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3/13/23, 12:29 PM MODULE 2 – EMPLOYMENT: GENERAL PRINCIPLES

MODULE 2 – EMPLOYMENT: GENERAL PRINCIPLES

Site: New Era University Printed by: Frenzyn Mae S. Yoro


Course: PDT322-18: Personality Development 2 Date: Monday, 13 March 2023, 12:29 PM
Book: MODULE 2 – EMPLOYMENT: GENERAL PRINCIPLES

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Description

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Table of contents

1. Introduction/Overview

2. Learning Outcomes

3. Lesson 3: Employment; Employer-Employee Relationship


3.1. Activity 1: Video Analysis

4. Lesson 4: Social Justice; Compassionate Justice


4.1. Activity 2: Theory into Practice

5. Lesson 5: Types of Employment and Related Topics

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1. Introduction/Overview

This module aims to  extrapolate the basic concepts of employment.   It discusses about the primary parties in the workplace as well as the
relationship that exists between them.  Furthermore, basic bases of labor laws are incorporated in order for the pre-service teachers to be aware
on the in’s and out’s of the working pool.

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2. Learning Outcomes

1.   Identify the parties of employment.

2. Explain the purposes of the existence of the employer-employee relationship.

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3. Lesson 3: Employment; Employer-Employee Relationship

Employment

Employment  is a relationship between two  parties, usually based on  contract  where work is paid for, where one party, which may be
a corporation, for profit, not-for-profit organization, co-operative or other entity is the employer and the other is the employee.  Employees work
in return for  payment, which may be in the form of an hourly wage, by  piecework  or an annual  salary, depending on the type of work an
employee does or which sector they are working in. Employees in some fields or sectors may receive  gratuities,  bonus payment  or  stock
options. In some types of employment, employees may receive benefits in addition to payment. Benefits can include  health insurance,
housing, disability insurance or use of a gym. Employment is typically governed by employment laws organisation or legal contracts.

Employer 

An employer is one for whom employees work in consideration of wages or salaries.  An employer may either be natural or juridical.

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Employee 

An employee is one who works for an employer, a person working for salary or wages, any person in the service of another under a contract for
hire, express or implied, oral or written.  An employee is always a natural person.

Relationship between the Employer and an Employee

1.  Contractual in Character 

The employer-employee relationship is contractual in character.   It arises from the agreement of the parties.   But such relationship is so
impressed with public interest that labor contracts must yield to the common good; they are subject to special laws on labor unions, collective
bargaining, strikes and lock-outs, closed shop, wages, working conditions, hours of labor and similar subjects (Art. 1700, Civil Code).   The
parties, furthermore, are enjoined not to act oppressively against each other, or impair the interest or convenience of the public (Art. 1701, Civil
Code).

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2.  In Personam

The employer-employee relationship is in personam.  It involves the rendition of personal service by the employee, and partakes of master and
servant relationship.

Elements of Employer-Employee Relationship

The elements that are generally considered are the following:

1.  the selection and engagement of the employee;

2.  the payment of wages;

3.  the power of dismissal; and

4.  the employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished.

The most important index of the employer-employee relationship is so called the “control test”, and that is, 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 (Investment Planning Corporation of the Philippines vs. Social Security System, GR No. L-19124, November 18,
1967).  Stated otherwise, an employer-employee relationship exists where the person for whom the services are performed reserves the right to
control not only the end to be achieved but also the means to be used in reaching such end (Dy Keh Beng vs. International Labor and Maritime
Union of the Philippines et. al., GR No. L-32205, May 25, 1979).  It is essentially the relationship of master and servant.

Significance in Determining the Employer-Employee Relationship

This is to determine what laws will govern the rights and liabilities of the parties, and what tribunal or court will have jurisdiction over their
disputes.   Where there exists an employer-employee relationship, labor laws will govern the rights and liabilities of the parties, and labor
tribunals will have jurisdiction over their disputes.

On the other hand, if the relationship be one of principal and independent contractor, the ordinary rules on obligations and contract will apply
and the regular courts will have jurisdiction over the disputes.

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3.1. Activity 1: Video Analysis

Identify whether the employer-employee relationship exists in this scenario.  State the existence of each element.  Justify your claim by stating
the following:

1.  Synopsis of the Issue

2.  Elements of the ER-EE Relationship

3.  Assessment / Evaluation of the Issue

Write your answer on the activity box provided in the ASSIGNMENT PART.

REKLAMO SA KUMPANYA NA HINDI NAGBIBIGAY NG TAMANG

http://

Criteria for Grading:

Substance - 60%

Organization - 20%

Creativity in the Presentation - 20%

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4. Lesson 4: Social Justice; Compassionate Justice

The term “labor law” covers the following:

1.  Statutes passed by the state to promote the welfare of workers and employees and regulate their relations with their employers.

2.  Judicial decisions applying and interpreting the aforesaid statutes.

3.  Rules and regulations issued by administrative agencies, within their legal competence, to implement labor statutes.

Classification of Labor Statutes

1.  Labor Standard Laws - those that provide for the pay and other legal benefits to which the worker, while at work, is entitled to receive from
his employer

Example:

A law providing for the minimum rates of pay to which workers are entitled for a day’s work

2.  Welfare Legislation - those that require payment of benefits by government agencies to the worker or his family when and while he cannot
work, by reason of sickness, disability, old age, death and similar hazards

Example:

The Social Security Law (RA 1161, as amended) which provides for payment of sickness, maternity, disability, old age and death benefits

3.  Labor Relations Laws - those intended to stabilize the relations of employees and their employers, adjust differences between them thru
collective bargaining, and settle labor disputes through conciliation, mediation, and arbitration

Labor Provision of the 1987 Constitution

Section 3 of Article XIII (Social Justice and Human Rights) 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.

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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 right of enterprises to reasonable returns on investments, and to expansion and growth.

Social Justice 

Under the 1987 Constitution, Social Justice envisions equitable diffusion of wealth and political power for the common good, regulation of the
acquisition, ownership, use and disposition of property and its increments; and creation of economic opportunities based on freedom of initiative
and self-reliance (Section 1 & 2, Article XIII).

Social Justice is a means to insure equality between labor and capital.  Labor occupies a position which is weaker than capital.  Through social
justice, the State is able to make labor as strong as capital, thereby providing equal protection.  Social justice is a means to equal protection.

Definition

Social Justice is neither communism, nor despotism, nor atomism, nor anarchy, but the humanization of laws and the equalization of the social
economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated.   Social Justice
means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all
the component elements of society, through maintenance of proper economic and social equilibrium in the interrelations of the members of the
community; constitutionally, through the adoption of the measures legally justifiable; or extra-constitutionally, through the exercise of powers
underlying the existence of all governments on the time-honored principle of salus populi est suprema lex (Calalang vs. Williams, 70 Phil. 728).

Guarantee of Social Justice 

Social Justice does not champion division of property or equality of economic status; what it and the Constitution do guarantee are equality of
opportunity, equality of political rights, equality before the law, equality between values given and received, equitable sharing of the social and
material goods on the basis of efforts exerted in the production.  It is a command to devise measures, but it cannot be used to trample upon the
rights of others (Guido vs. Rural Progress Administration, GR No. L-2089, October 31, 1949).

True Concept of Social Justice

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In our scheme of government, social justice as a fundamental principle enshrined in the 1935 Constitution, reiterated and revitalized in the 1973
Constitution, is formulated and implemented by the legislative and executive departments, respectively.  It is the specific duty of the judiciary in
turn to examine and determine - in appropriate cases coming before the courts - the intendment and scope - or the constitutionality, where
raised - of tenancy, labor and other social legislation and/or measures.  This responsibility the judiciary has discharged, ever mindful and always
aware in proper cases that in the words of the famous grass-roots slogan of the late President Magsaysay “…those who have less in life should
have more in law.”  A cursory study of the long line of decisions on social justice will readily reveal, however, that the concept has been fleshed
out - the principle, conceptualized - as Justice Laurel enjoined in the celebrated case of Calalang vs. Williams - no thru mistaken sympathy for or
misplaced antipathy against any group - whether labor or capital, landlord or tenant - but even-handedly and fairly, thru the observance of the
principle of “equal justice under the law”, for all and each and every element of the body politic (Cabalan vs. Court of Appeals, GR Nos. L-44875-
76; L-45160; L-46211-12, January 22, 1980).

Should the policy of social justice countenance wrongdoing by the underprivileged?

The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged.  At best it may
mitigate the penalty but certainly will not condone the offense.  Compassion for the poor is an imperative of every humane society but only when
the recipient is not a rascal claiming an undeserved privilege.  Social justice cannot be permitted to be the refuge of scoundrels any more than
can equity be an impediment to the punishment of the guilty.  Those who invoke social justice may do so only if their hands are clean and their
motives blameless and not simply because they happen to be poor.  This great policy of our Constitution is not meant for the protection of those
who have proved they are not worthy of it, like the workers who have tainted the cause of labor with the blemishes of their own character (PLDT
Co. Vs. NLRC et al., GR No. L-80609, August 23, 1988).

Relevance of Compassionate Justice in Labor Cases

Relying on the constitutional mandate on the protection to labor, courts and labor tribunals dispensed what is known as “compassionate
justice”, disregarding rigid rules and giving due weight to all the equities of the case.  For labor law determinations are only secumdum rationem
but secundum caritatem (Almira et al. vs. BF Goodrich Philippines, Inc. Et al., GR No. L-34974, July 25, 1974).

Compassionate Justice has been applied to bar the dismissal of workers guilty of certain offenses but who have rendered long year of service
and without previous derogatory records (Philippine Airlines, Inc. vs. Philippine Airlines Employee Association et al., GR No. L-24626, June 28,
1974; Gelmart Industries Phils., Inc. vs. NLRC et al., GR No. 85668, August 10, 1989).

  

Illustrations:

The dismissal of the branch accountant of a bank, for violation of the bank’s housing plan for employees has been ruled to be unduly harsh in
view of the accountant’s eight (8) years of service with no previous derogatory record and considering that he repaid the loan amount in full (yap
vs. NLRC et al., GR No. 123492, August, 1997).

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The dismissal of an employee for theft of lighter fluid valued at P8.00 has been held to be severe, in view of his length of service (8 years) and
lack of previous derogatory record, and considering that the company did not lose anything as the bottle of lighter fluid was retrieved on time,
that there was no showing that the employee’s retention in the service would work undue prejudice to the viability of the employer’s operations
or is patently inimical to its interest, and that he had been preventively suspended and had undergone mental torture (Caltex refine Employees’
Association vs. NLRC et al., GR No. 102993, July 14, 1995).

After seventeen (17) years of untarnished service, an employee in the production department of a pharmaceutical firm was dismissed for
allegedly being caught in possession of a plastic bag which belonged to the company.  Under the company rules, unauthorized possession of
company property was punishable by outright dismissal.  But even assuming that the offense was committed, the penalty of dismissal is unduly
harsh and grossly disproportionate to the act done (Dela Cruz vs. NLRC et al., GR No. 119536, February 17, 1997).

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The dismissal of an employee of a food company for theft of fifteen (15) pieces of hamburger patties, one (1) pair of boots, and one (1) empty
aluminum container has been held to be harsh, in view of his two (2) years of service without previous derogatory record (Associated labor
Unions et al. vs. NLRC et al., GR No. 120450, February 10, 1999). 

Although an employee has been validly dismissed, the employer may still be required to pay the former severance compensation as a measure
of compassionate justice as long as the dismissal is not for serious misconduct or for reasons reflecting on the employee’s moral character
(Philippine Long Distance Telephone Co. vs. NLRC et al., GR No. 80609, August 23, 1988).

It has been held that although the dismissal of a bus conductor for gross negligence was justified, he should be given financial assistance taking
into account his twenty (20) years of service and there being no showing of dishonesty on his part (Philippine Rabbit Bus Lines, Inc. vs. NLRC et
al., GR No. 98137, September 15, 1997).  

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4.1. Activity 2: Theory into Practice

Reflect on the video whether social justice or compassionate justice is applicable.  State your work on the following requisites: (a) Introduction;
(b) Body; and (c) Conclusion.  Place your output in the Assignment activity box provided for it.

Criteria:

Substance  - 70%

Appeal - 30% 

Brigada: Pabahay na puwersahang inokupa ng Kadamay, tadta

http://

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5. Lesson 5: Types of Employment and Related Topics

Art. 139 – Minimum Employable Age

“(a) No child below fifteen (15) years of age shall be employed, except when he works directly under the sole responsibility of his parents or
guardian, and his employment does not in any way interfere with his schooling.”  (See also Sec. 3 of RA 9231.)

Minimum Employable Age in Hazardous and Deleterious Jobs

“The foregoing provisions shall in no case allow the employment of a person below eighteen (18) years of age  in an undertaking which is
hazardous or deleterious in nature as determined by the Secretary of Labor.”

Employment of Minors

GR: Children below fifteen years of age shall not be employed.

XPNS:

a. 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; and

b. Where the child’s employment or participation in public entertainment or information through cinema, theatre, radio, television or other forms
of media is essential (RA No. 9231, Sec. 2).

Art. 140 – On Account of Age

“No employer shall discriminate against any person in respect to terms and conditions of employment on account of his age.”

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Types of Employment

MANAGERIAL SUPERVISORY
EMPLOYEES EMPLOYEES

“(m) one who is Those who, in the


vested with powers interest of the
or prerogatives  to lay employer, effectively
down and execute recommend such
management managerial actions  if
policies  and/or to hire, the exercise of such
transfer, suspend, lay- authority is not merely
off, recall, discharge, routinary or clerical in
assign or discipline nature  but requires the
employees use of independent
judgment.  

All employees not


falling within any of the
above definitions are
considered rank-and-file
employees for purposes
of this Book.”

NOTE: Managerial employees are not entitled to overtime and holiday pay.

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Regular Employment

Test of Regularity:

a. Regular employee by nature of work –

those performing a particular activity which is necessary or desirable in the usual trade or business of the employer, regardless of their length of
service (Art. 295) 

b. Regular employee by years of service –

those who have been performing the job, regardless of the nature thereof, for at least one (1) year of service (Art. 295);

NOTE:  The term at least 1-year of service shall mean service for not less than 12 months, whether continuous or broken, reckoned from the
date the employee started working (IRR of the Labor Code, Book III, Rule V, Sec. 3).

c. Regular employee by probationary employment –

those allowed to work after the probationary period (Art. 296).

Art. 281.  Probationary Employment

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Probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship
agreement stipulating a longer period.  The services of an employee who has been engaged on a probationary basis may be terminated for a
just cause or when he fails to qualify as a regular employee in accordance with the reasonable standards made known by the employer to the
employee at the time of his engagement.   An employee who is allowed to work after a probationary period shall be considered a regular
employee.

NOTE:  As provided for in the law, probationary employment shall not exceed six (6) months.  But probationary period could be extended with
the consent of the probationary employee to give him an opportunity to improve his performance.

If a CBA (Collective Bargaining Agreement) provides that only regular employees be entitled to the benefits stipulated thereunder, it should be
construed strictly.  Hence, it extends only to probationary employees from the time they acquire regular status.

Termination of probationary employees must be for a just cause after observance of due process as they also enjoy security of tenure during the
effectivity of their probationary status.  See also Biboso vs,. Victoria Milling, GR No. L-44360, March 31, 1977.

Probationary employees who are unjustly dismissed from work during the probationary period shall be entitled to reinstatement and payment of
full backwages, inclusive of allowances, and to other benefits or their monetary equivalent computed from the time their compensation was
withheld from them up to the time of their actual reinstatement, conformably with Article 279 of the Labor Code (Cebu Marine Beach resort, et al
vs. NLRC, GR No. 143252, Oct 23, 2003).

Art. 78 – Handicapped Workers; Definition

Handicapped workers are those whose earning capacity is impaired (1) by age or (2) physical or (3) mental deficiency.

NOTE:  Low IQ or low efficiency does not make the worker “handicapped” in the contemplation of law.

Art. 80 (B) – Wage Rate of Handicapped Workers 

(b)  The rate to be paid the handicapped workers shall be not less than seventy-five percent (75%) of the applicable legal minimum wage.

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 Qualified Disabled Person

A qualified disabled person is an employee who can perform, with or without reasonable accommodations, the essential functions of her
employment.  A qualified disabled employee shall be subject to the same terms and conditions and the same compensation, privileges,
benefits, fringe benefits, incentives or allowances as a qualified able-bodied person (RA No. 7277, Sec. 5)

Art. 279.  Security of Tenure

Reinstated Employees’ Right to Benefits and Increases during the Period of Lay-off 

XXX “An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and
to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation
was withheld from him up to the time of his actual reinstatement.”

In the case of Sigma Personnel Services vs. NLRC, 2224 SCRA 181, “Backwages are granted for earnings a worker lost due to his illegal
dismissal and an employer is obliged to pay an illegally dismissed the whole amount of salaries plus all other benefits and bonuses and general
increases to which the latter should have been normally had he not been dismissed.”

Economic Components of Backwages

Art. 279 provides that “In cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or
when authorized by this Title.  An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights
and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or monetary equivalent computed from the time
his compensation was withheld from him up to the time of his actual reinstatement.” (See also Art. 245 of LC and Art. XIII, Sec. 3 of the
Constitution)

NOTE:  Backwages also include 13th month pay as well as benefits under the CBA.  Managerial employees are not entitled to such benefits as
they are ineligible to join a labor organization.

Benefits to be considered in computing the backwages:

1.  Fringe benefits or their monetary equivalent (Acesite Corporation vs. NLRC, GR No. 152308, Jan. 26, 2005).

2.   Increases in compensation and other benefits, including 13th  month pay (Food Traders House, Inc. vs. NLRC, GR No. 120677, Dec. 21,
1998).

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3.  Transportation and emergency allowances (Santos vs. NLRC, GR No. 76721, Sept. 21, 1987).

4.  Holiday pay, vacation and sick leaves and service incentive leaves (St. Louise College of Tuguegarao vs. NLRC, GR No. 74214, Aug. 31,
1989; on Service Incentive Leave, see Fernandez vs. NLRC, GR No. 105892, Jn. 28, 1998).

5.  Just share in the service charges (Maranaw Hotels & Resort Corporation vs. NLRC, GR No. 123880, Feb. 23, 1999).

6.  Gasoline, car and representation allowances (Consolidated Rural Bank [Cagayan Valley], Inc. vs. NLRC, GR No. 123810, Jan. 20, 1999, 301
SCRA 223).

NOTE:   In the case of Buhain vs. The Hon. CA, GR No. 143709, July 2, 2002, the period of preventive suspension is included in the
computation of the backwages (reckoning date from the first day the employee was preventively suspended).

Questions to Ponder: 

Among the prerogatives of the employer is the prerogative to select his employees.  Is this prerogative absolute?  Explain.

No.  The exercise of this prerogative is subject to constitutional and statutory limitations.

Among the constitutional restrictions are on the promotion of equality of employment for all (Sec. 3, Article XIII) and on the fundamental equality
before men and women (sec. 14, Article II). 

Among the statutory restrictions are Article 3 of the Labor Code on equal work opportunities, regardless of race, sex, or creed; Article 135 of the
Labor Code prohibiting discrimination against a woman employee solely on account of her sex; Article 21 of the Civil Code on abuse of right;
Republic Act No. 7277 prohibiting discrimination against qualified disabled workers; Republic Act No. 8504 penalizing discrimination in any form
against HIV-positive individuals.

Does promotion of employee automatically entitle him to an increase in his salary?  Explain.

No.   While promotion is usually accompanied by an increase in salary, such increase is dependent upon the employer in the absence of a
contractual stipulation or established company policy.  Promotion may denote an advancement merely in rank without an equivalent increase in
salary.   The matter of salary increases is a management prerogative (National Federation of Labor Unions et. al. Vs. NLRC et. al., GR No.
90739, October 3, 1991).

  

May an employer transfer an employee on the ground that it feels “uncomfortable” with the latter?

No.  This is a grave abuse of the employer’s prerogative to transfer and reassign employees.  This can be a mere subterfuge on the part of an
employer to rid itself of employees (Pocketbell Philippines, Inc. Vs. NLRC et al., GR No. 106843, January 20, 1995).

  

Discuss briefly the employer’s prerogative to transfer and reassign employees.

Well-settled is the rule that it is the prerogative of the employer to transfer and reassign employees for valid reasons and according to the
requirements of its business, provided there is no demotion in rank or diminution of his salary, benefits and other privileges.  And in the case of a
constructive dismissal, the employer has the burden of proving that the transfer and demotion of an employee are for valid and legitimate
grounds and not unreasonable, inconvenient or prejudicial to the employee.  It has been ruled that the transfer of a bank’s foreign remittance
clerk for payment order/collection to foreign remittance clerk for inquiry was a lawful exercise of management prerogative since these positions
were of co-equal footing and co-important and the transfer did not entail any reduction of wages and other benefits (Castillo vs. NLRC et al., GR
No. 104319, June 17, 1999).  

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The transfer of the lady security guard from her post in Makati to Tagaytay, Rizal has been upheld as a valid exercise of management
prerogative where it appears that the same was prompted by the request of the agency’s client for a more disciplined service of the guard’s on
detail, and the renewal of the security contract hinged on the action taken by the agency on the client’s request; this, notwithstanding that the
lady guard lived in Sta. Mesa and now she had to travel to a farther place of work (OSS Security and Allied Services, Inc. Et al vs. NLRC et al
GR No. 122752, February 9, 2000).

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