Labor Law Module 1

LABOR LAW AND SOCIAL LEGISLATIONS
CHAPTER 1: INTRODUCTION
INTRODUCTION TO LABOR LAW
What constitutes Labor?

Labor includes the labor force who are employed or those who are able and willing to
work but are temporarily or involuntarily unemployed. Thus, it includes manpower, which is
that portion of the population who has actual or potential capability to contribute to the
production of goods and services.
• That is why, if you browse through the Labor Code there is a title on recruitment and
placement, so even if there is no employer-employee relationship yet, the labor force is
already protected.
What is labor law?

Labor law includes all the rules of law governing the conditions under which persons may
work under the control of other persons called employers. Labor law has two main divisions
– Labor standard laws and Labor relations law.
What are the sources of labor laws?

The sources of labor laws are as follows:
• The Philippine Constitution
• Legislations passed by Congress
• Decisions of the Supreme Court
• Implementing rules and regulations of DOLE
• ILO conventions
• Other sources such as foreign laws and decisions
What are labor standards laws?

Labor standards law prescribes the terms and conditions of employment as affecting
wages or monetary benefits, hours of work, cost of living allowances and occupational
health, safety and welfare of the workers.
• In other words, it prescribes the minimum requirements of employment which employers
must provide or comply with and to which the employees are entitled to as a matter of
legal right.
What are labor relations laws?

Labor relations law defines the status, rights and duties and the institutional mechanisms,
that govern the individual and collective interactions of employers, employees or their
representatives (labor unions).
• Book 1 to 4 of the Labor Code deal largely with labor standards while book 5 and six
cover labor relations.
• The distinction between labor standards and labor relations law is useful only for
academic purposes but in reality, they mingle. For example, a dispute between
employer and employee is a labor relations matter but very often, the cause of the
dispute is labor standards.
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What is the meaning of social legislation?
Social legislation is a law governing employer-employee relationship while the latter is not
“at work” due to hazards beyond his control arising from employment which immobilize
him from working.
• According to Azucena, social legislation includes laws that provide particular kinds of
protection or benefits to society in furtherance of social justice.
• Examples of social legislation are the retirement law, CARP law, SSS law and GSIS law.
How is labor law distinguished from social legislation?

The distinctions are as follows:
• Labor law affects actual employment; social legislation governs the effects of
employment.
• Labor law is designed the meet the daily needs of a worker; social legislation involves
long-range benefits.
• Labor law affects the work of the employee; social legislation affects the life of the
employee
• Benefits under the labor law are paid by the employer; benefits under a social legislation
are paid by the government.
• The concept of Labor law is narrower than social legislation.
What is the purpose/aim of labor laws and social legislation?

Social justice
What is social justice?

Justice Laurel defined social justice as “neither communism, nor despotism, nor atomism
nor anarchy, but the humanization of laws and the equalization of social and economic
forces by the State so that justice in its rational and objectively secular conception may at
least be approximated.
What are the legal bases of labor and social legislation?

The legal bases of labor and social legislations are as follows:
• Police power of the State
• Constitutional bases
- Social Justice clause of the Constitution
- Protection to Labor clause of the Constitution
- Doctrine of Incorporation clause of the Constitution
- Social Service/full employment/freedom from poverty clause of the Constitution
- Due process and equal protection clause
• Statutory bases – Articles 1700 – 1712 of the Civil Code
What is police power?

It is the inherent power of the State to enact laws to protect public safety, peace, health,
and morals When a branch of a tree is touching an electrical post and the government
removes it or when a concrete fence is in danger of collapsing and the government
removes it because it poses danger to the public, the government is exercising police
power
Is the exercise of police power without limit?
The exercise of police power is not without limit. The following conditions must concur:
• Its exercise must be for the interest of the public in general and not only of a particular
class.
• The means used must be reasonably necessary to accomplish the purpose and not be
oppressive upon individuals.
In the case of PASEI vs. Drillon, The petitioner assailed the validity of an order suspending
the deployment of Filipina domestic and household workers abroad. According to the
petitioner, the order discriminates against Filipina domestic workers as the ban on
deployment applies only to the latter to the exclusion of male and other female OFWs. The
SC ruled that the order is a valid exercise of police power even if it is applicable only to
one class of the population provided the following requisites are complied with:
• classification is based on a valid distinction, they are germane to the purposes of the law
• They are not confined to existing conditions; and
• They apply equally to all members of the same class.
What is the social justice clause of the Constitution?

Section 10 Article 2 of the Constitution provides, “The State shall promote social justice in all
phases of national development.”
Social justice is further reiterated in several other provisions of the Constitution such as the
following:
• Article II Section 6: The State shall promote social justice to ensure the dignity, welfare
and security of all the people. Towards this end, the State shall regulate the acquisition,
ownership, use, enjoyment and disposition of private property, and equitably diffuse
property ownership and profits.
• Article XII Section 2: The promotion of social justice shall include the commitment to
create economic opportunities based on freedom of initiative and self-reliance.
What is social justice?

Social justice is “neither communism, nor despotism, nor atomism nor anarchy, but the
humanization of laws and the equalization of social and economic forces by the State so
that justice in its rational and objectively secular conception may at least be
approximated.
What is the object of social justice?

The object and concern of social justice is to uplift the social and economic status of the
common man or to maintain proper economic and social equilibrium in the interrelations
of the members of the community.
However, social justice cannot be resorted to trample upon the rights of others nor to shield
wrongdoings or illegal acts prejudicial to the rights of property owners who, under the
Constitution are also entitled to protection. It is only for the deserving.
How is social justice promoted by the State in all phases of national development?
When the State provides scholarship to deserving students born to less privileged families;
or when it creates agencies such as SSS and Philhealth to extend financial assistance to the
downtrodden; or when it provides low-cost housing for the homeless, the State is promoting
social justice.
What is the social service or full employment or freedom from poverty clause of the
Constitution?
Article II Section 9 of the Constitution provides that “The State shall promote a just and
dynamic social order that will ensure the prosperity and independence of the nation and
free the people from poverty through policies that provide adequate social services,
promote full employment, a rising standard of living, and an improved quality of life for all.”
This is an extension of social justice. Its absence, however, will not defeat the very
existence of the government. This can still be afforded by the State in its capacity as
parens patriae (parent of the nation).
What is “standard of living” as used in the social services clause of the Constitution and
how is it distinguished from “cost of living”?
Standard of living is defined as a social and economic concept which deals with “what”
facilities are needed by an employee necessary to assure himself and his family a life
worthy of human dignity.
Cost of living is an economic and social concept which deals with “how much” facilities
that an employee could cost in order to maintain his standard of living worthy of human
dignity.
What is the protection to labor clause of the Constitution?

Section 3, Article XIII of the 1987 Constitution provides:
The State shall afford full protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of employment opportunities for
all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and
negotiations, and peaceful concerted activities, including the right to strike in accordance
with law. They shall be entitled to security of tenure, humane conditions of work, and a
living wage. They shall also participate in policy and decision-making processes affecting
their rights and benefits as may be provided by law.
The State shall promote the principle of shared responsibility between workers and
employers and the preferential use of voluntary modes in settling disputes, including
conciliation and shall enforce their mutual compliance therewith to foster industrial peace.
The State shall regulate the relations between workers and employers, recognizing the right
of labor to its just share in the fruits of production and the rights of enterprises to reasonable
returns on investments, and to expansion and growth.
According to the protection to labor clause, the State shall promote full employment. What
does full employment mean?
Full employment means that “those who want to work at the prevailing rates of pay are
able to find work without undue difficulty. It is a situation where people who have the skills
refuse to work because they have more than enough to sustain themselves.
Full employment does not mean that everybody is working.
• Unemployment on the other hand is involuntary idleness on the part of an employee who
is able and willing to work but could hardly find one.
• Underemployment is the condition in which people in a labor force are employed
at less than full-time or regular jobs or at jobs inadequate with respect to their
training or economic needs.
What are the Constitutional rights of workers guaranteed particularly under the
protection to labor clause?
The Constitutional rights of workers are as follows:
Right to self-organization – This refers to the right to form associations or societies for
purposes not contrary to law. The establishment of a labor union is an exercise of
this right. This right is further reiterated in Article III Section 8 which states that
SECTION 8. The right of the people, including those employed in the public and private
sectors, to form unions, associations, or societies for purposes not contrary to law shall not
be abridged.
• Right to collective bargaining – This will compel the employer to employer to deal
with the workers as a group. Its objective is the formation of a CBA.
• Right to security of tenure – It is the right of the worker to continue in employment
until the same is terminated by just or authorized causes. It is also intended to
shield the workers from an unwarranted or unconsented demotion or transfer.
• Right to just and humane conditions of work – This refers to “fair wages and equal
remuneration for work of equal value, safe and healthy working conditions, equal
opportunity to promotion and rest, leisure and reasonable limitation of working
hours.”
• Right to collective negotiations – This is applicable to unionism is the government
sector. NOTE: government employees cannot collectively bargain because the
terms and conditions of their work are fixed by law.
• Right to peaceful concerted activities – Such as PEACEFUL boycotts, pickets and
strikes.
• Right to strike – A strike is any temporary stoppage of work by the concerted
action of employees as a result of any industrial or labor dispute designed to
compel the employer to accede to certain demands of the employees. NOTE:
government employees don’t have the right to strike.
• Right to a living wage – A living wage is one sufficient to provide the worker and
his family a decent standard of living. NOTE: minimum wage may not be a living
or just wage.
• Right to participate in policy and decision-making processes – Allowing the union
to participate in the amendment of the company’s code of discipline is an
exercise of this right.
• Right to just share in the fruits of production – Fruits of production cover not only
salaries, wages, benefits but also includes profits. Bu t with respect to profits, an
enabling law is required to compel employers to give the employees share in the
profits.
What is the doctrine of incorporation?

Article II, section 2 of the Constitution provides that “The Philippines adopts the generally
accepted principles of international law as part of the law of the land.
What is the due process and equal protection clause of the Constitution?
Article III section 1 of the Constitution provides that “No person shall be deprived of life,
liberty or property without due process of law, nor shall any person be denied the equal
protection of the laws.”
What is due process of law?

Due process of law is a law which hears before it condemns, which proceeds upon inquiry
and renders judgment only after trial. Notice and hearing are the essential elements of
due process.
Thus, it is incumbent upon the employer to conduct a formal investigation and inform the
employee of the specific charges against him. Otherwise, the dismissal is arbitrary and
unwarranted, oppressive and abusive.
One of the legal bases of labor and social legislation is the Civil Code of the Philippines.
What are its provisions relating to labor?
The following articles of the Civil Code refer to contract of labor:
• Article 1700: The relations between capital and labor are not merely contractual. They
are so impressed with public interest that labor contracts must yield to the common
good. Therefore, such contracts are subject to the special laws on labor unions,
collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours
of labor and similar subjects.
• Art. 1701. Neither capital nor labor shall act oppressively against the other, or impair the
interest or convenience of the public.
NOTE: This is known as the principle of non-oppression. Thus, in one case, the Supreme
Court held that “to require a company to continue being generous when it is no longer in
a position to do so would certainly be unduly oppressive, unfair and most revolting to the
conscience.” The principle of social justice is never meant to oppress the employer.
• Art. 1702. In case of doubt, all labor legislation and all labor contracts shall be construed
in favor of the safety and decent living for the laborer. (Principle of liberal construction in
favor of labor)
NOTE: In the case of Villa Vert vs. ECC and GSIS where the deceased’s mother filed a
claim for income benefits from the GSIS for the death of her son due to hemorrhagic
pancreatitis, the GSIS denied the mother’s claim on the ground that the disease was not
occupational. The Supreme Court ruled in favor of the petitioner stating that since “the
exact cause of the acute hemorrhagic pancreatitis is still unknown despite extensive
researches in this field” any doubt thereof shall be resolved in favor of labor.
However, this principle applies only in case there is doubt. If the contractual
provision is crystal-clear, then it must be applied in accordance with its expressed terms.
Furthermore, the law also recognizes that management has rights whih are also
entitled to respect and enforcement in the interest of fairplay.
• Art. 1703. No contract which practically amounts to involuntary servitude, under any
guise whatsoever, shall be valid.
NOTE: This is also pursuant to Article XIII, Section 18 of the Constitution which provides that
“No involuntary servitude in any form shall exist except as a punishment for a crime
whereof the party shall have been duly convicted.
• Art. 1704. In collective bargaining, the labor union or members of the board or
committee signing the contract shall be liable for non-fulfillment thereof.
• Art. 1705. The laborer's wages shall be paid in legal currency.
• Art. 1706. Withholding of the wages, except for a debt due, shall not be made by the
employer.
• Art. 1707. The laborer's wages shall be a lien on the goods manufactured or the work
done.
• Art. 1708. The laborer's wages shall not be subject to execution or attachment, except for
debts incurred for food, shelter, clothing and medical attendance.
NOTE: Salaries, as distinguished from wages, can be subject to execution or
attachement.
• Art. 1709. The employer shall neither seize nor retain any tool or other articles belonging to
the laborer.
NOTE: Tools and implements necessary to the employee’s trade, such as the dental chair
of a dentist, are exempted from execution.
• Art. 1710. Dismissal of laborers shall be subject to the supervision of the Government,
under special laws.
• Art. 1711. Owners of enterprises and other employers are obliged to pay compensation
for the death of or injuries to their laborers, workmen, mechanics or other employees,
even though the event may have been purely accidental or entirely due to a fortuitous
cause, if the death or personal injury arose out of and in the course of the employment.
The employer is also liable for compensation if the employee contracts any illness or
disease caused by such employment or as the result of the nature of the employment. If
the mishap was due to the employee's own notorious negligence, or voluntary act, or
drunkenness, the employer shall not be liable for compensation. When the employee's
lack of due care contributed to his death or injury, the compensation shall be equitably
reduced.
• Art. 1712. If the death or injury is due to the negligence of a fellow worker, the latter and
the employer shall be solidarily liable for compensation. If a fellow worker's intentional
malicious act is the only cause of the death or injury, the employer shall not be
answerable, unless it should be shown that the latter did not exercise due diligence in the
selection or supervision of the plaintiff's fellow worker.
Are there limitations on the enactment of labor legislation?

Yes, the enactment of labor laws are limited by the following:
• Observance of non-impairment of contracts – The Constitution provides that “no law
impairing the obligation of contracts shall be passed.”
NOTE: An example of impairment by law is when a later taxing statute revokes a tax
exemption based on a contract, as when a contractor enters into a contract with the
government under the BOT law for the construction of an expressway. If their contract
provides that the contractor shall be exempted from the payment of tax, but
subsequently, a law is passed requiring the contractor to pay tax, the tax law is violative
of the principle of non-impairment of contracts.
However, in the case of Abella vs. NLRC where petitioner Abella dismissed his two workers
due to the closure of his business. Consequently, a law was passed requiring employers
to pay separation pay to employees removed by reason of authorized causes. Abella
invoked the non-impairment clause against the retroactive effect of the law. The
Supreme Court ruled that police power prevails over the principle of non-impairment of
contract.
• Observance of non-delegation of legislative power – The general rule is that the power
conferred upon Congress to make laws cannot be delegated to any other body or
authority. But this admits of some exceptions one of which is the delegation of the
“power of subordinate legislation” to administrative bodies. Due to the growing
complexity of modern society, it has become necessary to allow specialized
administrative bodies to promulgate supplementary rules, so that they can deal with
technical problems with more expertise and dispatch than the Congress or the courts.
Regulations or supplementary rules passed by the administrative bodies are intended to
fill-in the gaps and provide details to what is otherwise a broad statute passed by
Congress. For the rules and regulations to be valid and binding, they must be in
accordance with the statute on which they are based, complete in themselves, and fix
sufficient standards. If any of the requirements is not satisfied, the regulation will not be
allowed to affect private rights
• Observance of the constitutional provision against involuntary servitude – The Constitution
provides that “no involuntary servitude in any form shall exist except as a punishment for
a crime whereof the party shall have been duly convicted.”
NOTE: By way of exception, it may be a punishment for criminal conviction. Also, citizens
may be required to help in the repair of public highways and streets. Citizens may also
be required to perform military duties in case the country is at war.
• Observance of the equal protection of the law - Equal protection of the law requires that
all persons shall be treated alike, under like circumstances and conditions both in
privileges conferred and in the liabilities imposed.

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LABOR LAW AND SOCIAL LEGISLATIONS

INTRODUCTION TO LABOR LAW

What constitutes Labor?

What is labor law?

What are the sources of labor laws?

What are labor standards laws?

What are labor relations laws?

How is labor law distinguished from social legislation?

What is the purpose/aim of labor laws and social legislation?

What is social justice?

What are the legal bases of labor and social legislation?

What is police power?

Is the exercise of police power without limit?

What is the social justice clause of the Constitution?

What is social justice?

What is the object of social justice?

What is the protection to labor clause of the Constitution?

Full employment does not mean that everybody is working.

What is the doctrine of incorporation?

What is due process of law?

Are there limitations on the enactment of labor legislation?

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