfere in the right of peaceful ingress and egress to and from the
employer’s shop or obstruct the public thoroughfares
CONSEQUENCES OF CONCERTED ACTIVITIES: EMPLOYMENT STATUS
1. WORKERS:
Participation of a worker in a lawful strike does not constitute sufficient ground for termination of
employment. Even his participation in a strike that turned out to be illegal does not necessarily result on
his loss of job.
2. UNION OFFICER:
Any union officer who knowingly participates in an illegal strike or knowingly participates in the
commission of illegal acts during strike, maybe declared to have lost his employment status.
NOTE: ANYONE (worker or union officer) who commits an illegal act during a strike may be dismissed
from employment, regardless of whether the strike is legal or illegal.
NOTE: please refer to primer on strikes and lockout for other discussion of the topic.
LABOR RELATIONS
BOOK V
EMPLOYEES’ RIGHT TO SELF-ORGANIZATION (ART. 252/243)
1. Right to self-organize vs the right to form, join or assist labor organization

2. All persons may organize for a lawful purpose buy to say that all person may form labor unions
is not accurate
3. Employees of traditionally non-profit organizations like religious, charitable, medical or
education institutions may unionize
4. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those
without definite employers may form labor organization for their mutual aid and protection
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RIGHT OF EMPLOYEES IN THE PUBIC SERVICE TO SELF ORGANIZE (ART.

253/244)
1. All employees of government corporation established under the Corporation Code shall have
the right to organize and to bargain collectively with their respective employers
2. All other employees in the civil service shall have the right to form associations for purposes not
contrary to law
 EO 180: all government employees may organize, even unionize and negotiate
employment conditions not fixed by law. But they cannot strike
INELIGIBILITY OF MANAGERIAL EMPLOYEES TO JOIN ANY LABR
ORGANIZATION (ART. 245-255/245-246)
1. Managers are not eligible to join, assist or form any labor organization
2. Supervisors shall not be eligible for membership in the collective bargaining unit of the rank and
file employees but may join, assist or form separate bargaining units and/or legitimate labor
organizations of their own
3. CONFIDENTIAL EMPLOYEES. They assist and act in a confidential capacity to or have access to
confidential matters of persons who exercise managerial functions in the field of labor relations
 Ineligible to organize or join labor unions
4. SECURITY GUARDS. They may join labor organization of the rank and file or that of supervisory
union depending on their rank
5. COOP MEMBERS. An employee of the cooperative who is also a member and co-owner cannot
invoke the right to collective bargaining, for certainly an owner cannot bargain with himself or
his co-owners
6. Persons (religious objectors) whose religion forbade membership in labor unions could not be
compelled into union membership
UNFAIR LABOR PRACTICES (257/247)
What is unfair labor practice (ULP)?
ULPs are offenses committed by the employer or labor organization which violate the
constitutional right of workers and employees to self-organization. ULP acts are inimical to the
legitimate interests of both labor and management, disrupt industrial peace and hinder the
promotion of healthy and stable labor-management relations. (Art. 248 of the Labor Code, as
amended)
It connotes anti unionism or anti-organization of workers
ELEMENTS TO CONSTITUE AN OFFENSE:
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a. existence of employer-employee relationship

b. the act done is expressly defined in the Code as ULP NOTE: NOT
EVERY ACT, NO MATTER HOW UNFAIR IS ULP
What is the nature of ULP?
ULP is not only a violation of the civil rights of both labor and management, but also a criminal
offense against the State. Criminal ULP cases may be filed with the regular courts. No criminal
prosecution may be instituted, however, without a final judgment from the NLRC that an unfair
labor practice was committed.
Award for damages by the Labor Arbiter will preclude any claim for damages in a civil action
filed with the regular courts.
The final judgment from the NLRC/Labor Arbiter is not conclusive for a conviction in a criminal
case nor an evidence of guilt but merely as proof of compliance of the requirements of the law.
What are some of the ULPs committed by an employer?
ULP by management are as follows:

a) Requiring as a condition of employment that a person or an employee shall not join a labor
organization or shall withdraw from one to which he belongs;
b) Contracting out services or functions being performed by union members when such will
interfere with, restrain, or coerce employees in the exercise of their right to selforganization;
c) Discrimination as regards to wages, hours of work, and other terms and conditions of
employment in order to encourage or discourage membership in any labor organization; and
NOTE: YELLOW DOG CONTRACT. A promise exacted from prospective employees that they will
not belong to, or form a union during their employment. The act of obtaining the promise is ULP
VALID DISCRIMINATION: UNION SECURITY CLAUSE:
An agreement which imposes upon the employees the obligation to acquire or retain union
membership, at the expense of their employment if they fail to do so.
• There is union shop when all new regular employees are required to join the union within a
certain period as a condition for their continued employment.
• There is maintenance of membership shop when employees, who are union members as of the
effective date of the agreement, or who thereafter become members, must maintain union
membership as a condition for continued employment until they are promoted or transferred
out of the bargaining unit, or the agreement is terminated.
• A closed shop, on the other hand, may be defined as an enterprise in which, by agreement
between the employer and his employees or their representatives, no person may be employed
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in any or certain agreed departments of the enterprise unless he or she is, becomes, and, for the
duration of the agreement, remains a member in good standing of a union entirely comprised of
or of which the employees in interest are a part
d) Dismissal, discharge, prejudice or discrimination against an employee for having given or being
about to give testimony under the Labor Code. (Art. 248, 249 of the Labor Code, as amended)
What are some ULPs committed by labor organizations?
A labor organization commits ULP by any of the following violations:

a) Restraint or coercion of employees in the exercise of their right to self-organization: However,
the labor organization shall have the right to prescribe its own rules with respect to the acquisition or
retention of membership; and
b) Causing or attempting to cause an employer to discriminate against an employee, including

discrimination against an employee with respect to whom membership in such organization has been
denied or terminating an employee on any ground other than the usual terms and conditions under
which membership or continuation of membership is made available to other members.
c) to cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money
or other things of value, in the nature of an exaction, for services which are not performed or not to be
performed, including the demand for fee for union negotiations (FEATHERBEDDING)
What are ULPs committed by both employers and labor organizations?
ULPs by both management and labor organizations are as follows:

a) Interference, restraint, or coercion of employees in the exercise of their right to selforganization;
b) Violation of a collective bargaining agreement, when circumstances warrant;
c) Initiating, dominating, assisting or otherwise interfering with the formation or administration of any
labor organization, including the giving of financial or other support to it or its organizers or
supporters;
d) Violation of the duty to bargain collectively; and
e) Payment by employer of negotiation or attorney’s fees and acceptance by the union or its officers or
agents as part of the settlement of any issue in collective bargaining or any other dispute (Art. 248,
249 of the Labor Code, as amended). (SWEETHEART CONTRACT)
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WEEK 15
LABOR RELATIONS
BOOK V
Termination of Employment
1. What is the right to security of tenure?

The right to security of tenure means that a regular employee shall remain employed unless his
or her services are terminated for just or authorized cause and after observance of procedural
due process.
2. May an employer dismiss an employee? What are the grounds? Yes. An

employer may dismiss an employee on the following just causes: a) serious
misconduct;
b) willful disobedience;
c) gross and habitual neglect of duty;
d) fraud or breach of trust;
e) commission of a crime or offense against the employer, his family or representative; f) other similar
causes.
3. Are there other grounds for terminating an employment? What are they?
Yes. The other grounds are authorized causes: a)

installation of labor-saving devices;
b) redundancy;
c) retrenchment to prevent losses;
d) closure and cessation of business; and
e) disease / illness.
NOTE:
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• Just causes relate to acts done by the employee, while authorized causes (except
disease) involve measures taken by the employer because of business exigencies
(management prerogative).
• Just causes generally do not entail payment of separation pay; authorized causes
generally do.
4. Before terminating the services of an employee, what procedure should the employer
observe?
An employer shall observe procedural due process before terminating one’s employment.
5. What are the components of procedural due process?

A. In a termination for just cause, due process involves the two-notice rule:
a) A notice of intent to dismiss specifying the ground for termination, and giving said employee
reasonable opportunity within which to explain his or her side;
b) A hearing or conference where the employee is given opportunity to respond to the charge,
present evidence or rebut the evidence presented against him or her;
c) A notice of dismissal indicating that upon due consideration of all the circumstances, grounds
have been established to justify termination.
B. In a termination for an authorized cause, due process means a written notice of dismissal to
the employee specifying the grounds at least 30 days before the date of termination. A copy of
the notice shall also be furnished the Regional Office of the Department of Labor and
Employment (DOLE) where the employer is located.
6. What is the sanction if the employer failed to observe procedural due process in
cases of legal and authorized termination?
In cases of termination for just causes, the employee is entitled to payment of indemnity or
nominal damages in a sum of not more than 30,000 pesos (Agabon vs. NLRC, 442 SCRA 573); in
case of termination for authorized causes, 50,000 pesos (Jaka Food Processing vs. Darwin Pacot,
454 SCRA 119).
7. May an employee question the legality of his or her dismissal?

Yes. The legality of a dismissal may be questioned before the Labor Arbiter of a Regional
Arbitration Branch of the National Labor Relations Commission (NLRC), through a complaint for
illegal dismissal. In establishments with a collective bargaining agreement (CBA), the dismissal
may be questioned through the grievance machinery established under the CBA. If the
complaint is not resolved at this level, it may be submitted to voluntary arbitration.
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8. In cases of illegal dismissal, who has the duty of proving that the dismissal is valid?
The employer.
9. Suppose the employer denies dismissing the employee, who has the duty to prove
that the dismissal is without valid cause?
The employee must elaborate, support or substantiate his or her complaint that he or she was
dismissed without valid cause (Ledesma, Jr. vs. NLRC, 537 SCRA 358, October 19, 2007).
10. On what grounds may an employee question his or her dismissal?

An employee may question his or her dismissal based on substantive or procedural grounds.
The substantive aspect pertains to the absence of a just or authorized cause supporting the
dismissal.
The procedural aspect refers to the failure of the employer to give the employee the
opportunity to explain his or her side.
11. What are the rights afforded to an unjustly dismissed employee?

An employee who is dismissed without just cause is entitled to any or all of the following:
a) reinstatement without loss of seniority rights;
b) in lieu of reinstatement, an employee may be given separation pay of one month pay for every year
of service (Golden Ace Builders, et. al vs. Jose Talde, May 5, 2010, GR
No. 187200);
c) full backwages, inclusive of allowances and other benefits or their monetary equivalent from the
time compensation was withheld up to the time of reinstatement;
d) damages if the dismissal was done in bad faith (Aurora Land Project Corp. vs NLRC, 266 SCRA 48).
12. What is reinstatement?

Reinstatement means restoration of the employee to the position from which he or she has
been unjustly removed.
Reinstatement without loss of seniority rights means that the employee, upon reinstatement,
should be treated in matter involving seniority and continuity of employment as though he or
she had not been dismissed from work.
When a Labor Arbiter rules for an illegal dismissal, reinstatement is immediately executory even
pending appeal by the employer (Article 223 of the Labor Code, as amended).
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13. In what forms may reinstatement pending appeal be effected?

Reinstatement pending appeal may be actual or by payroll, at the option of the employer.
14. What is meant by full backwages?

Full backwages refer to all compensations, including allowances and other benefits with
monetary equivalent that should have been earned by the employee but was not collected by
him or her because of unjust dismissal. It includes all the amounts he or she could have earned
starting from the date of dismissal up to the time of reinstatement.
15. What is separation pay?

In termination for authorized causes, separation pay is the amount given to an employee
terminated due to installation of labor-saving devices, redundancy, retrenchment, closure or
cessation of business or incurable disease.
Separation pay may also be granted to an illegally dismissed employee in lieu of reinstatement.
16. How much is the separation pay?

In cases of installation of labor-saving devices or redundancy, the employee is entitled to receive
the equivalent of one month pay or one month for every year of service, whichever is higher.
In cases of retrenchment, closure or cessation of business or incurable disease, the employee is

entitled to receive the equivalent of one month pay or one-half month pay for every year of
service, whichever is higher.
In case of separation pay in lieu of reinstatement, the employee is entitled to receive the
equivalent of one month pay for every year of service.
17. Is proof of financial losses necessary to justify retrenchment?

Yes. Proof of actual or imminent financial losses that are substantive in character must be
proven by the employer to justify retrenchment (Lopez Sugar Central vs. NLRC, 189 SCRA 179).
18. Are there other conditions before an employee may be dismissed on the ground of
redundancy?
Yes. It must be shown that there is:
a) Good faith in abolishing redundant position; and
b) Fair and reasonable criteria in selecting employees to be dismissed, such as but not limited to less
preferred status (e.g. temporary employee), efficiency and seniority
(Asian Alcohol Corp. vs. NLRC, 305 SCRA 416);
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c) A one-month prior notice is given to the employee and DOLE Regional Office as prescribed by law.
19. May the services of an employee be terminated due to disease?
Yes. The employer may terminate employment on ground of disease only upon the issuance of a
certification by a competent public health authority that the disease is of such nature or at such
stage that it cannot be cured within a period of six months even with proper medical treatment.
20. What is constructive dismissal?

Constructive dismissal refers to an involuntary resignation resorted to when continued
employment becomes impossible, unreasonable or unlikely; when there is a demotion in rank or
a diminution in pay; or when a clear discrimination, insensibility or disdain by an employer
becomes unbearable to an employee or an unwarranted transfer or demotion of a employee, or
other unjustified action prejudicial to the employee. The employer has to prove that such
managerial actions do not constitute constructive dismissal (Blue Dairy Corp. vs. NLRC, 314 SCRA
401)
21. May an employee be placed on floating status?

Yes, provided it is permitted under circumstances for a period of not more than six (6) months.
Beyond this period, floating status becomes constructive dismissal which entitles the employee
to separation pay (Phil. Industrial Security Agency Corp. vs.
Virgilio Dapiton and NLRC, 320 SCRA 124)
22. When an employee resigned voluntarily, is he or she entitled to separation pay?
No. An employee is not entitled to separation pay when he or she resigns voluntarily, unless it is
a company practice or provided in the CBA (Hanford Philippines Inc. vs. Shirley Joseph, 454 SCRA
786, March 31, 2005).
23. Are quitclaims valid?

Yes, provided that these are voluntarily signed and the consideration is reasonable and is not against
the law or public policy. (More Maritime Agencies vs. NLRC, 307 SCRA 189)
Quitclaims entered into by union officers and some members do not bind those who did not sign
it (Liana’s Supermarket vs. NLRC, 257 SCRA 186).
24. Burden of Proof

In any dismissal case, the employer has the burden of proving the lawful cause by substantial
evidence.
115
Substantial evidence means such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.
In detail:
JUST CAUSES:
1. Serious Misconduct
a. Misconduct is improper or wrong conduct
b. It is the transgression of some established and definite rule of action, a forbidden act, a
dereliction of duty, willful in character and implies wrongful intent not mere error in
judgment
c. The misconduct to be serious must be such a grave and aggravated character and not
merely trivial or unimportant
d. Misconduct, however serious, must be in connection with the work of the employee to
constitute just cause for is separation
2. Willful disobedience
a. To constitute willful disobedience, the orders, regulations or instructions of the employer
or representative must be:
i. Reasonable and lawful
ii. Sufficiently made known to the employer
iii. In connection with his duties which the employee has been engaged to
discharge
b. The employee’s disobedience, in order to justify his dismissal under this provision must
relate to substantial matters, not merely to trivial or unimportant matters
3. Neglect of Duty
a. In order to constitute a just cause for employee’s dismissal, the neglect of duties must
not only gross but also habitual.
b. Single act or isolated act of negligence does not constitute a just cause for the dismissal
of the employee
c. Gross neglect means an absence of that diligence that an ordinarily prudent man would
use in his own affairs
d. To justify the dismissal of an employee, it does not seem necessary that the employer
show that he has incurred actual loss, damage or prejudice by reason of the employee’s
conduct.
e. It is sufficient that the gross and habitual neglect by the employee of his duties tends to
prejudice the employer’s interests since it would be unreasonable to require the
116
employer to wait until he is materially injured before removing the cause of the
impending evil
f. Abandonment is a form of neglect of duty
The following must concur in order to constitute neglect of duty
i. Failure to report to work or absence without valid or justifiable reason
ii. A clear intention to sever the employer-employee relationship
4. Fraud, Loss of Confidence
a. Fraud is any act, omission or concealment which involves a breach of legal duty, trust or
confidence justly reposed and is injurious to another
b. To constitute just cause, the fraud must be committed against the employer or
representative and in connection with the employer’s work
c. Loss of confidence applies to employees who occupy positions of trust and confidence
or to those situations where the employee is routinely charged with care and custody of
the employer’s money or property.
d. Loss of confidence must be based on willful breach of trust and founded on clearly
established or proven facts
e. Positions usually involves confidence: Cashier, manager, supervisor, salesmen or other
personnel occupying positions of responsibility
5. Commission of a crime or offense against the person of his employer or any immediate member
of the employer’s family
a. Immediate members of the family refer to the spouse, ascendants, descendants or
legitimate, natural or adopted brothers or sisters of the employer or of his relative by
affinity in the same degree and those by consanguinity within the fourth civil degree
6. Analogous causes
a. To be considered analogous, a cause must be due to the voluntary and/or willful act or
omission of the employee
AUTHORIZED CAUSES:
1. Installation of labor saving devices (automation)

2. Redundancy
a. Exist where the services of an employee are in excess of what is reasonably demanded
by the actual requirements of the industry.
b. A position is redundant where it is superfluous, and superfluity of positions may be the
outcome of over hiring, decreased volume of business, dropping of a particular product
line
3. Retrenchment
117
a. To be valid, the following must be met:

i. It is intended to prevent losses and such losses are proven
ii. Written notices are served on the workers and the DOLE at least 30 days before
the effective date of retrenchment
iii. Separation pay is paid
b. Standards of retrenchment
i. Losses expected should be substantial and not merely de minimis in extent
ii. Substantial loss apprehended must be reasonably imminent and such
imminence can be perceived objectively and in good faith by the employer
iii. Be reasonably necessary and likely to effectively prevent the expected loss.
iv. Alleged losses if already realized, and the expected imminent losses sought to
be forestalled must be proven by sufficient and convincing evidence.
c. Criteria: whom to retrench
i. Less preferred status (i.e., temporary employees
ii. Efficiency rating
iii.Seniority
iv. Other criteria: LIFO (last in-first out)
4. Closure or cessation of business
a. A firm that faces serious business decline and loss, is allowed to close its business in
order to avoid further economic loss.
5. Disease
a. Employee suffers from disease and his continued employment is prohibited by law or
prejudicial to his health or to the health of his coemployee.
118

Labor Code of The Philippines Presidential Decree No. 442 of 1974, As Amended and Renumbered

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Labor Code of The Philippines Presidential Decree No. 442 of 1974, As Amended and Renumbered

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Labor Code of the Philippines

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

(Art. 1 – 6) social justice. In that sense, labor

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

• participate in policy and • Must substitute rationality for

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

• RA 875 or the Industrial Peace • The ILO formulates

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

• Minimum Age Convention (1973); • The working man’s welfare should

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

while those incorporated under the NOTE:

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

BOOK ONE: PRE-EMPLOYMENT (ARTS. 12 – 42)

RECRUITMENT AND PLACEMENT OF WORKERS

WHAT CONSTITUTES RECRUITMENT AND PLACEMENT?

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Art. 14. EMPLOYMENT PROMOTION

Art. 15: BUREAU OF EMPLOYMENT SERVICES

The PESO (Public Employment Service Office)

Article 16: PRIVATE RECRUITMENT

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Article 17: OVERSEAS EMPLOYMENT DEVELOPMENT BOARD

1. OVERSEAS EMPLOYMENT, A BRIEF HISTORY

2. LEGISLATIVE BACKGROUND OF OVERSEAS EMPLOYMENT

3. OVERSEAS EMPLOYMENT POLICY

R.A. No. 8042

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Filipino migrant workers;

4. THE POEA: OVERVIEW OF ITS FUNCTIONS AND POWERS

A. REGULATORY FUNCTION OF POEA

Article 18: BAN ON DIRECT-HIRING

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

ART. 22. Mandatory Remittance of Foreign Exchange Earnings.

Who are disqualified from being issued a license?

a. Travel agencies and sales agencies of airline companies

Private Sector Participation in the Recruitment and Placement of Workers

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

What are the fees/costs chargeable to the workers?

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Article 35: SUSPENSION AND/OR CANCELLATION OF LICENSE OR AUTHORITY

1. SUSPENSION OR CANCELLATION OF LICENSE

• The grounds for imposition of administrative sanctions include engaging in acts of

2. PERSONS LIABLE; DURATION OF LIABILITY

Art. 38 – ILLEGAL RECRUITMENT

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

h. To fail to submit reports on the status of employment, placement vacancies, remittance of

• Principals, Accomplices, and Accessories;

Section 7, RA 8042 provides:

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Art. 40 EMPLOYMENT OF NON-RESIDENT ALIENS

EMPLOYMENT PERMIT OF NON-RESIDENT ALIENS

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

TRAINING AND EMPLOYMENT OF SPECIAL WORKERS (Art. 57 – 81)

Apprenticeable Occupation learnership agreement, shall include:

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

related which shall not exceed three (3) months;

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

1. Handicapped workers may be employed when:

EMPLOYMENT OF WOMEN (Art. 130/132 – 136/138)

PRESIDENTIAL DECREE NO. 442 OF 1974, AS AMENDED AND RENUMBERED

Maternity Leave Benefit (RA 8282, as amended by RA 11210)

 The following are acts of discrimination: