University of Santo Tomas

FACULTY OF CIVIL LAW (1734)

LABOR LAW AND

SOCIAL LEGISLATION

Questions Asked More Than Once

QuAMTO 2023
 QuAMTO is a compilation of past Bar questions with answers as suggested by
the UPLC and other distinct luminaries in the academe, and updated by the
UST Academics Committee to fit for the 2023 Bar Exams.

Bar questions are arranged per topic in accordance with the Bar Syllabus
released by the Supreme Court and were selected based on their occurrence
on past bar examinations from 1987 to 2022.

Address: Academics Committee

UST Bar Operations
Faculty of Civil Law
University of Santo Tomas
España, Manila 1008

Tel. No: (02) 8731-4027

(02) 8406-1611 loc. 8578

Academics Committee
Faculty of Civil Law
University of Santo Tomas
España, Manila 1008

All rights reserved by the Academics Committee of the Faculty of Civil Law of the Pontifical and Royal
University of Santo Tomas, the Catholic University of the Philippines.

2023 Edition.

No portion of this material may be copied or reproduced in books, pamphlets, outlines or notes,
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Released in the Philippines, 2023.

 Faculty of Civil Law (1734)

ACADEMICS COMMITTEE 2023

ANGELA BEATRICE S. PEÑA KATHERINE S. POLICARPIO

SECRETARIES-GENERAL

RON-SOPHIA NICOLE C. ANTONIO CRIMINAL LAW

HERLENE MAE D. CALILUNG LABOR LAW AND SOCIAL LEGISLATION

POLITICAL LAW AND

PATRISHA LOUISE E. DUMANIL
PUBLIC INTERNATIONAL LAW

LEGAL AND JUDICIAL ETHICS WITH

ALEXANDRA MAUREEN B. GARCIA
PRACTICAL EXERCISES

HANNAH JOY C. IBARRA COMMERCIAL LAW

JEDIDIAH R. PADUA CIVIL LAW

PAULINNE STEPHANY G. SANTIAGO TAXATION LAW

DIANNE MICAH ANGELA D. YUMANG REMEDIAL LAW

EXECUTIVE COMMITTEE

PAULA ANDREA F. PEÑAFLOR COVER DESIGN ARTIST

 Faculty of Civil Law (1734)

LABOR LAW AND SOCIAL LEGISLATION

COMMITTEE 2023

ADRIANNE C. TAMAYO
LABOR LAW AND SOCIAL LEGISLATION
SUBJECT HEAD

MEMBERS
JUFFLIN A. CALALO
NAMNAMA CHANTAL ESPIRITU
JOSE MARI M. LEE
JENILYN B. TOLEDO
SANTIAGO U. VITUG

ADVISERS
COMMISSIONER LEONARD VINZ OCHOA IGNACIO
LABOR ARBITER BENEDICT G. KATO
 Faculty of Civil Law (1734)

FACULTY OF CIVIL LAW

UNIVERSITY OF SANTO TOMAS

ACADEMIC OFFICIALS
ATTY. NILO T. DIVINA REV. FR. ISIDRO C. ABAÑO, O.P.
DEAN REGENT

ATTY. ARTHUR B. CAPILI

FACULTY SECRETARY

ATTY. ELGIN MICHAEL C. PEREZ

LEGAL COUNSEL
UST CHIEF JUSTICE ROBERTO CONCEPCION LEGAL AID CLINIC

JUDGE PHILIP A. AGUINALDO

SWDB COORDINATOR

LENY G. GADIANA, R.G.C.

GUIDANCE COUNSELOR
 Faculty of Civil Law (1734)

OUR DEEPEST APPRECIATION TO OUR

MENTORS AND INSPIRATION
Dean Jacqueline O. Lopez-Kaw, DCL

Dean Salvador A. Poquiz

Commissioner Leonard Vinz Ochoa Ignacio

Labor Arbiter Benedict G. Kato

Atty. Arnold E. Cacho

Atty. Irvin Joseph Fabella

Atty. Ian Jerny E. De Leon

Atty. Roland L. Marquez

Atty. Alwyn Faye B. Mendoza

Atty. Cesar E. Santamaria, Jr.

For being our guideposts in understanding the intricate sphere of

Labor Law and Social Legislation.
– Academics Committee 2023
 UST LAW

DISCLAIMER

THE RISK OF USE OF THIS BAR

REVIEW MATERIAL SHALL BE
BORNE BY THE USER
 QuAMTO (1987-2022)
A: An employer is a person who employs the services of
I. FUNDAMENTAL PRINCIPLES AND CONCEPTS another and pays for their wages and salaries. As such, Art.
XIII, Sec. 3 of the Constitution provides and guarantees
them with the following rights:

1. Reasonable return of investment

A. LEGAL BASIS 2. Expansion
(2009, 2006, 2005, 2000, 1998, 1996, 1994 BAR) 3. Growth

On the other hand, an employee is a person who works

1. 1987 CONSTITUTION under the employ of another in exchange of a valuable
(2009, 2006, 1998, 1996 BAR) consideration in the form of wages, salaries, benefits, etc.
Art. XIII, Sec. 3 of the Constitution similarly provides and
similarly guarantees them the following rights to:
Q: Which is not a constitutional right of the worker?
(2012 BAR)
1. Security of tenure;
2. Receive a living wage;
a. The right to engage in peaceful concerted
3. Humane conditions of work;
activities
4. Just share in the fruits of production;
b. The right to enjoy security of tenure
5. Self-organization;
c. The right to return on investment;
6. Conduct collective bargaining or negotiation with
d. The right to receive a living wage.
management;
7. Engage in peaceful concerted activities including
A: (C) The right to return on investment. (Art. XIII, Sec. 3,
strike; and
Constitution) (UPLC Suggested Answers)
8. Participate in policy and decision-making process.
Q: What are the salient features of the protection to
Q: Explain the extent of the workers’ right to participate
labor provision of the Constitution? (1998 BAR)
in policy and decision-making process as provided
under Art. XIII, Sec. 3 of the Philippine Constitution.
A: The salient features of the Protection to Labor provision
Does, it include membership in the Board of Directors
of the Constitution (Sec. 3, Art. XIII, 1987 Constitution) are
of a corporation? (2008 BAR)
as follows:

A: The workers’ right to participate in policy and decision

• Extent of Protection – Full protection to labor;
making processes of the establishment where they are
employed in so far as said processes affect their rights,
• Coverage of Protection – Local and overseas,
benefits and welfare as embodied in Section 3 of Article XIII
organized and unorganized;
of the Constitution is reiterated in Art. 267 of the Labor
Code where it is provided that for the purpose of
• Employment Policy – Full employment and
implementing such right, workers and employers may form
equality of employment opportunities for all;
labor management councils provided that the
representatives of workers in such labor management
• Guarantees:
councils shall be elected by the majority of all the employees
in said establishment. It is clear from the aforementioned
Unionism and Method of Determination of
Article of the Labor Code that the right of workers to
Conditions of Employment – Right of all workers
participate in policy and decision making processes as
to self-organization, collective bargaining and
provided in Article XIII, Section 3 of the Constitution does
negotiations.
not include membership in the Board of Directors of a
Corporation but this could be the proper subject of a CBA.
Concerted Activities – Right to engage in peaceful
(UPLC Suggested Answers)
concerted activities, including the right to strike in
accordance with law.
Q: What is the principle of codetermination? (2007
BAR)
Working Conditions – Right to security of tenure,
humane conditions of work and a living wage.
A: By the principle of codetermination, the workers have a
right to participate in the decision making process of
Decision Making Processes – Right to participate
employers on matters affecting their rights and benefits,
in policy and decision-making processes affecting
through collective bargaining agreements, grievance
their rights and benefits as may be provided by law.
machineries, voluntary modes of settling disputes and
conciliation proceedings mediated by government. (UPLC
• Share in Fruits of Production – Recognition of Suggested Answers)
right of labor to its just share in fruits of
production. Q: What, if any, is the basis under the Constitution for
adopting the principle of codetermination? (2007 BAR)
Q: What are the rights of an employer and an
employee? (1996 BAR)

1 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
A: The adoption of codetermination is based on the exercise
of police power by the state “to promote, the principle of
shared responsibility between the workers and the
employers.” The Constitution expressly provides that: “It
shall guarantee the rights of all workers to… collective
bargaining and negotiations... 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.” (Art. XIII, Sec. 3, 1987 Constitution)
(UPLC Suggested Answers)
2. CIVIL CODE
(2009, 1998, 1996 BAR)
3. LABOR CODE
(2009, 2006, 2005, 2000, 1998, 1996, 1994 BAR)
Q: In her State of the Nation Address (SONA), the
President stressed the need to provide an investor-
friendly business environment so that the country can
compete in the global economy that now suffers from a
crisis bordering on recession. Responding to the call,
Congress passed two innovative legislative measures,
namely: (1) a law abolishing the security of tenure
clause in the Labor Code; and (2) a law allowing
contractualization in all areas needed in the
employer’s business operations. However, to soften
the impact of these new measures, the law requires
that all employers shall obtain mandatory
unemployment insurance coverage for all their
employees.
The constitutionality of the two (2) laws is challenged
in court. As judge, how will you rule? (2009 BAR)
A: The first innovative measure, regarding abolition of the
security of tenure clause in the Labor Code, is
unconstitutional as it goes against the entitlement of
workers to security of tenure under Sec. 3, Art. XIII of the
1987 Constitution.
The second innovative measure, allowing
contractualization in all areas needed in the employer’s
business operations, is constitutional. There is no
constitutional prohibition against contractualization.
However, the new law cannot prejudice employees who
have acquired security of tenure.
B. STATE POLICY TOWARDS LABOR
(2022, 2020-2021, 2018, 2017, 2014, 2012, 2010,
2009, 2006, 2004, 2003, 2002, 2000, 1999, 1998, 1996
BAR)
1. SECURITY OF TENURE
(2009, 1998, 1996 BAR)
2. SOCIAL JUSTICE
(2009, 2003, 1998, 1996 BAR)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
3. EQUAL WORK OPPORTUNITIES
(1996 BAR)
4. RIGHT TO SELF-ORGANIZATION AND COLLECTIVE
BARGAINING
(2022, 2020-2021, 2018, 2014, 2012, 2010, 2009,
2004, 2003, 2002, 2000, 1999, 1996 BAR)
See page 34 for bar questions on D. Labor Relations
5. CONSTRUCTION IN FAVOR OF LABOR
(2018, 2017, 2012, 2009, 2006, 1998 BAR)
Q: What is the concept of liberal approach in
interpreting the Labor Code and its Implementing
Rules and Regulations in favor of labor? (2006 BAR)
A: The State is bound under the Constitution to afford full
protection to Labor; and when conflicting interests collide
and they are to be weighed on the scales of social justice,
the law should accord more sympathy and compassion to
the less privileged workingman. (Fuentes v. NLRC, G.R. No.
110017, 02 Jan. 1997)
However, it should be borne in mind that social justice
ceases to be an effective instrument for the “equalization of
the social and economic forces” by the State when it is used
to shield wrongdoing. (Corazon Jamer v. NLRC, G.R. No.
112630, 05 Sept. 1997)
Q: Clarito, an employee of Juan, was dismissed for
allegedly stealing Juan’s wristwatch. In the illegal
dismissal case instituted by Clarito, the Labor Arbiter,
citing Article 4 of the Labor Code, ruled in favor of
Clarito upon finding Juan’s testimony doubtful. On
appeal, the NLRC reversed the Labor Arbiter holding
that Art. 4 applies only when the doubt involves
“implementation and interpretation” of the Labor
Code provisions. The NLRC explained that the doubt
may not necessarily be resolved in favor of labor since
this case involves the application of the Rules on
Evidence, not the Labor Code. Is the NLRC correct?
Reasons. (2017, 2009 BAR)
A: NO. The NLRC is not correct. It is a well-settled doctrine
that if doubts exist between the evidence presented by the
employer and the employee, the scale of justice must be
tilted in favor of the latter. It is a time-honored rule that in
controversies between laborer and master, doubts
necessarily arising from the evidence, or in the
implementation of the agreement and writing should be
resolved in favor of the laborer.
ALTERNATIVE ANSWER:
NO. Art. 227 [formerly 221] of the Labor Code clearly
provides that “the rules of evidence prevailing in courts of
law shall not be controlling” in any proceeding before the
NLRC or the Labor Arbiters. Moreover, the NLRC/Labor
Arbiters are mandated to use every and all reasonable
means to ascertain the facts speedily and objectively and
without regard to technicalities of law or procedure, all in
the interest of due process. (2009-2017 UST FCL Bar Q&A)
2
 QuAMTO (1987-2022)
Q: Procopio was dismissed from employment for
stealing his co-employee Raul's watch. Procopio filed a
complaint for illegal dismissal. The Labor Arbiter ruled
in Procopio's favor on the ground that Raul's testimony
was doubtful, and, therefore, the doubt should be
resolved in favor of Procopio. On appeal, the NLRC
reversed the ruling because Art. 4 of the Labor Code -
which states that all doubts in the interpretation and
implementation of the provisions of the Labor Code,
including the implementing rules and regulations, shall
be resolved in favor of labor - applied only when the
doubt involved the "implementation and
interpretation" of the Labor Code; hence, the doubt,
which involved the application of the rules on evidence,
not the Labor Code, could not necessarily be resolved in
favor of Procopio. Was the reversal correct? Explain
your answer. (2017 BAR)
A: NO, the reversal is not correct. It is a time-honored rule
that in controversies between a laborer and his master,
doubts reasonably arising from the evidence, or in the
interpretation of agreement and writings, should be
resolved in the former's favor. (Lepanto Consolidated
Mining Company v. Dumapis, G.R. No. 163210, 13 Aug. 2008)
There appears to be serious doubts in the evidence on
record as to the factual basis of the charges against
Procopio. These doubts should be resolved in his favor in
line with the policy under the Labor Code to afford
protection to labor and construe doubts in favor of labor.
(Asuncion v. NLRC, G.R. No. 129329, 31 July 2001)
6. BURDEN OF PROOF AND QUANTUM OF EVIDENCE
(2012, 2003 BAR)
Q: What is the quantum of evidence required in labor
case? (2012 BAR)
a. The degree of proof which produces the
conclusion that the employee is guilty of the
offense charged in an unprejudiced mind;
b. Such amount of relevant evidence which a
reasonable mind might accept as adequate to
justify a conclusion;
c. That degree of proof which is greater in weight
than the opposing party’s evidence;
d. Such evidence which must be highly and
substantially more probable to be true than not
which convinces the trier of facts of its
factuality.
A: B. Such amount of relevant evidence which a reasonable
mind might accept as adequate to justify a conclusion.
(2009-2017 UST FCL Bar Q&A)
Q: Jose and Pedro were utility workers employed by
Yellow Farms. Inc. On 13 Jan. 1984, they were picked up
by the company's guards in connection with the theft of
polyethylene bags belonging to the company. They
were detained at the Baybay Municipal Jail. Initial
investigation of the police yielded no prima facie case
against them, resulting in their release. However, after
further investigation, an amended complaint was
formally filed against them and two others, charging
them with theft before the Municipal Court. The
Company terminated Jose and Pedro due to loss of
3 U N IV E R S I T Y O F S A N T O T O M A S
confidence. Consequently, the two filed a complaint of
illegal dismissal on the ground that their dismissal
based on the criminal complaint did not justify their
termination.
What is the quantum of proof necessary to terminate an
employee for loss of confidence?
A: The quantum of evidence necessary to terminate an
employee for loss of confidence is substantial evidence.
(2009-2017 UST FCL Bar Q&A)
II. PRE-EMPLOYMENT
A. RECRUITMENT AND PLACEMENT OF LOCAL AND
MIGRANT WORKERS
(2019, 2017, 2015, 2012, 2010, 2006, 2005, 2004,
2002, 1998, 1991 BAR)
1. DEFINITION OF RECRUITMENT AND PLACEMENT
(2015, 2012, 2006, 2005, 2004, 2002, 1998 BAR)
Q: Which phrase is the most accurate to complete the
statement – A private employment agency is any person
or entity engaged in the recruitment and placement of
workers: (2012 BAR)
a. for a fee, which is charged directly from the
workers.
b. for a fee, which is charged directly from
employers.
c. for a fee, which is charged directly or indirectly
from workers, employers or both.
d. for a fee, which is charged from workers or
employers, which covers both local and
overseas employment.
A: (C) for a fee, which is charged directly or indirectly from
workers, employers or both. (Art. 13(c), LC) (UPLC
Suggested Answers)
2. REGULATION OF RECRUITMENT AND PLACEMENT
ACTIVITIES
(2017, 2015, 2012, 2010, 2006, 2005, 2004, 2002,
1998, 1991 BAR)
a) REGULATORY AUTHORITIES
(1) PHILIPPINE OVERSEAS EMPLOYMENT
ADMINISTRATION
(2) REGULATORY AND VISITORIAL POWERS OF THE
DEPARTMENT OF LABOR AND EMPLOYMENT
SECRETARY
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
b) BAN ON DIRECT HIRING 3. ILLEGAL RECRUITMENT
(2017 BAR) Labor Code and the Migrant Workers and Overseas
Employment Act of 1995 (R.A. No. 8042), as amended by
Q: As a rule, direct hiring of migrant workers is not R.A. No. 10022
allowed. What are the exceptions? Explain your (2019, 2017, 2015, 2012, 2010, 2006, 2005, 2002,
answer. (2017 BAR) 1991 BAR)

A: The following are the exceptions to the ban on direct

Q: Rocket Corporation is a domestic corporation
hiring:
registered with the SEC, with 30% of its authorized
capital stock owned by foreigners and 70% of its
1. Direct hiring of Filipinos by the diplomatic corps;
authorized capital stock owned by Filipinos. Is Rocket
2. Direct hiring of Filipinos by foreign governments
Corporation allowed to engage in the recruitment and
or international organizations; and
placement of workers, locally and overseas? Briefly
3. Direct hiring as may be allowed by the Secretary of
state the basis for your answer. (2015 BAR)
Labor and Employment. (Art. 18, LC) (Bar Q&A by
Kato, 2020)
A: NO. Art. 27 of the Labor Code mandates that, for a
Corporation to validly engage in recruitment, and local and
Q: TRUE or FALSE. As a general rule, direct hiring of
overseas placement of workers, at least 75% of its
OFWs is not allowed. (2010 BAR)
authorized and voting capital stock must be owned and
controlled by Filipino citizens. Since only 70% of Rocket
A: TRUE. Art. 15 of the Labor Code provides that no
Corporation’s authorized capital stock is owned by
employer may hire a Filipino worker for overseas
Filipinos, it cannot, as a result, validly engage in
employment except through the Boards and entities
recruitment, and local and overseas placement of workers.
authorized by the DOLE except direct-hiring by members of
(2009-2017 UST FCL Bar Q&A)
the diplomatic corps, international organizations and such
other employers as may be allowed by the DOLE.
Q: A was approached for possible overseas deployment
to Dubai by X, an interviewer of job applicants for Alpha
Another exception is ‘‘Name Hire,” which refers to a worker
Personnel Services, Inc., an overseas recruitment
who is able to secure an overseas employment opportunity
agency. X required A to submit certain documents
with an employer without the assistance or participation of
(passport, NBI clearance, medical certificate) and to
any agency. (2009-2017 UST FCL Bar Q&A)
pay P25,000 as processing fee. Upon payment of the
said amount to the agency cashier, A was advised to
c) ENTITIES PROHIBITED FROM RECRUITING
wait for his visa. After five months, A visited the office
of Alpha Personnel Services, Inc. during which X told
d) SUSPENSION OR CANCELLATION OF LICENSE OR
him that he could no longer be employed for
AUTHORITY
employment abroad.
(2012 BAR)

A was informed by the POEA that while Alpha

Q: The power to suspend or cancel a license to recruit
Personnel Services, Inc. was a licensed agency, X was
employees is vested on: (2012 BAR)
not registered as its employee, contrary to POEA Rules
a. The Secretary of Labor and Employment;
and Regulations. Under POEA Rules and Regulations,
b. The POEA Administrator;
the obligation to register personnel with the POEA
c. A and B 'concurrently;
belongs to the officers of a recruitment agency. (2010
d. Neither of them.
BAR)

A: B. The POEA Administrator. (UPLC Suggested Answers)

(a) May X be held criminally liable for illegal
recruitment? Explain.
ALTERNATIVE ANSWERS:

A: NO. X performed his work with the knowledge that he

C. A and B concurrently. (Transaction Overseas Corp. v. Sec.
works for a licensed recruitment agency. The obligation to
of Labor, G.R. No. 109583, 05 Sept. 1997) (UPLC Suggested
register its personnel with the POEA belongs to the officers
Answers)
of the agency. He is in no position to know that the officers
of said recruitment agency failed to register him as its
e) PROHIBITED PRACTICES (Art. 34, LC)
personnel. (People v. Chowdury, G.R. No. 129577-80, 15 Feb.
2000)

(b) May the officers having control, management

or direction of Alpha Personnel Services, Inc. be
held criminally liable for illegal recruitment?
Explain.

A: YES. Sec. 6 of R.A. No. 8042, as amended, provides that in

case of juridical persons, the officers having ownership,
control, management or direction of their businesses who
are responsible for the commission of the offense shall be

U N IV E R S I T Y O F S A N T O T O M A S 4
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
criminally liable therefor. Relevantly, failure to reimburse
the 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, amounts to illegal recruitment
under Sec. 6(m) of the law. (2009-2017 UST FCL Bar Q&A)
Q: Wonder Travel and Tours Agency (WTTA) is a well-
known travel agency and an authorized sales agent of
the Philippine Air Lines. Since majority of its
passengers are overseas workers, WTTA applied for a
license for recruitment and placement activities. It
stated in its application that its purpose is not for profit
but to help Filipinos find employment abroad. Should
the application be approved? (2006 BAR)
A: NO. The application should be disapproved. The law
clearly states that 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. (Art. 26, LC)
In the present case, it is clear that WTTA is the authorized
sales agency of PAL; and as such, falls within the prohibition
of Art. 26. Art. 26 provides for an absolute prohibition and
does not place any merit on the intention of the applicant.
Q: Maryrose Ganda's application for the renewal of her
license to recruit workers for overseas employment
was still pending with the Philippine Overseas
Employment Administration (POEA). Nevertheless, she
recruited Alma and her three sisters, Ana, Joan and
Mavic, for employment as housemaids in Saudi Arabia.
Maryrose represented to the sisters that she had a
license to recruit workers for overseas employment.
Maryrose also demanded and received P30,000.00
from each of them for her services. However,
Maryrose's application for the renewal of her license
was denied, and consequently failed to employ the four
sisters in Saudi Arabia.
The sisters charged Maryrose with large scale illegal
recruitment. Testifying in her defense, Maryrose
declared that she acted in good faith because she
believed that her application for the renewal of her
license would be approved. Maryrose adduced in
evidence the Affidavits of Desistance which the four
private complainants had executed after the
prosecution rested its case. In the said affidavits, they
acknowledged receipt of the refund by Maryrose of the
total amount of P120,000,00 and indicated that they
were no longer interested to pursue the case against
Maryrose. Resolve the case with reasons. (2005 BAR)
A: Maryrose is still criminally liable for large scale illegal
recruitment. Good faith is not a defense in illegal
recruitment as defined in Sec. 6 of R.A. 8042. Illegal
recruitment is malum prohibitum.
Refund of the P120,000.00 she received does not likewise
extinguish her criminal liability. If at all, it satisfies only her
civil liability. The affidavit of desistance, moreover, does not
bar Maryrose's prosecution. The criminal offense
is not extinguished by such desistance. Besides, affidavit of
desistance, as a rule, is frowned upon.
5 U N IV E R S I T Y O F S A N T O T O M A S
Q: Marino Palpak, Eddie Angeles and Jose Berdugo
advertised in the Manila Bulletin the following
information: “20 Teachers wanted for Egypt. Apply at
No. 123 Langit, Manila." Salvacion Inocente applied and
was made to pay minimal fees to cover administrative
expenses and the cost of her passport and visa. For one
reason or another, Salvacion did not get the job and
filed a complaint with the POEA.
Marino, Eddie and Jose admitted having no license or
authority but claimed that they are not covered by the
Labor Code since they are not engaged in the
recruitment and placement for profit and, at any rate,
only one prospective worker was involved. May Marino,
Eddie and Jose be prosecuted? If so, for what specific
offense/s? (1991 BAR)
A: YES. Marino, Eddie and Jose can be prosecuted.
Recruitment and placement by persons without a license or
authority constitute illegal activities. Marino, Eddie and Jose
were engaged in recruitment and placement when they
advertised that 20 teachers were wanted to Egypt.
Advertising for employment is one of the acts considered as
recruitment and placement in the Labor Code.
That they were not engaged in recruitment and placement
for profit does not mean that the conditions for a person to
engage in recruitment and placement found in the Labor
Code are not applicable to them. The Code applies to any
recruitment or placement, whether for profit or not.
The fact that only one prospective worker was involved
does not mean that they were not engaged in recruitment
or placement. They were. The reference in the Code that any
person who offers employment to “two or more persons” as
being engaged in recruitment and placement does not mean
that there must be at least two persons involved. This
reference is merely evidentiary.
They may be prosecuted for these specific offenses. They
already charged fees even if they have not yet obtained
employment for the applicant. (2009-2017 UST FCL Bar
Q&A)
a) ELEMENTS
b) TYPES
(2015, 2007, 2002 BAR)
Q: When is illegal recruitment considered a crime of
economic sabotage? Explain briefly. (2015, 2007, 2002
BAR)
A: According to Art. 28 of the Labor Code, illegal
recruitment is considered a crime of economic sabotage
when committed by a syndicate or in large scale.
Illegal recruitment is deemed committed by a
syndicate if carried out by a group of 3 or more persons
conspiring and/or confederating with one another in
carrying out any unlawful or illegal transaction, enterprise
or scheme which is an act of illegal recruitment.
Illegal recruitment is deemed committed in large scale if
committed against 3 or more persons individually or as a
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
group. (2009-2017 UST FCL Bar Q&A)
Q: Discuss the types of illegal recruitment under the
Labor Code. (2007 BAR)
A: Under the Labor Code, as amended by Republic Act No.
8042 otherwise known as the “Overseas Filipinos and
Migrant workers Act of 1995”, there are two types of illegal
recruitment, particularly simple illegal recruitment and
illegal recruitment which is considered as an offense
involving economic sabotage. Illegal recruitment as an
offense involving economic sabotage is committed under
the following qualifying circumstances, to wit:
A. When illegal recruitment is committed by a syndicate,
that is when it is carried out by a group of three (3) or
more persons conspiring and/or confederating with
one another; or
B. When illegal recruitment is committed in large scale,
that is when it is committed against three (3) or more
persons whether individually or as a group.
c) ILLEGAL RECRUITMENT vs. ESTAFA
4. LIABILITY OF LOCAL RECRUITMENT AGENCY AND
FOREIGN EMPLOYER
(2019, 2017, 2012, 2010, 2004, 1997 BAR)
a) SOLIDARY LIABILITY
(2019, 2017, 2012, 2010, 1997 BAR)
Q: Mr. A signed a one (1)-year contract with XYZ
Recruitment Co. for deployment as welding supervisor
for DEF, Inc. located in Dubai. The employment
contract, which the Philippine Overseas Employment
Administration (POEA) approved, stipulated a salary of
US$600.00 a month. Mr. A had only been in his job in
Dubai for six (6) months when DEF, Inc. announced that
it was suffering from severe financial losses and thus
intended to retrench some of its workers, among them
Mr. A. DEF, Inc. hinted, however, that employees who
would accept a lower salary could be retained.
Together with some other Filipino workers, Mr. A
agreed to a reduced salary of US$400.00 a month and
thus, continued with his employment.
Assuming that the reduction was invalid, may Mr. A
hold XYZ recruitment Co. liable for underpayment of
wages? Explain. (2019 BAR)
A: YES, Mr. A. may hold XYZ Recruitment Co. liable for the
payment of his wages under the rule that a recruiter is
solidarily liable for breach of the terms and conditions of
the POEA-approved employment contract. (Sec.1(f), Rule II,
Book 11, POEA Rules and Regulations; Datuman v. First
Cosmopolitan Manpower and Promotion Services, Inc., G.R.
156029, 14 Nov. 2008; UPLC Suggested Answers)
Q: Andrew Manning Agency (AMA) recruited Feliciano
for employment by Invictus Shipping, its foreign
principal. Meantime, AMA and Invictus Shipping
terminated their agency agreement. Upon his
repatriation following his premature termination,
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Feliciano claimed from AMA and Invictus Shipping the
payment of his salaries and benefits for the unserved
portion of the contract. AMA denied liability
on the ground that it no longer had an agency
agreement with Invictus Shipping. Is AMA correct?
Explain your answer. (2017 BAR)
A: NO. AMA is not correct. Under Sec. 10 of R.A. No. 8042,
the solidary liability of the principal and the recruitment
agency exists for the whole duration of the employment
contract and shall not be affected by any substitution,
amendment or modification made locally or in a foreign
country. Here, AMA recruited Feliciano for employment by
Invictus Shipping.
Hence, AMA remains solidary liable with Invictus for any
breach of Feliciano’s employment contract, even if AMA and
Invictus had already terminated their agency contract.
Q: What is the nature of the liabilities of the local
recruitment agency and its foreign principal?
a. The local agency is jointly liable with the
foreign principal; severance of relations
between the local agent and the foreign
principal dissolves the liability of the local
agent recruiter;
b. Local agency is solidarily liable with the foreign
principal; severance of relations between the
local agent and the foreign principal dissolves
the liability of the foreign principal, only;
c. Local agency is solidarily liable with the foreign
principal; severance of relations between the
local agent and foreign principal does not affect
the liability of the foreign principal;
d. Local agency is jointly liable with the foreign
principal; severance of the relations between
the local agent and the foreign principal does
not affect the liability of the local recruiter.
(2012 BAR)
A: C. Local agency is solidarily liable with the foreign
principal; severance of relations between the local agent
and foreign principal does not affect the liability of the
foreign principal. (Sec. 10(2), R.A. No. 8042; 2009-2017 UST
FCL Bar Q&A)
Q: A was approached for possible overseas deployment
to Dubai by X, an interviewer of job applicants for Alpha
Personnel Services, Inc., an overseas recruitment
agency. X required A to submit certain documents
(passport, NBI clearance, medical certificate) and to
pay P25,000 as processing fee. Upon payment of the
said amount to the agency cashier, A was advised to
wait for his visa. After five months, A visited the office
of Alpha Personnel Services, Inc. during which X told
him that he could no longer be deployed for
employment abroad. A was informed by the POEA that
while Alpha Personnel Sendees, Inc. was a licensed
agency, X was not registered as its employee, contrary
to POEA Rules and Regulations. Under POEA Rules and
Regulations, the obligation to register personnel with
the POEA belongs to the officers of a recruitment
agency. (2010 BAR)
6
 QuAMTO (1987-2022)
(a) May X be held criminally liable for illegal 5. TERMINATION OF CONTRACT OF MIGRANT
recruitment? WORKER
(2017, 2004 BAR)
A: NO. X performed his work with the knowledge that he
works for a licensed recruitment agency. He is in no
Q: Phil, a resident alien, sought employment in the
position to know that the officers of said recruitment
Philippines. The employer, noticing that Phil was a
agency failed to register him as its personnel (People v.
foreigner, demanded that he first secures an
Chowdury, G.R. No. 129577-80, 15 Feb. 2000) The fault not
employment permit from the DOLE. Is the employer
being attributable to him, he may be considered to have
correct? Explain your answer. (2017 BAR)
apparent authority to represent Alpha on recruitment for
overseas employment.
A: NO, the employer is not correct. Only non-resident aliens
seeking admission to the Philippines are required to obtain
(b) May the officers having control, management
an employment permit from the DOLE. (Art. 40, LC)
or direction of Alpha Personnel Services, Inc.
be held criminally liable for illegal
ALTERNATIVE ANSWER: The employer is not correct.
recruitment?
Under DOLE D.O. No. 75-06, resident foreign nationals are
exempted from securing an employment permit.
A: YES. Sec. 6 of R.A. No. 8042, as amended, provides that in
case of juridical persons, the officers having ownership,
control, management or direction of their businesses who
are responsible for the commission of the offense shall be B. EMPLOYMENT OF NON-RESIDENT ALIENS
criminally liable therefor. Relevantly, failure to reimburse
the 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 C. DISCRIMINATORY PRACTICES
without the worker’s fault, amounts to illegal recruitment (2017, 2011, 1998, 1997, 1995 BAR)
under Section 6(m) of the law. (2009-2017 UST FCL Bar
Q&A)

Q: A was recruited to work abroad by Speedy 1. AGE

Recruitment Agency as a technician for a Saudi Arabian R.A. No. 10911 or the Anti-Age Discrimination in
construction firm, with a monthly salary of $650.00. Employment Act
When she got to the construction site, the employer (1998 BAR)
compelled her to sign another contract that referred
her to another employer for a salary of $350.00. She 2. GENDER AND/OR MARITAL STATUS
worked for the second employer and was paid $350.00 R.A. No. 9710 or the Magna Carta of Women
until her two-year contract expired. Upon her return to (2017, 1997, 1995 BAR)
the Philippines, she filed a case against the agency and
the two employers. May the agency validly raise the
defense that it was not privy to the transfer of A to the 3. HEALTH CONDITION
second employer? Explain. (2010 BAR) R.A. No 7277 or the Magna Carta for Disabled Persons

A: NO. Speedy’s obligation to A is joint and several with the
principal employer. (Sec. 10, R.A. No. 8042)
The liability of the principal/employer and the
recruitment/placement agency for any and all claims for
money claims shall be joint and several, which undertaking
shall form part of A’s employment contract, and condition
precedent for its approval. This liability shall continue
during the entire period or duration of the employment
contract and shall not be affected by any substitution,
amendment or modification made locally or in a foreign
country of said contract. (Sec. 10, R.A. No. 8042; 2009-2017
UST FCL Bar Q&A)
b) THEORY OF IMPUTED KNOWLEDGE
4. SOLO PARENTS
Sec. 7, R.A. No. 8972, as amended by R.A. No. 11861
(2011 BAR)
Q: Of the four definitions below, which one does NOT fit
the definition of “solo parent” under the Solo Parents
Welfare Act? (2011 BAR)
(A) Solo parenthood while the other parent serves
sentence for at least one year.
(B) A woman who gives birth as a result of rape.
(C) Solo parenthood due to death of spouse.
(D) Solo parenthood where the spouse left for
abroad and fails to give support for more than a
year

A: D. (2009-2017 UST FCL Bar Q&A)

7 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
1. DISCIPLINE
III. EMPLOYMENT PROPER (1994 BAR)

Q: Bulacan Medical Hospital (BMH) entered into a CBA

with its Union, wherein it is expressly stipulated in the
A. MANAGEMENT PREROGATIVE Management Prerogative Clause that BMH shall, in the
(2022, 2018, 2017, 2015, 2014, 2012, 2010, 2003, exercise of its management prerogatives, have the sole
2002, 1999, 1998, 1995, 1994, 1991 BAR) and exclusive right to promulgate, amend and modify
rules and regulations for the employees within the
bargaining unit. A year after the contract was signed,
BMH issued its Revised Rules and Regulations and
Q: Which takes precedence in conflicts arising between
furnished a copy thereof to the Union for
the employer’s management prerogative and the
dissemination to all employees covered by the CBA.
employee’s right to security of tenure? Why? (1993
The Union wrote BMH demanding that the Revised
BAR)
Rules and Regulations be first discussed with them
before its implementation. BMH refused. So, the Union
A: The employee's right to security of tenure takes
filed an action for unfair labor practice (ULP) against
precedence over the employer's management prerogative.
BMH. (1994 BAR)
Thus, an employer's management prerogative includes the
right to terminate the services of an employee, but this
(a) Is the Union correct?
management prerogative is limited by the Labor Code,
which provides that the employer can terminate an
A: YES. The Union is correct. A provision in the collective
employee only for a just cause or when authorized by law.
bargaining agreement concerning management
This limitation on management prerogative is because no
prerogatives may not be interpreted as a cession of the
less than the Constitution recognizes and guarantees an
employees’ right to participate in the deliberation of
employee’s right to security of tenure. (Art. 279 [now 294],
matters which may affect their right and the formulation of
LC; Sec. 3, Art. XIII, 1987 Constitution)
policies relative thereto, such as the formulation of a code
of discipline.
Q: Harbor View Hotel has an existing CBA with the
union of rank-and-file employees consisting, among
A line must be drawn between management prerogatives
others, of bartenders, waiters, room boys, housemen,
regarding business operations per se and those which
and stewards. During the lifetime of the CBA, Harbor
affect the rights of the employees, and in treating the latter,
View Hotel, for reasons of economy and efficiency,
management should see to it that its employees are at least
decided to abolish the position of housemen and
properly informed of its decisions or modes of action.
stewards who do the cleaning of the hotel’s public
areas. Over the protest of the Union, the Hotel
The attainment of a harmonious labor-management
contracted out the aforementioned job to the City
relationship and the existing state policy of enlightening
Service Janitorial Company, a bona fide independent
workers concerning their rights as employees demand no
contractor which has a substantial capital in the form of
less than the observance of transparency in managerial
janitorial tools, equipment, machineries and
moves affecting employees’ rights. (Philippine Airlines. Inc.
competent manpower. Is the action of the Harbor View
v. National Labor Relations Commission, et al., G.R. No.
Hotel legal and valid? (1994 BAR)
85985, 13 Aug. 1993; 2009-2017 UST FCL Bar Q&A)

A: The action of Harbor View Hotel is legal and valid. The

ALTERNATIVE ANSWER:
valid exercise of management prerogative, discretion, and
judgment encompasses all aspects of employment,
The Union is correct. Workers have the right to participate
including the hiring, work assignments, working methods,
in policy and decision-making processes affecting their
time, place and manner of work, tools to be used, processes
rights, benefits, and welfare. (Art. 255, LC)
to be followed, supervision of workers, working
regulations, transfer of employees, work supervision, lay-
ALTERNATIVE ANSWER:
off of workers, and the discipline, dismissal, and recall of
workers, except as provided for, or limited by special laws.
The Union is correct in asking for a discussion of the
revised rules prior to their effectivity. The reason is Art.
Company policies and regulations, unless shown to be
XIII. Sec. 3 of the 1987 Constitution allows workers the
grossly oppressive or contrary to law, are generally binding
right to participate in policy and decision-making on
and valid on the parties and must be complied with until
matters related to their welfare and benefits.
finally revised or amended unilaterally or preferably
through negotiation or by a competent authority. (San
The Union's remedy, however should not be to file a ULP
Miguel Corporation v. Reynaldo Ubaldo and Emmanuel Noel
case but to initiate a GRIEVANCE proceeding and if
Cruz, Chairman and Member respectively of the Voluntary
unresolved, submit the matter to voluntary arbitration.
Arbitration Panel, et al., G.R. No. 92859, 01 Feb. 1993)

(b) Assuming that the CBA was signed or executed

before the 1987 Constitution was ratified,
would your answer to the preceding question
be different?

U N IV E R S I T Y O F S A N T O T O M A S 8
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
A: The answer would be the same even if the CBA were
signed or executed before the ratification of the 1987
Constitution because it has always been the policy of the
State to promote the enlightenment of workers concerning
their rights and obligations as employees. (Art. 211, LC; PAL
v. NLRC, G.R. No. 85985. 13 Aug. 1993; 2009-2017 UST FCL
Bar Q&A)
2. TRANSFER OF EMPLOYEES
(2018, 2015, 2014, 2012, 1999 BAR)
Q: Northeast Airlines sent notices of transfer, without
diminution in salary or rank, to 50 ground crew
personnel who were front-liners at Northeast Airlines
counters at the Ninoy Aquino International Airport
(NAIA). The 50 employees were informed that they
would be distributed to various airports in Mindanao to
anticipate robust passenger volume growth in the area.
North Union, representing rank-and-file employees,
filed unfair labor practice and illegal dismissal cases
before the NLRC, citing, among others, the
inconvenience of the 50 concerned employees and
union discrimination, as 8 of the 50 concerned ground
crew personnel were union officers. Also, the Union
argued that Northeast Airlines could easily hire
additional employees from Mindanao to boost its
ground operations in the Mindanao airports. (2018
BAR)
(a) Will the transfer of the 50 ground crew
personnel amount to illegal dismissal?
A: YES. The transfer of an employee is an exercise of a
managerial prerogative, which must be exercised without
grave abuse of discretion, bearing in mind the basic
elements of justice and fair play. Such transfer cannot be
used as a subterfuge by the employer to rid itself of an
undesirable worker.
In particular, the employer must be able to show that the
transfer is not undesirable, inconvenient, or prejudicial to
the employee; nor does it involve a demotion in rank or a
diminution of his salaries, privileges, and other benefits.
Should the employer fail to overcome this burden of proof,
the employee’s transfer shall be tantamount to constructive
dismissal, which exists when an act of clear discrimination,
insensibility, or disdain by an employer has become so
unbearable to the employee, leaving him with no option but
to forego with his continued employment. (Best Wear
Garments v. De Lemos, G.R. No. 191281, Dec. 5, 2012)
In the present case, the impending transfer of 50 employees
based in Luzon to Mindanao, allegedly borne out of business
necessity, is unreasonable and inconvenient to the
concerned employees and their families. It was also not
shown if Northeast Airlines looked into the option of hiring
workers from Mindanao to run its counters in the Mindanao
airports.
(b) Will the unfair labor practice case prosper?
9 U N IV E R S I T Y O F S A N T O T O M A S
A: NO. In ascertaining whether Northeast Airlines’
proposed transfer amounted to an unfair labor practice or
interference with, restraint, or coercion of the employees’
exercise of their right to self-organization, the “totality of
conduct doctrine” test should be applied. (Insular Life
Assurance Co., Ltd. Employees Association-NATU v. Insular
Life Assurance Co., Ltd., G.R. No. L-25291, 30 Jan. 1971)
A finding of an unfair labor practice should not be based on
a single act in isolation but should be viewed on the basis of
the employer’s acts outside of the bigger context of the
accompanying labor relation situation. In the case at hand,
Northeast Airlines’ act of transferring the 50 employees,
while it may amount to constructive dismissals, cannot
translate into an unfair labor practice, absent any other
indicia of anti-union bias on the part of the Company.
Q: Din Din is a single mother with one child. She is
employed as a sales executive at a prominent
supermarket. She and her child live in Quezon City and
her residence and workplace are a 15-minute drive
apart.
One day, Din Din is informed by her boss that she is
being promoted to a managerial position, but she is
now being transferred to the Visayas. Din Din does not
want to uproot her family and refuses the offer. Her
boss is so humiliated by Din Din's refusal of the offer
that she gives Din Din successive unsatisfactory
evaluations that result in Din Din being removed from
the supermarket. Din Din approaches you, as counsel,
for legal advice. What would you advise her? (2015
BAR)
A: I will advise Din Din to sue her boss and the supermarket
for illegal dismissal. Din Din cannot be compelled to accept
the promotion. Her unsatisfactory evaluations, as well as
her boss’ insistence that she should agree to the intended
transfer to Visayas, are badges of an abuse of management
prerogative. In Pfizer Inc. v. Velasco (G.R. No. 177467, 9 Mar.
2011), the Supreme Court held that the managerial
prerogative to transfer personnel must be exercised
without abuse of discretion, bearing in mind the basic
elements of justice and fair play. Hence, Din Din’s dismissal
is illegal. (2009-2017 UST FCL Bar Q&A)
3. PRODUCTIVITY STANDARD
(2010, 1994 BAR)
Q: Union “X” is the majority union of the rank and file
employees at Slipper Mart Company. It amended its by-
laws to include among the obligations of its members
“to refuse to work with non-union members.” Slipper
Mart wants the amendment to be declared null and
void, considering that not all its rank-and-file
employees belong to Union “X” and its enforcement will
cause work stoppage in the company. Give your opinion
on the validity of the amendment.
A: The provision of the by-laws of the union that made it
among the obligations of its members ‘‘to refuse to work
with non-union members” cannot be implemented at the
Slipper Mart Company. It is management’s prerogative to
determine who shall work together in a company. (2009-
2017 UST FCL Bar Q&A)
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
ALTERNATIVE ANSWER:
The act is an unfair labor practice on the part of the union
because it could have the effect of forcing the employer to
compel its employees to join Union “X,” thus, in effect
restraining or coercing employees in the exercise of their
right to self-organization. (2009-2017 UST FCL Bar Q&A)
4. BONUS
(2015, 2014, 2003, 2002, 1995 BAR)
Q: What is a bonus? When is it demandable as a matter
of right? Explain. (1995 BAR)
A: A bonus is money given in addition to an employee’s
usual compensation.
It may be given as a gratuity, as an act of liberality. But a
bonus is demandable as a matter of right if it is made a legal
obligation by law or in a collective bargaining agreement or
in a contract of employment or by its having been given for
such a long time that the receipt of a bonus has ripened into
a right.
ALTERNATIVE ANSWER:
she objected. Is Katrina's objection justified? Explain.
(2015 BAR)
A: Katrina’s objection is justified. Having enjoyed the
across-the-board bonuses, Katrina has earned a vested
right. Hence, none of them can be withheld or reduced. In
the problem, the company has not proven its alleged losses
to be substantial. Permitting a reduction of pay at the
slightest indication of losses is contrary to the policy of the
State to afford full protection to labor and promote full
employment. (Linton Commercial Co. v. Hellera, G.R. No.
163147, 10 0ct. 2007)
As to the withheld productivity-based bonuses, Katrina is
deemed to have earned them because of her excellent
performance ratings for three quarters. On this basis, they
cannot be withheld without violating the Principle of Non-
Diminution of Benefits.
Moreover, it is evident from the facts of the case that what
was withdrawn by FEB was a productivity bonus. Protected
by R.A. 6791 which mandates that the monetary value of the
productivity improvement be shared with the employees,
the “productivity-based incentive” scheme of FEB cannot
just be withdrawn without the consent of its affected
employees. (2009-2017 UST FCL Bar Q&A)

A bonus is an amount granted and paid to an employee for

Q: Lito was anticipating the bonus he would receive for
his industry and loyalty, which contributed to the
2013. Aside from the 13th month pay, the company has
employer's success and realization of profit.
been awarding him and his other co-employees a two to
three months bonus for the last 10 years. However,
1. Grant of bonus is a prerogative, not an obligation of
because of poor overall sales performance for the year,
the employer; and
the company unilaterally decided to pay only a one
2. It is entirely dependent on the employer's capacity
month bonus in 2013. Is Lito’s employer legally allowed
to pay.
to reduce the bonus? (2014 BAR)
Q: Far East Bank (FEB) is one of the leading banks in the
A: YES. A bonus is an act of generosity granted by an
country. Its compensation and bonus packages are top
enlightened employer to spur the employee to greater
of the industry. For the last 6 years, FEB had been
efforts for the success of the business and the realization of
providing the following bonuses across-the-board to all
bigger profits. The granting of a bonus is a management
its employees:
prerogative, something given in addition to what is
ordinarily received by or strictly due to the recipient. Thus,
a. 13th month pay;
a bonus is not a demandable and enforceable obligation,
b. 14th to 18th month pay;
except when it is made part of the wage, salary, or
c. Christmas basket worth P6,000;
compensation of the employee. It may, therefore, be
d. Gift check worth P4,000; and
withdrawn unless they have been made a part of the wage
e. Productivity-based incentive ranging
or salary or compensation of the employees, a matter which
from a 20% to 40% increase in gross monthly
is not in the facts of the case. (American Wire and Cable Daily
salary for all employees who would receive an
Rated Employees Union v. American Wire and Cable Co., Inc.
evaluation of "Excellent" for 3 straight quarters
and the Court of Appeals, G.R. No. 155059, 29 Apr. 2005)
in the same year.

Q: The projected bonus for the employees of Suerte Co.

Because of its poor performance overall, FEB decided to
was 50% of their monthly compensation.
cut back on the bonuses this year and limited itself to
Unfortunately, due to the slump in the business, the
the following:
president reduced the bonus to 5% of their
compensation. Can the company unilaterally reduce the
a. 13th month pay;
amount of bonus? Explain briefly. (2002 BAR)
b. 14th month pay;
c. Christmas basket worth P4,000; and
A: YES. The granting of a bonus is a management
d. Gift check worth P2,000.
prerogative, something given in addition to what is
ordinarily received by or strictly due the recipient. An
Katrina, an employee of FEB, who had gotten a rating of
employer, like Suerte Co., cannot be forced to distribute
"Excellent" for the last 3 quarters was looking forward
bonuses when it can no longer afford to pay. To hold
to the bonuses plus the productivity incentive bonus.
otherwise would be to penalize the employer for his past
After learning that FEB had modified the bonus scheme,

U N IV E R S I T Y O F S A N T O T O M A S 10
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
generosity. (Producers Bank of the Phil. v. NLRC, G.R. No. Q: Trixie is a scientist/researcher in the academe,
100701, 28 Mar. 2001; 2009-2017 UST FCL Bar Q&A) specializing in vaccine research, particularly
messenger ribonucleic acid (mRNA) technology. At the
5. CHANGE OF WORKING HOURS start of the pandemic in 2020, Trixie was hired by AZ
(2015 BAR) Corp. to help formulate and produce a vaccine against
COVID-19. The employment contract provides:

6. BONA FIDE OCCUPATIONAL QUALIFICATIONS
(2019, 2012, 1995 BAR)
Q: Define bona fide occupational qualifications (2019
BAR)
A: A bona fide occupational qualification (BFOQ) is an
occupational requirement based on quality or attribute. It
is valid if it serves a legitimate business purpose, it is work-
related, and its possession enhances an employee's
productivity at work. (Star Paper Corp., et al. v. Simbol, et
al., G.R. No. 164774, 12 April 2006) (Central Bar Q&A by
Kato, 2023)
7. MARRIAGE BETWEEN EMPLOYEES OF COMPETITOR-
EMPLOYERS
(2017, 2012, 2010, 1998, 1995, 1991 BAR)
Q: A was working as a medical representative of RX
pharmaceutical company when he met and fell in love
with B, a marketing strategist for Delta Drug Company,
a competitor of RC. On several occasions, the
management of RX called A’s attention to the
stipulation in his employment contract that requires
him to disclose any relationship by consanguinity or
affinity with co-employees or employees of competing
companies in light of a possible conflict of interest. A
seeks your advice on the validity of the company policy.
What would be your advice? (2010 BAR)
A: I would advise A that the company policy is valid. because
it serves a legitimate business purpose, viz., the protection
of his employer against unfair competition. Therefore, he
should consider the possibility of losing his job if he decides
to marry B. (Central Bar Q&A by Kato, 2023)
“You shall not work for whatsoever capacity, either as an
employee, agent, or consultant with any person,
anywhere in the Philippines, whose business is in direct
and indirect competition with the company during the
period of this contract, and for a period of 10 years from
date of resignation or separation from the company.
Violation of this stipulation shall make you liable for
liquidated damages in the amount of Php 5,000,000.00.”
Trixie was able to successfully produce the vaccine and
for which AZ Corp. paid her Php 50,000,000.00.
Thereafter, Trixie resigned from AZ Corp. and returned
to her work in the academe. AZ Corp. filed a complaint
for damages in the amount of Php 5,000,000.00 against
Trixie for violation of the above stipulation in her
contract.
If you were the judge, rule on the validity of the
stipulation. Explain briefly. (2022 BAR)
A: If I were the judge, I would rule against the validity of the
stipulation. The non-compete clause is void for being
contrary to public policy as the same is unreasonably
excessive as to both its temporal and spatial restrictions. As
to time, 10 years is unreasonable as it has the effect of
depriving Trixie of livelihood for too long a time as to drive
her to penury. (Ferrazzini v. Gsell, G.R. No. L-10712, 10 Aug.
1916) As to space, it requires Trixie to get out of the
Philippines to be able to get gainfully employed. (Tiu v.
Platinum Plans Phils., Inc., G.R. 163512, 28 Feb. 2007) At any
rate, Trixie did not violate her undertaking because she did
not join a competitor company in any capacity. The
academe is not a business enterprise, much less engaged in
the production and trading of vaccine. (Central Bar Q&A by
Kato, 2023)

8. POST-EMPLOYMENT RESTRICTIONS
(2022, 2012, 2009 BAR)

Q: TRUE or FALSE. Answer TRUE if the statement is true,

or FALSE if the statement is false. Explain your answer
in not more than two (2) sentences.

An employment contract prohibiting employment in a

competing company within one year from separation is
valid. (2009 BAR)

A: TRUE. An employment contract prohibiting employment

in a competing company within a reasonable period of one
year from separation is valid. The employer has the right to
guard its trade secrets, manufacturing formulas, marketing
strategies, and other confidential programs and
information. (2009-2017 UST FCL Bar Q&A)

11 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
B. LABOR STANDARDS
(2022, 2020-21, 2019, 2018, 2017, 2016, 2015, 2014,
2013, 2012, 2011, 2010, 2009, 2007, 2005, 2004, 2003,
2002, 1998, 1997, 1994, 1987 BAR)
1. CONDITIONS OF EMPLOYMENT
(2022, 2018, 2017, 2015, 2012, 2010, 2009, 2005,
2004, 2003, 2002, 1998, 1997, 1994, 1992, 1987 BAR)
a) COVERAGE
b) HOURS OF WORK
(2022, 2017, 2015, 2010, 2009, 2005, 2004, 2003,
2002, 1998, 1997, 1987 BAR)
Q: Gil Bates, a computer analyst and programmer of
Hard Drive Company, works eight hours a day for five
days a week at the main office providing customers
information technology assistance. On Saturdays,
however, the company requires him to keep his cellular
phone open from 8:00 A.M. to 5:00 P.M. so that the
Management could contact him in case of heavy work
load or emergency problems needing his expertise.
May said hours on Saturdays be considered
compensable working hours “while on call”? If so,
should said compensation be reported to the Social
Security System (2004 BAR)
A: YES. Said hours on Saturdays should be considered as
compensable working hours "while on call". Under the
Rules and Regulations Implementing the Labor Code, an
employee who is not required to leave word at his home or
with company officials as to where he may be reached is not
working while on call. But in the question, Gil Bates was
required to keep his cell phone open from 8:00 A.M. to 5:00
P.M. Therefore, Bates should be considered as working
while on call if he cannot use effectively and gainfully for his
own purpose the time from 8:00 A.M. to 5:00 P.M. on
Saturdays when he is required to keep his cellphone open.
The compensation actually received by Bates for working
while on call on Saturdays should be reported to the Social
Security System because under the Social Security Law,
compensation means "all actual remuneration for
employment."
(1) NORMAL HOURS OF WORK AND HOURS WORKED
(2017 BAR)
Q: Percival was a mechanic of Pacific Airlines. He
enjoyed a meal break of one hour. However, during
meal breaks, he was required to be on stand-by for
emergency work. During emergencies, he was made to
forego his meals or to hurry up eating. He demanded
payment of overtime for work done during his meal
periods. Is Percival correct? Explain your answer.
(2017 BAR)
A: Overtime is extra work rendered beyond normal hours
of work, as long as it is rendered within the same work day.
(Art. 87, LC) Since Percival's meal period is within his
normal hours of work, the work required of him during that
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
period is not overtime work. However, all meal periods
utilized by Pacific Airlines must be compensated based on
his basic salary; otherwise, the company would be unjustly
enriched at his expense. (Central Bar Q&A by Kato, 2023)
(2) COMPRESSED WORK WEEK
(2005 BAR)
Q: Under what conditions may a "compressed work
week" schedule be legally authorized as an exception
to the "eight-hour a day" requirement under the Labor
Code? (2005 BAR)
A: A "compressed work week" schedule may be authorized
under the following conditions:
1. The employee voluntarily agrees to it.
2. There is no diminution in their weekly or monthly
take home pay or fringe benefits.
3. The benefits are more than or at least
commensurate or equal to what is due the
employees without the compressed work week.
4. Overtime pay will be due and demandable when
they are required to work on those days which
should have ceased to be working days because of
the compressed work week schedule.
5. No strenuous physical exertion or that they are
given adequate rest periods.
6. It must be for a temporary duration as determined
by the Department of Labor. (2009-2017 UST FCL
Bar Q&A)
(3) MEAL PERIODS
(2011 BAR)
(4) NIGHT-SHIFT DIFFERENTIAL
(2002 BAR)
Q: As a tireman in a gasoline station open 24 hours a
day with only 5 employees, Goma worked from 10:00
P.M. until 7:00 A.M. of the following day. He claims he is
entitled to night shift differential. Is he correct? Explain
briefly. (2002 BAR)
A: YES. Under Art. 86 of the Labor Code, night shift
differential shall be paid to every employee for work
performed between 10:00 o’clock in the evening to six
o’clock in the morning. Therefore, Goma is entitled to night
shift differential for work performed from 10:00 pm until
6:00 am of the day following, but not from 6:00 am to 7:00
am of the same day. (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
NO. The Omnibus Rules Implementing the Labor Code (in
Book III, Rule II dealing with night shift differential) provides
that its provisions on night shift differential shall NOT apply
to employees of “retail and service establishments regularly
employing not more than five (5) workers”. Because of this
provision, Goma is not entitled to night shift differential
because the gasoline station where he works has only five
employees.
12
 QuAMTO (1987-2022)
(5) OVERTIME WORK
(2022, 2015, 2010, 2003, 2002 BAR)
Q: Krys is a daily-paid factory worker who is required
to render eight hours of work per day. Two days ago, he
rendered only seven hours of work as he arrived late in
the morning. Yesterday, Krys worked for nine hours as
he was required to assist in the processing of
perishable goods. His supervisor, Rudy, told Krys that
he would not get any overtime pay as his work for nine
hours yesterday was meant to offset the one-hour
shortfall in his work the day before. (2022 BAR)
a. Is Rudy correct? Explain briefly.
A: NO, Rudy is not correct. Overtime cannot offset
undertime. (Art. 88, LC) The purpose of this prohibition is to
protect the overtime rate of employees. On the second day
when Krys rendered 1-hour overtime work, his overtime
compensation did not consist only of his basic salary for his
extra work. In addition, he was entitled to at least 25%
thereof. Hence, if his hourly rate for the 1- hour overtime he
rendered on the second day were used to offset the hourly
rate he lost by reason of his undertime on the first day, the
25% overtime rate he is entitled to would be unlawfully
withheld. (Central Bar Q&A by Kato, 2023)
b. Assuming Krys is entitled to overtime pay, how
much will he get as overtime pay if his daily
wage is Php 640.00? Explain briefly.
A: The overtime pay of Krys would be as follows:
(Hourly Rate x 1 Hour) + 25%
Overtime Pay =
thereof
= (P640.00/8) (1 hour) + 25% thereof
= (P80.00) (1 hour) + 25% of P80.00
= P80.00 + P20.00
= P100.00
(Central Bar Q&A by Kato, 2023)
Q: LKG Garments Inc. makes baby clothes for export. As
part of its measures to meet its orders, LKG requires its
employees to work beyond 8 hours everyday, from
Monday to Saturday. It pays its employees an additional
35% of their regular hourly wage for work rendered in
excess of 8 hours per day. Because of additional orders,
LKG now requires 2 shifts of workers with both shifts
working beyond 8 hours but only up to a maximum of 4
hours. Carding is an employee who used to render up to
6 hours of overtime work before the change in
schedule. He complains that the change adversely
affected him because now he can only earn up to a
maximum of 4 hours' worth of overtime pay. Does
Carding have a cause of action against the company?
(2015 BAR)
A: NO. A change in work schedule is a management
prerogative of LKG. Thus, Carding has no cause of action
against LKG if, as a result of its change to two shifts, he now
can only expect a maximum of 4 hours overtime work.
Besides, Art. 87 of the LC does not guarantee Carding a
certain number of hours of overtime work. In Manila Jockey
Employees’ Union v. Manila Jockey Club (G.R. No. 167760, 07
13
Mar. 2007), the Supreme Court held that the basis of
overtime claim is an employee’s having been “permitted to
work.” Otherwise, as in this case, such is not demandable.
(2009-2017 UST FCL Bar Q&A)
Q: After working from 10 a.m. to 5 p.m. on a Thursday
as one of 5,000 employees in a beer factory, A hurried
home to catch the early evening news and have dinner
with his family. At around 10 p.m. of the same day, the
plant manager called and ordered A to fill in for C who
missed the second shift. (2010 BAR)
(a) May A validly refuse the plant manager’s
directive? Explain.
A: YES. A may validly refuse to fill in for C. A may not be
compelled to perform overtime work considering that the
plant manager’s directive is not for an emergency overtime
work, as contemplated under Art. 89 of the Labor Code.
(2009-2017 UST FCL Bar Q&A)
(a) Assuming that A was made to work from 11
p.m. on Thursday until 2 a.m. on Friday, may
the company argue that, since he was two
hours late in coming to work on Thursday
morning, he should only be paid for work
rendered from 1 a.m. to 2 a.m.? Explain?
A: NO. Undertime is not offset by overtime. (Art. 88, LC;
2009-2017 UST FCL Bar Q&A)
Q: A case against an employer company was filed
charging it with having violated the prohibition against
offsetting undertime for overtime work on another day.
The complainants were able to show that, pursuant to
the CBA, employees of the union had been required to
work "overtime" on Saturday but were paid only at
regular rates of pay on the thesis that they were not
required to complete, and they did not in fact complete,
the eight-hour work period daily from Monday through
Friday. Given the circumstances, the employer
contended that the employees were not entitled to
overtime compensation, i.e., with premium rates of pay.
Decide the controversy. (2003 BAR)
A: Art. 88 of the Labor Code provides that undertime work
on any particular day shall not be offset by overtime work
on any other day. The CBA, the law between the parties and
the Union has shown that the employees are required to
render overtime work on Saturdays, thus the contention of
the employer is not tenable. The employer cannot use the
undertime incurred from Monday through Friday to offset
the overtime on Saturday. Hence, the employees are
entitled to overtime compensation, i.e., premium rates of
pay on Saturday.
Q: Socorro is a clerk-typist in the Hospicio de San Jose,
a charitable institution dependent for its existence on
contributions and donations from well-wishers. She
renders work 11 hours a day but has not been given
overtime pay since her place of work is a charitable
institution. Is Socorro entitled to overtime pay?
Explain briefly. (2002 BAR)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
A: YES. Socorro is entitled to overtime compensation. She diminution of benefits. (Asian Transmission Corp. v. Court of
does not fall under any of the exceptions to the coverage of Appeals, G.R. No. 144664, 15 Mar. 2004)
Art. 82 (Hours of Work). The Labor Code is equally
applicable to non-profit institutions. A covered employee e) SERVICE CHARGE (Art. 96 of the LC, as amended by
who works beyond 8 hours is entitled to overtime R.A. No. 11360)
compensation. (2009-2017 UST FCL Bar Q&A)
f) OCCUPATIONAL SAFETY AND HEALTH STANDARDS
(6) COMPUTATION OF ADDITIONAL COMPENSATION LAW (R.A. No. 11058)
(RATES ONLY)
(1) COVERED WORKPLACES
c) REST PERIODS Sec. 3(c)
(1998, 1987 BAR)
(2) DUTIES OF EMPLOYERS, WORKERS, AND OTHER
Q: A Ladies Dormitory run or managed by a charitable PERSONS (Sec. 4)
non-profit organization claims that it is exempt from
the coverage of the Weekly Rest Period provision of the (3) WORKERS’ RIGHT TO KNOW (Sec. 5)
Labor Code. Is the claim valid? (1998 BAR)
(4) WORKERS’ RIGHT TO REFUSE UNSAFE WORK (Sec.
A: NO. The claim is not valid. The provisions on weekly rest 6)
periods in the Labor Code cover every employer, whether
operating for profit or not. (Art. 91, LC) (5) WORKERS’ RIGHT TO PERSONAL PROTECTIVE
EQUIPMENT (PPE) (Sec. 8)
Q: Lawyer Antonio Martin recently formed a law
partnership with five other lawyer-friends of his. They 2. WAGES
hired two office secretaries, an accounting clerk- (2022, 2020-21, 2019, 2018, 2017, 2016, 2015, 2013,
cashier, one bookkeeper, and two messengers. You are 2012, 2011, 2010, 2008, 2004, 1998, 1997, 1994, 1992
among three associate attorneys. The workweek is BAR)
Monday to Friday. There is no vacation leave but sick
leave is 15 days for every year of continuous and
a) DEFINITIONS
satisfactory service.
(2017, 2013, 2010, 1994 BAR)

Managing partner Martin is preparing a set of

(1) WAGE vs. SALARY
personnel policies in terms and conditions of
(2017, 1994 BAR)
employment for the staff and has asked you to give him
a brief memo on the questions listed below. Should the
Q: Distinguish "salary" from "wages." (1994 BAR)
law firm schedule a rest day for the employees,
including you? (1987 BAR)
A: In the case of Gaa v. Court of Appeals (G.R. No. L-44169, 03
Dec. 1985), the Supreme Court had the opportunity to
A: NO. There is no need under the Labor Code to schedule a
distinguish salary and wages. According to the Supreme
rest day. The Code (in Art. 91) requires an employer to
Court, the term wages refer to the compensation given in
provide each of his employees a weekly rest day after every
consideration of manual labor, skilled or unskilled. On the
six consecutive normal work days. Here, the work week is
other hand, salary denotes a compensation for a higher
such that it is for 5 days. The Saturdays and Sundays when
degree of employment.
the employees are not required to work more than satisfy
the required weekly rest day.
Q: Tarcisio was employed as operations manager and
received a monthly salary of P25,000.00 through his
d) HOLIDAYS
payroll account with DB Bank. He obtained a loan from
(2018, 2012, 2005, 2004, 2002, 1998, 1994, 1987 BAR)
Roberto to purchase a car. Tarcisio failed to pay
Roberto when the loan fell due. Roberto sued to collect
Q: During the open forum following your lecture before
and moved to garnish Tarcisio’s payroll account. The
members of various unions affiliated with a labor
latter vigorously objected and argued that salaries
federation, you were asked the following question:
were exempt from garnishment. Is Tarcisio correct?
Explain your answer. (2017 BAR)
Araw ng Kagitingan and Good Friday are among the 10
paid regular holidays under Art. 94 of the Labor Code.
A: NO, Tarcisio is not correct. Under Art. 1708 of the Civil
How much will an employee receive when both
Code, only wages, which are the compensation paid for
holidays fall on the same day? (2005 BAR)
manual skilled or unskilled labor, are exempt from
garnishment. Here, the subject of garnishment is Tarcisio’s
A: The employee will receive 200% of his regular daily
salary as a managerial employee, which is not considered as
wage when both regular holidays fall on the same day and
wages. Hence, Tarcisio’s salary may be garnished.
he does not work. The law provides that he shall receive his
regular daily wage for each regular holiday. The employee
will receive 100% for Araw ng Kagitingan and 100% for
Good Friday. If he works on that day, he is entitled to 400%
of his regular daily wage; otherwise, there will be

U N IV E R S I T Y O F S A N T O T O M A S 14
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
ALTERNATIVE ANSWER:
NO, Tarcisio is not correct. Under Art. 1708 of the Civil Code,
“(t)he laborer’s wages shall not be subject to execution or
attachment, for debts incurred for food, shelter, clothing
and medical attendance.” Tarcisio incurred his debt for a
car, which is not among those mentioned in the law.
ALTERNATIVE ANSWER:
NO, Tarcisio is not correct. Case law exempts rank-and-file
employees from garnishment.' Tarcisio, however manager,
is a managerial employee. Since the rule covers only file
employees, therefore, Tarcisio's salary is not exempt from
garnishment. (Gaa v. Court of Appeals, G.R. No. L-44169, 03
Dec. 1985)
(2) FACILITIES vs. SUPPLEMENTS
(2013, 2010 BAR)
Q: A worked as a roomboy in La Mallorca Hotel. He sued
for underpayment of wages before the NLRC, alleging
that he was paid below the minimum wage. The
employer denied any underpayment, arguing that
based on long standing, unwritten policy, the Hotel
provided food and lodging to its housekeeping
employees, the costs of which were partly shouldered
by it and the balance was charged to the employees. The
employees’ corresponding share in the costs was thus
deducted from their wages. The employer concluded
that such valid deduction naturally resulted in the
payment of wages below the prescribed minimum. If
you were the Labor Arbiter, how would you rule?
Explain. (2010 BAR)
A: I will rule in favor of A. Even if food and lodging were
provided and considered as facilities by the employer, the
employer could not deduct such facilities from its workers’
wages without compliance with law. (Mayon Hotel &
Restaurant v. Adana, G.R. No. 157634, 16 May 2005)
In Mabeza v. NLRC (G.R. No. 118506, 18 April 1997), the
Supreme Court held that the employer simply cannot
deduct the value from the employee’s wages without
satisfying the following:
a. Proof that such facilities are customarily furnished
by the trade;
b. The provision of deductible facilities is voluntarily
accepted in writing by the employee; and
c. The facilities are charged at fair and reasonable
value. (2009-2017 UST FCL Bar Q&A)
15
b) PRINCIPLES
(2020-21, 2019, 2015, 2012, 2008, 2006, 2005, 2003,
2002, 1999, 1997, 1995 BAR)
(1) NO WORK, NO PAY
(2008, 1999, 1997 BAR)
Q: The rank-and-file union staged a strike in the
company premises which caused the disruption of
business operations. The supervisors’ union of the
same company filed a money claim for unpaid salaries
for the duration of the strike, arguing that the
supervisors' failure to report for work was not
attributable to them. The company contended that it
was equally faultless, for the strike was not the direct
consequence of any lockout or unfair labor practice.
May the company be held liable for the salaries of the
supervisor? Decide (2008 BAR)
A: NO. I will apply the “No work, No pay” principle. The
supervisors are not entitled to their money claim for unpaid
salaries, as they should not be compensated for services
skipped during the strike of the rank-and-file union. The
age-old rule governing the relation between labor and
capital, or management and employee of a “fair day’s wage
for a fair day’s labor” remains as the basic factor in
determining employees’ wages. (Aklan Electric Cooperative,
Inc. v. NLRC, G.R. No. 121439, 25 Jan. 2000)
(2) EQUAL PAY FOR EQUAL WORK
(2012 BAR)
(3) FAIR WAGE FOR FAIR WORK
(2012 BAR)
(4) NON-DIMINUTION OF BENEFITS
(2019, 2015, 2006, 2005, 2003, 2002, 1995 BAR)
Q: Can an employer and an employee enter into an
agreement reducing or increasing the minimum
percentage provided for night differential pay,
overtime pay, and premium pay? (2006 BAR)
A: NO. If the agreement is with regards to reduction, Art.
100 provides for the prohibition against elimination or
diminution of benefits. However, if the agreement seeks to
increase the minimum percentage, it is allowed because
there is nothing in the law which prohibits the same. What
is expressly prohibited under the law is only reduction.
Q: D, one of the sales representatives of OP, Inc., was
receiving a basic pay of P50,000.00 a month, plus a 1 %
overriding commission on his actual sales transactions.
In addition, beginning 3 months ago, or in August 2019,
D was able to receive a monthly gas and transportation
allowance of P5,000.00 despite the lack of any company
policy therefor. In November 2019, D approached his
manager and asked for his gas and transportation
allowance for the month. The manager declined his
request, saying that the company had decided to
discontinue the aforementioned allowance considering
the increased costs of its overhead expenses. In
response, D argued that OP, Inc.' s removal of the gas
and transportation allowance amounted to a violation
of the rule on non-diminution of benefits. Is the
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
argument of D tenable? Explain. (2019 BAR)
A: NO. The argument of D is not tenable. The principle of
non-diminution of benefits, which has been incorporated in
Art. 100 of the Labor Code, forbids an employer from
unilaterally reducing, diminishing, discontinuing or
eliminating compensation or privilege which are given as a
company practice. In Netlink v. Delmo (G.R. No. 160827, 18
June 2014), the Supreme Court said that the length of time
has not been laid out on what constitutes a company
practice. However, there are Supreme Court decisions that
consider benefits given for a period of two years, more or
less, a company practice (Sevilla Trading Company v.
Semana, G.R. No. 152456, 28 Apr. 2004). In the question, the
monthly gas and transportation allowance was given to D
for three months only. Guided by the Supreme Court’s
rulings, the monthly gas and transportation allowance
given to D have not yet ripened into a company practice.
(UPLC Suggested Answers)
Q: Far East Bank (FEB) is one of the leading banks in
the country. Its compensation and bonus packages are
top of the industry. For the last 6 years, FEB had been
providing the following bonuses across-the-board to
all its employees:
a. 13th month pay;
b. 14th to 18th month pay;
c. Christmas basket worth P6,000;
d. Gift check worth P4,000; and
e. Productivity-based incentive ranging from a
20%-40% increase in gross monthly salary for
all employees who would receive an
evaluation of "Excellent" for 3 straight
quarters in the same year.
Because of its poor performance over-all, FEB decided
to cut back on the bonuses this year and limited itself
to the following:
a. 13th month pay;
b. 14th month pay;
c. Christmas basket worth P4,000; and
d. Gift check worth P2,000.
Katrina, an employee of FEB, who had gotten a rating
of "Excellent" for the last 3 quarters, was looking
forward to the bonuses plus the productivity incentive
bonus. After learning that FEB had modified the bonus
scheme, she objected. Is Katrina's objection justified?
Explain. (2015 BAR)
A: YES. Katrina’s objection is justified. Having enjoyed the
across-the-board bonuses, Katrina has earned a vested
right. Hence, none of them can be withheld or reduced. In
the problem, the company has not proven its alleged losses
to be substantial. Permitting reduction of pay at the
slightest indication of losses is contrary to the policy of the
State to afford full protection to labor and promote full
employment. (Linton Commercial Co. v. Hellera, G.R. No.
163147, 10 Oct. 2007)
As to the withheld productivity-based bonuses, Katrina is
deemed to have earned them because of her excellent
performance ratings for three quarters. On this basis, they
cannot be withheld without violating the Principle of Non-
Diminution of Benefits.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Moreover, it is evident from the facts of the case that what
was withdrawn by FEB was a productivity bonus.
Protected by R.A. 6791 which mandates that the monetary
value of the productivity improvement be shared with the
employees, the “productivity-based incentive” scheme of
FEB cannot just be withdrawn without the consent of its
affected employees. (2009-2017 UST FCL Bar Q&A)
c) PAYMENT OF WAGES
Q: Benito is the owner of an eponymous clothing brand
that is a top seller. He employs a number of male and
female models who wear Benito's clothes in
promotional shoots and videos. His deal with the
models is that Benito will pay them with 3 sets of free
clothes per week. Is this arrangement allowed? (2015
BAR)
A: NO. The arrangement is not allowed. The models are
Benito’s employees. As such, their services are required to
be paid only in legal tender, even when expressly requested
by the employee otherwise (Art. 102, LC). Hence, no lawful
deal in this regard can be entered into by and between
Benito and his models. The three sets of clothes, regardless
of value, are in kind and are therefore not in the form
prescribed by law. (2009-2017 UST FCL Bar Q&A)
Q: Robert, an employee of ABC Company, is married to
Wanda. One day, Wanda visited the company office
with her three (3) emaciated minor children, and
narrated to the Manager that Robert had been
squandering his earnings on his mistress, leaving only
a paltry sum for the support of their children. Wanda
tearfully pleaded with the Manager to let her have one
half of Robert's pay every payday to ensure that her
children would at least have food on the table. To
support her plea, Wanda presented a Kasulatan signed
by Robert giving her one half of his salary, on the
condition that she would not complain if he stayed with
his mistress on weekends. If you were the Manager,
would you release one half of Robert's salary to Wanda?
(2013 BAR)
A: NO, because an employer is prohibited from interfering
with the freedom of its employees to dispose of their wages.
ALTERNATIVE ANSWER:
NO, because there is no written authorization for ABC
Company to release Robert's salary to Wanda.
d) PROHIBITIONS REGARDING WAGES
(2019, 2018, 2013 BAR)
Q: Mr. A signed a 1-year contract with XYZ Recruitment
Co. for deployment as welding supervisor for DEF, Inc.
located in Dubai. The employment contract, which the
POEA approved, stipulated a salary of US$600.00 a
month. Mr. A had only been in his job in Dubai for 6
months when DEF, Inc. announced that it was suffering
from severe financial losses and thus intended to
retrench some of its workers, among them Mr. A. DEF,
Inc. hinted, however, that employees who would accept
a lower salary could be retained. Together with some
16
 QuAMTO (1987-2022)
other Filipino workers, Mr. A agreed to a reduced salary
of US$400.00 a month and thus, continued with his
employment. (2019 BAR)
(a) Was the reduction of Mr. A’s salary valid?
Explain.
A: NO, the reduction of Mr. A's salary is invalid. All the
Terms and Conditions in the POEA contract remain in force
until such changes are approved by the POEA. To substitute
or alter to the prejudice of the worker, employment
contracts approved and verified by the Department of
Labor and Employment from the time of actual signing
thereof by the parties up to and including the period of the
expiration of the same without the approval of the
Department of Labor and Employment constitutes a
prohibited practice. (Sec. 6, R.A. No. 8042) (UPLC Suggested
Answers)
ALTERNATIVE ANSWER:
NO, the reduction of Mr. A's salary is invalid. The Labor Code
provisions on retrenchment and other authorized causes of
termination are to apply to Mr. A, and hence, he should be
entitled to retrenchment pay of 1 month guaranteed pay or
½ month for every year of service, whichever is higher. The
principle of incorporation and ler loci celebrations applies
to Filipino workers, regardless of their deployment abroad.
If at all, he ought to have received his retrenchment pay, and
then signed up for a new contract of employment under
reduced salaries. (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
YES, the reduction of Mr. A's salary is valid. Assuming that
the company is truthfully suffering from severe financial
losses, the reduction of Mr. A's salary is valid as it is a result
of his agreement together with other employees, with the
objective of preventing the company from shutting down.
The law (Art. 100, Labor Code) prohibits diminution or
elimination of benefits by a unilateral action of the
employer. The law is not violated if the action resulted from
a joint or negotiated decision freely made by the employer
and the employee. In Insular Hotel Employees Union-NFL v.
Waterfront Insular Hotel Davao (G.R. Nos. 174040-41, 22
Sept. 2010), the Supreme Court upheld the reduction of pay
agreed by the union so as to prevent closure of the
enterprise. (UPLC Suggested Answers)
Q: Nelda worked as a chambermaid in Hotel Neverland
with a basic wage of PhP560.00 for an eight-hour
workday. On Good Friday, she worked for 1 hour from
10:00 PM to 11:00 PM. Her employer paid her only
PhP480.00 for each 8-hour workday, and PhP70.00 for
the work done on Good Friday. She sued for
underpayment of wages and non-payment of holiday
pay and night shift differential pay for working on a
Good Friday. Hotel Neverland denied the alleged
underpayment, arguing that based on long-standing
unwritten tradition, food and lodging costs were
partially shouldered by the employer and partially paid
for by the employee through salary deduction.
According to the employer, such valid deduction caused
the payment of Nelda's wage to be below the prescribed
17
minimum. The hotel also claimed that she was not
entitled to holiday pay and night shift differential pay
because hotel workers have to work on holidays and
may be assigned to work at night. (2018 BAR)
(1) Does the hotel have valid legal grounds to
deduct food and lodging costs from Nelda's
basic salary?
A: NO. In Mabeza v. NLRC, (G.R. No. 118506, 18 Apr. 1997)
the Supreme Court established three requirements before
the value of facilities such as food and lodging may be
deducted from an employee's wages: first, proof must be
shown that such facilities are customarily furnished by the
trade; second, the provision of deductible facilities must be
voluntarily accepted in writing by the employee; and finally,
facilities must he charged at fair and reasonable value. In
the case at hand, the second and third requisites on
voluntary acceptance of deductible facilities in writing, at
fair and reasonable value, was not established. (UPLC
Suggested Answers)
ALTERNATIVE ANSWER:
NO. In Atok Big Wedge Association v. Atok Big Wedge
Company, Inc. (G.R. No. L-7349, 19 July 1955), the Supreme
Court distinguished facilities from supplement.
Supplements constitute extra remuneration given to
laborers above their wage. Facilities are items of expense
necessary for the laborer's and his family's existence and
subsistence.
Board and lodging are treated as supplement if the company
benefits from the employees not going home anymore or
not leaving his work station to eat. Since Nelda is a
chambermaid, her board and lodging should be treated as
supplement. (UPLC Suggested Answers)
(2) Applying labor standards law, how much
should Nelda be paid for work done on Good
Friday? Show the computation in your test
booklet and encircle your final answer.
A: Nelda's take-home pay for working on Good Friday is as
follows:
Salary for 1 hour work rendered Php 70.00
Holiday Pay Php 560.00
Nightshift Pay (10-11 PM work) Php 7.00
Total Php 637.00
(Central Bar Q&A by Kato, 2023)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
e) WAGE DISTORTION
(2019, 2018, 2017, 2009, 2008, 2006, 2002, 1997 BAR)
(1) CONCEPT
(2019, 2018, 2017, 2009, 2008, 2006, 2002, 1997 BAR)
Q: What is wage distortion? (2019, 2009)
A: A wage distortion is the elimination or serious
contraction of the wage gap advantage enjoyed by one wage
group over another of the same wage region; provided, such
elimination or compression is caused by a wage law, or
wage order (Art. 124, LC); CBA renegotiation (Metro Transit
Organization, Inc. v. NLRC, et al., G.R. No. 116008, 11 July
1995); or merger (Manila Mandarin Employees Union v.
NLRC, et al., G.R. No. 108556, 19 Nov. 1996); but not a
promotion (NFL v. NLRC, G.R. No. 103586, 21 July 1994). (Bar
Q&A by Kato, 2022)
Q: When is there a wage distortion? (2019, 2009, 2006,
1997 BAR)
A: There is wage distortion where an increase in prescribed
wage rates results in the elimination or severe contraction
of intentional quantitative differences in wage or salary
rates between and among employee groups in an
establishment as to effectively obliterate the distinctions
embodied in such wage structure based on skills, length of
service, or other logical bases of differentiation.
Wage distortion arises four essential elements are present:
a. An existing hierarchy of positions with corresponding
salary rates;
b. A significant change or increase in salary rate of a lower
pay class without a corresponding increase in the
salary of a higher one;
c. The elimination of the distinction between two groups
or classes; and
d. The distortion exists in the same region of the country.
(Prubankers Association v. Prudential Bank and Trust
Co., G.R. No. 131247, 25 Jan. 1999)
Q: What procedural remedies are open to workers who
seek correction of wage distortion? (2009 BAR)
A: Workers who seek correction of a wage distortion have
the following procedural remedies:
If the establishment is organized, they may bring the issue
to the Grievance Machinery. If unresolved in 7 days at that
level, they may elevate it to voluntary arbitration.
If the establishment is unorganized, their remedy is to
bring the issue to the NCMB which has 10 calendar days to
resolve it; otherwise, it shall refer it to the Labor Arbiter.
(Bar Q&A by Kato, 2022)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: Upon a review of the wage rate and structure
pertaining to its regular rank and file employees, K
Corporation found it necessary to increase its hiring
rates for employees belonging to the different job
classification levels to make their salary rates more
competitive in the labor market. After the
implementation of the new hiring salary, Union X, the
exclusive bargaining agent of the rank and file
employees. It argued that the increase in hiring rates
resulted in wage distortion since it erased the wage gap
between the new and old employees. In other words,
new employees would enjoy almost the same salary
rates as K Corporation’s old employees.
Did a wage distortion arise under the circumstances
which legally obligated K Corporation to rectify the
wages of its old employees? Explain. (2019 BAR)
A: NO. Since the cause of the alleged elimination is not one
of the recognized causes, as it was an adjustment of the
hiring rate for new hires joining other wage groups, the
elimination of the wage gap is not a wage distortion. It is
rather clear that the increased rate would only be given to
new hires and not to all the members of the wage group/s
they would be joining. Hence, the company has nothing to
adjust or rectify. (Bar Q&A by Kato, 2022)
Q: How should a wage distortion be settled? (2009,
2006, 1997 BAR)
A: Any dispute arising from wage distortion shall be
resolved through the grievance procedure as provided in
the applicable collective bargaining agreement and, if the
dispute remains unresolved, then through voluntary
arbitration.
In cases where there are no collective bargaining
agreements or recognized labor unions, the employers and
workers shall endeavor to correct such wage distortions.
Any dispute arising therefrom shall be settled through the
National Conciliation and Mediation Board and, if it remains
unresolved after 10 calendar days of conciliation, the issue
of wage distortion shall be referred to the appropriate
branch of the NLRC.
Q: How should a wage distortion be resolved:
(1) In case there is a collective bargaining
agreement; and
(2) In case there is none?
Explain briefly. (2002 BAR)
A: According to Art. 124 of the Labor Code, in case there is a
CBA, a dispute arising from wage distortions shall be
resolved through the grievance machinery provided in the
CBA, and if remains unresolved, through voluntary
arbitration.
In case there is no CBA, the employers and workers shall
endeavor to correct such distortions. Any dispute arising
therefrom shall be settled through the NCMB and if it
remains unresolved after 10 calendar days of conciliations,
then the dispute is referred to the appropriate branch of the
NLRC. (2009-2017 UST FCL Bar Q&A)
18
 QuAMTO (1987-2022)
f) MINIMUM WAGE LAW
(2017, 2000, 1998 BAR)
Q: The Regional Tripartite Wages and Productivity
Board (RTWPB) for Region 3 issued a wage order on 02
Nov. 2017 fixing the minimum wages for all industries
throughout Region 3. (2017 BAR)
(a) Is the wage order subject to the approval of
the National Wages and Productivity
Commission before it takes effect?
A: NO. The wage order is not subject to the approval of the
National Wages and Productivity Commission (NWPC)
before it takes effect. Under the Labor Code, the NWPC only
exercises technical and administrative supervision over the
RTWPB. (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
NO, unless appealed in 10 calendar days to the National
Wages Productivity Commission, a wage order becomes
effective once issued by the Regional Wages and
Productivity Board following proper conduct of
consultations. (Art. 123, LC) (Central Bar Q&A by Kato, 2023)
(b) The law mandates that no petition for wage
increase shall be entertained within a period
of 12 months from the effectivity of the wage
order. Under what circumstances may the
Kilusang Walang Takot, a federation of labor
organizations that publicly and openly assails
the wage order as blatantly unjust, initiate the
review of the wage increases under the wage
order without waiting for the end of the 12-
month period? Explain your answer.
A: Kilusang Walang Takot may initiate the review of wage
order without waiting for the end of the 12-month period
when there are supervening conditions that demand a
review of the minimum wage rates.
These supervening conditions include:
1. Extraordinary increase in prices of petroleum
products; and
2. Extraordinary increase in the cost of basic goods
and services.
g) HOLIDAY PAY
(2019, 2018, 2011, 2010 BAR)
Q: Ms. F, a sales assistant, is one of the 8 workers
regularly employed by ABC Convenience Store. She was
required to report on Dec. 25 and 30. Should ABC
Convenience Store pay her holiday pay? Explain. (2019
BAR)
A: NO. As provided by Art. 94 of the Labor Code, every
employee is entitled to the payment of his regular daily
basic wage (100%) during holiday except employees
working in retail and service establishments regularly
employing less than 10 workers. In the case at bar, Ms. F
works as a sales assistant in ABC Convenience Store which
is engaged in retail business with only 8 workers. As such,
ABC Convenience Store falls under the exception and hence,
19
is not obliged to pay Mrs. F her holiday pay. (UPLC Suggested
Answers)
Q: A, a worker at ABC Company, was on leave with pay
on March 31, 2010. He reported for work on April 1 and
2, Maundy Thursday and Good Friday, respectively,
both regular holidays. Is A entitled to holiday pay for
the two successive holidays? Explain. (2010 BAR)
A: YES. For having been on leave with pay on the day
immediately preceding the two regular holidays, A enjoys
the benefit of the “no work with pay” effect of a regular
holiday. Therefore, he is entitled to 200% of his basic salary.
(Sec. 6, Rule IV, Book III, ORILC; Bar Q&A by Kato, 2022)
h) 13TH MONTH PAY
(2018, 2016, 2012, 2004 BAR)
Q: Nico is a medical representative engaged in the
promotion of pharmaceutical products and medical
devices for Northern Pharmaceuticals, Inc. He regularly
visits physicians' clinics to inform them of the chemical
composition and benefits of his employer's products. At
the end of every day, he receives a basic wage of
P700.00 plus a P150.00 "productivity allowance." For
purposes of computing Nico's 13th month pay, should
the daily "productivity allowance" be included? (2018
BAR)
A: Since a productivity allowance is not performance based,
it is not under the category of wage-type bonus. As such, it
is not part of Nico's basic salary. (Boie-Takeda Chemicals,
Inc. v. Dela Serna, G.R. Nos. 92147 & 102552, 10 Dec. 1993)
Therefore, it should be excluded because 13th month pay is
computed based only on a covered employee's basic salary.
(P.D. 851) (Central Bar Q&A by Kato, 2023)
Q: Dennis was a taxi driver who was being paid on the
"boundary" system basis. He worked tirelessly for
Cabrera Transport Inc. for 14 years until he was eligible
for retirement. He was entitled to retirement benefits.
During the entire duration of his service, Dennis was
not given his 13th month pay or his service incentive
leave pay. (2012 BAR)
(a) Is Dennis entitled to 13th month pay and
service leave incentive pay? Explain.
A: NO. A taxi driver paid under the “boundary system” is not
entitled to a 13th month pay and a SIL pay. Hence, his
retirement pay should be computed solely on the basis of
his salary. Specifically, Sec. 3(e) of the Rules and Regulations
Implementing P.D. 851 excludes from the obligation of 13 th
Month Pay “Employers of those who are paid on…
boundary” basis. On the other hand, Sec. 1(d), Rule V, Book
III of the Omnibus Rules provides that those “employees
whose performance is unsupervised by the employer” are
not entitled to Service Incentive Leave. A taxi driver paid
under the Boundary System is an “unsupervised” employee.
(2009-2017 UST FCL Bar Q&A)
(b) Since he was not given his 13th month pay and
service incentive leave pay, should Dennis be
paid upon retirement, in addition to the salary
equivalent to 15 days for every year of service,
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
the additional 2.5 days representing 1/12 of
the 13th month pay as well as the 5 days
representing the service incentive leave for a
total of 22.5 days? Explain.
A: NO. Since he is not entitled to 13th month pay and Service
Incentive Leave, his retirement pay should be computed
solely on the basis of his salary. (R&E Transport v. Latag, G.R.
No. 155214, 13 Feb. 2004) (2009-2017 UST FCL Bar Q&A)
Q: TRX, a local shipping firm, maintains a fleet of
motorized boats plying the island barangays of AP, a
coastal town. At day's end, the boat operators/crew
members turn over to the boat owner their cash
collections from cargo fees and passenger fares, less
the expenses for diesel fuel, food, landing fees and
spare parts. 50% of the monthly income or earnings
derived from the operations of the boats are given to
the boatmen by way of compensation. Deducted from
the individual shares of the boatmen are their cash
advance and peso value of their absences, if any. Are
these boatmen entitled to overtime pay, holiday pay,
and 13th month pay? (2004 BAR)
A: If the boatmen are considered employees, like jeepney
drivers paid on a boundary system, the boatmen are not
entitled to overtime and holiday pay because they are
workers who are paid by results. Said workers, under the
Labor Code are not entitled, among others, to overtime pay
and holiday pay. In accordance with the Rules and
Regulations implementing the 13th month pay law,
however, the boatmen are entitled to the 13 th month pay.
Workers who are paid by results are to be paid their 13 th
month pay.
3. LEAVES
(2019, 2018, 2016, 2013, 2012, 2011, 2010, 1987 BAR)
a) SERVICE INCENTIVE LEAVE
(2019, 2016, 2012, 2010, 1987 BAR)
Q: Mrs. B, the personal cook in the household of X, filed
a monetary claim against her employer, X, for denying
her service incentive leave pay. X argued that Mrs. B did
not avail of any service incentive leave at the end of her
one (1) year of service and hence, not entitled to the
said monetary claim. (2019 BAR)
(a) Is the contention of X tenable? Explain.
A: NO. The contention of X is not tenable. Mrs. B being a
kasambahay is entitled to service incentive leave under R.A.
10361 as clarified by Labor Advisory No. 010-18. As such, she
has the prerogative to use it, monetize it after 12 months of
service, or commute it until separation from service. If she
elects the second, she has 3 years to demand for payment to
avail of the benefit. Hence, not being a prescribed claim, its
withholding is unlawful. (Lourdes Rodriguez v. Park N Ride,
G.R. No. 222980, 20 Mar. 2017) (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
NO. This is not correct because Art. 95 of the Labor Code
provides that unused SIL is commutable to its money
equivalent at the end of the year. Furthermore, if the
employee does not use or commute the same, he is entitled
upon his resignation or separation from work to the
commutation of his accrued service incentive leave. (Auto
Bus Transport v. Bautista, G.R. No. 156367, 16 May 2005)
(b) Assuming that Mrs. B is instead a clerk in X's
company with at least 30 regular employees,
will her monetary claim prosper? Explain.
A: YES. The money claim will prosper. A clerk is not one of
those exempt employees in Art. 82 of the Labor Code which
refers to government employees, managerial employees,
field personnel, members of the family who are dependent
on the employer for support, domestic helpers, persons in
the personal service of another and persons who are paid
by results. (UPLC Suggested Answers)
Q: A driver for a bus company, sued his employer for
non-payment of commutable service incentive leave
credits upon his resignation after five years of
employment. The bus company argued that A was not
entitled to service incentive leave since he was
considered a field personnel and was paid on
commission basis and that, in any event, his claim had
prescribed. If you were the Labor Arbiter, how would
you rule? Explain. (2010 BAR)
A: I will grant the prayer of A. Payment on commission basis
alone does not prove that A is a field personnel. There must
be proof that A is left to perform his work unsupervised by
his employer. Otherwise, he is not a field personnel, thus
entitled to commutable service incentive leave (SIL) credits.
(Auto Bus v. Bautista, G.R. No. 156367, 16 May 2005)
His action has not yet prescribed. In Auto Bus v. Bautista
(supra.), the Supreme Court recognized that SIL is such a
unique labor standard benefit, because it is commutable. An
employee may claim his accrued SIL throughout the years
of his service with the company upon his resignation,
retirement, or termination. Therefore, when A resigned
after five years, his right of action to claim ALL of his SIL
benefits accrued at the time when the employer refused to
pay him his rightful SIL benefits. (Art. 291 [now 306], LC;
2009-2017 UST FCL Bar Q&A)
b) MATERNITY LEAVE
(2018, 2013, 2012 BAR)
c) PATERNITY LEAVE
(2018, 2012 BAR)
Q: Nestor and Nadine have been living in for the last 10
years without the benefit of marriage. Their union has
produced four children. Nadine was three months
pregnant with her 5th child when Nestor left her for
another woman. When Nadine was eight months
pregnant with her 5th child, she applied for maternity
leave benefits. Her employer refused on the ground
that this was already her 5th pregnancy and that she
was only living in with the father of her child, who is
now in a relationship with another woman. When
Nadine gave birth, Nestor applied for paternity leave
20
 QuAMTO (1987-2022)
benefits. His employer also denied the application on
the same grounds that Nadine’s employer denied her
application. (2018 BAR)
(a) Can Nadine’s employer legally deny her claim
for maternity benefits?
A: NO. The Expanded Maternity Leave Law (R.A. No. 11210),
which took effect on 11 Mar. 2019, expanded maternity
leave to every instance of pregnancy, miscarriage, or
emergency termination, regardless of frequency, from the
previous limit of the first four deliveries or miscarriages.
Thus, applying the new law, Nadine would be entitled to
maternity benefits despite it being her 5th pregnancy.
(b) Can Nestor’s employer legally deny his claim
for paternity benefits?
A: YES. Nestor is not entitled to paternity benefits since it is
only available for the first 4 deliveries or miscarriages of his
legitimate spouse with whom he is living with.
d) SOLO PARENT LEAVE (R.A. No. 8972, as amended by
R.A. No. 11861)
(2011, 2010 BAR)
Q: A, single, has been an active member of the Social
Security System for the past 20 months. She became
pregnant out of wedlock and on her 7th month of
pregnancy, she was informed that she would have to
deliver the baby through caesarean section because of
some complications. Can A claim maternity benefits? If
yes, how many days can she go on maternity leave? If
not, why is she not entitled? (2010 BAR)
A: YES. The SSS Law does not discriminate based on the civil
status of a female member- employee. As long as said female
employee has paid at least 3 monthly contributions in the
twelve- month period immediately preceding the semester
of her childbirth, she can avail of the maternity benefits
under the law.
Under the Expanded Maternity Leave Law, A shall be entitled
to a minimum of 105 days maternity leave with full pay. As
long as a female SSS member has paid at least 3 monthly
contributions in the 12-month period immediately
preceding the semester of her childbirth, miscarriage, or
emergency termination of pregnancy, she can avail of the
maternity benefits under the law, regardless of whether she
gave birth via caesarian section or natural delivery, subject
to the conditions set forth under Sec. 5 of R.A. 11210.
Further, A may also avail of an additional maternity leave of
30 days without pay, provided that she gives due notice to
her employer in writing at least 45 days before the end of
her maternity leave. However, no prior notice shall be
necessary in the event of a medical emergency but
subsequent notice shall be given to her employer (Sec. 3, IRR
of R.A. 11210). Lastly, if A qualifies as a solo parent under
R.A. 8972, she shall also be granted an additional 15 days
maternity leave with full pay. (Sec. 3, R.A. 11210)
21
e) LEAVE BENEFITS FOR WOMEN WORKERS UNDER
MAGNA CARTA OF WOMEN (R.A. No. 9710) and ANTI-
VIOLENCE AGAINST WOMEN AND THEIR CHILDREN OF
2004 (R.A. No. 9262)
(2013 BAR)
Q: Because of the stress in caring for her four (4)
growing children, Tammy suffered miscarriage late in
her pregnancy and had to undergo an operation. In the
course of the operation, her obstetrician further
discovered a suspicious-looking mass that required
the subsequent removal of her uterus (hysterectomy).
After surgery, her physician advised Tammy to be on
full bed rest for six (6) weeks. Meanwhile, the biopsy
of the sample tissue taken from the mass in Tammy's
uterus showed a beginning malignancy that required
an immediate series of chemotherapy once a week for
four (4) weeks. What benefits can Tammy claim under
existing social legislation? (2013 BAR)
A: Assuming she is employed, Tammy is entitled to a
special leave benefit of 2 months with full pay
(Gynecological Leave) pursuant to R.A. No. 9710 or the
Magna Carta of Women. She can also claim Sickness Leave
Benefit in accordance with the SSS Law. (2009-2017 UST
FCL Bar Q&A)
NOTE: Under the Expanded Maternity Act (R.A. No.
11210), mothers can claim a 60-day paid maternity leave
in the event of a miscarriage or an emergency termination
of pregnancy.
f) COMPASSIONATE LEAVES
4. SPECIAL GROUPS OF EMPLOYEES
(2017, 2015, 2014, 2013, 2012, 2011, 2009, 2007,
2004, 2002, 2000, 1998 BAR)
a) WOMEN
(2017, 2013, 2012, 2011, 2000, 1998, 1995 BAR)
(1) DISCRIMINATION
(2011, 2000, 1998 BAR)
Q: An exclusive school for girls, run by a religious
order, has a policy of not employing unwed mothers,
women with live-in partners, and lesbians. (2000 BAR)
(a) Is the policy violative of any provision of the
Labor Code on employment of women?
A: NO. The policy does not violate the Labor Code. The
practice is a valid exercise of management function.
Considering the nature and reason for existence of the
school, it may adopt such policy as will advance its laudable
objectives. In fact, the policy accords with the constitutional
precept of inculcating ethical and moral values in schools.
The school policy does not discriminate against women
solely on account of sex (Art. 135 (now 133), LC) nor are the
acts prohibited under Art. 137 (now 135) of the Labor Code.
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
(b) The same school dismissed two female faculty
members on account of pregnancy out of
wedlock. Did the school violate any provision
of the Labor Code on employment of women?
A: NO. To tolerate pregnancy out of wedlock will be a
blatant contradiction of the school’s laudable mission
which, as already stated, accords with high constitutional
precepts. This answer does not contradict the ruling in
Chua-Qua v. Hon. Jacobo C. Clave and Tay Tung High School,
Inc. (G.R. No. 49549, 30 Aug. 1990) where the teacher merely
fell in love with a bachelor student and the teacher, also
single, did not get pregnant out of wedlock.
(2) STIPULATION AGAINST MARRIAGE
(2017, 2012, 1995 BAR)
Q: One of Pacific Airline’s policies was to hire only single
applicants as flight attendants, and considered as
automatically resigned the flight attendants at the
moment they got married. Is the policy valid? Explain
your answer. (2017 BAR)
A: NO, the policy is not valid. A single status policy is valid
only if it serves a legitimate business purpose; otherwise, it
is discriminatory as to be within the proscriptive tone of
Art. 134 of the Labor Code, as renumbered. Since Pacific
Airline’s policy does not amount to a BFQQ, it is productive
of disparate treatment; hence, it is void. (Star Paper Corp., et
al. v. Ronaldo Simbol, et al., G.R. No. 164774, 12 Apr. 2006; Bar
Q&A by Kato, 2022)
Q: Mam-manu Aviation Company (Mam-manu) is a new
airline company recruiting flight attendants for its
domestic flights. It requires that the applicant be single,
not more than 24 years old, attractive and familiar with
three (3) dialects, viz: Ilonggo, Cebuano and
Kapampangan. Ingga, 23 years old, was accepted as she
possesses all the qualifications. After passing the
probationary period, Ingga disclosed that she got
married when she was 18 years old but the marriage
was already in the process of being annulled on the
ground that her husband was afflicted with a sexually
transmissible disease at the time of the celebration of
their marriage. As a result of this revelation, Ingga was
not hired as a regular flight attendant. Consequently,
she files a complaint against Mam-manu alleging that
the pre-employment qualifications violate relevant
provisions of the Labor Code and are against public
policy. Is the contention of Ingga tenable? Why? (2012,
1995 BAR)
A: YES. The requirement that applicants be single violates
the provision in the Labor Code which makes it unlawful for
an employer to require as a condition of employment that a
woman employee shall not get married. (Art. 134, LC) The
requirement that applicants must not be more than 24
years old violates the law which makes it unlawful for an
employer to “require the declaration of age or birth date
during the application process.” (Sec. 5, R.A. No. 10911) The
situation described does not fall in any of the law’s
exceptions as it is not justified as a "bona fide occupational
qualification," where the particular requirements of the job
justify it. The said requirement is not valid because it does
not reflect an inherent quality that is reasonably necessary
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
for a satisfactory job performance. (PT&T vs. NLRC, GR No.
118978, 23 May 1997) (UPLC Suggested Answers)
(3) PROHIBITED ACTS
b) MINORS
(2012, 2007, 2006, 2004, 2002 BAR)
Q: A spinster school teacher took pity on one of her
pupils, a robust and precocious 12-year old boy whose
poor family could barely afford the cost of his schooling.
She lives alone at her house near the School after her
housemaid had left. In the afternoon, she lets the boy do
various chores as cleaning, fetching water and all kinds
of errands after school hours. She gives him rice and
P100.00 before the boy goes home at 7:00 every night.
The school principal learned about it and charged her
with violating the law which prohibits the employment
of children below 15 years of age. In her defense, the
teacher stated that the work performed by her pupil is
not hazardous. Is her defense tenable? Why? (2012
BAR)
A: NO. The defense is misplaced. Under the Labor Code, a
minor aged below 15 cannot be employed except under the
sole responsibility of his parents or guardian and in a
business where only family members are employed. Hence,
the teacher’s defense might be meritorious if she is the
guardian of the pupil. However, she is not. Likewise, under
R.A. No. 9231, minors of like age can be employed by any
person in essential public entertainment or information
through media. Certainly, the tasks performed by the pupil
are outside the letter of R.A. No. 9231. (Bar Q&A by Kato,
2022)
Q: Determine whether the following minors should be
prohibited from being hired and from performing their
respective duties indicated hereunder: (2006 BAR)
(a) A 17-year-old boy working as a miner at the
Walwaldi Mining Corporation.
A: YES. He should be prohibited from being hired and from
performing the duties of a miner because such constitutes
hazardous work under D.O. No. 04 Series of 1999. Art. 139
(c) [now 137(c)] of the Labor Code expressly prohibits the
employment of persons below 18 years of age in an
undertaking which is hazardous or deleterious in nature as
determined by the Secretary of Labor.
(b) An 11-year-old boy who is an accomplished
singer and performer in different parts of the
country.
A: NO. He should not be prohibited from being hired and
from performing as a singer. Under Art. VIII, Sec. 12, par. 2
of R.A. 7610 as amended by R.A. 7658, this constitutes an
exception to the general prohibition against the
employment of children below 15 years of age, provided
that the following requirements are strictly complied with:
a. The employer shall ensure the protection, health,
safety and morals of the child;
b. The employer shall institute measures to prevent
the child’s exploitation or discrimination taking
into account the system and level of remuneration,
22
 QuAMTO (1987-2022)
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 skill acquisition of the child.
Moreover, the child must be directly under the sole
responsibility of his parents or guardian and his
employment should not in any way interfere with his
schooling.
(c) A 15-year-old girl working as a library assistant
in a girls’ high school.
A: NO. She should not be prohibited from working as a
library assistant because the prohibition in the Labor Code
against employment of persons below 18 years of age
merely pertains to employment in an undertaking which is
hazardous or deleterious in nature as identified in the
guidelines issued by the DOLE Secretary. Working as a
library assistant is not one of undertakings identified to be
hazardous under D.O. No. 04 Series of 1999.
(d) A 16-year-old girl working as model promoting
alcoholic beverages.
A: YES. She should be prohibited from working as a model
promoting alcoholic beverages. R.A. 7610 categorically
prohibits the employment of child models in all
commercials or advertisements promoting alcoholic
beverages and intoxicating drinks, among other things.
(e) A 17-year-old boy working as dealer in a casino.
A: YES. He should be prohibited from working as a dealer
in a casino, because Art. 139 [now Art. 137] of the Labor
Code prohibits the employment of persons below 18 years
of age in an undertaking which is hazardous or deleterious
in nature as identified in the guidelines issued by the DOLE
Secretary. Working as a dealer in a casino is classified as
hazardous under D.O. No. 04 Series of 1999 as it exposes
children to physical, psychological or sexual abuses.
Q: You were asked by 3 paint manufacturing company
regarding the possible employment as a mixer of a
person, aged 17, who shall be directly under the care of
the section supervisor. What advice would you give?
Explain briefly. (2002 BAR)
A: I will advise the paint manufacturing company that it
cannot hire a person who is aged seventeen (17). Art. 139
(c) [now Art. 137(c)] of the Labor Code provides that a
person below eighteen (18) years of age shall not be
allowed to work in an undertaking which is hazardous or
deleterious in nature as determined by the Secretary of
Labor. Paint manufacturing has been classified by the
Secretary of Labor as a hazardous work.
23
c) KASAMBAHAYS
(2018, 2015, 2014, 2012, 2009, 2007, 2000, 1998 BAR)
Q: Your favorite relative, Tita Nilda, approaches you
and seeks your advice on her treatment of her
kasambahay, Noray. Tita Nilda shows you a document
called a "Contract of Engagement" for your review.
Under the Contract of Engagement, Noray shall be
entitled to a rest day every week, provided that she may
be requested to work on a rest day if Tita Nilda should
need her services that day. Tita Nilda also claims that
this Contract of Engagement should embody all terms
and conditions of Noray's work as the engagement of a
kasambahay is a private matter and should not be
regulated by the State. (2018 BAR)
(a) Is Tita Nilda correct in saying that this is a
private matter and should not be regulated by
the State?
A: NO. Tita Nilda is incorrect. The relationship between Tita
Nilda and Noray is an employer-employee arrangement
that is regulated by the police power of the State. Through
the Batas Kasambahay (R.A. No. 10361), the State recognizes
this employment relationship and establishes minimum
labor standards for domestic workers, toward decent
employment and income, enhanced coverage of social
protection and respect for human rights, and strengthened
social dialogue. Also, since domestic workers are generally
working women in vulnerable working conditions, the State
regulates domestic worker employment to prevent abuse
and exploitation and uphold the gender rights of domestic
workers. (UPLC Suggested Answers)
(b) Is the stipulation that she may be requested to
work on a rest day legal?
A: YES. Such a stipulation is legal as it states that Noray may
only be “requested” to work on a rest day, thereby
recognizing that the consent of Noray is needed in order to
waive her right to a weekly rest day. Sec. 21 of the
Kasambahay Law allows both the employer and domestic
worker to agree on certain arrangements to offset, waive,
or accumulate rest days, subject to payment of appropriate
wages and benefits. (UPLC Suggested Answers)
(c) Are stay-in family drivers included under the
Kasambahay Law?
A: NO. Family drivers are not included under the
Kasambahay Law. A “kasambahay” refers to any person
engaged in domestic work within an employment
relationship such as, but not limited to, the following:
general househelp, nursemaid or “yaya”, cook, gardener, or
laundry person, but shall exclude any person who performs
domestic work only occasionally or sporadically and not on
an occupational basis. (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
The R.A. No. 10361 does not exclude family drivers from the
coverage of the Kasambahay law. It is only in the
Implementing Rules that the family drivers were excluded.
Note that the Labor Code explicitly includes “family drivers
and other persons in the personal service of another in the
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 LABOR LAW AND SOCIAL LEGISLATION
coverage of the Labor Code, and hence, it is believed that
the family drivers should fall within the ambit of the
Kasambahay Law. The exclusion of driver in the
Implementing Rules is without basis.
Domestic helper or househelper or domestic servant shall
refer to any person, whether male or female, who renders
services in and about the employer’s home and which
services are usually necessary or desirable for the
maintenance and enjoyment thereof, and ministers
exclusively to the personal comfort and enjoyment of the
employers’ family. Such definition covers family drivers,
domestic servants, laundry women, yayas, gardeners,
houseboys and other similar househelps. (Apex Mining
Company, Inc. v. NLRC, G.R. No. 94951, 22 Apr. 1991; UPLC
Suggested Answers)
Q: Soledad, a widowed school teacher, takes under her
wing one of her students, Kiko, 13 years old, who was
abandoned by his parents and has to do odd jobs in
order to study. She allows Kiko to live in her house,
provides him with clean clothes, food, and a daily
allowance of 200 pesos. In exchange, Kiko does routine
housework, consisting of cleaning the house and doing
errands for Soledad. One day, a representative of the
DOLE and the DSWD came to Soledad's house and
charged her with violating the law that prohibits work
by minors. Soledad objects and offers as a defense that
she was not requiring Kiko to work as the chores were
not hazardous. Further, she did not give him chores
regularly but only intermittently as the need may arise.
Is Soledad's defense meritorious? (2015 BAR)
A: YES. Soledad’s defense is meritorious. Sec. 4(d) of the
Kasambahay Law (R.A. 10361) provides that the term
“Domestic Worker” 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. (2009-2017 UST FCL Bar Q&A)
Q: Linda was employed by Sectarian University (SU) to
cook for the members of a religious order who teach
and live inside the campus. While performing her
assigned task, Linda accidentally burned herself.
Because of the extent of her injuries, she went on
medical leave. Meanwhile, SU engaged a replacement
cook. Linda filed a complaint for illegal dismissal, but
her employer SU contended that Linda was not a
regular employee but a domestic househelp. Decide.
(2014 BAR)
A: The employer's argument that Linda was not a regular
employee has no merit. The definition of domestic servant
or househelper contemplates one who is employed in the
employer’s home to minister exclusively to the personal
comfort and enjoyment of the employer’s family. The
Supreme Court already held that the mere fact that the
househelper is working in relation to or in connection with
the employer’s business warrants the conclusion that such
househelper or domestic servant is and should be
considered as a regular employee. (Apex Mining Co., Inc. v.
NLRC, G.R. No. 94951, 22 Apr. 1991)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Here, Linda was hired not to minister to the personal
comfort and enjoyment of her employer's family but to
attend to other employees who teach and live inside the
campus. (2009-2017 UST FCL Bar Q&A)
Q: The weekly work schedule of a driver is as follows
Monday, Wednesday, Friday – Drive the family car to
bring and fetch the children to and from school.
Tuesday, Thursday, Saturday – Drive the family van to
fetch merchandise from suppliers and deliver the same
to a boutique in a mall owned by the family.
Is the driver a househelper? (2012, 1998 BAR)
A: YES. The driver is a househelper. A person is a
househelper or is engaged in domestic or household service
if he/she renders services in the employer's home which
are usually necessary or desirable for the maintenance and
enjoyment thereof and includes ministering to the personal
comfort and convenience of the members of the employer's
household including the services of family drivers.
A family driver who drives the family van to fetch
merchandise from suppliers and delivers the same to a
boutique in a mall owned by the family for whom he works
should be paid the minimum daily wage of a driver in a
commercial establishment.
The Labor Code (in Art. 143) provides that no househelper
shall be assigned to work in a commercial, industrial or
agricultural enterprise at a wage or salary rate lower than
that provided by law for agricultural or non-agricultural
workers.
Q: Albert, a 40-year old employer, asked his domestic
helper, Inday, to give him a private massage. When
Inday refused, Albert showed her Art. 141 of the Labor
Code, which says that one of the duties of a domestic
helper is to minister to the employer’s personal
comfort and convenience. (2009 BAR)
(a) Is Inday’s refusal tenable? Explain.
A: Inday’s refusal is tenable. Art. 141 of the LC does not
contemplate the rendition by a domestic helper of indecent
services. At any rate, the provisions of the Labor Code on
domestic helpers have been supplanted by R.A. No. 10361,
or the Kasambahay Act. Under said law, a kasambahay is
entitled to humane treatment by the members of the
household she ministers to. (Bar Q&A by Kato, 2022)
24
 QuAMTO (1987-2022)
d) HOMEWORKERS
(2017, 2009, 2000, 1998 BAR)
Q. Distinguish briefly, but clearly, a “househelper” from
a “homeworker.” (2017, 2009 BAR)
A: The differences between a househelper and a home-
worker are as follows:
1. As to regulatory law, househelpers (now
kasambahay) are protected by R.A. No. 10361;
whereas, industrial homeworkers are protected by
P.D. 442, as renumbered;
2. As to nature of work, a kasambahay ministers to
the personal comfort and convenience of a
household; whereas, a homeworker processes or
fabricates raw materials;
3. As to place of work, a kasambahay works at his
employer's house; whereas, a homeworker works
at home or about the premise of his home;
4. As to tenure, a kasambahay is a contractual
worker; whereas, a homeworker has security of
tenure (D.O. 5, s. 1995);
5. As to jurisdiction, the issues of a kasambahay
against their employer are for the DOLE Regional
Director to hear and resolve (Sec. 37, R.A. 10361);
whereas, the issues of a homeworker against his
employer are not exclusively for the DOLE
Regional Director to resolve. (Central Bar Q&A by
Kato, 2023)
e) NIGHT WORKERS
(2002 BAR)
f) APPRENTICES AND LEARNERS
(2017 BAR)
Q: Distinguish a learner from an apprentice. (2017
BAR)
A: A learner differs from an apprentice as follows:
1. A learner is engaged for not more than 3 months;
whereas, an apprentice is engaged for not more
than 6 months;
2. A learner performs a semi-skilled work; whereas,
an apprentice performs a highly technical work;
3. A learner is regularized by the completion of his
learnership; whereas, the completion of the
apprenticeship does not regularize an apprentice;
4. The illegal dismissal of a learner on the third month
of his employment regularizes him; whereas, the
illegal dismissal of an apprentice anytime during
the period of his apprentice does not have the same
legal effect; and
25
5. In the event of disputes, a learner shall file his
complaint with the Labor Arbiter; whereas, subject
to exhaustion of administrative remedies, an
apprentice shall file his complaint with the DOLE
Regional Director. (Bar Q&A by Kato, 2022)
g) PERSONS WITH DISABILITIES
(1) DISCRIMINATION
Q: For humanitarian reasons, a bank hired several
handicapped workers to count and sort out currencies.
The handicapped workers knew that the contract was
only for a period for six-months and the same period
was provided in their employment contracts. After six
months, the bank terminated their employment on the
ground that their contract has expired. This prompted
the workers to file with the Labor Arbiter a complaint
for illegal dismissal. Will their action prosper? Why or
why not? (2012 BAR)
A: YES. The special law to apply is Sec. 5 of the Magna Carta
for Persons with Disability which guarantees to disabled
workers the rights to able-bodied workers, one of which is
the right to regularization by reason of the nature of work
performed. Since sorting out and counting of coins is a job
that is usually necessary and desirable in the usual trade of
the bank then the complainants are regular employees;
hence, they can only be dismissed for a just or authorized
cause (Art. 294, LC). Since expiration of contract is not a
listed cause, their dissociation can be challenged via a
complaint for illegal dismissal. (Bar Q&A by Kato, 2022)
(a) MAGNA CARTA FOR DISABLED PERSONS (R.A. No.
7277)
(b) MENTAL HEALTH ACT (R.A. No. 11036)
(2) INCENTIVES FOR EMPLOYERS
5. SEXUAL HARASSMENT IN THE WORK ENVIRONMENT
(2022, 2018, 2009, 2006, 2005, 2004, 2003, 2000 BAR)
a) SEXUAL HARASSMENT ACT (R.A. No. 7877)
(2018, 2009 BAR)
Q: Nena worked as an Executive Assistant for Nesting,
CEO of Nordic Corporation. One day, Nesting called
Nena into his office and showed her lewd pictures of
women in seductive poses which Nena found offensive.
Nena complained before the General Manager who, in
turn, investigated the matter and recommended the
dismissal of Nesting to the Board of Directors. Before
the Board of Directors, Nesting argued, that since the
Anti-Sexual Harassment Law requires the existence of
"sexual favors," he should not be dismissed from the
service since he did not ask for any sexual favor from
Nena. Is Nesting correct? (2018 BAR)
A: NO. Nesting’s argument on lack of sexual favor is
incorrect. The essence of sexual harassment is unwanted
sexual attention. That Nena found the lewd pictures
offensive is an indication of the unwanted nature of
Nesting's overt act. Demand, requirement, or request for
sexual favor need not be articulated in a categorical oral or
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FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
written statement. It may be discerned, with equal
certitude, from the acts of the offender. If the combined
acts, i.e., prepositioning the lewd pictures and summoning
Nena into Nesting's office for her to view them, "resound
with defeaning clarity the unspoken request for sexual
favor", sexual harassment is deemed committed. (Domingo
v. Rayala, G.R. Nos. 155831 & 155840, 18 Feb. 2008) (Central
Bar Q&A by Kato, 2023)
Q: Atty. Renan, a CPA-lawyer and Managing Partner of
an accounting firm, conducted the orientation seminar
for newly-hired employees of the firm, among them,
Miss Maganda. After the seminar, Renan requested
Maganda to stay, purportedly to discuss some work
assignment. Left alone in the training room, Renan
asked Maganda to go out with him for dinner and
ballroom dancing. Thereafter, he persuaded her to
accompany him to the mountain highway in Antipolo
for sight-seeing. During all these, Renan told Maganda
that most, if not all, of the lady supervisors in the firm
are where they are now, in very productive and
lucrative posts, because of his favorable endorsement.
Did Renan commit acts of sexual harassment in a
work-related or employment environment? Reasons.
(2009 BAR)
A: YES. Atty. Renan is guilty of sexual harassment. This
conclusion is predicated upon the following consideration:
a. Atty. Renan has authority, influence or moral
ascendancy over Miss Maganda;
b. While the law calls for a demand, request or
requirement of a sexual favor, it is not necessary that
the demand, request or requirement of a sexual favor
be articulated in a categorical oral or written
statement. It may be discerned, with equal certitude
from the acts of the offender; (Domingo v. Rayala, G.R.
No. 155831, 18 Feb. 2008);
c. The acts of Atty. Renan towards Miss Maganda
resound with deafening clarity the unspoken request
for a sexual favor, regardless of whether it is accepted
or not by Miss Maganda; and
d. In sexual harassment, it is not essential that the
demand, request or requirement be made as a
condition for continued employment or promotion to
a higher position. It is enough that Atty. Renan’s act
result in creating an intimidating, hostile or offensive
environment for Miss Maganda. (2009-2017 UST FCL
Bar Q&A)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
b) SAFE SPACES ACT (Art. IV of R.A. No. 11313 Only;
Exclude Liability of Employers)
(2022 BAR)
Q: Due to Bitoy’s repeated unwanted sexual advances
towards his co-worker Diego, Diego went to the
Personnel Manager to report Bitoy’s behavior. The
Personnel Manager started a disciplinary action case
against Bitoy. In his written explanation, Bitoy denied
the allegation of sexual advances. He also pointed out
that sexual harassment only pertains to a superior-
subordinate relationship, where the perpetrator is the
superior and the victim is the subordinate. Since Diego
is not his subordinate, as they are co-workers with the
same rank, Bitoy cannot be subject to disciplinary
action. Is Bitoy’s contention correct? Explain
briefly. (2022 BAR)
A: NO, Bitoy's contention is not correct. His sexual advances
are acts of sexual harassment under the 2019 Safe Spaces
Act (R.A. No. 11313). Under the 1995 Anti-Sexual
Harassment Act (R.A. No. 7877), the gravamen of the
offense of sexual harassment is abuse of authority.
(Philippine Aeolus Automotive United Corp. vs. NLRC, G.R.
1246171 28 Apr. 2000) It is not so under R.A. 11313 where
the essence of sexual harassment is unwanted sexual
attention or offensive sexual intrusion in public spaces, e.g.,
workplace. Hence, despite lack of superior-subordinate
relationship between the two, Bitoy is liable for sexual
harassment. (Central Bar Q&A by Kato, 2023)
C. SOCIAL WELFARE LEGISLATION
(2019, 2018, 2017, 2016, 2015, 2014, 2010, 2009,
2008, 2007, 2005, 2004, 2003, 2002, 2000, 1999, 1997,
1992, 1991, 1990. 1987 BAR)
NOTE: R.A. No. 11199, “(Social Security Act of 2018)” which
took effect on March 5, 2019, repealed R.A. No. 1161, as
amended by R.A. 8282 (Social Security Act of 1997). Thus,
unless the question specifies a date which calls for the
application of the old law, the answers given below are
based on the new law.
1. SSS LAW (R.A. No. 8282, as amended by
R.A. No. 11199)
(2019, 2017, 2016, 2015, 2010, 2008, 2007, 2005,
2003, 2002, 2000, 1992, 1990, 1987 BAR)
a) COVERAGE
(2016, 2015, 2010, 2008, 2007, 2003, 2002, 2000 BAR)
Q: State the respective coverage of Social Security Law:
A: Under R.A. 10361 (Kasambahay Law), domestic helpers
who have rendered at least 1 month of service regardless of
the amount of their salary shall be covered by the SSS.
Premium payments or contributions shall be shouldered by
the employer. However, if the domestic worker is receiving
a wage of Five thousand pesos (P5,000.00) and above per
month, the domestic worker shall pay the proportionate
share in the premium payments or contributions, as
provided by law. (Sec. 30, R.A. No. 10361)
26
 QuAMTO (1987-2022)
NOTE: R.A. 11199, otherwise known as the “Social Security
Act of 2018” which took effect on 05 Mar. 2019, repealed
R.A. No. 1161, as amended by R.A. 8282 (Social Security Act
of 1997)
Under the Social Security Act of 2018, the coverage of SSS
is:
1. Compulsory Coverage
a. All Ees not over 60 years of age and their Ers;
b. Domestic helpers whose income is not less than
P1,000/month and not over 60 years of age and
their Ers;
c. All self-employed professionals;
d. Partners and single proprietors of business;
e. Actors and actresses, directors, scriptwriters and
news correspondents who do not fall within the
definition of the term “employee” in Sec. 8(d) of
the 2018 SSS Law;
f. Professional athletes, coaches, trainers, and
jockeys;
g. Individual farmers and fishermen; and
h. All sea-based and land-based OFWs, as defined
under R.A. 8042, as amended, provided they are
not over 60 years of age.
2. Voluntary Coverage
a. Spouses who devote full time to managing the
household and family affairs.
XPN: They are also engaged in other vocation or
employment which is subject to mandatory
coverage.
b. An OFW upon the termination of his/her
employment overseas;
c. A covered employee who was separated from
employment who continues to pay his/her
contributions;
d. Self-employed who realizes no income for a certain
month;
e. Filipino permanent migrants, including Filipino
immigrants, permanent residents and naturalized
citizens of their host countries.
3. By agreement – Any foreign government, international
organization or their wholly owned instrumentality
employing workers in the Philippines or employing
Filipinos outside of the Philippines.
XPN: Those already covered by their respective civil
service retirement systems.
Q: Baldo, a farm worker on pakyaw basis, had been
working on Dencio’s land by harvesting abaca and
coconut, processing copra, and cleaning weeds from
year to year starting January 1993 up to his death in
2007. He worked continuously in the sense that it was
done for more than one harvesting season. (2016 BAR)
(a) Was Dencio required to report Baldo for
compulsory social security coverage under
the SSS law? Explain.
27
A: Dencio was required to report his employee Baldo for SSS
coverage. Only the following are excluded from SSS
coverage: purely casual employees, Filipinos employed by
foreign vessels while outside Philippine territory,
employees of foreign governments and international
organizations unless covered by administrative
agreements, government employees, and other employees
excluded by the Social Security Commission. Baldo, a
regular employee, was not one of the excluded employees.
(Bar Q&A by Kato, 2022)
(b) What are the liabilities of the employer who
fails to report his employee for social security
coverage? Explain.
A: The Social Security Act is a penal law. Hence, an employer
who does not report his employee for SSS coverage shall
incur criminal liability. In addition, he shall pay the benefit
if the latter dies, becomes disabled, gets sick or retires. He
shall also pay all contributions, plus 3% penalty per month.
(Bar Q&A by Kato, 2022)
Q: Ador is a student working on his master's degree in
horticulture. To make ends meet, he takes on jobs to
come up with flower arrangements for friends. His
neighbor, Nico, is about to get married to Lucia and
needs a floral arranger. Ador offers his services and
Nico agrees. They shake hands on it, agreeing that Nico
will pay Ador P20,000.00 for his services but that Ador
will take care of everything. As Ador sets about to
decorate the venue, Nico changes all of Ador’s plans and
ends up designing the arrangements himself with Ador
simply executing Nico’s instructions. (2015 BAR)
(a) Is there an employer-employee relationship
between Nico and Ador?
A: Ador is a worker paid on task basis; hence, there is
employer-employee relationship between him and Nico.
When the latter assumed the control of both result and
manner of performance from Ador, all vestiges of the initial
independent contractorship arrangement disappeared.
What replaced it was employer-employee relationship. (Bar
Q&A by Kato, 2022)
(b) Will Nico need to register Ador with the SSS?
A: Ador is a purely casual employee; hence, Nico need not
report him for SSS coverage. (Bar Q&A by Kato, 2022)
Q: Luisa is an unwed mother with 3 children from
different fathers. In 2004, she became a member of the
SSS. That same year, she suffered a miscarriage of a
baby out of wedlock from the father of her third child.
She wants to claim maternity benefits under the SSS Act.
Is she entitled to claim? (2015, 2010, 2007, 2000 BAR)
A: YES. Under the Social Security Act of 1997, the law in
effect at the time, Luisa is entitled to claim maternity
benefits provided she has reported to her employer her
pregnancy and date of expected delivery and paid at least
three monthly contributions during the 12-month period
immediately preceding her miscarriage, then she is entitled
to maternity benefits up to four deliveries or miscarriages.
As to the fact that she got pregnant outside wedlock, as in
her past three pregnancies, this will not bar her claim
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 LABOR LAW AND SOCIAL LEGISLATION
because the SSS is non-discriminatory. (2009-2017 UST FCL
Bar Q&A)
NOTE: This answer is still applicable under the SSS Act of
2018.
NOTE: The law merely says “a female member”. It does not
qualify the term to mean legally married woman. (Sec. 14-A,
Social Security Act of 1997 (now Sec. 14-A, R.A. No. 11199)
Q: Tito Paciencioso is an employee of a foundry shop in
Malabon, Metro Manila. He is barely able to make ends
meet with his salary of P4,000.00 a month. One day, he
asked his employer to stop deducting from his salary
his SSS monthly contribution, reasoning out that he is
waiving his social security coverage. If you were Tito’s
employer, would you grant his request? Why? (2008
BAR)
A: NO. As Tito’s employer, I am bound by law to remit to SSS
Tito’s monthly contribution. The SSS law covers any person
natural, juridical, domestic or foreign, carrying in the
Philippines trade, business, industry, undertaking or
activity and uses the services of another under his order as
regards employment. The compulsory coverage of
employers and employees under the SSS law is actually a
legal imposition on the employers and employees, designed
to provide social security to workingmen. Membership in
SSS is in compliance with a lawful exercise of the police
power of the State and may not be waived by agreement of
any party. (Phil. Blooming Mills, Co., Inc. v. SSS, G.R. No. L-
21223, 31 Aug. 1966; 2009-2017 UST FCL Bar Q&A)
NOTE: This answer is still applicable under the SSS Act of
2018.
Q: Pablo was a farm-hand, in a plantation owned by ABC
& Co., working approximately 6 days a week for a good
15 years. Upon Pablo's death, his widow filed a claim for
burial grant and pension benefits with the SSS. The
claim was denied on the ground that Pablo had not been
a registered member-employee. Pablo’s widow filed a
petition before the SSS asking that ABC & Co. be directed
to pay the premium contributions of Pablo and that his
name be reported for SSS coverage.
ABC & Co. countered that Pablo was hired to plow,
harrow and burrow, using his own carabao and other
implements and following his own schedule of work
hours, without any supervision from the company. If
proven, would this factual setting advanced by ABC &
Co. be a valid defense against the petition? (2003 BAR)
A: YES. ABC & Co. has a valid defense. Pablo should be an
employee of ABC & Co. to be under the compulsory coverage
of the SSS. To be an employee, Pablo should be under the
control of ABC & Co. as regards his employment. But the
facts show that he was not under the control of ABC & Co. as
regards his employment. Among others, he had his own
schedule of work hours, without any supervision from the
company. Thus, he is an independent contractor and not an
employee.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
An independent contractor is not under the compulsory
coverage of the SSS. He may be covered as a self-employed
person. But then as such, ABC & Co. has no legal obligation
to report Pablo for coverage under the SSS because ABC &
Co. is not Pablo’s employer.
b) DEPENDENTS AND BENEFICIARIES
(2019, 2017, 2008, 1992, 1990, 1987 BAR)
Q: X is a member of the Social Security System (SSS). In
2015, he died without any spouse or children. Prior to
the semester of his death, X had paid 36 monthly
contributions. His mother, M, who had previously been
receiving regular support from X, filed a claim for the
latter's death benefits. (2019 BAR)
(a) Is M entitled to claim death benefits from the
SSS? Explain.
A: YES. R.A. 8282, the law in effect in 2015, states that if a
member has no primary beneficiaries, his secondary
beneficiaries shall be entitled to a lump sum benefit
equivalent to 36 times the monthly pension. Thus, the
mother of X, as a secondary beneficiary, is entitled to a lump
sum death benefit for X, who has made at least 36 monthly
contributions. (Sec. 13 in relation to Sec. 8[k], R.A. No. 8282,
now Sec. 13 in relation to Sec. 8[k], R.A. No. 11199) (UPLC
Suggested Answers)
NOTE: Sec. 13 in relation to Sec. 8[k], R.A. No. 11199 contains
a similar provision.
(b) Assuming that X got married to his girlfriend a
few days before his death, is M entitled to claim
death benefits from the SSS? Explain.
A: YES. The presumption that the surviving spouse whose
marriage to SSS members were contracted after the latter’s
retirement entered into the marriage for the purpose of
securing survivor’s benefits is not necessarily or
universally true. (Dycaico v. Social Security System, G.R. No.
161357, 30 Nov. 2005) (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
A: In view of the marriage of X to his girlfriend, M is deemed
restored to her secondary beneficiary status. Hence, X's
wife will be his primary beneficiary until she remarries;
provided, she was living with him at the time of his death.
(Sec. 8(k), R.A. 8282; Yolanda Signey v. SSS, G.R. No. 173582,
28 January 2008) (Central Bar Q&A by Kato, 2023)
c) BENEFITS
(2017, 2010, 2007, 2005, 2000 BAR)
Q: Gene is a married regular employee of Matibay
Corporation. The employees and Matibay Corporation
had an existing CBA that provided for funeral or
bereavement aid of P15,000.00 in case of the death of a
legal dependent of a regular employee. His widowed
mother, who had been living with him and his family for
many years, died; hence, he claimed the funeral aid.
Matibay Corporation denied the claim on the basis that
she had not been his legal dependent as the term legal
28
 QuAMTO (1987-2022)
dependent was defined by the Social Security Law.
(2017 BAR)
(a) Who may be the legal dependents of Gene
under the Social Security Law?
A: Under the 2018 SSS Act:
1. The legal spouse entitled by law to receive support
from the member;
2. The legitimate, legitimated, or legally adopted, and
illegitimate child who is unmarried, not gainfully
employed, and has not reached 21 years of age, or
if over 21 years of age, he is congenitally or while
still a minor has been permanently incapacitated
and incapable of self-support, physically or
mentally; and
3. The parent who is receiving regular support from
the member.
(b) Is Gene entitled to the funeral aid for the death
of his widowed mother? Explain your answer.
A: YES. Gene is entitled to the funeral aid for the death of
his widowed mother. In Philippine Journalists, Inc. v. Journal
Employees Union (G.R. No. 192601, 03 June 2013), the
Supreme Court held that term “legal dependent” as used in
the CBA should be construed as similar to the meaning that
contemporaneous social legislations have set if the CBA is
silent about it. Here, the CBA is silent about the coverage of
the term “legal dependent.” Hence, the definition of legal
dependent in the Social Security Law, which includes a
legitimate parent dependent on the employee for support,
should be used.
2. GSIS LAW (R.A. No. 8291)
(2018, 2015, 2014, 2009, 2005, 2004, 1999, 1997,
1991 BAR)
a) COVERAGE
(2015, 2009, 2005, 2004, 1999 BAR)
Q: State the respective coverage of GSIS Law. (2009
BAR)
A: Membership in the GSIS (Sec. 3, R.A. No. 8291) shall be
compulsory for all employees receiving compensation who
have not reached the compulsory retirement age,
irrespective of employment status.
An employee or member is any person, receiving
compensation while in the service of the national
government, its political subdivisions, branches, agencies or
instrumentalities, including government-owned or
controlled corporations, and financial institutions with
original charters, the constitutional commissions and the
judiciary, whether by election or appointment, irrespective
of status of appointment, including barangay and
sanggunian officials. (Sec. 2(c) and (d), R.A. No. 8291)
XPNs:
1. Members of the AFP and PNP; and
2. Contractuals that have no employer-employee
relationship with the agencies that they serve.
29
All members of the GSIS shall have life insurance,
retirement, and all other social security protection such as
disability, survivorship, separation, and unemployment
benefits.
XPN: life insurance only
Members of the:
1. The Judiciary; and
2. The Constitutional Commissions.
Q: Luis, a PNP officer, was off duty and resting at home
when he heard a scuffle outside his house. He saw two
of his neighbors fighting and he rushed out to pacify
them. One of the neighbors shot Luis by mistake, which
resulted in Luis's death. Marian, Luis's widow, filed a
claim with the GSIS seeking death benefits. The GSIS
denied the claim on the ground that the death of Luis
was not service-related as he was off duty when the
incident happened. Is the GSIS correct? (2015 BAR)
A: NO, the GSIS is not correct. Luis, a policeman, just like a
soldier, is covered by the 24-Hour Duty Rule. He is deemed
on round-the clock-duty unless on official leave, in which
case, his death outside performance of official peace-
keeping mission will bar death claim. In this case, Luis was
not on official leave and he died in the performance of a
peace-keeping mission. Therefore, his death is
compensable. (2009-2017 UST FCL Bar Q&A)
b) DEPENDENTS AND BENEFICIARIES
(2018, 1999, 1997, 1991 BAR)
Q: Sgt. Nemesis was a detachment non-commissioned
officer of the Armed Forces of the Philippines in Nueva
Ecija. He and some other members of his detachment
sought permission from their Company Commander for
an overnight pass to Nueva Vizcaya to settle some
important matters. The Company Commander orally
approved their request and allowed them to carry their
firearms as the place they were going to was classified
as a "critical place."
They arrived at the place past midnight; and as they
were alighting from a tricycle, one of his companions
accidentally dropped his rifle, which fired a single shot,
and in the process hit Sgt. Nemesis fatally. The shooting
was purely accidental.
At the time of his death, he was still legally married to
Nelda, but had been separated de facto from her for 17
years. For the last 15 years of his life, he was living in
with Narda, with whom he has two minor children.
Since Narda works as a kasambahay, the two children
lived with their grandparents, who provided their daily
support. Sgt. Nemesis and Narda only sent money to
them every year to pay for their school tuition.
Nelda and Narda, both for themselves and the latter,
also on behalf of her minor children, separately filed
claims for compensation as a result of the death of Sgt.
Nemesis. The line of Duty Board of the AFP declared Sgt.
Nemesis' death to have been "in line of duty", and
recommended that all benefits due to Sgt. Nemesis be
given to his dependents. However, the claims were
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
denied by GSIS because Sgt. Nemesis was not in his
workplace nor performing his duty as a soldier of the
Philippine Army when he died. (2018 BAR)
(a) Are the dependents of Sgt. Nemesis entitled to
compensation as a result of his death?
A: YES. The death of Sgt. Nemesis arose out of and in the
course of his employment as a soldier on active duty in the
AFP and hence, compensable. The concept of a “workplace”
cannot always be literally applied to a soldier on active
duty. Sgt. Nemesis had permission to go to Nueva Vizcaya
and he and his companions had permit to carry their
firearms which they could use to defend themselves when
attacked. A soldier on active duty is really on duty 24 hours
a day since he can be called upon anytime by his superiors,
except when he is on vacation leave status, which Sgt.
Nemesis was not, at the time of his death. (Hinoguin v. ECC,
G.R. No. 8430, 17 Apr. 1989) (UPLC Suggested Answers)
(b) As between Nelda and Narda, who should be
entitled to the benefits?
A: To be considered as a beneficiary, the spouse must be the
legal spouse and living with the employee at the time of his
death. Nelda, as the surviving spouse who has been
separated de facto from the deceased employee, may still be
entitled if the separation was due to the covered employee’s
abandonment of the spouse without valid reason, or for
other justifiable reasons. Narda, not being a legitimate
spouse, is not entitled to the benefits; however, the ECC may
act as referee and arbitrator between two (2) claimants to
help each other reach a mutually acceptable compromise
settlement of allocating the compensation among
themselves and their dependent children. (Samar Mining
Co. Inc. v. WCC, G.R. No. L-29938-39, 31 Mar. 1971) (UPLC
Suggested Answers)
(c) Are the minor children entitled to the benefits
considering that they were not fully dependent
on Sgt. Nemesis for support?
A: YES. Being a dependent does not mean absolute
dependency for the necessities of life, but rather, that the
claimant looked up to and relied on the contribution of the
covered employee for his means of living as determined by
his position in life. One need not be in the deceased’s
household in order to be a dependent. (Malate Taxicab v.
Del Villar G.R. No. L-7489, 29 Feb. 1956) (UPLC Suggested
Answers)
c) BENEFITS
(2018, 2014, 2005, 2004, 1999 BAR)
Q: Luisito has been working with Lima Land for 20
years. Wanting to work in the public sector, Luisito
applied with and was offered a job at Livecor. Before
accepting the offer, he wanted to consult you whether
the payments that he and Lima Land had made to the
SSS can be transferred or credited to the GSIS. What
would you advice? (2014 BAR)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
A: YES. Under R.A. 7699, otherwise known as the
Portability Law, one may combine his years of service in the
private sector represented by his contributions to the Social
Security System (SSS) with his government service and
contributions to the GSIS. The contributions shall be
totalized for purposes of old-age, disability, survivorship
and other benefits in case the covered member does not
qualify for such benefits in either or both Systems without
totalization. (2009-2017 UST FCL Bar Q&A)
LIMITED PORTABILITY LAW
R.A. No. 7699
(2014, 2011 BAR)
Q: Under the Limited Portability law, funds from the
GSIS and the SSS maybe transferred for the benefit of a
worker who transfers from one system to the other. For
this purpose, overlapping periods of membership shall
be (2011 BAR)
a. credited only once.
b. credited in full.
c. proportionately reduced.
d. equally divided for the purpose of totalization.
A: A.
Q: Luisito has been working with Lima Land for 20
years. Wanting to work in the public sector, Luisito
applied with and was offered a job at Livecor. Before
accepting the offer, he wanted to consult you whether
the payments that he and Lima Land had made to the
Social Security System (SSS) can be transferred or
credited to the Government Service Insurance System
(GSIS). What would you advice? (2014 BAR)
A: YES. Under R.A. No. 7699, otherwise known as the
Portability Law, one may combine his years of service in the
private sector represented by his contributions to the SSS
with his government service and contributions to the GSIS.
The contributions shall be totalized for purposes of old-age,
disability, survivorship, and other benefits in case the
covered member does not qualify for such benefits in either
or both Systems without totalization.
ALTERNATIVE ANSWER:
I would tell Luisito that, under the Limited Portability Law,
he will carry with him his creditable service and paid
contributions as he moves from one system to the other.
Hence, he may accept the job offer without fearing that he
would lose his years of service in the private sector.
Actually, they can be totalized with his years of service in
the public sector in the event that he would not be able to
qualify for benefits due solely to insufficiency of creditable
service. (Central Bar Q&A by Kato, 2023)
30
 QuAMTO (1987-2022)
3. DISABILITY AND DEATH BENEFITS b) POEA-STANDARD EMPLOYMENT CONTRACT
(2022, 2019, 2018, 2017, 2015, 1999 BAR) (2022, 2019, 2018, 2015 BAR)

Q: Marino, a seafarer, was engaged as an oiler on board

a) LABOR CODE
Searena Corporation’s oil tanker vessel. After ten
(2017 BAR)
consecutive contracts, with each contract having a
duration of eight months and the last one ending in Dec.
Q: Rosa was granted vacation leave by her employer to
2021, Marino decided it was time to enjoy his hard-
spend three weeks in Africa with her family. Prior to
earned money, and disembarked from the vessel upon
her departure, the General Manager of the company
the expiration of his employment contract. In April
requested her to visit the plant of a client of the
2022, he felt excruciating pain in his groin. He went to a
company in Zimbabwe in order to derive best
doctor and was diagnosed with acute hernia. The
manufacturing practices useful to the company. She
doctor also determined that the hernia was caused by
accepted the request because the errand would be
repeated heavy lifting because of his work as an oiler.
important to the company and Zimbabwe was anyway
As a result, Marino filed a case against Searena
in her itinerary. It appears that she contracted a serious
Corporation before the Labor Arbiter, claiming total
disease during the trip. Upon her return, she filed a
and permanent disability under the POEA Standard
claim for compensation, insisting that she had
Employment Contract. Searena Corporation raised in
contracted the disease while serving the interest of her
its position paper that Marino is barred from filing the
employer. Under the Labor Code, the sickness or death
case as he did not raise any complaints during the term
of an employee, to be compensable, must have resulted
of his employment, and within three days from his
from an illness either definitely accepted as an
arrival in the country after his last employment.
occupational disease by the Employees' Compensation
Commission, or caused by employment subject to proof
If you were the Labor Arbiter, rule on Searena
that the risk of contracting the same is increased by
Corporation’s defense. Explain briefly. (2022 BAR)
working conditions. Is the serious disease Rosa
contracted during her trip to Africa compensable?
A: If I were the Labor Arbiter, I would rule in favor of
Explain your answer. (2017 BAR)
Searena. The compensability of a disability arising from
disease requires the concurrence of two conditions, viz.: (1)
A: YES, it is compensable. For sickness and the resulting
the disease must be work-connected, i.e., it is a listed disease
disability to be compensable, the sickness must be the result
under Sec. 32-A of the POEA-SEC; or it is unlisted but
of an occupational disease listed under Annex A of the
disputably presumed as work-connected sans evidence to
Amended Rules on Employees' Compensation with the
overcome the presumption (Racelis v. UPL, G.R. No. 198408,
condition set therein satisfied; otherwise, proof must be
12 Nov. 2014); and (2) the disease must have been
shown that the risk of contracting the disease is increased
contracted during the period of the seafarer's employment
by the working condition. The burden of proof is upon Rosa.
contract. (Sec. 20-A, POEA-SEC) Since Marino contracted
No proof was presented by Rosa to substantiate the
acute hernia after the expiration of his employment
foregoing. Moreover, it is required that the sickness and the
contract, the second requisite is absent. Hence, his disability
resulting injury must have arisen out of or in the course of
is not compensable even if his medical evidence might show
employment. In the present case/ Rosa contracted the
that his disease is work-connected. (Central Bar Q&A by
disease While on vacation leave. Consequently, the disease
Kato, 2023)
contracted by herin Africa during her vacation leave is not
compensable (Iloilo Dock & Engineering Co. v. Workmen's
ALTERNATIVE ANSWER:
Compensation Commission et al., G.R. NO, L-26341, 27 Nov.
1968)
A post-employment disability is not compensable unless it
can be proven that the disease causing it is work-connected
ALTERNATIVE ANSWER:
and the seafarer's performance of his onboard work has
increased his risk of contracting it (Increased Risk Theory).
YES, it is compensable. Under the Amended Rules on
Since Marino's medical evidence shows that his acute
Employee Compensation (AREC), disability or death arising
hernia is work-connected, what requires further proof is
from disease is compensable if the disease is an
the increased risk element since there is no medical
occupational one, i.e., it is listed under Annex "A" of the
repatriation in the premises. The question to ask then is:
AREC as such. If unlisted, it is still an occupational disease if
“has performance by Marino of his customary work
covered by the Proximate Cause Theory or the Increased
increased his risk of contracting acute hernia?” Again, based
Risk Theory. In Rosa's case, she contracted the disease as a
on his medical evidence, the answer is in the affirmative.
result of her performance of a work-related task. Hence,
Since the defenses raised by Searena Corporation are
there being no efficient intervening cause breaking the
misplaced defenses as they do not address the herein
chain of causes connecting that performance to her disease,
applicable requisites of compensability, they should be
the occupational character of her medical condition is
disregarded. (Central Bar Q&A by Kato, 2023)
beyond doubt (Proximate Cause Theory). (Central Bar Q&A
by Kato, 2023)
Q: W Ship Management, Inc. hired Seafarer G as bosun
in its vessel under the terms of the 2010 Philippine
Overseas Employment Administration – Standard
Employment Contract (POEA–SEC).

31 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
On his 6th month on board, Seafarer G fell ill while
working. In particular, he complained of stomach pain,
general weakness, and fresh blood in his stool. When
his illness persisted, he was medically repatriated on
15 Jan. 2018. On the same day, Seafarer G submitted
himself to a post-employment medical examination,
wherein he was referred for further treatment. As of 30
Sept. 2018, Seafarer G has yet to be issued any fit-to-
work certification by the company-designated
physician, much less a final and definitive assessment
of his actual condition. Since Seafarer G still felt unwell,
he sought an opinion from a doctor of his choice who
later issued an independent assessment stating that he
was totally and permanently disabled due to his illness
sustained during work.
Seafarer G then proceeded to file a claim for total and
permanent disability compensation. The company
asserts that the claim should he dismissed due to
prematurity since Seafarer G failed to first settle the
matter through the third-doctor conflict resolution
procedure as provided under the 2010 POEA-SEC.
(2019 BAR)
(a) What is the third-doctor conflict resolution
procedure under the 2010 POEA-SEC? Explain.
A: In the event of conflicting medical assessments, the
parties are required to select a third physician whose
finding shall be final and binding on them. Under Sec. 20(B)
of the 2010 POEA-SEC, the selection is consensual;
however, jurisprudence has made it mandatory. (Philippine
Hammonia Ship Agency, Inc. v. Eulogio Dumadag, G.R. No.
194362, 26 June 2013)
(b) Will Seafarer G's claim for total and permanent
disability benefits prosper despite his failure to
first settle the matter through the third-doctor
conflict resolution procedure? Explain.
A: YES, it will prosper. The Third Physician Rule has no
application when the company-designated physician
exceeds the 120/240-day treatment period without making
a final, categorical and definitive assessment. Here, he
allowed 273 days to elapse without issuing a fit-to-work
assessment or a disability grade. (Apines v.
Shipmanagement Philippines, Inc., G.R. No. 2021334, 09 Nov.
2016)
(c) Assuming that Seafarer G failed to submit
himself to a post-employment medical
examination within three (3) working days
from his return, what is the consequence
thereof to his disability claim? Explain.
A: Noncompliance with the 3-day reporting requirement
results in the forfeiture of G's entitlement to disability
compensation. (Sec. 20(B), POEA-SEC)
Q: Mr. A signed a one (1)-year contract with XYZ
Recruitment Co. for deployment as welding supervisor
for DEF, Inc. located in Dubai. The employment
contract, which the POEA approved, stipulated a salary
of US$600.00 a month.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Mr. A had only been in his job in Dubai for 6 months
when DEF, Inc. announced that it was suffering from
severe financial losses and thus intended to retrench
some of its workers, among them Mr. A. DEF, Inc. hinted,
however, that employees who would accept a lower
salary could be retained. Together with some other
Filipino workers, Mr. A agreed to a reduced salary of
US$400.00 a month and thus, continued with his
employment.
Was the reduction of Mr. A’s salary valid? Explain.
(2019 BAR)
A: NO, the reduction of Mr. A's salary is invalid. All the
Terms and conditions in the POEA contract remain in force
until such changes are approved by the POEA. To substitute
or alter to the prejudice of the worker, employment
contracts approved and verified by the Department of
Labor and Employment from the time of actual signing
thereof by the parties up to and including the period of the
expiration of the same without the approval of the
Department of Labor and Employment constitutes a
prohibited practice. (Sec. 6, R.A. No. 8042; UPLC Suggested
Answers)
ALTERNATIVE ANSWER:
NO, the reduction of Mr. A's salary is invalid. The Labor
Code provisions on retrenchment and other authorized
causes of termination are to apply to Mr. A, and hence, he
should be entitled to retrenchment pay of 1 month
guaranteed pay or 1/2 month for every year of service,
whichever is higher. The principle of incorporation and lex
loci celebrationis applies to Filipino workers, regardless of
their deployment abroad. If at all, he ought to have received
his retrenchment pay, and then signed up for a new contract
of employment under reduced salaries. (UPLC Suggested
Answers)
ALTERNATIVE ANSWER:
YES, the reduction of Mr. A's salary is valid. Assuming that
the company is truthfully suffering from severe financial
losses, the reduction of Mr. A's salary is valid as it is a result
of his agreement together with other employees, with the
objective of preventing the company from shutting down.
The law (Art. 100) prohibits diminution or elimination of
benefits by unilateral action of the employer. The law is not
violated if the action resulted from a joint or negotiated
decision freely made by the employer and the employee. In
Insular Hotel EmpIoyees Union-NFL v. Waterfront Insular
Hotel Davao (G.R. Nos. 174040-41, 22 Sept. 2010), the
Supreme Court upheld the reduction of pay agreed by the
union so as to prevent the closure of the enterprise. (UPLC
Suggested Answers)
Q: Nonato had been continuously employed and
deployed as a seaman who performed services that
were necessary and desirable to the business of N-Train
Shipping, through its local agent, Narita Maritime
Services (Agency), in accordance with the 2010
Philippine Overseas Employment Administration
Standard Employment Contract (2010 POEA-SEC).
Nonato’s last contract (for 5 months) expired on 15 Nov.
2016. Nonato was then repatriated due to a “finished
32
 QuAMTO (1987-2022)
contract.” He immediately reported to the Agency and
complained that he had been experiencing dizziness,
weakness, and difficulty in breathing. The Agency
referred him to Dr. Neri, who examined, treated, and
prescribed him with medications. After a few months of
treatment and consultations, Nonato was declared fit to
resume work as a seaman. Nonato went back to the
Agency to ask for re-deployment but the Agency
rejected his application. Nonato filed an illegal
dismissal case against the Agency and its principal, with
a claim for total disability benefits based on the
ailments that he developed on board N-Train Shipping
vessels. The claim was based on the certification of his
own physician, Dr. Nunez, that he was unfit for sea
duties because of his hypertension and diabetes. (2018
BAR)
(a) Was Nonato a regular employee of N-Train
Shipping?
A: NO, he is not. Seafarers are considered contractual
employees. They cannot be considered as regular
employees under Art. 280 of the Labor Code. Their
employment is governed by the contracts they sign every
time they are hired or rehired and their employment is
terminated when the contract expires. Their employment is
contractually fixed for a certain period of time. (Millares v.
NLRC, G.R. No. 110524. 29 July 2002) (UPLC Suggested
Answers)
(b) Can Nonato successfully claim disability
benefits against N-Train Shipping and its agent
Narita Maritime Services?
A: NO, Nonato cannot successfully claim disability
compensation for these reasons: First, the requisites for
compensability are not present. Second, the Third Physician
Rule was not observed.
The twin-requisites of compensation for disability arising
from disease are: (a) work connection, and (b) effectivity of
contract. (Sec. 20-A, POEA-SEC) For a disease to be work-
connected, it must be listed under Sec. 32-A of the POEA-SEC,
subject to the disputable presumption of work-connection
as to unlisted diseases. To meet the second requisite, it must
have been contracted or aggravated during the effectivity of
the seafarer’s employment contract. Since Nonato finished
his contract, i.e., he was not medically repatriated due to a
work-connected disease, the second requisite is absent.
Moreover, he should have submitted himself to a third
physician given the conflicting medical assessments made
by the company-designated physician and his physician of
choice. He did not. For this additional reason, he cannot
successfully claim disability compensation based on his
medical evidence. (Philippine Hammonia Ship Agency v.
Eulogio Dumadag, G.R. No. 194362, 26 June 2013; Bar Q&A by
Kato, 2022)
33
Q: Victor was hired by a local manning agency as a
seafarer cook on board a luxury vessel for an eight-
month cruise. While on board, Victor complained of
chronic coughing, intermittent fever, and joint pains.
He was advised by the ship’s doctor to take complete
bed rest but was not given any other medication. His
condition persisted but the degree varied from day to
day. At the end of the cruise, Victor went home to Iloilo
and there had himself examined. The examination
revealed that he had tuberculosis. (2015 BAR)
(a) Victor sued for medical reimbursement,
damages and attorney’s fees, claiming that
tuberculosis was a compensable illness. Do you
agree with Victor? Why or why not?
A: TB is listed under Sec. 32-A of the POEA-SEC; hence, it is a
work-related disease. It was also either contracted or
aggravated during the effectivity of Victor’s contract.
Having shown its manifestations on board, Victor should
have been medically repatriated for further examination
and treatment in the Philippines. This obligation was
entirely omitted by bad faith by the company when it waited
for his contract to expire on him before signing him off. On
this basis, Victor is entitled to medical reimbursement,
damages and attorney’s fees. (Bar Q&A by Kato, 2022)
(b) Due to his prolonged illness, Victor was
unable to work for more than 120 days. Will
this entitle him to claim total permanent
disability benefits?
A: No. Victor’s TB may be work-related and it may have
developed on board thereby satisfying the twin-requisites
of compensability. However, despite his knowledge of his
medical condition, he failed to report to his manning agent
within three days from his arrival as required by Sec. 20-
B(3) of the POEA-SEC. Since he already felt the
manifestations of TB before his sign-off, he should have
submitted to post-employment medical examination.
(Jebsens Maritime Inc. v. Enrique Undag, G.R. No. 191491, 14
Dec. 2011) The effect of his omission is forfeiture by him of
disability benefits (Coastal Safety Marine Services. Inc. v.
Elmer T. Esguerra, G.R. No. 185352, 10 Aug. 2011). In effect,
the 120-day rule has no application at all. (Bar Q&A by Kato,
2022)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
D. LABOR RELATIONS
(2022, 2020-21, 2019, 2018, 2017, 2016, 2015, 2014,
2013, 2012, 2011, 2010, 2009, 2008, 2007, 2006, 2005,
2004, 2003, 2002, 2001, 2000, 1999, 1998, 1997, 1996,
1995, 1994, 1993, 1992, 1991, 1990, 1989 BAR)
1. RIGHT TO SELF-ORGANIZATION
(2022, 2020-21, 2018, 2017, 2016, 2014, 2012, 2010,
2009, 2007, 2006, 2005, 2004, 2003, 2002, 2000, 1999,
1998, 1996, 1993, 1992, 1990 BAR)
Q: How does the government employees’ right to self-
organization differ from that of the employees in the
private sector? (1996 BAR)
A: In the public sector, Executive Order No. 180, the purpose
of self-organization is stated as "for the furtherance and
protection of their interest." In the private sector, Art. 243
[now 253] of the Labor Code states, "for the purpose of
collective bargaining", and "for the purpose of enhancing
and defending their interests and for their mutual aid and
protection." Furthermore, no less than the Constitution
itself guarantees that ALL workers have the right to self-
organization. (Sec. 3, Art. XIII, 1987 Constitution)
a) COVERAGE
(2020-21, 2018, 2017, 2014, 2012, 2010, 2009, 2004,
2003, 2002, 2000, 1999, 1996 BAR)
Q: Sec. 255 [245] of the Labor Code recognizes three
categories of employees, namely: managerial,
supervisory, and rank-and-file.
Give the characteristics of each category of employees,
and state whether the employees in each category may
organize and form unions. Explain your answer. (2017,
2003 BAR)
A: Managerial Employees are those vested with the
powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, lay-off, recall,
discharge, assign or discipline employees. Managerial
employees cannot organize and form labor unions since
their managerial duties present a conflict of interest with
that of a union member or officer.
Supervisory Employees are those who, in the interest of the
employer, effectively recommend such managerial actions
if the exercise of such functions is not merely routinary or
clerical in nature but requires the use of independent
judgment. Supervisory employees are allowed to organize
and form unions.
Rank-and-file Employees include those which do not fall
under the classification of managerial or supervisory
employees. Rank-and-file employees are allowed to
organize and form unions. (2009-2017 UST FCL Bar Q&A)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: Which of the following groups does not enjoy the
right to self-organization?
(A) those who work in a non-profit charitable
institution
(B) those who are paid on a piece-rate basis
(C) those who work in a corporation with less than
10 employees
(D) those who work as legal secretaries (2014 BAR)
A: (D) “Those who work as legal secretaries”. Legal
secretaries are confidential employees. (Tunay na
Pagkakaisa ng Manggagawa sa Asia Brewery v. Asia
Brewery, Inc. G.R. No. 162025, 03 Aug. 2010)
Not (A) because, under Art. 243 of the LC, employees of
charitable, religious, educational and medical institutions
are covered employees.
Not (B) because piece-raters do not suffer any
disqualification.
Not (C) because the “less than 10 rule” in the LC affects right
to labor standards benefits, in particular holiday pay and
service incentive leave (Art. 94 and 95, LC), not right to self-
organization. (Bar Q&A by Kato, 2022)
Q: Do the following workers have the right to self-
organization? Reasons/basis: (2000 BAR)
(a) Employees of non-stock, non-profit
organizations?
A: YES. Even employees of non-stock non-profit
organizations have the right to self-organization. This is
explicitly provided for in Art. 243 [now 253] of the Labor
Code. A possible exception, however, are employee
members of non-stock, non-profit cooperatives.
(b) Alien employees?
A: YES. Alien employees with valid work permits may
exercise the right to self-organization on the basis of parity
or reciprocity, that is, if Filipino workers in the aliens'
country are given the same right. (Art. 269 [now Art. 283],
LC)
Q: A non-governmental organization operating in the
Philippines which seeks to promote equality and
human dignity in the workplace has 40 rank-and-file
employees.
Can the employees of this cause-oriented,
nongovernmental organization form a labor union?
Explain briefly. (2020-21 BAR)
A: YES, they can. Organizational right is constitutionally
guaranteed to all workers. (Sec. 3, Art. XIII, 1987
Constitution)
Workers, in turn, are members of the labor force, whether
employed or not. (Art. 13, LC) Workers with employers are
employees whose right to self-organization, i.e. to join, form
or assist, is expressly secured by Art. 253 of the Labor Code.
NGO employees are akin to the employees of charitable
34
 QuAMTO (1987-2022)
institutions as expressly listed by said provision; hence,
they have organizational capacity. Notably, the NGO
employees in the problem mean to promote workplace
democracy and just and humane conditions of work which
are constitutional labor principles. Hence, there is more
reason to allow them to pursue such legitimate ends
through their exercise of the right to form a labor union.
Only the following are denied organizational coverage:
(1) Managerial employees by force of Art. 255, LC;
(2) Aliens without alien employment permits and who fail
to meet the reciprocity requirement;
(3) Confidential employees by force of the Principle of
Necessary Implication;
(4) High-level government employees owing to the
exclusionary text;
(5) Employees of cooperatives who are coop-members to
forestall conflict of interest; and
(6) Employees of foreign governments and international
organizations by preemption of immunity from suit.
Needless to state, NGO employees do not belong to any of
the foregoing disqualified groups. (UPLC Suggested
Answers)
Q: Nexturn Corporation employed Nini and Nono,
whose tasks involved directing and supervising rank-
and-file employees engaged in company operations.
Nini and Nono are required to ensure that such
employees obey company rules and regulations, and
recommend to the company's Human Resources
Department any required disciplinary action against
erring employees. In Nexturn Corporation, there are
two independent unions, representing rank-and-file
and supervisory employees, respectively.
May Nini and Nono join a union? (2018 BAR)
A: YES. As supervisors, Nini and Nono are allowed by Art.
255 of the Labor Code to join a union; provided, they do not
join a union composed of rank-and-filers to bar conflict of
interest. (Central Bar Q&A by Kato, 2023)
Q: Philhealth is a government-owned and controlled
corporation employing thousands of Filipinos. Because
of the desire of the employees of Philhealth to obtain
better terms and conditions of employment from the
government, they formed the Philhealth Employees
Association (PEA) and demanded Philhealth to enter
into negotiations with PEA regarding terms and
conditions of employment which are not fixed by law.
Are the employees of Philhealth allowed to self-
organize and form PEA and thereafter demand
Philhealth to enter into negotiations with PEA for
better terms and conditions of employment? (2014
BAR)
A: YES. Employees of Philhealth are allowed to self-organize
under Sec. 8, Art. III and Sec. 3, Art. XIII of the Constitution,
which recognize the rights of all workers to self-
organization. They cannot demand, however, for better
terms and conditions of employment for the same are fixed
by law (Art. 244 [now 254], LC), besides, their salaries are
35
standardized by Congress. (Art. 276 [now 291], LC; 2009-
2017 UST FCL Bar Q&A)
b) ELIGIBILITY FOR MEMBERSHIP
(2022, 2018, 2017, 2016, 2014, 2009, 2007, 2006,
2005, 2004, 1999, 1998, 1996, 1993, 1992, 1990 BAR)
Q: Sonic Build Corp. employed Leo and Dan in its
cement factory and assigned them the tasks of, among
others, directing and supervising rank-and-file
employees. Leo and Dan are required to ensure that
such employees obey company rules and regulations,
and recommend to the company’s Human Resources
Department any required disciplinary action against
erring employees. There is only one union representing
rank-and-file employees. May Leo and Dan join the
union? Explain briefly. (2022 BAR)
A: NO. Leo and Dan are supervisors because they effectively
recommend managerial action on employee discipline and
they do not perform said task in a clerical or routinary
manner as they have discretion. (Art. 219(m), LC) Since they
do not belong to the collective bargaining unit (CBU)
composed of rank-and file employees, conflict of interest
bars their membership in the sole union. (Central Bar Q&A
by Kato, 2023)
Q: Philhealth is a GOCC employing thousands of
Filipinos. Because of the desire of the employees of
Philhealth to obtain better terms and conditions of
employment from the government, they formed the
Philhealth Employees Association (PEA) and demanded
Philhealth to enter into negotiations with PEA
regarding terms and conditions of employment which
are not fixed by law. Are the employees of Philhealth
allowed to self- organize and form PEA and thereafter
demand Philhealth to enter into negotiations with PEA
for better terms and conditions of employment? (2014
BAR)
A: YES. Employees of Philhealth are allowed to self-organize
under Sec. 8, Art. III and Sec. 3, Art. XIII of the Constitution,
which recognize the rights of all workers to self-
organization. They cannot demand, however, for better
terms and conditions of employment for the same are fixed
by law (Art. 244 [now 254], LC), besides, their salaries are
standardized by Congress. (Art. 276 [now 291], LC; 2009-
2017 UST FCL Bar Q&A)
c) DOCTRINE OF NECESSARY IMPLICATION
(2017, 2003, 2000 BAR)
Q: May confidential employees who assist managerial
employees, and who act in a confidential capacity or
have access to confidential matters being handled by
persons exercising managerial functions in the field of
labor relations form, or assist, or join labor unions?
Explain your answer. (2007, 2003 BAR)
A: NO. Confidential employees to managerial employees
may not form, assist, or join labor unions. Applying the
Doctrine of Necessary Implication, confidential employees
are also covered by the prohibition on joining or forming
unions imposed on managerial employees. The policy of the
law is not to place confidential employees in a position
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
involving a conflict of interest because of their access to
matters handled by managerial employees whom they
assist.
ALTERNATIVE ANSWER:
NO. These confidential employees cannot form, assist, or
join labor unions. The exclusion from bargaining units of
employees who, in the general course of their duties,
become aware of management policies relating to labor
relations is founded upon the "confidential employee rule".
The rationale behind this rule is that employees should not
be placed in a position involving a potential conflict of
interests. Management should not be required to handle
labor relation matters through employees who are
represented by the union with which the company is
required to deal and who in the normal performance of
their duties may obtain advance information of the
company's position with regard to contract negotiations,
the disposition of grievances or other labor relations
matters. (San Miguel Corporation Supervisor and Exempt
Employees Union v. Laguesma, G.R. No. 110399, 15 Aug.
1997)
ALTERNATIVE ANSWER:
NO. Under the doctrine of necessary implication, the same
reason for the disqualification of managerial employees
applies to confidential employees. (Pepsi-Cola Products
Phil., Inc. v. Sec. of Labor, G.R. Nos. 96693 and 103300, 10 Aug.
1999)
Q: Do workers have a right not to join a labor
organization? (2000 BAR)
A: YES. The constitutional right to self-organization has two
aspects, the right to join or form labor organizations and the
right not to join said organization. (Victoriano v. Elizalde
Rope Worker’s Union, G.R. No. L-25246, 12 Sept. 1974)
Moreover, if they are members of a religious group whose
doctrine forbids union membership, their right not to be
compelled to become union members has been upheld.
However, if the worker is not a "religious objector" and
there is a union security clause, he may be required to join
the union if he belongs to the bargaining unit. (Reyes v.
Trajano, G.R. No. 84433, 2 June 1992)
d) COMMINGLING OR MIXED MEMBERSHIP
(2018, 2014, 2010 BAR)
Q: Nexturn Corporation employed Nini and Nono,
whose tasks involved directing and supervising rank-
and-file employees engaged in company operations.
Nini and Nono are required to ensure that such
employees obey company rules and regulations, and
recommend to the company's Human Resources
Department any required disciplinary action against
erring employees. In Nexturn Corporation, there are
two independent unions, representing rank-and-file
and supervisory employees, respectively. May the two
unions be affiliated with the same Union Federation?
(2018 BAR)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
A: YES. Art. 255 of the Labor Code, as amended by R.A. 9481,
allows a rank-and-file union and a supervisors’ union
operating within the same establishment to join one and the
same federation or national union as affiliates thereof.
(UPLC Suggested Answers)
Q: Our Lady of Peace Catholic School Teachers and
Employees Labor Union (OLPCS-TELU) is a legitimate
labor organization composed of vice-principals,
department heads, coordinators, teachers, and non-
teaching personnel of Our Lady of Peace Catholic School
(OLPCS).
OLPCS-TELU subsequently filed a petition for
certification election among the teaching and non-
teaching personnel of OLPCS before the Bureau of
Labor Relations (BLR) of the DOLE. The Med-Arbiter
subsequently granted the petition and ordered the
conduct of a joint certification election for the teaching
and non-teaching personnel of OLPCS.
May OLPCS-TELU be considered a legitimate labor
organization? (2014 BAR)
A: YES, OLPCS-TELU is a legitimate labor organization. Its
mixed-membership which includes supervisors and rank-
and-filers does not affect its legitimacy. The only effect of
such membership is that the supervisors in the persons of
vice-principals and department heads are deemed
automatically removed from the union membership. (R.A.
No. 9481; Bar Q&A by Kato, 2022)
Q: Company XYZ has two recognized labor unions, one
of its rank-and-file employees (RFLU), and one for
supervisory employees (SELU). Of late, the company
instituted a restructuring program by virtue of which A,
a rank-and-file employee and officer of RFLU, was
promoted to a supervisory position along with four (4)
other colleagues, also active union members and/or
officers. Labor Union KMJ, a rival labor union seeking
recognition as the rank-and-file bargaining agent, filed
a petition for the cancellation of the registration of
RFLU on the ground that A and her colleagues have
remained to be members of RFLU. Is the petition
meritorious? Explain. (2010 BAR)
A: NO, the petition for cancellation is not meritorious. The
ground invoked, viz., mixed-union membership, is not a
ground for cancellation under R.A. No. 9481 (Art. 256, LC,, as
renumbered). Its consequence is limited to the automatic
removal of non-members from the union. (Bar Q&A by Kato,
2022)
Q: Samahang Manggagawang Terracota, a union of
supervisory employees at Terracota Inc., recently
admitted a member of the company’s managerial staff,
A, into the union ranks. (2010 BAR)
(a) Should A be a member of the supervisory
union? Explain.
36
 QuAMTO (1987-2022)
A: Unlike Labor Standards Law under which a member of
the managerial staff has no labor standards coverage (Art.
82, Labor Code), Labor Relations Law does not disqualify
said employee unless his actual functions make him a real
manager who is disqualified (Art. 255, Labor Code), or he
assists or reports to another possessed with labor-
management information and he has access thereto as a
necessary consequence of his occupation of his position.
(Bar Q&A by Kato, 2022)
(b) Assuming that A is ineligible to join the
union, should the registration of Samahang
Manggagawang Terracota be cancelled?
Explain.
A: NO. Mixed-union membership is outside the limited list
of cancellation grounds under R.A. No. 9481. The only
grounds now are voluntary dissolution of the union upon a
2/3 vote, misrepresentation, fraud, or false statement
relative to the adoption of the Constitution and by-laws, and
similar acts relative to the election of union officers.
In the event of mixed-membership, the non-member is
simply automatically removed from the union. (R.A. No.
9481; Bar Q&A by Kato, 2022)
e) EFFECT OF INCLUSION AS MEMBERS OF EMPLOYEES
OUTSIDE OF THE BARGAINING UNIT
2. BARGAINING UNIT
(1999 BAR)
3. BARGAINING REPRESENTATIVE
(2022, 2018, 2017, 2016, 2014, 2009, 2007, 2006,
2005, 2004, 2000, 1999, 1998, 1996, 1993, 1992, 1990,
1989 BAR)
Q: Are probationary employees entitled to vote in a
certification election? Why? (1999 BAR)
A: YES. Any employee, whether employed for a definite
period or not, shall, beginning on his first day of service, be
considered an employee for purposes of membership in
any labor union. (Art. 277(c)) (UPLC Suggested Answers)
Q: The modes of determining the exclusive bargaining
agent of the employees in a business are: (a) Voluntary
Recognition; (b) Certification Election; and (c) Consent
Election. Explain how they differ from one another.
(2017, 2006, 2005, 2000, 1989 BAR)
A:
a. Request for SEBA Recognition is the process of
certifying a labor union as the exclusive bargaining
agent when there is only one legitimate labor union
in an unorganized establishment.
b. Certification Election is the process by which an
employer or the employees file a petition with the
Med-Arbiter to determine the exclusive bargaining
agent through secret ballot.
37
c. Consent Election is the process by which the
employees, voluntarily by agreement, with or
without the DOLE’s intervention, determine the
exclusive bargaining agent through secret ballot.
NOTE: Voluntary recognition has been repealed by DO 40-
I-15, series of 2015, and replaced with Request for SEBA
recognition.
Q: There are instances when a certification election is
mandatory. What is the rationale for such a legal
mandate? (2005 BAR)
A: According to the Labor Code, 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 a legitimate labor organization. In
the above-described situation, a certification election is
made mandatory because if there is no certified bargaining
agent as determined by a certification election, there could
be no collective bargaining in the said unorganized
establishment. (Art. 269. [257], LC)
Q: Two legitimate labor organizations (Union Jack and
Union Jill) are competing to become the first sole and
exclusive bargaining agent (SEBA) in Maharlika
Company. The unions agree to a consent election
without involving the Bureau of Labor Relations (BLR).
Union Jack garners an overwhelming majority of the
valid votes cast during the consent election. Negotiation
for a CBA commences, and while this is ongoing, a third
union, Union Jumble, files with the BLR a petition for
certification election seeking certification as the SEBA
in Maharlika Company. Union Jack opposes the petition,
arguing that no petition for certification election can be
filed within one year from the consent election, and
during the CBA negotiation. Is Union Jack correct?
Explain briefly. (2022 BAR)
A: YES. Union Jack's opposition to the CE petition on said
ground is correct. The Certification Year Bar requires that
the sole exclusive bargaining agent (SEBA) commence and
sustain collective bargaining within 12 months from the last
selection of a bargaining agent. Jumble Union's CE petition
is a barred petition because collective bargaining was
timely commenced and the same is in progress as to be
deemed sustained by Jack Union. (Central Bar Q&A by Kato,
2023)
Q: A certification election was conducted in Nation
Manufacturing Corporation, whereby 55% of eligible
voters in the bargaining unit cast their votes. The
results were as follows:
Union Nana: 45 votes
Union Nada: 40 votes
Union Nara: 30 votes
No Union: 80 votes
Union Nana moved to be declared as the winner of the
certification election. (2018 BAR)
a. Can Union Nana be declared as the winner?
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
A: NO. To win a certification election, a participant must
garner so much number of votes comprising majority of all
valid votes. In this case, the majority vote is 97.5. With just
45 votes, Union Nana lost the election; hence, it cannot be
certified. (Central Bar Q&A by Kato, 2023)
b. Assume that the eligibility of 30 voters was
challenged during the pre-election conference.
The ballots of the 30 challenged voters were
placed inside an envelope sealed by the DOLE
Election Officer. Considering the said envelope
remains sealed, what should be the next course
of action with respect to the said challenged
votes?
A: Since the challenged votes may materially affect the
results of the election and may in fact even give Union Nada
or Union Nara an absolute majority, then the said
challenged votes should be opened. Pursuant to Rule IX, Sec.
11 of the Rules Implementing Book V of the Labor Code, the
envelope with the challenged votes shall be opened and the
question of eligibility shall be passed upon by the DOLE
med-arbiter.
ALTERNATIVE ANSWER:
The necessity of opening the sealed envelopes must be
determined. If the 30 challenged votes could materially
alter the result of the election then they have to be opened.
Since there is a possibility that at least 17.5 of the
challenged votes were cast in favor of No Union, the
envelopes must be opened. If added to its 80 votes, No
Union would win the CE with 97.5 votes. Needless to say, No
Union can win a certification election. (Central Bar Q&A by
Kato, 2023)
Q: Nayon Federation issued a charter certificate
creating a rank-and-file Neuman Employees Union. On
the same day, New Neuman Employees Union filed a
petition for certification election with the Department
of Labor and Employment (DOLE) Regional Office,
attaching the appropriate charter certificate. The
employer, Neuman Corporation, filed a motion to
dismiss the petition for lack of legal personality on the
part of the petitioner union. (2018 BAR)
(a) Should the motion be granted?
A: NO. The motion should be denied. Under Art. 241 of the
LC, a petition for certification election may be filed on the
basis of a valid charter certificate issued to a chartered local
by a duly registered federation.
(b) The employer likewise filed a petition for
cancellation of union registration against New
Neuman Employees Union, alleging that Nayon
Federation already had a chartered local rank-
and-file union, Neuman Employees Union,
pertaining to the same bargaining unit within the
establishment. Should the petition for cancellation
prosper?
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
A: NO. The existence of another chartered local under the
same federation within the same bargaining unit is not
among the grounds to cancel union registration under Art.
247 of the Labor Code, as amended by R.A. 9481.
Q: Liwayway Glass had 600 rank-and-file employees.
Three rival unions A, B, and C – participated in the
certification elections ordered by the Med-Arbiter. 500
employees voted. The unions obtained the following
votes: A-200; B-150; C-50; 90 employees voted “no
union”; and 10 were segregated votes.
Out of the segregated votes, four (4) were cast by
probationary employees and six (6) were cast by
dismissed employees whose respective cases are still
on appeal. (2014 BAR)
(a) Should the votes of the probationary and
dismissed employees be counted in the total votes
cast for the purpose of determining the winning
labor union?
A: YES. Rule IX, Sec. 5 of DOLE Department Order 40-03
provides that “[a]ll employees who are members of the
appropriate bargaining unit sought to be represented by the
petitioner at the time of the issuance of the order granting
the conduct of a certification election shall be eligible to
vote. An employee who has been dismissed from work but
has contested the legality of the dismissal in a forum of
appropriate jurisdiction at the time of the issuance of the
order for the conduct of a certification election shall be
considered a qualified voter, unless his/her dismissal was
declared valid in a final judgment at the time of the conduct
of the certification election.” (2009-2017 UST FCL Bar Q&A)
(b) Was there a valid election?
A: YES. To have a valid election, at least a majority of all
eligible voters in the unit must have cast their votes. (Art.
256 [now Art. 266], LC)
In the instant case, 500 out of 600 rank-and-file employees
voted. (2009-2017 UST FCL Bar Q&A)
(c) Should Union A be declared the winner?
A: NO. The Labor Code provides that 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. (Art. 256 [now Art. 266], LC)
Here, the number of valid votes cast is 490; thus, the
winning union should receive at least 246 votes. Union A
only received 200 votes. (2009-2017 UST FCL Bar Q&A)
(d) Suppose the election is declared invalid, which of
the contending unions should represent the rank-
and-file employees?
A: None of them should represent the rank-and-file
employees. (Art. 255 [now Art. 265], LC; 2009-2017 UST FCL
Bar Q&A)
38
 QuAMTO (1987-2022)
(e) Suppose that in the election, the unions obtained
the following votes: A-250; B-150; C-50; 40 voted
“no union”; and 10 were segregated votes. Should
Union A be certified as the bargaining
representative?
A: YES. The Labor Code provides that 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. (Art. 256 [now Art. 266], LC)
Here, the number of valid votes cast is 490. Thus, the
winning union should receive at least 246 votes; Union A
received 250 votes. (2009-2017 UST FCL Bar Q&A)
Q: Samahang East Gate Enterprises (SEGE) is a labor
organization composed of the rank-and-file employees
of East Gate Enterprises (EGE), the leading
manufacturer of all types of gloves and aprons. EGE was
later requested by SEGE to bargain collectively for
better terms and conditions of employment of all the
rank-and-file employees of EGE. Consequently, EGE
filed a petition for certification election before the
Bureau of Labor Relations (BLR).
During the proceedings, EGE insisted that it should
participate in the certification process. EGE reasoned
that since it was the one who filed the petition and
considering that the employees concerned were its own
rank-and-file employees, it should be allowed to take
an active part in the certification process. Is the
contention of EGE proper? Explain. (2014 BAR)
A: NO. Under Art. 258-A [now Art. 271] of the LC, an
employer is a mere bystander in certification elections,
whether the petition for certification election is filed by said
employer or a legitimate labor organization. The employer
shall not be considered a party thereto with a concomitant
right to oppose a petition for certification election. (2009-
2017 UST FCL Bar Q&A)
Q: Among the 400 regular rank-and-file workers of
MNO Company, a certification election was ordered
conducted by the Med-Arbiter of the Region. The
contending parties obtained the following votes:
1. Union A – 70
2. Union B – 71
3. Union C – 42
4. No union – 180
5. Spoiled votes - 4
There were no objections or challenges raised by any
party on the results of the election. (2009 BAR)
(a) Can Union B be certified as the sole and exclusive
collective bargaining agent among the rank-and-
file workers of MNO Company considering that it
garnered the highest number of votes among the
contending unions? Why or why not?
39
A: NO. To be certified as bargaining agent, the vote required
is majority of the valid votes cast. There were 396 valid
votes cast, the majority of which is 199. Since Union B got
only 71 votes, it cannot be certified as the sole and exclusive
bargaining agent of MNO’s rank-and-file workers.
(b) May the management or lawyer of MNO Company
legally ask for the absolute termination of the
certification election proceedings because 180 of
the workers — a clear plurality of the voters —
have chosen not to be represented by any union?
Reasons.
A: NO, because 216 workers want to be represented by a
union as bargaining agent. Only 180 workers opted for No
Union. Hence, a clear majority is in favor of being
represented by a union.
(c) If you were the duly designated election officer in
this case, what would you do to effectively achieve
the purpose of certification election proceedings?
Discuss.
A: I will conduct a run-off election between the labor unions
receiving the two highest number votes. To have a run-off
election, all the contending unions (3 or more choices
required) must have garnered 50% of the number of votes
cast. In the present case, there are four (4) contending
unions and they garnered 216 votes. There were 400 vote
cast. The votes garnered by the contending unions is even
more than 50% of the number of vote cast. Hence, a run-off
election is in order.
4. RIGHTS OF LABOR ORGANIZATIONS
(2022, 2019, 2017, 2015, 2012, 2010, 2009, 2008,
2007, 2005, 2001, 1999, 1997, 1996, 1992, 1991 BAR)
a) CHECK OFF, ASSESSMENT, AND AGENCY FEES
(2022, 2019, 2015, 2010, 2009, 2007, 2005 BAR)
Q: Cristina, a new-hire of Sterling Corporation
(Sterling), was made to join Sterling Corporation
Employees Union (SCEU) in compliance with the union
shop provision in the collective bargaining agreement
(CBA) between SCEU and Sterling. At the request of
SCEU, Sterling started deducting union dues from
Cristina’s salary and remitting the same to SCEU
pursuant to the CBA provisions. Cristina protested,
claiming that she has not authorized the deduction in
writing. Is Cristina’s claim valid? Explain briefly. (2022
BAR)
A: NO, Cristina's claim is not valid. Art. 113 of the Labor
Code allows the deduction of union dues sans written
consent of union members to ensure the viability of the
contracting union. In this connection, Sterling has
recognized the right of SCEU to deduct union dues.
Therefore, there is no legal impediment to the deduction
complained of. (Central Bar Q&A by Kato, 2023)
Q: A is employed by XYZ Company where XYZ
Employees Union (XYZ-EU) is the recognized exclusive
bargaining agent. Although A is a member of rival union
XYR-MU, he receives the benefits under the CBA that
XYZ-EU had negotiated with the company.
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
XYZ-EU assessed A a fee equivalent to the dues and
other fees paid by its members but A insists that he has
no obligation to pay said dues and fees because he is not
a member of XYZ-EU and he has not issued an
authorization to allow the collection. Explain whether
his claim is meritorious. (2010 BAR)
A: NO. The fee exacted from A takes the form of an AGENCY
FEE. This is sanctioned by Art. 248 (e) [now Art. 259 (e)] of
the Labor Code.
The collection of agency fees in an amount equivalent to
union dues and fees from employees who are not union
members is recognized under Art. 248(e) [now 259(e)] of
the LC. The union may collect such fees even without any
written authorization from the non-union member
employees, if said employees accept the benefits resulting
from the CBA. The legal basis of agency fees is quasi-
contractual. (Del Pilar Academy v. Del Pilar Academy
Employees Union, G.R. No. 170112, 30 Apr. 2008; 2009-2017
UST FCL Bar Q&A)
b) COLLECTIVE BARGAINING
(2019, 2017, 2012, 2010, 2009, 2008, 2001, 1999,
1997, 1996, 1992, 1991 BAR)
(1) ECONOMIC TERMS AND CONDITIONS
(2012, 2010, 1997 BAR)
(2) NON-ECONOMIC TERMS AND CONDITIONS
(3) DUTY TO BARGAIN COLLECTIVELY
(2019, 2010, 2009, 2008, 2001, 1999, 1996, 1992,
1991 BAR)
Q: ABC company and U labor union have been
negotiating for a new Collective Bargaining Agreement
(CBA) but failed to agree on certain economic
provisions of the existing agreement. In the meantime,
the existing CBA expired. The company thereafter
refused to pay the employees their midyear bonus,
saying that the CBA which provided for the grant of
midyear bonus to all company employees had already
expired. Are the employees entitled to be paid their
midyear bonus? Explain your answer. (2010 BAR)
A: YES, under Art. 253 [now 264] of the LC, the parties are
duty-bound to maintain the status quo and to continue in
full force and effect the terms and conditions of the existing
CBA until a new agreement is reached by the parties.
Likewise, Art. 253-A [now 265] provides for an automatic
renewal clause of a CBA. Although a CBA has expired, it
continues to have legal effects as between the parties until
a new CBA has been entered into.
The same is also supported by the principle of holdover,
which states that despite the lapse of the formal effectivity
of the CBA, the law still considers the same as continuing in
force and effect until a new CBA shall have been validly
executed (MERALCO v. Hon. Sec. of Labor, G.R. No. 127598, 22
Feb. 2000 citing National Congress of Unions in the Sugar
Industry of the Philippines v. Ferrer-Calleja, G.R. No. 89609 27
Jan. 1992). The terms and conditions of the existing CBA
remain under the principle of CBA continuity.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: On 01 Dec. 2018, GHI Co., an organized
establishment, and Union J, the exclusive bargaining
agent therein, executed a 5-year CBA which, after
ratification, was registered with the Bureau of Labor
Relations. (2019 BAR)
(a) When can the union ask, at the earliest, for the
renegotiation of all the terms of the CBA, except its
representation aspect? Explain.
A: It can ask for the renegotiation of the terms of the CBA
within 60 days prior to the expiration of its economic
period, viz., from October 2, 2018 until November 30, 2021.
According to Art. 253-A [now 265] of the LC, all other
provisions of the CBA shall be renegotiated not later than 3
years after its execution. Any agreement of such other
provisions of the CBA entered into within 6 months from
the date of expiry of the term of such other provisions as
fixed in such CBA, shall retroact to the day immediately
following such date. If any such agreement is entered into
beyond six months, the parties shall agree on the duration
of retroactivity thereof. In case of a deadlock in the
renegotiation of the CBA, the parties may exercise their
rights under this Code.
Hence, they may submit the demand for renegotiation at
any time between 02 Oct. 2021 to 30 Nov. 2021. The earliest
day would be October 2, 2021. (UPLC Suggested Answers)
(b) When is the earliest time that another union can
file for a petition for certification election? Explain.
A: The sixty-day freedom period is from 02 Oct. 2023 to 30
Nov. 2023. Hence, they can file a petition for CE on 02 Oct.
2023 at the earliest.
According to Art. 253-A [now Art. 265] of the LC, any CBA
that the parties may enter into shall, insofar as the
representation aspect is concerned, be for a term of five (5)
years. No petition questioning the majority status of the
incumbent bargaining agent shall be entertained and no
certification election shall be conducted by the Department
of Labor and Employment outside of the sixty-day period
immediately before the date of expiry of such five-year term
of the CBA. (UPLC Suggested Answers)
Q: ABC company and U labor union have been
negotiating for a new Collective Bargaining Agreement
(CBA) but failed to agree on certain economic
provisions of the existing agreement. In the meantime,
the existing CBA expired. The company thereafter
refused to pay the employees their midyear bonus,
saying that the CBA which provided for the grant of
midyear bonus to all company employees had already
expired. Are the employees entitled to be paid their
midyear bonus? Explain your answer. (2010 BAR)
A: YES. Under Art. 253 [now 264] of the LC, the parties are
duty-bound to maintain the status quo and to continue in
full force and effect the terms and conditions of the existing
CBA until a new agreement is reached by the parties.
Likewise, Art. 253-A [now 265] provides for an automatic
renewal clause of a CBA. Although a CBA has expired, it
40
 QuAMTO (1987-2022)
continues to have legal effects as between the parties until
a new CBA has been entered into.
The same is also supported by the principle of holdover,
which states that despite the lapse of the formal effectivity
of the CBA, the law still considers the same as continuing in
force and effect until a new CBA shall have been validly
executed. (MERALCO v. Hon. Sec. of Labor, G.R. No. 127598,
22 Feb. 2000, citing National Congress of Unions in the Sugar
Industry of the Philippines v. Ferrer-Calleja, G.R. No. 89609,
27 Jan. 1992)
The terms and conditions of the existing CBA remain under
the principle of CBA continuity. (2009-2017 UST FCL Bar
Q&A)
(4) MANDATORY PROVISIONS IN THE COLLECTIVE
BARGAINING AGREEMENT (CBA)
(2019, 2018, 2008, 2000 BAR)
Q: Define or explain grievance machinery. (2019 BAR)
A: Under the Labor Code, grievance machinery refers to the
mechanism for the adjustment and resolution of grievances
arising from the interpretation or implementation of a CBA
and those arising front the interpretation or enforcement of
company personnel policies. It is part of the continuing
process of collective bargaining. (UPLC Suggested Answers)
Q: Explain the automatic renewal clause of collective
bargaining agreements. (2008 BAR)
A: The automatic renewal clause of Collective Bargaining
Agreements means that although a CBA has expired, it
continues to have legal effects as between the parties until
a new CBA has been entered into. (Pier 8 Arrastre &
Stevedoring Services, Inc. v. Roldan-Confessor, G.R. No.
110854, 13 Feb. 1995)
This is so because the law makes it a duty of the parties to
keep the status quo and to continue in full effect the terms
and conditions of the existing agreement until a new
agreement is reached by the parties. (Art. 253 [now 264],
LC)
Q: Nagrab Union and Nagrab Corporation have an
existing CBA which contains the following provision:
"New employees within the coverage of the bargaining
unit who may be regularly employed shall become
members of Nagrab Union. Membership in good
standing with the Nagrab Union is a requirement for
continued employment with Nagrab Corporation."
Nagrab Corporation subsequently acquired all the
assets and rights of Nuber Corporation and absorbed
all of the latter's employees. Nagrab Union immediately
demanded enforcement of the above-stated CBA
provision with respect to the absorbed employees.
Nagrab Corporation refused on the ground that this
should not apply to the absorbed employees who were
former employees of another corporation whose assets
and rights it had acquired. (2018 BAR)
41
(a) Was Nagrab Corporation correct in refusing to
enforce the CBA provision with respect to the
absorbed employees? May a newly-regularized
employee of Nagrab Corporation (who is not
part of the absorbed employees) refuse to join
Nagrab Union?
A: NO, Nagrab Corporation’s argument that the union
security clause should not apply to absorbed employees
resulting from the acquisition is untenable. In BPI
Employees Union-Davao City-FUBU (BPIEU-Davao City-
FUBU) v. BPI (G.R. No. 174912, 24 July 2013), the Supreme
Court ruled that the subject union security clause does not
make a distinction as to how a regular employee should
attain such status as a “new employee” to be covered by the
clause. Absorbed employees as a result of merger or
acquisition of assets and rights between two corporations,
therefore, should be considered as “new employees” of the
surviving or acquiring corporation. (UPLC Suggested
Answers)
(b) How would you advise the human resources
manager of Nagrab Corporation to proceed?
A: The HR Manager should heed the Supreme Court’s
proscription in Alabang Country Club, Inc. v. NLRC (G.R. No.
170287, 14 Feb. 2008), in cases involving termination of
employment due to enforcement of a union security clause.
The following requirements must be observed:
1. The union security clause is applicable;
2. The certified bargaining agent is requesting for
enforcement of such clause; and
There is sufficient evidence to support the sole and
exclusive bargaining agent’s decision to expel the employee
from membership. (UPLC Suggested Answers)
(c) How would you advise the human resources
manager of Nagrab Corporation to proceed?
A: I would advise the HR Manager to classify the employees
into new hires and old hires, with specific reference to the
date of effectivity of the Union Shop Clause. Those covered
by the clause may be dismissed upon request of the union,
subject to due process. (Central Bar Q&A by Kato, 2023)
Q: Natasha Shoe Company adopted an organizational
streamlining program that resulted in the
retrenchment of 550 employees in its main plant. After
having been paid their separation benefits, the
retrenched workers demanded payment of retirement
benefits under a CBA between their union and
management. Natasha Shoe Company denied the
workers' demand. (2018 BAR)
(a) What is the most procedurally peaceful means
to resolve this dispute?
A: Since the establishment is organized, the mode of
settlement most procedurally peaceful is recourse to the
grievance machinery. If the dispute be not resolved within
7 calendar days, the same shall be elevated to voluntary
arbitration. (Central Bar Q&A by Kato, 2023)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
(b) Can the workers claim both separation pay and
retirement benefits?
A: YES. In Santos v. Senior Philippines, (G.R. No. 166377, 28
Nov. 2008), the Supreme Court held that retirement benefits
and separation pay are not mutually exclusive, and both
benefits may be paid in the absence of a contrary stipulation
in the retirement plan and/or in the CBA. (UPLC Suggested
Answers)
5. UNFAIR LABOR PRACTICES
(2019, 2018, 2015, 2013, 2012, 2011, 2010, 2009,
2007, 2005, 2004, 2001, 1999, 1996, 1995, 1992, 1991,
1990 BAR)
a) NATURE AND ASPECT
(2019, 2011, 2010, 2009, 2007, 2005 BAR)
Q: When resolving a case of unfair labor practice (ULP)
filed by a union, what should be the critical point of
analysis to determine if an act constitutes ULP? (2019
BAR)
A: The critical point of analysis is the violation of the rights
of workers to self-organization, characterized by
interference, coercion, restraint by the employer to
discourage unionism and refusal to bargain a collective
bargaining agreement. (UPLC Suggested Answers)
Q: Discuss in full the jurisdiction over the civil and
criminal aspects of a case involving an unfair labor
practice for which a charge is pending with the
Department of Labor and Employment. (2007 BAR)
A: Unfair labor practices are not only violations of the civil
rights of both labor and management but are also criminal
offenses against the State.
and away from the bargaining table. It involves the question
of whether an employer’s conduct demonstrates an
unwillingness to bargain in good faith or is merely hard
bargaining. (Standard Chartered Bank Employees Union
(NUBE) v. Confesor, G.R. No. 114974, 16 June 2004)
Blue-Sky Bargaining is defined as “unrealistic and
unreasonable demands in negotiations by either or both
labor and management, where neither concedes anything
and demands the impossible.” (Standard Chartered Bank
Employees Union (NUBE) v. Confesor, G.R. No. 114974, 16
June 2004; 2009-2017 UST FCL Bar Q&A)
Q: The negotiating panels for the CBA of X Company
established a rule that only employees of the company
will seat in each panel. In the next session, the
management panel objected to the presence of the
union counsel. Still the negotiation proceeded. At the
next session, the management panel again objected to
the presence of the union counsel as a non-observance
of the “no outsider” rule. The negotiation nonetheless
proceeded. Does the management panel's objection to
the presence of the union counsel constitute unfair
labor practice through bad-faith bargaining? (2011
BAR)
a) Yes, the management is harping on a non-
mandatory matter instead of proceeding with the
mandatory subjects of bargaining.
b) No, there is no bargaining in bad faith since the
bargaining proceeded anyway.
c) Yes, the management panel has no legal basis for
limiting the composition of the union negotiating
panel.
d) No, since it is the union that violates the ground
rules fashioned by the parties, it is the one
negotiating in bad faith.

A: b) NO, there is no bargaining in bad faith since the

The civil aspect of all cases involving unfair labor practices,
bargaining proceeded anyway. (UPLC Suggested Answers)
which may include claims for actual, moral, exemplary and
other forms of damages, attorney’s fees and other
b) BY EMPLOYERS
affirmative relief, shall be under the jurisdiction of the
(2018, 2015, 2013, 2011, 2010, 2009, 2004, 2001,
Labor Arbiters.
1999, 1996, 1992, 1991, 1990 BAR)

However, no criminal prosecution shall be instituted

Q: In Northern Lights Corporation, union members Nad,
without a final judgment, finding that an unfair labor
Ned, and Nod sought permission from the company to
practice was committed, having been first obtained in the
distribute flyers with respect to a weekend union
administrative proceeding. During the pendency of such
activity. The company HR manager granted the request
administrative proceeding, the running of the period for
through a text message sent to another union member,
prescription of the criminal offense herein penalized shall
Norlyn. While Nad, Ned, and Nod were distributing the
be interrupted. The final judgment in the administrative
flyers at the company assembly plant, a company
proceeding shall not be binding in the criminal case nor be
supervisor barged in and demanded that they cease
considered as evidence of guilt but merely as proof of
from distributing the flyers, stating that the assembly
compliance of the requirements set forth by law. (Art. 247
line employees were trying to beat a production
[now Art. 258], LC)
deadline and were thoroughly distracted. Norlyn tried
to show the HR manager's text message authorizing
Q: Differentiate “surface bargaining” from “blue-sky
flyer distribution during work hours, but the
bargaining”. (2010 BAR)
supervisor brushed it aside. As a result, Nad, Ned, and
Nod were suspended for violating company rules on
A: Surface Bargaining is defined as “going through the
trespass and highly-limited union activities during
motions of negotiating” without any legal intent to reach an
work hours. The Union filed a ULP case before the NLRC
agreement. The determination of whether a party has
for union discrimination. (2018 BAR)
engaged in unlawful surface bargaining is a question of the
intent of the party in question, which can only be inferred
(a) Will the ULP case filed by the Union prosper?
from the totality of the challenged party’s conduct both at

U N IV E R S I T Y O F S A N T O T O M A S 42
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
A: YES. The supervisor of Nad, Ned and Nod directly
interfered with union activities and ultimately with the
right to self-organization. Good faith can be ascribed to Nad,
Ned and Nod’s actions, as prior permission was obtained
thru the HR Manager who apparently failed to
communicate such permission to the plant supervisor.
(UPLC Suggested Answers)
ALTERNATIVE ANSWER:
NO. ULP refers to acts that violate the worker’s right to
organize. The prohibited acts are related to the workers’
right to self-organization, and to the observance of the
collective bargaining agreement. Without this element, the
acts of the Northern Light Corporation in suspending Nad,
Ned, and Nod for violating company rules (on trespass and
highly-limited activities during work hours), even if unfair,
are not unfair labor practices. (General Santos Coca-Cola
Plant Free Workers Union-TUPAS v. Coca-Cola Bottlers Phil.
Inc., G.R. No. 178647, 13 Feb. 2009; UPLC Suggested Answers)
(b) Assume the NLRC ruled in favor of the Union.
The Labor Arbiter's judgment included, among
others, an award for moral and exemplary
damages at P50,000.00 each for Nad, Ned, and
Nod. Northern Lights Corporation argued that
any award of damages should be given to the
Union, and not individually to its members. Is
Northern Lights Corporation correct?
A: NO. In Digitel Telecommunications Philippines, Inc. v.
Digitel Employees Union (DEU) (G.R. No. 184903-04, 10 Oct.
2012), the Supreme Court ruled that the award of moral and
exemplary damages in illegal dismissal cases (applicable to
suspension) resulting from unfair labor practices may be
made in individual or aggregate amounts. If the offended
parties can be identified, then damages may be awarded
individually, such as in the case at hand. (UPLC Suggested
Answers)
Q: The CBA between Libra Films and its union, Libra
Films Employees' Union (LFEU), contains the following
standard clauses:
1. Maintenance of membership;
2. Check off for union dues and agency fees; and
3. No strike, no lock-out.
While Libra Films and LFEU are in re- negotiations for
an extension of the CBA, LFEU discovers that some of its
members have resigned from the union, citing their
constitutional right to organize (which includes the
right NOT to organize). LFEU demands that Libra Films
institute administrative proceedings to terminate
those union members who resigned in violation of the
CBA's maintenance of membership clause. Libra Films
refuses, citing its obligation to remain a neutral party.
As a result, LFEU declares a strike and after filing a
notice of strike and taking a strike vote, goes on strike.
The union claims that Libra Films grossly violated the
terms of the CBA and engaged in unfair labor practice.
Are LFEU's claims correct? Explain. (2015 BAR)
43
A: NO. LFEU’s claim that Libra Films committed ULP based
on its violation of the CBA is not correct. For violation of a
CBA to constitute ULP, the violation must be violation of its
economic provisions. Moreover, said violation must be
gross and flagrant. Based on the allegation of the union,
what was violated was the maintenance of membership
clause which was a political or representational provision;
hence, no ULP was committed. (BPI Employees Union-Davao
City v. BPI, G.R. No. 174912, 24 July 2013; 2009-2017 UST FCL
Bar Q&A)
Q: Pablo works as a driver at the National Tire Company
(NTC). He is a member of the Malayang Samahan ng
Manggagawa sa NTC, the exclusive rank-and-file
collective bargaining representative in the company.
The union has a CBA with NTC which contains a union
security and a check-off clause. The union security
clause contains a maintenance of membership
provision that requires all members of the bargaining
unit to maintain their membership in good standing
with the union during the term of the CBA under pain of
dismissal. The check-off clause on the other hand
authorizes the company to deduct from union
members' salaries defined amounts of union dues and
other fees. Pablo refused to issue an authorization to
the company for the check-off of his dues, maintaining
that he will personally remit his dues to the union.
(2013 BAR)
(a) Would the NTC management commit unfair
labor practice if it desists from checking off
Pablo's union dues for lack of individual
authorization from Pablo?
A: NO. Under R.A. 9481, violation of the Collective
Bargaining Agreement, to be an unfair labor practice, must
be gross in character. It must be a flagrant and malicious
refusal to comply with the economic provisions of the CBA.
(2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
NO. Check-offs impose an extra burden on the employer in
the form of additional administrative and bookkeeping
costs. It is a burden assumed by management at the
instance of the union and for its benefit, in order to facilitate
the collection of dues necessary for the latter’s life and
sustenance. But the obligation to pay union dues and
agency fees obviously devolves not upon the employer, but
the individual employee. It is a personal obligation not
demandable from the employer upon default or refusal of
the employee to consent to a check-off. The only obligation
of the employer under a check-off is to effect the deductions
and remit the collections to the union. (Holy Cross of Davao
College v. Joaquin, G.R. No. 110007, 18 Oct. 1996; 2009-2017
UST FCL Bar Q&A)
(b) Can the union charge Pablo with disloyalty for
refusing to allow the check-off of his union dues
and, on this basis, ask the company to dismiss
him from employment?
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
A: NO. The “check-off clause” in the CBA will not suffice. The
law prohibits interference with the disposition of one’s
salary. The law requires individual written authorization to
deduct union dues from Pablo’s salaries. For as long as he
pays union dues, Pablo cannot be terminated from
employment under the union security clause. As a matter of
fact, filing a complaint against the union before the DOLE
for forcible deduction from salaries does not constitute acts
of disloyalty against the union. (Tolentino v. Angeles, G. R.
No. L-8150, 30 May 1956; 2009-2017 UST FCL Bar Q&A)
Q: The management and Union X in Atisan Mining
entered into a CBA for 1997 to 2001. After 6 months, a
majority of the members of Union X formed Union Y and
sought management recognition. The latter responded
by not dealing with either union. But, when the CBA’s
economic provisions had to be renegotiated towards
the end of the term of the CBA, the management chose
to negotiate with Union Y, the newer union. Thus, Union
X which negotiated the existing CBA charged the
company with ULP. The company argued that it
committed no unfair labor practice since the supposed
violation had nothing to do with economic provisions of
the CBA. Is the management, right? (2011 BAR)
a) No. Refusal to comply with the CBA’s economic
provisions is not the only ground for ULP; a
disregard of the entire CBA by refusing to
renegotiate with the incumbent bargaining agent
is also ULP,
b) Yes. No unfair labor practice was committed
because the supposed violation has nothing to do
with economic provisions of the CBA.
c) Yes. The management commits no ULP when it
decided to renegotiate with the numerically
majority union.
d) Yes. A CBA violation amounts to ULP only if the
violation is “gross,” meaning flagrant or malicious
refusal to comply with the CBA’s economic
provisions which is not the case here.
A: a) NO. Refusal to comply with the CBA’s economic
provisions is not the only ground for ULP; a disregard of the
entire CBA by refusing to renegotiate with the incumbent
bargaining agent is also ULP. (UPLC Suggested Answers)
c) BY ORGANIZATIONS
(2012, 2011, 1995 BAR)
Q: Which of the following acts is NOT considered unfair
labor practice (ULP)? (2011 BAR)
a) Restraining employees in the exercise of the right
to self-organization.
b) Union's interference with the employee's right to
self-organization.
c) Refusal to bargain collectively with the employer.
d) Gross violation of the collective bargaining
agreement by the union.
A: B) Union's interference with the employee's right to self-
organization. (UPLC Suggested Answers)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: In the CBA between Dana Films and its rankand-file
Union (which is directly affiliated with MMFF, a
national federation), a provision on the maintenance of
membership expressly provides that the Union can
demand the dismissal of any member employee who
commits acts of disloyalty to the Union as provided for
in its Constitution and By-Laws. The same provision
contains an undertaking by the Union (MMFF) to hold
Dana Films free from any and all claims of any
employee dismissed. During the term of the CBA, MMFF
discovered that certain employee-members were
initiating a move to disaffiliate from MMFF and join a
rival federation, FAMAS. Forthwith, MMFF sought the
dismissal of its employee-members initiating the
disaffiliation movement from MMFF to FAMAS. Dana
Films, relying on the provision of the aforementioned
CBA, complied with MMFF's request and dismissed the
employees identified by MMFF as disloyal to it. a. Will
an action for illegal dismissal against Dana Films and
MMFF prosper or not? Why? (2012 BAR)
A: YES. While Dana Films, under the CBA, is bound to
dismiss any employee who is expelled by MMFF for
disloyalty (upon its written request), this undertaking
should not be done hastily and summarily. Due process is
required before a member can be dropped from the list of
union members of good standing. The company’s dismissal
of its workers without giving them the benefit of a hearing,
and without inquiring from the workers on the cause of
their expulsion as union members, constitute bad faith.
(Liberty Cotton Mills Workers Union, et. al v. Liberty Cotton
Mills, Inc. et. al., G.R. No. L-33987, 31 May 1979) (2009-2017
UST FCL Bar Q&A)
6. PEACEFUL CONCERTED ACTIVITIES
(2019, 2018, 2017, 2016, 2014, 2010, 2009, 2008,
2006, 2004, 2003, 2002, 2000, 1998, 1997, 1996, 1995,
1994, 1992, 1991 BAR)
a) STRIKES (VALID vs. ILLEGAL)
(2019, 2018, 2017, 2010, 2009, 2008, 2006, 2002,
2000, 1998, 1997, BAR)
Q: Can the issue of wage distortion be raised in a notice
of strike? Explain. (2009, 2006, 1997 BAR)
A: NO. In Ilaw ng Manggagawa v. NLRC, (G.R. No. 91980, 27
June 1991) the Supreme Court held that any issue involving
wage distortion shall not be a ground for a strike or lockout.
The legislative intent is to solve wage distortion problems
through voluntary negotiation or arbitration.
Q: Discuss the legal requirements of a valid strike.
(2007 BAR)
A: The legal requirements of a valid strike are as follows:
1. No labor union may strike on grounds involving
inter-union and intra-union disputes.
2. In cases of bargaining deadlocks, the duly certified
or recognized bargaining agent may file a notice of
strike with the DOLE at least 30 days before the
intended date thereof. In cases of ULP, the period
of notice shall be 15 days and in the absence of a
duly certified or recognized bargaining agent, the
notice of strike may be filed by any legitimate labor
44
 QuAMTO (1987-2022)
organization in behalf of its members.
3. However, in case of dismissal from employment of
union officers duly elected in accordance with the
union constitution and by-laws, which may
constitute union busting where the existence of the
union is threatened, the 15-day cooling-off period
shall not apply and the union may take action
immediately.
4. A decision to declare a strike must be approved by
a majority of the total union membership in the
bargaining unit concerned, obtained by secret
ballot in meetings or referenda called for that
purpose.
5. In every case, the union shall furnish the DOLE the
voting at least 7 days before the intended strike
subject to the cooling-off period herein provided.
6. No labor organization shall declare a strike without
first having bargained collectively; without first
having filed the notice required or without the
necessary strike vote first having been obtained
and reported to the DOLE.
7. No strike shall be declared after assumption of
jurisdiction by the President or the Secretary or
after certification or submission of the dispute to
compulsory or voluntary arbitration or during the
pendency of cases involving the same grounds for
the strike.
8. In a strike, no person engaged in picketing should
commit any act of violence, coercion or
intimidation or obstruct the free ingress to or
egress from the employer’s premises for lawful
purposes, or obstruct public thoroughfares.
Q: Upon compliance with the legal requirements on the
conduct of a strike, Navarra Union staged a strike
against Newfound Corporation on account of a
collective bargaining deadlock. During the strike,
some members of Navarra Union broke the windows
and punctured the tires of the company-owned buses.
The Secretary of Labor and Employment assumed
jurisdiction over the dispute. (2018 BAR)
(a) Should all striking employees be admitted back to
work upon the assumption of jurisdiction by the
Secretary of Labor and Employment? Will these
include striking employees who damaged
company properties?
A: YES. Under Art. 278(g) of the Labor Code, all striking
employees shall immediately return to work and the
employer shall immediately resume operations and re-
admit all workers under the same terms and conditions
prevailing before the strike or lockout.
Regarding the striking union members who damaged
company property, the employer should still reinstate
them, but after their reinstatement, the employer may
institute the appropriate disciplinary proceedings, or raise
the matter on the illegality of the strike on the ground of
45
violence and illegal acts committed during the strike before
the SOLE assumed jurisdiction.
(b) May the company readmit strikers only by
restoring them to the payroll?
A: NO as actual reinstatement is envisioned by Art. 278(g)
of the Labor Code. The purpose of the law is to bring back
the workers to their original work under the same terms
and conditions prevailing before the strike. (UPLC
Suggested Answers)
ALTERNATIVE ANSWER:
NO. The phrase "under the same terms and conditions" in
Art. 278(g) of the Labor Code means actual admission back
to work. As an exception, which fails to obtain here, strikers
whose employee status is under challenge may be
reinstated on the payroll (University of the Immaculate
Conception, Inc. v. Hon. Sec. of Labor, G.R. No. 151 379, 14 Jan.
2005) (Central Bar Q&A by Kato, 2023)
Q: A sympathetic strike is stoppage of work to make
common cause with other strikers in another
establishment or business. Is the sympathetic strike
valid? Explain your answer. (2017 BAR)
A: NO, a sympathetic strike is not valid. A strike is not valid
if there is no labor dispute between the employer and the
employees. In a sympathetic strike, there is no labor dispute
in the employees’ work since they are merely making
common cause with strikers in another establishment.
Hence, a sympathetic strike is not valid. (2009-2017 UST FCL
Bar Q&A)
Q: Due to business recession, Ballistic Company
retrenched a part of its workforce. Opposing the
retrenchment, some of the affected employees staged a
strike. Eventually, the retrenchment was found to be
justified, and the strike was declared illegal; hence, the
leaders of the strike, including the retrenched
employees, were declared to have lost their
employment status. Are the striking retrenched
employees still entitled to separation pay under Sec.
298 [283] of the Labor Code despite the illegality of
their strike? Explain your answer. (2017 BAR)
A: NO. The Supreme Court has ruled if the strike staged by
the union is declared illegal, the union officers and
members are considered validly dismissed from
employment for committing illegal acts during the illegal
strike. The striking retrenched union officials and members
who were found guilty of having staged an illegal strike,
which constituted serious misconduct, will not be entitled
to separation pay. (C. Alcantara & Sons, Inc. v. Court of
Appeals, G.R. No. 155109, 14 Mar. 2012; citing Toyota Motors
Phils. Corp. Workers Association v. NLRC, G.R. No. 158786 &
158789, 19 Oct. 2007) (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
A: YES. Since the retrenchment preceded the strike, the
liability of the company to pay separation pay under Art.
298 of the Labor Code has attached already. Hence,
regardless of the outcome of its complaint for illegal strike,
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
it must discharge said duty. An illegal strike staged by
retrenched employees will not extinguish said obligation.
(Central Bar Q&A by Kato, 2023)
Q: Given that the liability for an illegal strike is
individual, not collective, state when the participating
union officers and members may be terminated from
employment because of the illegal strike. Explain your
answer. (2017 BAR)
A: When a strike is declared illegal because of non-
compliance with statutory or contractual requirements or
because of the use of unlawful means, the consequence is
loss of employment status of the officers of the union who
knowingly participated in the illegal strike.
Ordinary union members will lose their employment status
only if they participated in the commission of illegal acts
during the strike, thus, mere union membership does not
result in automatic loss of employment as a result of an
illegal strike. (Arts. 263-264 [now Arts. 278-279], LC; Pepsi-
Cola Labor Union v. NLRC, G.R. No. L-58341, 29 June 1982;
Solidbank Corp. v. Solidbank Union, G.R. No. 159461, 15 Nov.
2010)
Q: A is a member of the labor union duly recognized as
the sole bargaining representative of his company. Due
to a bargaining deadlock, 245 members of the 500-
strong union voted on 13 Mar. 2010 to stage a strike. A
notice of strike was submitted to the National
Conciliation and Mediation Board on 16 Mar. 2010. 7
days later or on 23 Mar. 2010, the workers staged a
strike in the course of which A had to leave and go to
the hospital where his wife had just delivered a baby.
The union members later intimidated and barred other
employees from entering the work premises, thus
paralyzing the business operations of the company.
A was dismissed from employment as a consequence of
the strike. Was the strike legal? Explain (2010 BAR)
A: NO. The strike was not legal due to the union’s failure to
satisfy the required majority vote of union membership
(251 votes), approving the conduct of a strike. (See Art.
263(f) [now 278(f)], LC; Sec. 11, Rule XXII, D.O. 40-03)
Also, the strike was illegal due to the non-observance of the
30-day cooling off period by the union. (Art. 263(c) [now
278(c)], LC; Club Filipino, Inc. v. Bautista, G.R. No. 168406, 13
July 2009)
Q: On the first day of collective bargaining negotiations
between rank-and-file Union A and B Bus Company, the
former proposed a P45/day increase. The company
insisted that ground rules for negotiations should first
be established, to which the union agreed. After
agreeing on ground rules on the second day, the union
representatives reiterated their proposal for a wage
increase. When company representatives suggested a
discussion of political provisions in the CBA as
stipulated in the ground rules, union members went on
mass leave the next day to participate in a whole-day
prayer rally in front of the company building. (2010
BAR)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
(a) The company filed a petition for assumption of
jurisdiction with the Secretary of Labor and
Employment. The Union opposed the petition,
arguing that it did not intend to stage a strike.
Should the petition be granted? Explain.
A: YES. There was a strike. What the union engaged in was
actually a “work stoppage” in the guise of a prayer rally. Art.
212(o) [now 219(o)] of the LC defines strike as a temporary
stoppage of work by the concerted action of employees as a
result of an industrial or labor dispute. The fact that the
conventional term "strike” was not used by the striking
employees to describe their common course of action is
inconsequential. What is controlling is the substance of the
situation, and not its appearance. The term "strike”
encompasses not only concerted work stoppages, but also
slowdowns, mass leaves, sit-downs, attempts to damage,
destroy or sabotage plant equipment and facilities, and
similar activities. (Santa Rosa Coca-Cola Plant Employees
Union, Donrico v. Sebastian, et al. v. Coca-Cola Bottlers Phils.,
Inc., G.R. Nos. 164302-03, 24 Jan. 2007)
(b) The Union contended that assuming that the mass
leave will be considered as a strike, the same was
valid because of the refusal of the company to
discuss the economic provisions of the CBA. Rule
on the contention.
A: The Union’s contention is wrong. A strike may be
declared only in cases of deadlock in collective bargaining
negotiations and unfair labor practice. (Art. 263[c] [now
278(c)], LC; Sec. 1, Rule V, NCMB Manual of Procedures)
The proposal of the company to discuss political provisions
pursuant to the ground rules agreed upon does not
automatically mean that the company refuses to discuss the
economic provisions of the CBA, or that the company was
engaged in “surface bargaining” in violation of its duty to
bargain, absent any showing that such tend to show that the
company did not want to reach an agreement with the
Union. In fact, there is no deadlock to speak of in this case.
The duty to bargain does not compel either party to agree
to a proposal or require the making of a concession. The
parties’ failure to agree which to discuss first on the
bargaining table did not amount to ULP for violation of the
duty to bargain.
Besides, the mass leave conducted by the union members
failed to comply with the procedural requirements for a
valid strike under the Rules, -making the strike illegal.
(c) Union member AA, a pastor who headed the prayer
rally, was served a notice of termination by
management after it filed the petition for
assumption of jurisdiction. May the company
validly terminate AA? Explain.
A: NO. The company cannot terminate AA because the
Labor Code provides mere participation of a worker in a
strike shall not constitute sufficient ground for termination.
Q: Can a labor union invoke wage distortion as a valid
ground to go on strike? Explain. (2009 BAR)
46
 QuAMTO (1987-2022)
A: NO. A wage distortion dispute is non-strikable. The
allowable strike grounds are bargaining deadlock and ULP
to the exclusion of all others, e.g., inter-union dispute, intra-
union dispute, and labor standards disputes, like one arising
from a wage distortion. (Bar Q&A by Kato, 2022)
Q: Johnny is the duly elected President and principal
union organizer of the Nagkakaisang Manggagawa ng
Manila Restaurant (NMMR), a legitimate labor
organization. He was unceremoniously dismissed by
management for spending virtually 95% of his working
hours in union activities. On the same day Johnny
received the notice of termination, the labor union
went on strike. Management filed an action to declare
the strike illegal, contending that:
a. The union did not observe the “cooling-off
period” mandated by the Labor Code; and
b. The union went on strike without complying
with the strike-vote requirement under the
Labor Code.
Rule on the foregoing contentions with reasons. (2009
BAR)
(a) The union did not observe the “cooling-off period”
mandated by the Labor Code.
A: YES. The conduct of a strike action without observing the
cooling-off period is a violation of one of the requirements
of law which must be observed. The cooling-off periods
required by Arts. 263 (c) [now 278(c)] and 263 (f) [now
278(f)] of the LC are to enable the DOLE to exert efforts to
amicably settle the controversy, and for the parties to
review and reconsider their respective positions during the
cooling- off periods. But the Labor Code also provides that
if the dismissal constitutes union busting, the union may
strike immediately.
(b) The union went on strike without complying with
the strike-vote requirement under the Labor Code.
A: YES. The conduct of the strike action without a strike
vote violates Art. 263 (f) [now 278(f)] – In every case, the
union or the employer shall furnish the [DOLE] the results
of the voting at least seven days before the intended
strike...” to enable the DOLE and the parties to exert the last
effort to settle the dispute without strike action.
Q: On the day that the Union could validly declare a
strike, the Secretary of Labor issued an order assuming
jurisdiction over the dispute and enjoining the strike,
or if one has commenced, ordering the striking workers
to immediately return to work. The return-to-work
order required the employees to return to work within
twenty-four hours and was served at 8 a.m. of the day
the strike was to start. The order at the same time
directed the Company to accept all employees under
the same terms and conditions of employment prior to
the work stoppage. The Union members did not return
to work on the day the Secretary’s assumption order
was served, nor on the next day; instead, they held a
continuing protest rally against the company’s alleged
unfair labor practices. Because of the accompanying
picket, some of the employees who wanted to return to
work failed to do so. On the 3rd day, the workers
47
reported for work, claiming that they do so in
compliance with the Secretary’s return-to-work order
that binds them as well as the Company. The Company,
however, refused to admit them back since they had
violated the Secretary’s return-to-work order and are
now considered to have lost their employment status.
The Union officers and members filed a complaint for
illegal dismissal arguing that there was no strike but a
protest rally which is a valid exercise of the workers’
constitutional right to peaceable assembly and
freedom of expression. Hence, there was no basis for
the termination of their employment.
You are the Labor Arbiter to whom the case was raffled.
Decide, ruling on the following issues: Was there a
strike? (2008 BAR)
A: YES, there was a strike. No matter how they call it, the
“continuing protest rally against the company’s alleged
unfair labor practices” constitutes a “temporary stoppage of
work by the concerted action of employees as a result of an
industrial or labor dispute” – a case of strike as defined in
Art. 212(o) [now 219(o)] of the LC.
Recently, in Santa Rosa Coca-Cola Plant Employees Union, et
al. v. Coca-Cola Bottlers Phils., Inc. (G.R. Nos. 164302-03, 24
Jan. 2007), the Supreme Court clarified that a strike comes
in varied forms, from “slowdowns, mass leaves, sit downs”
to other “similar activities.” A protest rally which results in
temporary stoppage of work by the concerted action of
employees, as a result of a labor or industrial dispute, is
clearly a case of strike.
b) PICKETING
(2019, 2018, 2017, 2016, 2010, 2008, 2002, 2000,
1998 BAR)
Q: Asia Union (Union) is the certified bargaining agent
of the rank-and-file employees of Asia Pacific Hotel
(Hotel). The Union submitted its CBA negotiation
proposals to the Hotel. Due to the bargaining deadlock,
the Union, on 20 Dec. 2014, filed a Notice of Strike with
the National Conciliation and Mediation Board (NCMB).
Consequently, the Union conducted a Strike Vote on 14
Jan. 2015, when it was approved.
The next day, waiters who are members of the Union
came out of the Union office sporting closely cropped
hair or cleanly shaven heads. The next day, all the male
Union members came to work sporting the same hair
style. The Hotel prevented these workers from entering
the premises, claiming that they violated the company
rule on Grooming Standards.
On 16 Jan. 2015, the Union subsequently staged a picket
outside the Hotel premises and prevented other
workers from entering the Hotel. The Union members
blocked the ingress and egress of customers and
employees to the Hotel premises, which caused the
Hotel severe lack of manpower and forced the Hotel to
temporarily cease operations resulting to substantial
losses.
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
On 20 Jan. 2015, the Hotel issued notices to Union
members, preventively suspending them and charging
them with the following offenses: (1) illegal picket; (2)
violation of the company rule on Grooming Standards;
(3) illegal strike; and (4) commission of illegal acts
during the illegal strike. The Hotel later terminated the
Union officials and members who participated in the
strike. The Union denied it engaged in an illegal strike
and countered that the Hotel committed a ULP and a
breach of the freedom of speech.
Was the picketing legal? Was the mass action of the
Union officials and members an illegal strike? Explain.
(2016 BAR)
A: The picket was illegal. The right to picket as a means of
communicating the facts of a labor dispute is a phase of
freedom of speech guaranteed by the constitution. (De Leon
v. National Labor Union, G.R. No. L-7586, 30 Jan. 1957) But
this right is not absolute. Art. 278 of the LC provides that no
person engaged in picketing shall obstruct the free ingress
to or egress from the employer's premises for lawful
purposes or obstruct public thorough fares. The acts of the
union members in blocking the entrance and exit of the
hotel which caused it to shut down temporarily makes the
picket illegal.
The actions of all the union members in cropping or shaving
their head is deemed an illegal strike. In National Union of
Workers in the Hotel Restaurant and Allied Industries
(NUWHRAINAPL-IUF) Dusit Hotel Nikko Chapter v. Court of
Appeals, G.R. No. 163942 November 11 2008, the Supreme
Court ruled that the act of the Union was not merely an
expression of their grievance or displeasure but was,
indeed, a calibrated and calculated act designed to inflict
serious damage to the hotel's grooming standards which
resulted in the temporary cessation and disruption of the
hotel's operations. This should be considered as an illegal
strike.
ALTERNATIVE ANSWER:
As regards the shaving of heads by the union members, their
mass action was not an illegal strike. It was the Hotel
administration which prevented them from entering the
hotel premises. (2009-2017 UST FCL Bar Q&A)
c) LOCKOUTS
(2019, 1995 BAR)
Q: Define, explain, or distinguish strikes and lockouts
(2019 BAR)
A: Strikes are any temporary stoppage of work by the
concerted action of employees as a result of an industrial
labor dispute; whereas, lockouts are the temporary refusal
of an employer to furnish work as a result of an industrial
or labor dispute. (Art. 219(o) and (p) (formerly 212), LC)
(UPLC Suggested Answers)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
d) ASSUMPTION OF JURISDICTION BY THE DOLE
SECRETARY
(2018, 2017, 2014, 2010, 2008, 2004, 2003, 1998,
1997, 1996, 1994, 1992, 1991 BAR)
Q: In a labor dispute, the Secretary of Labor issued an
"Assumption Order" Give the legal implications of such
an order. (2017, 2003 BAR)
A: Under Art. 263(g) [now 278(g)] of the Labor Code, such
assumption shall have the effect of automatically enjoining
the intended or impending strike or lockout as specified in
the assumption order. If one had already taken place at the
time of assumption, all striking or lockout employees shall
immediately return to work and the employer shall
immediately resume operations and re-admit all workers
under the same terms and conditions prevailing before the
strike or lockout. The Secretary of Labor and Employment
may seek the assistance of law enforcement agencies to
ensure compliance with this provision as well as with such
orders as he may issue to enforce the same. The mere
issuance of an assumption order by the Secretary of Labor
automatically carries with it a return-to-work order, even if
the directive to return to work is not expressly stated in the
assumption order.
Those who violate the foregoing shall be subject to
disciplinary action or even criminal prosecution. Under Art.
264 [now 279] of the Labor Code, no strike or lockout shall
be declared after the assumption of jurisdiction by the
Secretary.
Q: Savoy Department Store (SDS) adopted a policy of
hiring salesladies on five-month cycles. At the end of a
saleslady’s five- month term, another person is hired as
replacement. Salesladies attend to store customers,
wear SDS uniforms, report at specified hours, and are
subject to SDS workplace rules and regulations. Those
who refuse the 5-month employment contract are not
hired. The day after the expiration of her 5-month
engagement, Lina wore her SDS white and blue uniform
and reported for work but was denied entry into the
store premises. Agitated, she went on a hunger strike
and stationed herself in front of one of the gates of SDS.
Soon thereafter, other employees whose 5-month term
had also elapsed joined Lina’s hunger strike. The owner
of SDS considered the hunger strike staged by Lina, et
al., an eyesore and disruptive of SDS’ business. He wrote
the Secretary of Labor a letter asking him to assume
jurisdiction over the dispute and enjoin the hunger
“strike”. What answer will you give if you were the
Secretary of Labor? (2008 BAR)
A: I will deny the letter-request of SDS because its business
is not indispensable to the national interest. Although the
Secretary of Labor has a wide latitude of discretion in
deciding whether or not to assume jurisdiction over a labor
dispute or certify the same to the NLRC for compulsory
arbitration, SDS’s business is clearly not one which is
indispensable to the national interest. Moreover, the
grounds relied upon by SDS, to wit: “eyesore and disruptive
of its business”, betrays the weakness of its case.
48
 QuAMTO (1987-2022)
Q: Several employees and members of Union A were
terminated by Western Phone Co. on the ground of
redundancy. After complying with the necessary
requirements, the Union staged a strike and picketed
the premises of the company. The management then
filed a petition for the Secretary of Labor and
Employment to assume jurisdiction over the dispute.
Without the benefit of a hearing, the Secretary issued
an Order to assume jurisdiction and for the parties to
revert to the status quo ante litem. (2010 BAR)
(a) Was the order to assume jurisdiction legal?
Explain.
A: YES. The Secretary of Labor and Employment has
plenary power to assume jurisdiction under Art. 263(g)
[now 278(g)] of the Labor Code. 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 may assume jurisdiction
over the dispute and decide it or certify it to the NLRC for
compulsory arbitration. (Art. 263[g] [now 278(g)], LC)
This extraordinary authority given to the Secretary of Labor
is aimed at arriving at a peaceful and speedy solution to
labor disputes, without jeopardizing national interests.
(Steel Corporation v. SCP Employees Union, G.R. Nos. 169829-
30, 16 Apr. 2008)
Such assumption shall have the effect of automatically
enjoining an impending strike or lockout, or an order
directing immediate return to work and resume operations,
if a strike already took place, and for the employer to re-
admit all employees under the same terms and conditions
prevailing before the strike or lockout. (Art. 263[g] [now
278(g)], LC; Sec. 15, Rule XXII, D.O. No. 40-G-03)
(b) Under the same set of facts the Secretary issued an
Order directing all striking workers to return to
work within 24 hours, except those who were
terminated due to redundancy. Was the Order
legal? Explain.
A: NO. The Secretary of Labor’s order will be inconsistent
with the established policy of the State of enjoining the
parties from performing acts that undermine the
underlying principles embodied in Art. 263(g) [now
278(g)] of the Labor Code.
In this case, excepting the employees terminated due to
redundancy from those who are required to return-to-
work, which was the very labor dispute that sparked the
union to strike, the Secretary of Labor comes short of his
duty under Art. 263(g) [now 278(g)] to maintain status quo
or the terms and conditions prevailing before the strike. In
fact, the Secretary could be accused of disposing of the
parties’ labor dispute without the benefit of a hearing, in
clear derogation of due process of law.
49
Q: Liwanag Corporation is engaged in the power
generation business. A stalemate was reached during
the collective bargaining negotiations between its
management and the union. After following all the
requisites provided by law, the union decided to stage a
strike. The management sought the assistance of the
Secretary of Labor and Employment, who assumed
jurisdiction over the strike and issued a return-to-work
order. The union defied the latter and continued the
strike. Without providing any notice, Liwanag
Corporation declared everyone who participated in the
strike as having lost their employment. (2014 BAR)
(a) Was Liwanag Corporation’s action valid?
A: YES. A strike that is undertaken despite the issuance by
the Secretary of Labor of an assumption or certification
order becomes an illegal act committed in the course of a
strike. It rendered the strike illegal. The Union officers and
members, as a result, are deemed to have lost their
employment status for having knowingly participated in an
illegal act. (Union of Filipro Employees v. NLRC, G.R. No.
91025; 19 Dec. 1990) Such kind of dismissal under Article
264 can immediately be resorted to as an exercise of
management prerogative. (Biflex v. Filflex Industrial, G.R. NO.
155679, 19 Dec. 2006)
ALTERNATIVE ANSWER:
NO. Liwanag Corporation cannot outrightly declare the
defiant strikers to have lost their employment status. “(A)s
in other termination cases,” the strikers are entitled to due
process protection under Article 277 (b) of the Labor Code.
Nothing in Article 264 of the Code authorizes immediate
dismissal of those who commit illegal acts during a strike.
(Stamford Marketing Corp. v. Julian, G.R. No. 145496, 24 Feb.
2004; Suico v. NLRC, G.R. No. 146762, 30 Jan. 2007)
(b) If, before the DOLE Secretary assumed jurisdiction,
the striking union members communicated in
writing their desire to return to work, which offer
Liwanag Corporation refused to accept, what
remedy, if any, does the union have?
A: File a case for illegal dismissal. (Art. 217(a)(2), LC)
E. TELECOMMUTING ACT (R.A. No. 11165)
1. DEFINITION (Sec. 3)
2. TELECOMMUTING PROGRAM (Sec. 4)
3. FAIR TREATMENT (Sec. 5)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
IV. POST-EMPLOYMENT
A. EMPLOYER-EMPLOYEE RELATIONSHIP
(2022, 2020-21, 2019, 2018, 2017, 2016, 2015, 2014,
2013, 2012, 2010, 2009, 2008, 2007, 2006, 2005, 2004,
2002, 2001, 1999, 1997, 1996, 1993, 1988, 1987 BAR)
1. TESTS TO DETERMINE EMPLOYER-EMPLOYEE
RELATIONSHIP
(2022, 2019, 2017, 2016, 2014, 2010, 2006, 2005,
2002, 2001, 1999, 1997, 1996, 1993, 1988, 1987 BAR)
Q: What are the accepted tests to determine the
existence of an employer-employee relationship?
(2017 BAR)
A: The accepted tests to determine the existence of an
employer-employee relationship are the four-fold test and
the economic reality test.
Under the four-fold test, there is employer-employee
relationship if the employer exercises (a) the power to hire
employees; (b) the power of dismissal; (c) payment of
wages; and (d) power to control employee’s conduct, which
is the most important requisite.
The economic reality test examines the economic realities
prevailing within the activity or between the parties, taking
into consideration the totality of circumstances
surrounding the true nature of the relationship between the
parties. (Orozco v. CA, G.R. No. 155207, 13 Aug. 2008)
Q: Kotse Corp. operates a mobile phone application
“Kotse PH” that allows users to book private cars on
demand to their destination, and matches them with
nearby available “driver-partners.” The destination is
only made known to the driver-partners when the
users have boarded the vehicle. Kotse Corp. has an
accreditation process for its driver-partners who are
required to submit bio-data, professional driver’s
license, and negative drug test result, as well as pass an
exam on road safety. After accreditation, the driver-
partners are free to choose their own work hours but
Kotse Corp. requires them to complete at least a total
40 hours per week or else the driver’s share in the fare
will be reduced. The fare is determined by the
application software depending on distance, time, and
the demand for rides. The fare is paid by the user or
passenger through the application and Kotse Corp.
remits the driver’s share of 75% of the fare every two
weeks. Kotse Corp. keeps 25% as its commission. The
driver-partners are evaluated by the users or
passengers through a five-star rating system. Driver-
partners who consistently have an average rating of
two stars or below may be removed from Kotse Corp.’s
roster of driver-partners. The driver-partners use their
own vehicles, pay for fuel, and secure their own vehicle
insurance.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Is there an employer-employee relationship between
Kotse Corp. and its driver-partners? Explain briefly.
(2022 BAR)
A: NO, there is none. The affair is a partnership. Although
Kotse Corp. is a common carrier (LTFRB, et al. vs. Hon. Carlos
A. Valenzuela, G.R. 242860, 11 Mar. 2019), its legal tie to its
driver-partners is not an employment affair. In
employment affair, drivers do not co-invest in the common
carrier's business. Kotse Corp. is a booking agent that
connects its partners to prospective passengers. The
desired result is not achieved through the exercise of
pervasive control over means and methods of performance
but through the interplay of mutual investments. The
payment received by Kotse Corp. is not business income
from which a payroll is funded in accordance with a wage
structure. The accreditation criteria do not pertain to
employee selection either but to the qualification of
partners, i.e., in addition. to their material investment.
Hence, pursuant to the Principle of Primacy of Facts, the
relationship between Kotse Corp. and its driver-partners is
one of partnership owing to the substantial contribution of
the latter. (Corporal, Sr., et al. vs NLRC, et al., G. R. 129315, 02
Oct. 2000) (Central Bar Q&A by Kato, 2023)
Q: A, B, and C were hired as resident-doctors by MM
Medical Center, Inc. In the course of their engagement,
A, B, and C maintained specific work schedules as
determined by the Medical Director. The hospital also
monitored their work through supervisors who gave
them specific instructions on how they should perform
their respective tasks, including diagnosis, treatment,
and management of their patients.
One day, A, B, and C approached the Medical Director
and inquired about the non-payment of their
employment benefits. In response, the Medical
Director told them that they are not entitled to any
because they are mere "independent contractors" as
expressly stipulated in the contracts which they
admittedly signed. As such, no employer-employee
relationship exists between them and the hospital.
(2019 BAR)
a. What is the control test in determining the
existence of an employer-employee
relationship?
A: This test is premised on the exercise or the reservation
of the right to control the manner and method to do a job.
The important factor to consider is how the work itself is
done, not just the result thereof. (Reyes v. Glaucoma, G.R. No.
189255, 17 June 2015) (UPLC Suggested Answers)
b. Is the Medical Director's reliance on the
contracts signed by A, B, and C to refute the
existence of an employer-employee
relationship correct? If not, are A, B, and C
employees of MM Medical Center, Inc.? Explain.
A: NO. The Medical Director’s reliance on the contracts
signed by A, B, and C to refute the existence of an employer-
employee relationship is not correct. A, B, and C are
employees of MM Medical Center, Inc. Under the control
test, an employment relationship existed between the
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 QuAMTO (1987-2022)
physicians and the hospital because the hospital controlled
the means and the details of the process by which the
resident doctors accomplished their task. In this case, the
hospital maintained the specific work schedules of A, B, and
C. Moreover, the hospital monitored their specific
instructions on how they should perform their respective
tasks, including diagnosis, treatment and management of
their patients. The element of control having been
established, A, B, and C are employees of MM Medical
Center, Inc. (Calamba Medical Center, Inc. v. NLRC, et al., G.R.
No. 176484, 25 Nov. 2008) (UPLC Suggested Answers)
Q: Applying the tests to determine the existence of an
employer-employee relationship, is a jeepney driver
operating under the boundary system an employee of
his jeepney operator or a mere lessee of the jeepney?
Explain your answer. (2017 BAR)
A: YES, The jeepney driver operating under the boundary
system is an employee of the jeepney operator.
Applying the four-fold test:
a. The jeepney operator has the power to choose the
jeepney drivers who can drive his vehicles;
b. The jeepney operator has the power to dismiss the
jeepney driver by refusing to let the latter drive;
c. The jeepney driver’s wage is the excess of the
boundary; and
d. Most importantly, the jeepney operator exercises
control over the jeepney driver, since the owner
must see to it that the driver follows the route
prescribed under the certificate of public
convenience.
Applying the economic reality test, the jeepney driver is
dependent solely on his income from driving the jeepney
operator’s vehicle. Therefore, the jeepney driver operating
under the boundary system is an employee of the jeepney
operator.
Q: Dr. Crisostomo entered into a retainer agreement
with AB Hotel and Resort whereby he would provide
medical services to the guests and employees of AB
Hotel and Resort, which, in turn, would provide the
clinic premises and medical supplies. He received a
monthly retainer fee of ₱60,000.00, plus a 70% share in
the service charges from AB Hotel and Resort's guests
availing themselves of the clinic's services. The clinic
employed nurses and allied staff, whose salaries, SSS
contributions and other benefits he undertook to pay.
AB Hotel and Resort issued directives giving
instructions to him on the replenishment of emergency
kits and forbidding the clinic staff from receiving cash
payments from the guests. In time, the nurses and the
clinic staff claimed entitlement to rights as regular
employees of AB Hotel and Resort, but the latter
refused on the ground that Dr. Crisostomo, who was
their employer, was an independent contractor. Rule,
with reasons. (2017 BAR)
A: I will rule in favor of AB Hotel and Resort. Dr. Crisostomo
was an independent contractor and the nurses and clinic
staff are his employees. Dr. Crisostomo had the power of
selection and engagement of the nurses and clinic staff; he
also paid their wages and SSS contributions. Most
51
importantly, he exercises control over the nurses and
clinical staffs’ conduct in dispensing medical services to the
guests and personnel of the resort. The fact that AB Hotel
and Resort gave instructions to Dr. Crisostomo regarding
replenishment of emergency kits and forbidding his staff
from receiving cash payments from guests is of no
consequence. They are nothing more but guidelines which
will not create an employer-employee relationship (Insular
Life Co., Ltd. v. NLRC, G.R. No. 84484, 15 Nov. 1989)
ALTERNATIVE ANSWER:
I will rule in favor of the employees. In the case of Samonte
v. La Salle Greenhills, Inc. (G.R. No. 199683, 10 Feb. 2016),
the Court held that, " the power of control refers to the
existence of the power and not necessarily to the actual
exercise thereof, nor is it essential for the employer to
actually supervise the performance of duties of the
employee. It is enough that the employer has the right to
wield that power." Such power is present in the hands of AB
Hotel and Resort.
Q: Gregorio was hired as an insurance underwriter by
the Guaranteed Insurance Corporation (Guaranteed).
He does not receive any salary but solely relies on
commissions earned for every insurance policy
approved by the company. He hires and pays his own
secretary but is provided free office space in the office
of the company. He is, however, required to meet a
monthly quota of twenty (20) insurance policies,
otherwise, he may be terminated. He was made to agree
to a Code of Conduct for underwriters and is supervised
by a Unit Manager. (2016 BAR)
(a) Is Gregorio an employee of Guaranteed?
A: NO. Gregorio is not an employee of Guaranteed. Under
the Control Test, there is employer-employee relationship
where the employer controls the employee’s the means and
methods by which the result is to be accomplished. (Avelino
Lambo and Vicente Belocura v. NLRC and J.C. Tailor Shop
and/or Johnny Co., G.R. No. 111042, 26 Oct. 1999, citing
Makati Haberdashery, Inc. v. NLRC, G.R. Nos. 83380-81, 15
Nov. 1989) The requirement of complying with quota,
company Code of Conduct and supervision by unit
managers do not go into means and methods by which
Gregorio must achieve his work. He has full discretion on
how to meet his quota requirement, hence, there is no
employer-employee relationship between Gregorio and
Guaranteed. (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
YES. Gregorio is Guaranteed’s employee. Gregorio was
made to agree to a Code of Conduct; he was supervised by
a Unit Manager; he was given a quota and can be
terminated if he does not meet the same. All the foregoing
are indicators that Guaranteed controls the means and
methods by which Gregorio must achieve his work.
Moreover, in Francisco v. NLRC, Kasei Corporation, (G.R. No.
170087, 31 Aug. 2006), the Court added another element to
ascertain employer-employee relationship. This is
whether or not the worker is dependent on the alleged
employer for his continued employment. This is dubbed as
the economic dependence test. The fact that Guaranteed
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
can terminate Gregorio if he does not meet the quota of 20
insurance policies a month meant that the latter is
economically dependent on the former which negates his
status as an independent contractor and proves that he is
an employee.
(b) Suppose Gregorio is appointed as Unit Manager
and assigned to supervise several underwriters.
He holds office in the company premises, receives
an overriding commission on the commissions of
his underwriters, as well as a monthly allowance
from the company, and is supervised by a branch
manager. He is governed by the Code of Conduct for
Unit Managers. Is he an employee of Guaranteed?
Explain.
A: YES. Gregorio is an employee. That he is supervised by
a branch manager is an indication that the company
exercises control over the means and method by which he
is to achieve the desired result.
ALTERNATIVE ANSWER:
YES. Art. 219(m) of the Labor Code defines a Managerial
employee as one who is vested with the powers or
prerogatives to lay down and execute management
policies and/or to hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline employees. As Gregorio was
appointed Unit Manager, the means and methods of
accomplishing his goal come under the guideline laid down
by Guaranteed. (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
NO. Guaranteed did not define the duties and
responsibilities of Gregorio; Guaranteed left it to Gregorio’s
discretion as to how he will achieve his goal. Therefore, the
only interest Guaranteed has is in the result of Gregorio’s
work. (2009-2017 UST FCL Bar Q&A)
Q: Matibay Shoe and Repair Store, as added service to
its customers, devoted a portion of its store to a shoe
shine stand. The shoe shine boys were tested for their
skill before being allowed to work and given ID cards.
They were told to be present from the opening of the
store up to closing time and were required to follow the
company rules on cleanliness and decorum. They
bought their own shoe shine boxes, polish and rags. The
boys were paid by their customers for their services but
the payment is coursed through the store’s cashier,
who pays them before closing time. They were not
supervised in their work by any managerial employee
of the store but for a valid complaint by a customer or
for violation of any company rule, they can be refused
admission to the store. Were the boys, employees of the
store? Explain. (2016 BAR)
A: YES. The elements to determine the existence of an
employment relationship are: (a) the selection and
engagement of the employee; (b) the payment of wages; (c)
the employer’s power to control the employee’s conduct;
and (d) the power of dismissal.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
The first element is present, as Matibay Shoe allowed shoe
shine boys in its shoe shine stand to render services that are
desirable in the line of business of Matibay Shoe. In issuing
IDs to the shoe shine boys, the same signifies that they can
represent themselves as part of the work force of Matibay
Shoe.
The second element is also present. Requiring the
customers to pay through the Matibay Shoe’s cashier
signifies that the shoe shine boys were not independently
engaged by the customers. Equally important, it was
Matibay Shoe which gave the shoe shine boys their daily
wage.
The third element is satisfied. Requiring the shoe shine
boys to be present from store opening until store closing
and to follow company rules on cleanliness and decorum
shows that they cannot conduct their activity anywhere
else but inside the store of Matibay Shoe, hence, their means
and methods of accomplishing the desired services for the
customers of Matibay Shoe was controlled by it.
Lastly, the fourth element is made apparent when Matibay
Shoe barred the shoe shine boys from continuing with their
work-related activity inside its establishment. (2009-2017
UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
NO. The elements to determine the existence of an
employment relationship are: (a) the selection and
engagement of the employee; (b) the payment of wages; (c)
the employer’s power to control the employee’s conduct;
and (d) the power of dismissal.
The first element is absent. The mere issuance of an ID to
the boys is not conclusive of the power of selection of
Matibay Shoe. They may be given IDs merely as a security
measure for the establishment. Furthermore, using the
control test, the boys have exclusive power over the means
and method by which the shoe shining activity is to be
conducted. (2009-2017 UST FCL Bar Q&A)
Q: Don Luis, a widower, lived alone in a house with a
large garden. One day, he noticed that the plants in his
garden needed trimming. He remembered that Lando,
a 17-year old out-of-school youth, had contacted him in
church the other day looking for work. He contacted
Lando who immediately attended to Don Luis’s garden
and finished the job in three days. Is there an employer-
employee relationship between Don Luis and Lando?
(2014 BAR)
A: YES. All the elements of employer-employee relationship
are present, viz:
1. The selection and engagement of the employee;
2. The power of dismissal;
3. The payment of wages; and
4. The power to control the employee's conduct.
There was also no showing that Lando has his own tools, or
equipment so as to qualify him as an independent
contractor. (2009-2017 UST FCL Bar Q&A)
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 QuAMTO (1987-2022)
ALTERNATIVE ANSWER:
NONE. Lando is an independent contractor for Don Luis
does not exercise control over Lando’s means and method
in tending to the former’s garden. (2009-2017 UST FCL Bar
Q&A)
Q: Lina has been working as a steward with a Miami,
U.S.A.-based Loyal Cruise Lines for the past 15 years.
She was recruited by a local manning agency,
Macapagal Shipping, and was made to sign a 10-month
employment contract every time she left for Miami.
Macapagal Shipping paid for Lina’s round-trip travel
expenses from Manila to Miami. Because of a food
poisoning incident which happened during her last
cruise assignment, Lina was not re-hired. Lina claims
she has been illegally terminated and seeks separation
pay. If you were the Labor Arbiter handling the case,
how would you decide? (2014 BAR)
A: I will dismiss Lina's complaint. Lina is a contractual
employee and the length of her employment is determined
by the contracts she entered into. Here, her employment
was terminated at the expiration of the contract (Millares,
et al. v. NLRC, G.R. No. 110524, 14 Mar. 2002)
Q: Solar Plexus Bar and Night Club allowed by tolerance
50 Guest Relations Officers (GRO) to work without
compensation in its establishment under the direct
supervision of its Manager from 8:00 p.m. to 4:00 a.m.
every day, including Sundays and holidays. The GROs,
however, are free to ply their trade elsewhere at
anytime but once they enter the premises of the night
club, they are required to stay up to closing time. The
GROs earned their keep exclusively from commissions
for food and drinks, and tips from generous customers.
In time, the GROs formed the Solar Ugnayan ng mga
Kababaihang Inaapi (SUKI), a labor union duly
registered with DOLE. Subsequently, SUKI filed a
petition for certification election in order to be
recognized as the exclusive bargaining agent of its
members. Solar Plexus opposed the petition for
certification election on the singular ground of absence
of employer-employee relationship between the GROs
on one hand and the night club on the other hand.
May the GROs form SUKI as a labor organization for
purposes of collective bargaining? Explain briefly.
(2012, 1999 BAR)
A: The GROs may form SUKI as a labor organization for
purposes of collective bargaining. There is an employer-
employee relationship between the GROs and the night
club.
The Labor Code (in Art. 138 [now 136]) provides that any
woman who is permitted or suffered to work, with or
without compensation, in any night club, cocktail lounge,
massage clinic, bar or similar establishment, under the
effective control or supervision of the employer for a
substantial period of time as determined by the Secretary of
Labor, shall be considered as an employee of such
establishment for purposes of labor and social legislation.
53
In the case at bar, it is clearly stated that the women, once
they enter the premises of the night club, would be under
the direct supervision of the manager from 8:00 p.m. to 4:00
a.m. everyday, including Sundays and holidays. Such is
indicative of an employer-employee relationship since the
manager would be exercising the right of control.
Q: TRUE or FALSE. Answer TRUE if the statement is true,
or FALSE if the statement is false. Explain your answer
in not more than two (2) sentences.
The relations between employer and employee are
purely contractual in nature. (2010 BAR)
A: FALSE. Some aspects of the relations between employer
and employee are determined by certain labor standards.
ALTERNATIVE ANSWER:
FALSE. The Constitution, Labor Code, Civil Code and other
social legislations are replete with provisions that define
employment relationship even without contract, with the
intention of insuring that all the rights of labor are
protected. Art. 1700 of the NCC provides that “[T]he
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.” In Article
106 of the Labor Code, the principal is deemed as a direct
employer in labor-only contracting, despite absence of
contractual relationship between the worker and the
principal.
2. KINDS OF EMPLOYMENT
(2022, 2020-21, 2019, 2016, 2015, 2014, 2013, 2010,
2009, 2008, 2007, 2005, 2004, 2002, 1999 BAR)
a) REGULAR
(2022, 2019, 2015, 2010, 2008, 2005 BAR)
Q: Sigaw Corp., a media entity, produces television
shows. To streamline its processes, it created a
database of camera crew and sound engineers whom it
usually engages for its television shows. Sigaw Corp.
pays them only “talent fees” each time they are engaged
for a show. After several years of this set-up, the camera
crew and sound engineers filed a complaint for
regularization against Sigaw Corp. before the Labor
Arbiter. On the other hand, Sigaw Corp., claims that they
are not regular employees but independent contractors
or talents because they are engaged and paid for their
specific technical skills.” Rule on the complaint. Explain
briefly. (2022 BAR)
A: The camera crew and sound engineers are regular
employees for the following reasons: First, they were not
engaged to showcase any unique artistic skills and talents,
much less in consideration of their celebrity status. On the
contrary, they were engaged to perform work directly
related to the trade of Sigaw Corp. as a TV network that
produces shows. Second, the tasks they perform are
necessary, desirable, vital and indispensable to the trade of
Sigaw Corp. These facts militate against the independent
contractorship insisted on by the company. (Del Rosario, et
al. v. ABS-CBN, G.R. No. 202481, 08 Sept. 2020) (Central Bar
Q&A by Kato, 2023)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
Q: Marciano was hired as Chief Engineer on board the
vessel MN Australia. His contract of employment was
for nine months. After nine months, he was re-hired. He
was hired a third time after another nine months. He
now claims entitlement to the benefits of a regular
employee based on his having performed tasks usually
necessary and desirable to the employer's business for
a continuous period of more than one year. Is
Marciano's claim tenable? Explain your answer. (2017
BAR)
A: NO, Marciano's claim is not tenable. Seafarers are
contractual employees for a fixed term, governed by the
contracts they sign. We should not depart from the rulings
of the Supreme Court in Brent School v. Zamora (G.R. No. L-
48494, 05 Feb. 1990); Coyoca v. NLRC (G.R. No. 113658, 31
Mar. 1995); and Millares v. NLRC (G.R. No. 110524, 29 July
2002), which constitute stare decisis with respect to the
employment status of seafarers as contractual employees,
not regular employees, notwithstanding performance of-
usually necessary and desirable functions which exceed one
year or continuous rehiring.
Q: Ms. A is a volleyball coach with 5 years of experience
in her field. Before the start of the volleyball season of
2015, she was hired for the sole purpose of overseeing
the training and coaching of the University's volleyball
team. During her hiring, the Vice-President for Sports
expressed to Ms. A the University's expectation that she
would bring the University a championship at the end
of the year. In her first volleyball season, the University
placed 9th out of 10 participating teams. Soon after the
end of the season, the Vice-President for Sports
informed Ms. A that she was a mere probationary
employee and hence, she need not come back for the
next season because of the poor performance of the
team. In any case, the Vice-President for Sports claimed
that Ms. A was a fixed-term employee whose contract
had ended at the close of the year. (2019 BAR)
(a) Is Ms. A a probationary, fixed-term, or regular
employee? Explain your reasons as to why she
is or she is not such kind of an employee for
each of the types of employment given.
A: There being no specific indication as to the nature of the
engagement or that her performance was to be evaluated in
accordance with standards for regularization made known
at the time of engagement, it is presumed that Ms. A was
hired as a regular employee. She cannot also be categorized
as a term employee since it was not agreed upon by her and
the University that her employment would only be for a
definite period of time. As a matter of fact, there being no
mention of a contract in the facts. Ms. A can only be
considered as a regular employee.
(b) Assuming that Ms. A was dismissed by the
University for serious misconduct but was
never given a notice to explain, what is the
consequence of a procedurally infirm dismissal
from service under our Labor law and
jurisprudence? Explain.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
A: The University should pay nominal damages to Ms. A in
the amount of P30,000.00. Applying the Agabon Doctrine, if
the dismissal of the employee was for just cause but
procedural due process was not observed, the lack of
statutory due process should not nullify the dismissal or
render it illegal or ineffectual. (Agabon v. NLRC, G.R. No.
158693, 17 Nov. 2004) However, the employer should
indemnify the employee for the violation of his right to
procedural due process.
Q: Don Don is hired as a contractual employee of
CALLHELP, a call center. His contract is expressly for a
term of 4 months. Don Don is hired for 3 straight
contracts of 4 months each but at 2-week intervals
between contracts. After the third contract ended, Don
Don is told that he will no longer be given another
contract because of "poor performance." Don Don files
a suit for "regularization" and for illegal dismissal,
claiming that he is a regular employee of CALLHELP and
that he was dismissed without cause. You are the Labor
Arbiter. How would you decide the case? (2015 BAR)
A: As Labor Arbiter, I will decide the case in favor of Don
Don. Given the nature of Don Don’s work, which consist of
activities usually necessary or desirable in the usual
business of CALLHELP, Don Don should be considered a
regular employee.
CALLHELP’s termination of Don Don’s service in the guise
of “poor performance” is not valid. Whether for a
probationary or regular employee, the requisites of
dismissal on that ground do not appear to have been
complied with by the employer here. (2009-2017 UST FCL
Bar Q&A)
Q: Julius Lagat, a truck driver, was hired by Merdeka
Trucking Company which is engaged in the business of
hauling farm produce, fertilizer and other cargo for an
agribusiness company on a non-seasonal and
continuing basis. Lagat’s contract stipulated that it was
effective for six months from date of execution,
renewable for the same period. Upon expiration of the
renewed contract. Lagat was advised by Merdeka that
his services were terminated. Lagat filed a complaint
for illegal dismissal against Merdeka which contended
that Lagat had no cause of action as his employment
was for a definite and specific period. You are the Labor
Arbiter. Decide with reasons. (2015 BAR)
A: As Labor Arbiter, I will decide in favor of Lagat. From the
circumstances of the case, it is apparent, that the six-month
period was imposed to preclude the employee from
acquiring security of tenure. The contract that Merdeka had
with Lagat can be considered as circumventing the law that
gives a worker the right to security of tenure, considering
that Lagat was a truck driver in a business that was not
seasonal and was on a continuing basis. If the work was
seasonal, then he would have been legally employed for a
specific period, namely, per season. (Cielo v. NLRC, G.R. No.
28 Jan. 1991) This should also be noted: Lagat’s contract
was a renewed contract. This means that at the very least,
he was already employed for six months after which the
contract was renewed. So, if the first six-month period was
considered a probationary period, Lagat has now worked
after the probationary period. Thus, he is now a regular
54
 QuAMTO (1987-2022)
employee and clearly with the right to security of tenure.
(Art. 281, LC; 2009-2017 UST FCL Bar Q&A)
Q: A was hired in a sugar plantation performing such
tasks as weeding, cutting and loading canes, planting
cane points, fertilizing and cleaning the drainage.
Because his daily presence in the field was not
required, A also worked as a houseboy at the house of
the plantation owner. For the next planting season, the
owner decided not to hire A as a plantation worker but
as a houseboy instead. Furious, A filed a case for illegal
dismissal against the plantation owner. Decide with
reason. (2010 BAR)
A: A is a regular seasonal employee. Therefore, he cannot be
dismissed without just or valid cause. The primary standard
for determining regular employment is the reasonable
connection between the particular activity performed by
the employee in relation to the usual trade or business of
the employer (Pier 8 Arrastre & Stevedoring Services, Inc., et
al. v. Jeff B. Boclot, G.R. No. 173849, 28 Sept. 2007).
Considering that A, as plantation worker, performs work
that is necessary and desirable to the usual business of the
plantation owner, he is therefore a regular seasonal
employee and is entitled to reinstatement upon onset of the
next season unless he was hired for the duration of only one
season. (Hacienda Bino v. Cuenca, G.R. No. 150478, 15 Apr.
2005) Converting A to a mere houseboy at the house of the
plantation owner amounts to an act of severing his
employment relations as its plantation worker (Angeles v.
Fernandez, G.R. No. 160213, 30 Jan. 2007)
Q: Super Comfort Hotel employed a regular pool of
“extra waiters” who are called or asked to report for
duty when the Hotel’s volume of business is beyond the
capacity of the regularly employed waiters to
undertake. Pedro has been an “extra waiter” for more
than 10 years. He is also called upon to work on
weekends, on holidays and when there are big affairs at
the hotel. What is Pedro’s status as an employee under
the Labor Code? Why? Explain your answer fully. (2008
BAR)
A: Pedro has acquired the status of a regular employee.
Pedro was engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the
employer. Moreover, Pedro has been an “extra waiter” for
more than 10 years. Under the law, any employee who has
rendered service at least one year of service, whether such
service is continuous or broken, shall be considered a
regular employee with respect to the activity in which he is
employed and his employment shall continue while such
activity exists. (Art. 280 [now 295], LC)
b) CASUAL
(2015, 2010, 2008, 2007, 2005 BAR)
Q: Savoy Department Store (SDS) adopted a policy of
hiring salesladies on five-month cycles. At the end of a
saleslady’s 5-month term, another person is hired as
replacement. Salesladies attend to store customers,
wear SDS uniforms, report at specified hours, and are
subject to SDS workplace rules and regulations. Those
who refuse the 5-month employment contract are not
hired.
55
The day after the expiration of her 5-month
engagement, Lina wore her SDS white and blue uniform
and reported for work but was denied entry into the
store premises. Agitated, she went on a hunger strike
and stationed herself in front of one of the gates of SDS.
Soon thereafter, other employees whose 5-month term
had also elapsed joined Lina’s hunger strike.
Lina and 20 other salesladies filed a complaint for
illegal dismissal, contending that they are SDS’ regular
employees as they performed activities usually
necessary or desirable in the usual business or trade of
SDS and thus, their constitutional right to security of
tenure was violated when they were dismissed without
a valid, just or authorized cause. SDS, in defense, argued
that Lina, et al. agreed- prior to engagement – to a fixed
period employment and thus waived their right to a
full- term tenure. Decide the dispute. (2008 BAR)
A: I would rule in favor of Lina, et al. In Pure Foods
Corporation v. NLRC, G.R. No. 122653, 12 Dec. 1997), the
scheme of the employer in hiring workers on a uniformly
fixed contract basis of 5 months and replacing them upon
the expiration of their contracts with other workers with
the same employment status was found to have been
designed to prevent “casual” employees from attaining the
status of a regular employee. (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
The Complaint of Lina and 20 other employees should be
dismissed. Under existing jurisprudence, there is no
dismissal to speak of when the term of fixed-period
employments expires. As such, there is no violation of the
right to security of tenure of these fixed-period employees
even if they performed activities usually necessary or
desirable in the usual trade of business, because they knew
beforehand that their contract is to expire after five (5)
months. (2009-2017 UST FCL Bar Q&A)
ALTERNATIVE ANSWER:
I will resolve the illegal dismissal case in favor of SDS. In
Brent, the Supreme Court En Banc held that while fixed
term employment has already been repealed by the various
amendments to the Labor Code, the Civil Code still allows
fixed term employment. Such kind of employment is valid
as long as it is established that: (1) the fixed period of
employment was knowingly and voluntarily agreed upon
by the parties, without any force, duress or improper
pressure being brought to bear upon the employee and
absent any other circumstance vitiating his consent; and (2)
the employer and employee dealt with each other on more
or less equal terms with no moral dominance on the latter.
Since admittedly, Lina, et al. agreed, prior to their
engagement, to the fixed term employment, and it
appearing that their consent was not vitiated, and
considering further that it has not been argued that the
parties dealt with each other on less equal terms, it then
follows that Lina, et al’s fixed term employment is valid. No
illegal dismissal can take place upon expiration of such fixed
term employment. (2009-2017 UST FCL Bar Q&A)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
c) PROBATIONARY
(2020-21 BAR)
Q: In 2019, as a response to a viral #UniversityDoBetter
movement, a university announced that it would create
the position of independent gender auditor answerable
only to the university's Board of Regents. The
#UniversityDoBetter movement had arisen when a
high school student started to post on social media
complaints alleging sexual improprieties by some
professors. Others soon followed with their own
stories. Even traditional media outlets covered their
stories. True to its promise, the university engaged one
of its former professors with profound feminist views
as gender auditor. The contract stipulated a
performance review after five months of the gender
auditor's being engaged. The gender auditor's
performance was never the subject of any assessment
by the Board of Regents. For about two years, the
gender auditor submitted several candid findings on
the behavior of some members of the university's
faculty and administration. In January 2021, the gender
auditor submitted a report that the university's
management, including the Board of Regents, enabled
and facilitated a hostile environment not only for
women but also for those whose sexual orientation,
gender identity, or gender expression were considered
"nonconforming," i.e., members of the lesbian, gay,
bisexual, transgender, queer, intersex, asexual, and
other gender and sexual minorities (LGBTQIA+)
community. This report leaked and stirred a
controversy, causing the university president to be
dismissed from their post.
In January 2022, after the president's dismissal, the
gender auditor received a letter from the Board of
Regents, requiring the submission of a performance
assessment to determine whether the gender auditor
can be considered a regular employee. The gender
auditor seeks your advice because you passed the
#BestBarEver2020_21 and were recognized for
exemplary performance.
Is the gender auditor still a probationary employee?
Explain briefly. (2020-21 BAR)
A: NO. The gender auditor was able to attain regular
employment status for the following reasons:
First, he survived the stipulated probationary period of 5
months. Hence, pursuant to Art. 296 of the Labor Code, he
became a regular employee on the day immediately
following the expiry of his 5-month pre-regularization
employment.
Second, his engagement as independent gender auditor was
in the nature of compliance by the university with its
statutory duty to act on all complaints for sexual
harassment. (Sec. 5, R.A. No. 7877) Instead of forming a
Committee on Decorum and Investigation (CODI), the
university deployed a one-man investigating team to look
into complaints. Said statutory requirement attached to the
position offered him the character of a necessary and
desirable position in the usual affairs of the university with
its tuition-paying students. (Bar Q&A by Kato, 2022)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
d) PROJECT
(2019, 2016, 2005, 2002 BAR)
Q: Define, explain, or distinguish seasonal and project
employees (2019 BAR)
A: Seasonal employees are those who are called to work
from time to time according to the occurrence of varying
need during a season, and the employment is only for the
duration of said season. They are laid off after completion of
the required phase of work for the season.
Project employees are those who are assigned to carry out
a specific project or undertaking, the duration and scope of
which were specified at the time the employees were
engaged for the project, hence, the services of the project
employees are coterminous with the project for which they
were hired. (Art. 295, LC) (UPLC Suggested Answers)
Q: Mario Brothers, plumbing works contractor, entered
into an agreement with Axis Business Corporation
(Axis) for the plumbing works of its building under
construction. Mario Brothers engaged the services of
Tristan, Arthur, and Jojo as plumber, pipe fitter, and
threader, respectively. These workers have worked for
Mario Brothers in numerous construction projects in
the past but because of their long relationship, they
were never asked to sign contracts for each project. No
reports to government agencies were made regarding
their work in the company.
During the implementation of the works contract, Axis
suffered financial difficulties and was not able to pay
Mario Brothers its past billings. As a result, the 3
employees were not paid their salaries for 2 months
and their 13th month pay. Because Axis cannot pay,
Mario Brothers cancelled the contract and laid off
Tristan, Arthur, and Jojo. The 3 employees sued Mario
Brothers and Axis for illegal dismissal, unpaid wages,
and benefits. (2016 BAR)
(a) Mario Brothers claims the 3 workers are
project employees. It explains that the
agreement is, if the works contract is cancelled
due to the fault of the client, the period of
employment is automatically terminated. Is the
contractor correct? Explain.
A: NO. In GMA Network, Inc v. Pabriga, (G.R. No. 176419, 27
Nov. 2013) the requirements to qualify an employment as
project-based was set as follows:
(1) Employers claiming that their workers are project
employees should not only prove that the duration
and scope of the employment was specified at the
time they were engaged, but also that there was
indeed a project; and
(2) The termination of the project must be reported by
the employer to the DOLE Regional Office having
jurisdiction over the workplace within the period
prescribed, and failure to do so militates against
the employer's claim of project employment. This
is true even outside the construction industry.
56
 QuAMTO (1987-2022)
Mario Brothers failed to comply with both requirements;
hence, Tristan, Arthur and Jojo are its regular employees.
The cancellation of its contract with Axis did not result to
the termination of employment of Tristan, Arthur and Jojo.
(2009-2017 UST FCL Bar Q&A)
(b) Can Axis be made solidarily liable with Mario
Brothers to pay the unpaid wages and 13th
month pay of Tristan, Arthur, and Jojo? Explain.
A: YES. Axis can be made solidarily liable with Mario
Brothers. Principals are solidarily liable with their
contractors for the wages and other money benefits of their
contractors' workers. (2009-2017 UST FCL Bar Q&A)
e) SEASONAL
(2019 BAR)
f) FIXED-TERM
(2014, 2013. 2009, 2005 BAR)
Q: Mr. Del Carmen, unsure if his foray into business
(messengerial service catering purely to law firms)
would succeed but intending to go long-term if he
hurdles the first year, opted to open his operations with
one-year contracts with two law firms although he also
accepts messengerial service requests from other firms
as their orders come. He started with one permanent
secretary and 6 messengers on a one-year, fixed-term,
contract.
Is the arrangement legal from the perspective of labor
standards? (2013 BAR)
(A) No, because the arrangement will circumvent
worker's right to security of tenure.
(B) No. If allowed, the arrangement will serve as
starting point in weakening the security of
tenure guarantee.
(C) Yes, if the messengers are hired through a
contractor.
(D) Yes, because the business is temporary and the
contracted undertaking is specific and time-
bound.
(E) No, because the fixed term provided is invalid.
A: (A) No because the arrangement will circumvent
worker's right to security of tenure. (UPLC Suggested
Answers)
ALTERNATIVE ANSWER:
(E) No because the fixed term provided is invalid.
Reason: The employer and employee must deal with each
other on more or less equal terms. (UPLC Suggested
Answers)
Q: Lucy was one of approximately 500 call center agents
at Hambergis, Inc. She was hired as a contractual
employee four years ago. Her contracts would be for a
duration of five (5) months at a time, usually after a
one-month interval. Her re- hiring was contingent on
her performance for the immediately preceding
contract. Six (6) months after the expiration of her last
57
contract, Lucy went to Hambergis personnel
department to inquire why she was not yet being
recalled to work. She was told that her performance
during her last contract was “below average.” Lucy
seeks your legal advice about her chances of getting her
job back. What will your advice be? (2014 BAR)
A: Lucy cannot get her job back. She is a fixed-term
employee and as such, her employment terminates upon
the expiration of her contract. (Rowell Industrial
Corporation v. Court of Appeals, G.R. No. 167714, 07 Mar.
2007) (UPLC Suggested Answers)
ALTERNATIVE ANSWER:
I will advise Lucy that she can get her job back if she files a
case for illegal dismissal where, as a general rule, the twin
reliefs of backwages and reinstatement are available. In the
instant case, Lucy is a regular employee because the
employment contracts of 5 months at a time, for 4 years are
obviously intended to circumvent an employee's security of
tenure, and are therefore void. As a regular employee, Lucy
may only be dismissed from service based on just and
authorized causes enumerated under the Labor Code, and
after observance of procedural due process prescribed
under said law. (Magsalin, et al. v. NOWM, G.R. No. 148492,
09 May 2003; 2009-2017 UST FCL Bar Q&A)
g) FLOATING STATUS
(2014, 2004, 1999 BAR)
Q: RS, a security guard, filed a complaint for illegal
dismissal against Star Security Agency. He alleged he
was constructively dismissed after ten years of service
to the Agency. Having been placed on “off-detail” and
“floating status” for 6 months already, he claimed the
Agency just really wanted to get rid of him because it
required him to take a neuro-psychiatric evaluation
test by Mahusay Medical Center. RS said he already
submitted the result of his evaluation test by Brent
Medical Clinic as precondition to a new assignment, but
the report was rejected by the Agency. RS added that
Mahusay Medical Center had close ties with Star’s
president. It could manipulate tests to favor only those
guards whom the Agency wanted to retain. Star
defended its policy of reliance on Mahusay Medical
Center because it has been duly accredited by the
Philippine National Police. It is not one of those dubious
testing centers issuing ready-made reports. Star cited
its sad experience last year when a guard ran amuck
and shot an employee of a client-bank. Star claimed
management prerogative in assigning its guards, and
prayed that RS’ complaint be dismissed.
What are the issues? Identify and resolve them. (2004
BAR)
A: The facts in the question raise these issues:
1. When RS was placed on "off-detail" or "floating
status" for more than six months, can RS claim that
he was terminated?
2. Is there a valid reason for the termination of RS?
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
On the first issue, based on prevailing jurisprudence, RS can
be considered as terminated because he has been placed on
"off detail" or "floating status" for a period which is more
than 6 months. On the second issue, it is true that disease is
a ground for termination. But the neuro-psychiatric
evaluation test by the Mahusay Medical Center is not the
certification required for disease to be a ground for
termination. The Rules and Regulations implementing the
Labor Code require a certification by a public health
authority that the disease is of such nature or at such a stage
that it cannot be cured within a period of 6 months even
with proper medical treatment. (UPLC Suggested Answers)
A: YES, it is lawful for a private security guard agency to
place its security guard on a "floating status" if it has no
assignment to give to said security guards. But if the
security guards are placed on a "floating status" for more
than 6 months, the security guards may consider
themselves as having been dismissed. (UPLC Suggested
Answers)
3. LEGITIMATE SUBCONTRACTING VS. LABOR-ONLY
CONTRACTING
(2022, 2019, 2018, 2017, 2015, 2012, 1994 BAR)

Q: Distinguish Labor-Only contracting and Job-Only

Q: Asia Security & Investigation Agency (ASIA) executed
contracting. (2012, 1994 BAR)
a one-year contract with the Baron Hotel (BARON) for
the former to provide the latter with 20 security guards
A: In labor-only contracting, the contractor does not have
to safeguard the persons and belongings of hotel guests,
substantial capital or investment in the form of tools,
among others. The security guards filled up Baron
equipment, machineries, work premises, among others, and
application form and submitted the executed forms
the employees of the contractor are performing activities
directly to the Security Department of Baron. The pay
which are directly related to the main business of the
slips of the security guards bore Baron's logo and
principal. (Sy, et al. v. Fairland Knitcraft Co., Inc., G.R. Nos.
showed that Baron deducted therefrom the amounts
182915 & 189658, 12 Dec. 2011)
for SSS premiums, medicare contributions and
withholding taxes. Assignments of security guards, who
In Legitimate Job Contracting, the contractor has
should be on duty or on call, promotions, suspensions,
substantial capital and investment in the form of tools,
dismissals and award citations for meritorious services
equipment, etc. and carries a distinct and independent
were all done upon approval by Baron's chief Security
business and undertakes to perform the job, work or
officer.
service on its own responsibility, according to its own
manner and method, and free from control and direction of
After the expiration of the contract with Asia, Baron did
the principal in all matters connected with the performance
not renew the same and instead executed another
of the work except as to the results thereof. (Escasinas v.
contract for security services with another agency. Asia
Shangri-la’s Mactan Island Resort, G.R. No. 178827, 04 Mar.
placed the affected security guards on "floating status"
2009)
on "no work no pay" basis. Having been displaced from
work, the Asia security guards filed a case against the
Labor-only contracting is prohibited while job contracting
Baron Hotel for illegal dismissal, overtime pay,
is allowed by law. (2009-2017 UST FCL Bar Q&A)
minimum wage differentials, vacation leave and sick
leave benefits, and 13th month pay. Baron Hotel denied
ALTERNATIVE ANSWER:
liability alleging that Asia is the employer of the
security guards and therefore, their complaint for
1. Job-Only contracting is legal; whereas, Labor-Only
illegal dismissal and payment of money claims should
contracting is prohibited by law.
be directed against Asia. Nevertheless, Baron filed a
Third Party Complaint against Asia. (1999 BAR)
2. In Job-Only contracting, the principal is only an
indirect employer; whereas, in Labor-Only
a. Is there an employer-employee relationship
contracting, the principal becomes the direct
between the Baron Hotel, on one hand, and the
employer of the employees of the labor-only
Asia security guards, on the other hand?
contractor.
Explain briefly.

A: YES. As a general rule, the security guards of a private

3. The liability of the principal in Job-Only contracting
security guard agency are the employees of the latter and
vis-à-vis employees of job- contractor is for a
not of the establishment that has entered into a contract
limited purpose only, e.g. wages and violation of
with the private security guard agency for security services.
labor standards laws; whereas, the liability of the
But under the facts in the question, Baron Hotel appear to
principal in Labor-Only contracting is for a
have hired the security guards, to have paid their wages, to
comprehensive purpose and, therefore, the
have the power to promote, suspend or dismiss the security
principal becomes solidarily liable with the labor-
guards and the power of control over them, namely, the
only contractor for all the rightful claims of the
security guards were under orders of Baron Hotel as regard
employees.
their employment. Because of the above-mentioned
circumstances, Baron Hotel is the employer of the security
4. In Job-Only contracting, no employer-employee
guards. (UPLC Suggested Answers)
relationship exists between the principal and the
employees of the job contractor; whereas, in
b. Assuming that ASIA is the employer, is the act of
Labor-Only contracting, the law creates an
ASIA in placing the security guards on "floating
employer-employee relationship between the
status" lawful? Why?
principal and the employees of the labor-only

U N IV E R S I T Y O F S A N T O T O M A S 58
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
contractor. (2009-2017 UST FCL Bar Q&A)
Q: What is a “labor-only" contract? (1994 BAR)
A: “Labor-only” contract is a contract between an employer
and a person who supplies workers to such employer
where the person supplying workers does not have
substantial capital or investment in the form of tools,
equipment, machineries, work premises, among others, and
the workers recruited and placed by such person are
performing activities which are directly related to the
principal business of such employer. (Art. 106, LC)
Q: Distinguish the liabilities of an employer who
engages the services of a bona fide “independent
contractor” from one who engages a “labor-only"
contractor? (2012, 1994 BAR)
A: A person who engages the services of a bona fide
“independent contractor” for the performance of any work,
task, job or project is the indirect employer of the
employees who have been hired by the independent
contractor to perform said work, task, job or project.
In the event that the independent contractor fails to pay the
wages of his employees, an indirect employer, in the same
manner and extent that he is liable to employees directly
employed by him, is jointly and severally liable with the
independent contractor to the employees of the latter to the
extent of the work performed under the contract.
As for the person who engages the services of a “labor only”
contractor, the latter is considered merely as an agent of the
former who shall be responsible to the workers hired by the
“labor only” contractor in the same manner and extent as if
he directly employed such workers. (2009-2017 UST FCL
Bar Q&A)
Q: Julian was hired by Index Agency, a licensed
manpower and recruitment corporation, which had a
Service Agreement with Kainan Resto, a fast food
restaurant, for the provision of ancillary and support
services. Index Agency assigned Julian to work at
Kainan Resto as a cashier and counter clerk, whose
duties involved taking customer orders, receiving
payments, preparing food orders, and serving food to
customers. Julian was accused of short-changing a
customer during one transaction. He was immediately
dismissed from service by the manager of Kainan Resto.
Julian filed a complaint for illegal dismissal against
Index Agency and Kainan Resto. In its defense, Kainan
Resto argued that Julian was not its employee but that
of Index Agency, given that Index Agency is a licensed
manpower and recruitment corporation. Is Kainan
Resto correct? Explain briefly. (2022 BAR)
A: YES. Kainan Resto is correct, assuming that besides its
D.O. 174 certificate of registration, Index Agency possesses
the additional qualities of a legitimate job contractor. In job-
contracting, the solidary liability imposed by Art. 106 of the
Labor Code on the principal is the limited type, i.e., limited
to unpaid wages only. (Meralco Industrial Engineering
Service, Inc. vs NLRC) Hence, said principal cannot be
imposed liabilities arising from its legitimate job
contractor's violation of Labor Relations Law. The statutory
59
employment tie created by Art. 106 between the Kai nan
Resto and Julian is not for a comprehensive purpose as to
impose on the former liabilities arising from Index Agency's
violation of Julian's right to security of tenure.
Comprehensive solidary liability attaches only in labor-only
contracting arrangements. (Central Bar Q&A by Kato, 2023)
ALTERNATIVE ANSWER:
One who exercises the powers of an employer, like the
power to dismiss on grounds provided for by Art. 297 of the
Labor Code is an employer. (Austria vs NLRC, G.R. No.
124382, 16 Aug. 1999) On this basis, since Julian was
dismissed by Kainan Resto then the employment tie cannot
be denied by the latter. Regardless of the fact that, in job
contracting, the principal's solidary liability is limited to
unpaid wages by Art. 106 of the Labor Code, Kainan Resto
is estopped from disowning the consequences of its act of
dismissal. Moreover, it is when the legitimate contractor
dismisses a worker that its principal is spared the
consequences thereof. (Central Bar Q&A by Kato, 2023)
Q: W Gas Corp. is engaged in the manufacture and
distribution to the general public of various petroleum
products. On 01 Jan. 2010, W Gas Corp. entered into a
Service Agreement with Q Manpower Co., whereby the
latter undertook to provide utility workers for the
maintenance of the former's manufacturing plant.
Although the workers were hired by Q Manpower Co.,
they used the equipment owned by W Gas Corp. in
performing their tasks, and were likewise subject to
constant checking based on W Gas Corp.' s procedures.
On 01 Feb. 2010, Mr. R, one of the utility workers, was
dismissed from employment in line with the
termination of the Service Agreement between W Gas
Corp. and Q Manpower Co. Thus, Mr. R filed a complaint
for illegal dismissal against W Gas Corp., claiming that
Q Manpower Co. is only a labor-only contractor. In the
course of the proceedings, W Gas Corp. presented no
evidence to prove Q Manpower Co.'s capitalization.
(2019 BAR)
Is Q Manpower Co. a labor-only contractor? Explain.
A: YES. Q Manpower Co. is a labor-only contractor. Art. 106
of the Labor Code provides that there is “labor-only”
contracting where the person supplying workers to an
employer does not have substantial capital or investment in
the form of tools, equipment, machineries, work premises,
among others and the workers recruited and placed by such
contractor are performing activities which are directly
related to the business.
In the question posed, the equipment belonged to W Gas
Corp. In the course of the proceedings, no evidence was
presented to prove Q Manpower Co’s substantial
capitalization.
Q: Dr. Crisostomo entered into a retainer agreement
with AB Hotel and Resort whereby he would provide
medical services to the guests and employees of AB
Hotel and Resort, which, in turn, would provide the
clinic premises and medical supplies. He received a
monthly retainer fee of ₱60,000.00, plus a 70% share in
the service charges from AB Hotel and Resort's guests
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
availing themselves of the clinic's services. The clinic
employed nurses and allied staff, whose salaries, SSS
contributions and other benefits he undertook to pay.
AB Hotel and Resort issued directives giving
instructions to him on the replenishment of emergency
kits and forbidding the clinic staff from receiving cash
payments from the guests. In time, the nurses and the
clinic staff claimed entitlement to rights as regular
employees of AB Hotel and Resort, but the latter
refused on the ground that Dr. Crisostomo, who was
their employer, was an independent contractor. Rule,
with reasons. (2017 BAR)
A: I will rule in favor of AB Hotel and Resort. Dr. Crisostomo
was an independent contractor and the nurses and clinic
staff are his employees. Dr. Crisostomo had the power of
selection and engagement of the nurses and clinic staff; he
also paid their wages and SSS contributions. Most
importantly, he exercises control over the nurses and
clinical staffs’ conduct in dispensing medical services to the
guests and personnel of the resort. The fact that AB Hotel
and Resort gave instructions to Dr. Crisostomo regarding
replenishment of emergency kits and forbidding his staff
from receiving cash payments from guests is of no
consequence. They are nothing more but guidelines which
will not create an employer-employee relationship (Insular
Life Co., Ltd. v. NLRC, G.R. No. 84484, 15 Nov. 1989)
ALTERNATIVE ANSWER:
I will rule in favor of the employees. In the case of Samonte
v. La Salle Greenhills, Inc. (G.R. No. 199683, 10 Feb. 2016), the
Court held that, " the power of control refers to the
existence of the power and not necessarily to the actual
exercise thereof, nor is it essential for the employer to
actually supervise the performance of duties of the
employee. It is enough that the employer has the right to
wield that power." Such power is present in the hands of AB
Hotel and Resort.
Q: The labor sector has been loudly agitating for the end
of labor-only contracting, as distinguished from job
contracting. Explain these two kinds of labor
contracting, and give the effect of a finding that one is a
labor-only contractor. Explain your answers. (2017
BAR)
A: There is job contracting if a contractor carries on a
distinct and independent business free from the control of
the principal in all matters except as to the results thereof
and has substantial capital or investment.
There is labor-only contracting when the principal retains
the power to control the contracted employees; or when the
contractor has insufficient capital and performs activities
directly related to the business of the principal.
A finding that there is labor-only contracting makes the
principal the direct employer of the contracted employees
and is solidarily liable with the contractor for the wages and
other benefits of the contracted employees.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
ALTERNATIVE ANSWER:
There is labor-only contracting where:
1. the person supplying workers to an employer does
not have substantial capital or investment in the
form of tools, equipment, machineries, work
premises, among others; and
2. the workers recruited and placed by such person
are performing activities which are directly related
to the principal business of such employer. (Baguio
v. NLRC, G.R. Nos. 79004-08, 04 Oct. 1991; Art. 106,
LC)
There is job contracting where:
1. the contractor carries on an independent business
and undertakes the contract 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 the results thereof; and
2. the contractor has substantial capital or
investment in the form of tools, equipment,
machineries, work premises, and other materials
which are necessary in the conduct of his business.
(Baguio v. NLRC, G.R. Nos. 79004-08, 04 Oct. 1991;
Art. 106, LC)
A finding that a contractor is a labor-only contractor is
equivalent to a declaration that there is an employer-
employee relationship between the principal and the
employees of the labor-only contractor (Industrial Timber
Corp. v. NLRC, G.R. No. 83616, 20 Jan. 1989). In such a case,
the person or intermediary shall be considered merely as
an agent of the employer, who shall be responsible to the
workers in the manner and extent as if the latter were
directly employed by him (Sandoval Shipyards, Inc. v. Prisco
Pepito, G.R. No. 143428, 25 June 2001). The liability of the
principal vis-a-vis the employees of the labor-only
contractor is comprehensive, i.e., not only for unpaid wages
but for all claims under the Labor Code and ancillary laws.
(San Miguel Corporation v. MAERC Integrated Services; Inc.,
G.R. No. 144672, 10 July 2003; 2009-2017 UST FCL Bar Q&A)
Q: Star Crafts is a lantern maker based in Pampanga. It
supplies Christmas lanterns to stores in Luzon, Metro
Manila, and parts of Visayas, with the months of August
to November being the busiest months. Its factory
employs a workforce of 2,000 workers who make
different lanterns daily for the whole year. Because of
increased demand, Star Crafts entered into a
contractual arrangement with People Plus, a service
contractor, to supply the former with I 00 workers for
only 4 months, August to November, at a rate different
from what they pay their regular employees. The
contract with People Plus stipulates that all equipment
and raw materials will be supplied by Star Crafts with
the express condition that the workers cannot take any
of the designs home and must complete their tasks
within the premises of Star Crafts.
60
 QuAMTO (1987-2022)
Is there an employer-employee relationship between
Star Crafts and the 100 workers from People Plus?
Explain. (2015 BAR)
A: YES. People Plus is a labor-only-contractor because it is
not substantially capitalized. Neither does it carry on an
independent business in which it uses its own investment
in the form of tools, equipment, machineries or work
premises. Hence, it is just an agent or recruiter of workers
who perform work directly related to the trade of Star
Crafts. Since both the essential element and the conforming
element of labor-only contracting are present, Star Crafts
becomes the employer of the supplied worker.
As principal, Star Crafts will always be an employer in
relation to the workers supplied by its contractor. Its status
as employer is either direct or indirect depending on
whether the contractor is legitimate or not. Thus, even if
People Plus were a legitimate job contractor, still Star Crafts
will be treated as a statutory employer for purposes of
paying the workers’ unpaid wages and benefits. (2009-2017
UST FCL Bar Q&A)
Q: XYZ Manpower Services (XYZ) was sued by its
employees together with its client, ABC Polyester
Manufacturing Company (ABC). ABC is one of the many
clients of XYZ. During the proceedings before the Labor
Arbiter, XYZ was able to prove that it had substantial
capital of Five Million Pesos. The Labor Arbiter ruled in
favor of the employees because it deemed XYZ as a
labor only contractor. XYZ was not able to prove that it
had invested in tools, equipment, etc. Is the Labor
Arbiter's ruling valid? Explain. (2012 BAR)
A: YES. The presumption is that a contractor is a labor-only
contractor unless it is shown that it has substantial capital
and substantial investment in the form of tools, equipment,
machineries, work premises and the like. [Sy, et al. v.
Fairland Knitcraft Co., Inc., G.R. Nos. 182915 & 189658, 12
Dec. 2011] Besides, what Art. 106 of the Code defines is
Labor-Only Contracting and not Job-Contracting. In
mandating that “(t)here is ‘labor- only’ contracting where
the person supplying workers to an employer does not have
substantial capital OR investment in the form of tools,
equipment, machineries, work premises, among others”,
the law is therefore clear that the presence of either
handicap– “substantial capital OR (substantial) investment
in the form of tools, equipment, (etc.)” – is enough basis to
classify one as a labor-only contractor. (2009-2017 UST FCL
Bar Q&A)
a) ELEMENTS
(2016, 2012 BAR)
Q: What is not an element of legitimate contracting?
(2012 BAR)
a. The contract calls for the performance of a
specific job, work or service;
b. It is stipulated that the performance of a
specific job, work or service must be within a
definite predetermined period;
c. The performance of a specific job, work or
service has to completed either within or
outside the premises of the principal;
61
d. The principal has control over the performance
of a specific job, work or service.
A: D. The principal has control over the performance of a
specific job, work or service. (Art. 106, LC)
Q: Empire Brands (Empire) contracted the services of
Style Corporation (Style) for the marketing and
promotion of its clothing line. Under the contract, Style
provided Empire with Trade Merchandising
Representatives (TMRs) whose services began on
September 15, 2004 and ended on June 6, 2007, when
Empire terminated the promotions contract with Style.
Empire then entered into an agreement for manpower
supply with Wave Human Resources (Wave). Wave
owns its condo office, owns equipment for the use by
the TMRs, and has assets amounting to P1,000,000.00.
Wave provided the supervisors who supervised the
TMRs, who, in turn, received orders from the Marketing
Director of Empire. In their agreement, the parties
stipulated that Wave shall be liable for the wages and
salaries of its employees or workers, including benefits
and protection due them, as well as remittance to the
proper government entities of all withholding taxes,
Social Security Service, and Philhealth premiums, in
accordance with relevant laws.
As the TMRs wanted to continue working at Empire,
they submitted job applications as TMRs with Wave.
Consequently, Wave hired them for a term of five (5)
months, or from 07 June 2007 to 06 Nov. 2007,
specifically to promote Empire’s products.
When the TMRs’ 5-month contracts with Wave were
about to expire, they sought renewal thereof, but were
refused. Their contracts with Wave were no longer
renewed as Empire hired another agency. This
prompted them to file complaints for illegal dismissal,
regularization, non-payment of service incentive leave
and 13th month pay against Empire and Wave. Are the
TMRs employees of Empire? (2016 BAR)
A: YES. From the time Empire contracted the services of
Style, both engaged in labor-only contracting. In BPI
Employees Union-Davao City FUBU v. BPI (G.R. No. 174912,
24 July 2013), it was ruled that where any of the following
elements is present, there is labor-only contracting:
a. The contractor or subcontractor does not have
substantial capital or investment which relates to
the job, work or service to be performed and the
employees recruited, supplied or placed by such
contractor or subcontractor are performing
activities which are directly related to the main
business of the principal; or
b. The contractor does not exercise the right to
control over the performance of the work of the
contractual employee.
The first element is present herein, as Style has no
substantial capital or investment in engaging in the supply
of services contracted out by Empire which is directly
related to the marketing and promotion of its clothing line.
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
The second element is present as it is inevitable for Empire
to direct the activities of the TMRs to properly market and
promote its product line.
The subsequent contract of Empire with Wave did not affect
the regular employment of the TMRs with Empire as,
through the Marketing Director of Empire, the TMRs were
under the control of Empire. Thus, the five-month
employment contract entered into by the TMRs with Wave
did not divest them of their regular employment status with
Empire. In addition, such scheme undermined the security
of tenure of the TMRs which is constitutionally guaranteed,
hence, the contract of the TMRs with Wave is void ab initio.
(2009-2017 UST FCL Bar Q&A)
b) TRILATERAL RELATIONSHIP
(2018 BAR)
Q: Nathaniel has been a salesman assigned by Newmark
Enterprises (Newmark) for nearly two years at the
Manila office of Nutrition City, Inc. (Nutrition City). He
was deployed pursuant to a service agreement between
Newmark and Nutrition City, the salient provisions of
which were as follows:
a. the Contractor (Newmark) agrees to perform
and provide the Client (Nutrition City), on a
non-exclusive basis, such tasks or activities that
are considered contractible under existing
laws, as may be needed by the Client from time
to time;
b. the Contractor shall employ the necessary
personnel like helpers, salesmen, and drivers
who are determined by the Contractor to be
efficiently trained;
c. the Client may request replacement of the
Contractor's personnel if quality of the desired
result is not achieved;
d. the Contractor's personnel will comply with the
Client's policies, rules, and regulations; and
e. the Contractor's two service vehicles and
necessary equipment will be utilized in
carrying out the provisions of this Agreement.
When Newmark fired Nathaniel, he filed an illegal
dismissal case against the wealthier company,
Nutrition City, Inc., alleging that he was a regular
employee of the same. Is Nathaniel correct? (2018 BAR)
A: YES, Nathaniel is correct. Similar to the case of Coca-Cola
Bottlers Philippines, Inc. v. Agito (G.R. No. 179546, 13 Feb.
2009), the lack of control by the Contractor (Newmark) over
the worker Nathaniel can be gleaned from the Service
Agreement. It is apparent that Newmark has to comply with
Nutrition City's regulations, and that Nutrition City has the
right to request the replacement of Newmark's personnel.
It is likewise apparent that the Agreement did not identify
the work needed to be performed and the final result to be
accomplished, pointing to the conclusion that Newmark did
not obligate itself to perform an identifiable job, work, or
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
service. Nathaniel, thus, was under the control of Nutrition
City.
With respect to the service vehicles and equipment, these
may not be considered ns substantial capital on the part of
Newmark, as the facts do not establish their sufficiency to
carry out the Agreement. The presence of Newmark’s
vehicles and equipment did not necessarily preclude the
use of Nutrition City’s own capital and assets. (UPLC
Suggested Answers)
ALTERNATIVE ANSWER:
Nathaniel’s contention is not correct. He is not a regular
employee of Nutrition but rather of Newmark Enterprises.
Assuming that Newmark has a DO 174 certification, this is a
valid job contracting arrangement especially so that the
Newmark has sufficient capitalization in the form of tools,
equipment, machineries and that Nutrition has no control
over the manner and means by which Newmark and its
employees are to do the work. (UPLC Suggested Answers)
c) SOLIDARY LIABILITY
(2019 BAR)
Q: W Gas Corp. is engaged in the manufacture and
distribution to the general public of various petroleum
products. On January 1, 2010, W Gas Corp. entered into
a Service Agreement with Q Manpower Co., whereby the
latter undertook to provide utility workers for the
maintenance of the former's manufacturing plant.
Although the workers were hired by Q Manpower Co.,
they used the equipment owned by W Gas Corp. in
performing their tasks, and were likewise subject to
constant checking based on W Gas Corp.' s procedures.
On February 1, 2010, Mr. R, one of the utility workers,
was dismissed from employment in line with the
termination of the Service Agreement between W Gas
Corp. and Q Manpower Co. Thus, Mr. R filed a complaint
for illegal dismissal against W Gas Corp., claiming that
Q Manpower Co. is only a labor-only contractor. In the
course of the proceedings, W Gas Corp. presented no
evidence to prove Q Manpower Co.'s capitalization.
(2019 BAR)
Will Mr. R's complaint for illegal dismissal against W
Gas Corp. prosper? Explain.
A: YES. Mr. R's complaint for illegal dismissal against W Gas
Corp will prosper as it is solidarily liable with Q Manpower
Corp. under Art. 106 of the Labor Code. As a a labor-only
contractor, Q Manpower Corp is considered merely as an
agent of W Gas Corp. Consequently, there exists an
employer-employee relationship between Mr. R and W Gas
Corp. As such, W Gas Corp. can only terminate the
employment of Mr. R based on just and authorized causes
under the Labor Code. Significantly, termination of the
service contract is not among those causes.
62
 QuAMTO (1987-2022)
B. TERMINATION OF EMPLOYMENT BY EMPLOYER
(2022, 2019, 2017, 2016, 2014, 2013, 2009, 2008,
2006, 2004, 2003, 2002, 2001, 2000, 1999, 1998, 1996,
1995, 1994, 1993, 1990, 1989 BAR)
Q: Define, explain or distinguish just and authorized
causes. (2019 BAR)
A: A termination based on just cause under Art. 282 of the
Labor Code means that the employee has committed a
wrongful act or mission inimical to the interests of the
employer, which justifies the severance of the employer-
employee relationship, (e.g., the employee has committed
some serious misconduct, gross insubordination; fraud for
loss of trust and confidence; gross and habitual neglect of
duty; crime committed against the employer and his family;
other analogous cases.) Payment of separation pay is not
mandated by law.
On the other hand, termination based on authorized cause
under Art. 283 and Art. 284 of the Labor Code means that
there exists a ground which the law itself authorizes to be
invoked to justify the termination of an employee even if he
has not committed any wrongful act or omission. Under the
same provisions, authorized causes are classified into two
classes, namely business-related causes such as installation
of labor-saving devices; retrenchment; redundancy; or
closure not due to serious losses; and health-related causes,
such as disease. (UPLC Suggested Answers)
1. JUST CAUSES
(2019, 2018, 2017, 2016, 2015, 2014, 2013, 2009,
2008, 2004, 2003, 2000, 1996, 1995, 1993, 1989 BAR)
Q: What are the grounds for validly terminating the
services of an employee based on a just cause? (2017
BAR)
A: Art. 296 of the LC (formerly Art. 282) provides for the
termination of the services of an employee for just causes.
An employer may terminate an employment for any of the
following causes:
The specific just causes for employee termination are the
following:
1. Serious misconduct;
2. Fraud or loss of trust and confidence;
3. Willful disobedience;
4. Gross and habitual neglect of duty;
5. Crime or offense against the employer, immediate
member of his family, or authorized
representative; and
6. Other analogous causes. (Central Bar Q&A by Kato,
2023)
Q: Distinguish between dismissal of an employee for
just cause and termination of employment for
authorized cause. Enumerate examples of just cause
and authorized cause. (2019, 2000 BAR)
63
A: A termination based on just cause under Art. 282 [now
Art. 297] of the Labor Code means that the employee has
committed a wrongful act or omission inimical to the
interests of the employer, which justifies the severance of
the employer-employee relationship, e.g., the employee
has committed some serious misconduct; gross
insubordination; fraud or loss of trust and confidence;
gross and habitual neglect of duty; crime committed
against the employer and his family; other analogous
cases. Payment of separation pay is not mandated by law.
On the other hand, termination based on authorized cause
under Art. 283 and Art. 284 [now 298 and 299] of the
Labor Code means that there exists a ground which the law
itself authorizes to be invoked to justify the termination of
an employee even if he has not committed any wrongful act
or omission. Under the same provisions, authorized causes
are classified into two (2) classes, namely, business-related
causes such as installation of labor-saving devices;
retrenchment; redundancy; or closure not due to serious
losses; and health-related causes, such as disease.
ALTERNATIVE ANSWER:
Dismissal for a just cause is founded on faults or misdeeds
of the employee. Separation pay, as a rule, will not be paid.
Examples: Serious misconduct, willful disobedience,
commission of a crime against the employer, gross and
habitual neglect, fraud and other causes analogous to the
foregoing. (Art. 282 [now 297], LC)
Termination for authorized causes are based on business
exigencies or measures adopted by the employer, not
constituting faults of the employee. Payment of separation
pay at varying amounts is required. Examples:
Redundancy, closure, retrenchment, installation of labor-
saving device and authorized cause. (Art. 283-284 [now
298-299], LC)
Q: Give the procedure to be observed for validly
terminating the services of an employee based on a
just cause? (2017 BAR)
A: Termination of an employee based on just causes
requires compliance with the twin-notice requirement.
First, a notice should be served on the employee specifying
the grounds for termination. The employee should be
given reasonable opportunity to explain his side Second, a
notice should be served on the employee indicating the
termination of his services.
Q: Nicodemus was employed as a computer
programmer by Network Corporation, a
telecommunications firm. He has been coming to work
in short and sneakers, in violation of the "prescribed
uniform policy" based on company rules and
regulations. The company human resources manager
wrote him a letter, giving him 10 days to comply with
the company uniform policy. Nicodemus asserted that
wearing shorts and sneakers made him more
productive, and cited his above-average output. When
he came to work still in violation of the uniform policy,
the company sent him a letter of termination of
employment. Nicodemus filed an illegal dismissal case.
The Labor Arbiter ruled in favor of Nicodemus and
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
ordered his reinstatement with backwages. Network
Corporation, however, refused to reinstate him.
The NLRC 1st Division sustained the Labor Arbiter's
judgment. Network Corporation still refused to
reinstate Nicodemus. Eventually, the Court of Appeals
reversed the decision of the NLRC and ruled that the
dismissal was valid. Despite the reversal, Nicodemus
still filed a motion for execution with respect to his
accrued backwages. (2018 BAR)
(a) Were there valid legal grounds to dismiss
Nicodemus from his employment?
A: YES. Nicodemus clearly committed willful disobedience
of lawful orders issued by the Network Corporation, with
respect to the uniform policy. This is a ground for
termination under Art. 297(a) of the Labor Code.
(b) Should Nicodemus' motion for execution be
granted?
A: YES. In Garcia v. Philippine Airlines, Inc. (G.R. No. 164856,
20 Jan. 2009) the employer who did not reinstate an
employee pending appeal may be held liable for wages of
the dismissed employee covering the period from the time
he was ordered reinstated by the Labor Arbiter to the
reversal of the NLRC’s decision by the Court of Appeals.
Q: Rico has a temper and, in his work as Division
Manager of Matatag Insurance, frequently loses his
temper with his staff. One day, he physically assaults his
staff member by slapping him. The staff member sues
him for physical injuries. Matatag insurance decides to
terminate Rico, after notice and hearing, on the ground
of loss of trust and confidence. Rico claims that he is
entitled to the presumption of innocence because he
has not yet been convicted. Comment on Matatag’s
action in relation to Rico’s argument. (2015 BAR)
A: Matatag Insurance does not have to await the result of
the criminal case before exercising its prerogative to
dismiss. Dismissal is not affected by a criminal case. Under
the Three-fold Liability Rule, a single act may result in three
liabilities, two of which are criminal and administrative. To
establish them, the evidence of the crime must amount to
proof beyond reasonable doubt; whereas, the evidence of
the ground for dismissal is substantial evidence only. In this
regard, the company has some basis already for
withholding the trust it has reposed on its manager. Hence,
Rico’s conviction need not precede the employee’s
dismissal. (2009-2017 UST FCL Bar Q&A)
Q: Lanz was a strict and unpopular Vice- President for
Sales of Lobinsons Land. One day, Lanz shouted
invectives against Lee, a poor performing sales
associate, calling him, among others, a “brown
monkey.” Hurt, Lee decided to file a criminal complaint
for grave defamation against Lanz. The prosecutor
found probable cause and filed an information in court.
Lobinsons decided to terminate Lanz for committing a
potential crime and other illegal acts prejudicial to
business. Can Lanz be legally terminated by the
company on these grounds? (2014 BAR)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
A: NO. The grounds relied upon by Lobinsons are not just
causes for dismissal under the Labor Code. Defamation is
not a crime against person which is a ground to dismiss
under Art. 282 [now Art. 297 (d)] of the LC. (2009-2017 UST
FCL Bar Q&A)
Q: Jose and Erica, former sweethearts, both worked as
sales representatives for Magna, a multinational firm
engaged in the manufacture and sale of pharmaceutical
products. Although the couple had already broken off
their relationship, Jose continued to have special
feelings for Erica. One afternoon, Jose chanced upon
Erica riding in the car of Paolo, a co-employee and
Erica's ardent suitor; the two were on their way back to
the office from sales call on Silver Drug, a major drug
retailer. In a fit of extreme jealousy, Jose rammed
Paolo's car, causing severe injuries to Paolo and Erica.
Jose's flare up also caused heavy damage to the two
company-owned cars they were driving. (2013 BAR)
(a) As lawyer for Magna, advise the company
on whether just and valid grounds exist to
dismiss Jose.
A: Jose can be dismissed for serious misconduct, violation
of company rules and regulations, and commission of a
crime against the employer’s representatives. Art. 282 [now
297] of the LC provides that an employer may terminate an
employment for any serious misconduct or willful
disobedience by the employee of the lawful orders of his
employer or his representatives in connection with his
work.
Misconduct involves “the transgression of some established
and definite rule of action, forbidden act, a dereliction of
duty, willful in character, and implies wrongful intent and
not mere error in judgment.” For misconduct to be serious
and therefore a valid ground for dismissal, it must be:
1. Of grave and aggravated character and not merely
trivial or unimportant and;
2. Connected with the work of the employee. (2009-
2017 UST FCL Bar Q&A)
(b) Assuming this time that Magna dismissed
Jose from employment for cause and you
are the lawyer of Jose, how would you
argue the position that Jose's dismissal
was illegal?
A: The offense committed by Jose did not relate to the
performance of his duties. For misconduct or improper
behavior to be a just cause for dismissal, it (a) must be
serious; (b) must relate to the performance of the
employee’s duties; and (c) must show that the employee
has become unfit to continue working for the employer.
On the basis of the foregoing guidelines, it can be concluded
that Jose was not guilty of serious misconduct; Jose was not
performing official work at the time of the incident
(Lagrosas v. Bristol Myers Squibb, G.R. No. 168637 and
170684, 12 Sept. 2008). Additionally, there was no
compliance with the rudimentary requirements of due
process. (2009-2017 UST FCL Bar Q&A)
64
 QuAMTO (1987-2022)
Q: Domingo, a bus conductor of San Juan
Transportation Company, intentionally did not issue a
ticket to a female passenger, Kim, his long-time crush.
As a result, Domingo was dismissed from employment
for fraud or willful breach of trust. Domingo contests
his dismissal, claiming that he is not a confidential
employee and, therefore, cannot be dismissed from the
service for breach of trust. Is Domingo correct?
Reasons. (2009 BAR)
A: Domingo as bus conductor holds a position wherein he
was reposed with the employer’s trust and confidence.
In Bristol Myers Squibb (Phils.) v. Baban (G.R. No. 167449, 17
Dec. 2008), the Court established a second class of positions
of trust that involve rank-and-file employees who, in the
normal and routine exercise of their functions, regularly
handle significant amounts of money. A bus conductor falls
under such second class of persons. This does not mean,
however, that Domingo should be dismissed. In Etcuban v.
Sulpicio Lines (G.R. No. 148410, 17 Jan. 2005), the Court held
that where the amount involved is miniscule, an employee
may not be dismissed for loss of trust and confidence.
(2009-2017 UST FCL Bar Q&A)
Q: Arnaldo, President of "Bisig" Union in Femwear
Company, readied himself to leave exactly at 5:00 p.m.
which was the end of his normal shift to be able to sed
off his wife who was scheduled to leave for overseas.
However, the General Manager required him to render
overtime work to meet the company's export quota.
Arnaldo begged off, explaining to the General Manager
that he had to see off his wife who was leaving to work
abroad. The company dismissed Arnaldo for
insubordination. He filed a case for illegal dismissal.
Decide. (2008 BAR)
A: Arnaldo was illegally dismissed. Insubordination, the
ground relied upon by the company, has legal meaning; it
has elements; and it has controlling case authority. On the
overall, it obtains when an employee wilfully violates a
reasonable directive pertaining to his work and his
violation is characterized by wrongful and perverse
attitude. Here, the inability of Arnaldo to render work as
requested by the General Manager has a valid excuse. In
other words, responsible discharge of marital or familial
duty can never be wrong or perverse. This cancels out the
element of wrongful and perverse attitude. Being
insufficient in law, therefore, the company's ground cannot
justify the dismissal. (Central Bar Q&A by Kato, 2023)
2. AUTHORIZED CAUSES
(2016, 2014, 2006, 2004, 2003, 2002, 2001, 2000,
1999, 1998, 1994, 1990 BAR)
Q: Hagibis Motors Corporation (Hagibis) has 500
regular employees in its car assembly plant. Due to the
Asian financial crisis, Hagibis experienced very low car
sales resulting to huge financial losses. It implemented
several cost-cutting measures such as cost reduction on
use of office supplies, employment hiring freeze,
prohibition on representation and travel expenses,
separation of casuals and reduced work week. As
counsel of Hagibis, what are the measures the company
should undertake to implement a valid retrenchment?
65
Explain. (2016 BAR)
A: For a valid retrenchment, the following requisites must
be complied with:
a. The retrenchment is necessary to prevent losses
and such losses are proven;
b. Written notice to the employees and to the DOLE at
least one month prior to the intended date of
retrenchment; and
c. Payment of separation pay equivalent to one-
month pay or at least one-half month pay for every
year of service, whichever is higher.
Jurisprudential standards for the losses which may justify
retrenchment are: firstly, the losses expected should be
substantial and not merely de minimis in extent. If the loss
purportedly sought to be forestalled by retrenchment is
clearly shown to be insubstantial and inconsequential in
character, the bona fide nature of the retrenchment would
appear to be seriously in question; secondly, the substantial
loss must be reasonably imminent, as such imminence can
be perceived objectively and in good faith by the employer;
x x x thirdly, because of the consequential nature of
retrenchment, it must be reasonably necessary and is likely
to be effective in preventing the expected losses; x x x lastly,
alleged losses if already realized, and the expected
imminent losses sought to be forestalled, must be proved by
sufficient and convincing evidence. (Manatad v. Philippine
Telegraph and Telephone Corporation, G.R. No. 12363, 07
Mar. 2008)
Hagibis should exercise its prerogative to retrench
employees in good faith. It must be for the advancement of
its interest and not to defeat or circumvent the employees’
right to security of tenure. Hagibis should use fair and
reasonable criteria such as status, efficiency, seniority,
physical fitness, age and financial hardship for certain
workers in ascertaining who would be dismissed and who
would be retained among the employees. (2009-2017 UST
FCL Bar Q&A)
Q: Zienna Corporation (Zienna) informed the
Department of Labor and Employment Regional
Director of the end of its operations. To carry out the
cessation, Zienna sent a Letter Request for
Intervention to the NLRC for permission and guidance
in effecting payment of separation benefits for its 50
terminated employees. Each of the terminated
employees executed a Quitclaim and Release before
Labor Arbiter Nocomora, to whom the case was
assigned. After the erstwhile employees received their
separation pay, the Labor Arbiter declared the labor
dispute dismissed with prejudice on the ground of
settlement. Thereafter, Zienna sold all of its assets to
Zandra Company (Zandra), which in turn hired its own
employees. Nelle, one of the 50 terminated employees,
filed a case for illegal dismissal against Zienna. She
argued that Zienna did not cease from operating since
the corporation subsists as Zandra. Nelle pointed out
that aside from the two companies having essentially
the same equipment, the managers and owners of
Zandra and Zienna are likewise one and the same. For
its part, Zienna countered that Nelle is barred from
filing a complaint for illegal dismissal against the
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
corporation in view of her prior acceptance of 3. DUE PROCESS
separation pay. (2022, 2020-21, 2017, 2009, 2006, 1999, 1998, 1994
BAR)
Is Nelle correct in claiming that she was illegally
dismissed? (2016 BAR)
Q: Discuss and differentiate between the procedural
requirements in termination of employment for (i) just
A: NO. In SME Bank v. De Guzman (G.R. No. 184517 and
and (ii) authorized causes. Explain briefly. (2022, 2017
186641, 08 Oct. 2013), there are two (2) types of corporate
BAR)
acquisitions: asset sales and stock sales. In asset sales, the
corporate entity sells all or substantially all of its assets to
A: Procedural due process mandates that the twin
another entity. In stock sales, the individual or corporate
requirements of Notice and Hearing should be present. The
shareholders sell a controlling block of stock to new or
two notices are as follows:
existing shareholders.
1. 1st notice: Notice of appraisal, which is a written
Asset sales happened in this case; hence, Zienna is
notice served on the employee specifying the
authorized to dismiss its employees, but must pay
ground or grounds of termination, and giving the
separation pay. The buyer Zandra, is not obliged to absorb
employee reasonable opportunity within which to
the employees affected by the sale, nor is it liable for the
explain his side.
payment of their claims. The most that Zandra may do, for
reasons of public policy and social justice, is to give
2. 2nd notice: Notice of termination, which is a
preference in hiring qualified separated personnel of
written notice of termination served upon the
Zienna. (2009-2017 UST FCL Bar Q&A)
employee, indicating that upon due consideration
of all the circumstances, grounds have been
Q: Luisa Court is a popular chain of motels. It employs
established to justify his termination.
over 30 chambermaids who, among others, help clean
and maintain the rooms. These chambermaids are part
The first notice should contain a detailed narration of facts
of the union rank-and-file employees which has an
and circumstances that will serve as basis for the charge or
existing CBA with the company. While the CBA was in
specific causes or ground for termination against the
force, Luisa Court decided to abolish the position of
employee, and a directive that the employee is given the
chambermaids and outsource the cleaning of the rooms
opportunity to submit his written explanation within a
to Malinis Janitorial Services, a bona fide independent
reasonable period. (Unilever Phil. v. Maria Ruby Rivera, G.R.
contractor which has invested in substantial
No. 201701, 03 June 2013) This is to enable the employee to
equipment and sufficient manpower. The
intelligently prepare his explanation and defenses.
chambermaids filed a case of illegal dismissal against
Luisa Court. In response, the company argued that the
A general description of the charge will not suffice. The
decision to outsource resulted from the new
notice should specifically mention which company rules, if
management’s directive to streamline operations and
any, are violated (King of Kings Transport, Inc. v. Mamac, G.R.
save on costs. If you were the Labor Arbiter assigned to
No. 166208, June 29, 2007, 526 SCRA 116) and that the
the case, how would you decide? (2014 BAR)
employer seeks his dismissal for the act or omission
charged against him; otherwise, the notice does not comply
A: I will decide in favor of Luisa Court, provided that all the
with the rules (Magro Placement and General Services v.
requisites for a valid retrenchment under the Labor Code
Hernandez, G.R. No. 156964, 04 July 2007; see also Mercury
are satisfied. It is management prerogative to farm out any
Drug Corporation v. Serrano, G.R. No. 160509, 10 Mar. 2006;
of its activities. (BPI Employees Union-Davao City-FUBU
citing Maquiling v. Philippine Tuberculosis Society, Inc, G.R.
(BPIEU-Davao City-FUBU) v. Bank of the Philippine Islands, et
No. 143384, 04 Feb. 2005)
al., G.R. No. 174912, 23 July 2013)

"Reasonable opportunity" under the Omnibus Rules means

ALTERNATIVE ANSWER:
every kind of assistance that management must accord to
the employee to enable him to prepare adequately for his
I will decide in favor of the chambermaids. Art. 248 (c) of
defense. This should be construed as a period of at least 5
the Labor Code considers as unfair labor practice on the
calendar days from receipt of the notice to give the
part of Luisa Court its “contracting out the services or
employee an opportunity to study the accusation against
functions being performed by union members”. Luisa
him, consult a union official or lawyer, gather data and
Court's abolition and act of outsourcing the chambermaids'
evidence, and decide on the defenses he will raise against
position are clearly acts of illegal dismissal.
the complaint. (King of Kings Transport, Inc. v. Mantac, G.R.
No. 166208, 29 June 2007)

After receiving the first notice apprising him of the charges

against him, the employee may submit a written
explanation (which may be in the form of a letter,
memorandum, affidavit or position paper) and offer
evidence in support thereof, like relevant company records
(such as his 201 file and daily time records) and the sworn
statements of his witnesses.

U N IV E R S I T Y O F S A N T O T O M A S 66
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
a. For this purpose, he may prepare his explanation
personally or with the assistance of a
representative or counsel. He may also ask the
employer to provide him copy of records material
to his defense. His written explanation may also
include a request that a formal hearing or
conference be held.
b. In such a case, the conduct of a formal hearing or
conference becomes mandatory, as where there
exist substantial evidentiary disputes or where
company rules or practice requires an actual
hearing as part of employment pretermination
procedure. (Perez v. Philippine Telegraph and
Telephone Company, G.R. No. 152048, 07 Apr. 2009)
ALTERNATIVE ANSWER: The prescribed pre-termination
procedures are as follows:
1. Termination for a Just Cause.
Art. 292 of the Labor Code requires service of two
notices on the employee sought to be dismissed as
follows: The first shall apprise him of the ground on
which his intended dismissal is to be effected. The
second shall notify him of his employer's final
decision to dismiss him. In between these notices,
the employee must be given ample opportunity to
come to the defense of his livelihood.
2. Termination for an Authorized Cause.
A termination under Art. 298 of the Labor Code
requires notice to both DOLE-RD and employee 30
days before the intended dismissal. Under Art. 299,
a medical termination shall be preceded by two
notices, the first of which is to apprise the sick of
employee of his employer's intention to dismiss
him and the second is the communication of the
latter's final decision to effect the intended
dismissal. In between, the employee shall be given
the opportunity to produce medical evidence to
prove his fitness for continued employment.
(Central Bar Q&A by Kato, 2023)
a) TWIN NOTICE REQUIREMENT
(2020-21, 2017, 2009, 2006, 1998 BAR)
Q: Upon the owner's instructions, the restaurant
manager served a notice of termination on a cashier
who has been employed in that restaurant for more
than 5 years. Effective immediately, the notice was
based on the alleged insubordination of the cashier.
The owner had ordered the termination immediately
after learning from the manager that the cashier was
asking whether the restaurant was remitting Social
Security System contributions deducted from
employees' salaries.
Will an action for illegal dismissal filed by the cashier
prosper? Explain briefly. (2020-21 BAR)
A: YES. The cashier's action for illegal dismissal will
prosper for the following reasons:
67
a. his dissociation as a regular employee is not for a
just or authorized cause; and
b. he was denied statutory due process. As to the first,
an at-will employment is repugnant to the tenurial
guarantee of both Art. 294 of the Labor Code and
Sec. 3, Art. XIll of the Constitution. The statutory
guarantee requires that employees who have
attained tenure under Art. 295 of the Labor Code,
which the cashier has attained owing to the nature
of his work as necessary, desirable, vital and
indispensable to the restaurant business of his
employer - not to mention his 5-year tenure can
only be dismissed based on fault or culpability (Art.
297, LC) or as authorized by Book VI. (Arts. 298 and
299, LC)
The alleged insubordination, although a listed just cause,
lacks factual support. A just cause has legal meaning; it has
elements; and it has governing case law. Applicable case law
requires that the disobedience be characterized by
wrongful and perverse attitude. (Gold City Integrated Port
Services v. NLRC, G.R. No. 86000 21 Sept. 1990)
Before then, Art. 297 of the Labor Code requires willfulness.
Hence, absent violation of any reasonable workplace rule or
work-related instruction made known earlier to the
cashier, the basis of his dismissal cannot possibly come
within the legal meaning of insubordination,
As to the second, Art. 292 of the Labor Code requires
observance of the prescribed pre-termination procedure
consisting of a notice to explain and a notice of termination,
which notices must be connected by observance of the
ample opportunity to be heard prescript. Here, none of
these requirements has been observed. (Bat Q&A by Kato,
2022)
Q: Alfredo was dismissed by management for serious
misconduct. He filed suit for illegal dismissal, alleging
that although there may be just cause, he was not
afforded due process by management prior to his
termination. He demands reinstatement with full
backwages.
What are the twin-requirements of due process which
the employer must observe in terminating or
dismissing an employee? Explain. (2009 BAR)
A: The twin requirements of due process are notice and
hearing to be given to the worker. There is likewise a two-
notice requirement rule, with the first notice pertaining to
specific causes or grounds for termination and a directive
to submit a written explanation within a reasonable period.
“The second notice pertains to notice of termination.
Pursuant to Perez v. PT&T Company (G.R. No. 152048, 07 Apr.
2009), the Court held that a hearing or conference is not
mandatory, as long as the employee is given “ample
opportunity to be heard”, i.e., any meaningful opportunity
(verbal or written) to answer the charges against him or her
and submit evidence in support of the defense, whether in
a hearing, conference, or some other fair, just and equitable
way. (2009-2017 UST FCL Bar Q&A)
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
b) HEARING
(1999, 1998, 1994 BAR)
4. TERMINATION OF CONTRACT OF MIGRANT
WORKERS (R.A. No. 8042, as amended by R.A. No.
10022)
A: NO. Ms. T's claims will not prosper as she was not placed
in a situation that left her no option except to self
terminate. Instead, she was just given a graceful exit. A
graceful exit is within the prerogative of an employer to
give instead of binding an employee to his fault, or filing an
action for redress against him (Central Azucarera de Bais,
Inc., et al. v. Janet T. Siason, G.R. No. 215555, 29 July 2015).

Q: Due to his employer's dire financial situation,

C. TERMINATION OF EMPLOYMENT BY EMPLOYEEE
(2019, 2018, 2014, 2004, 1996 BAR)
1. RESIGNATION vs. CONSTRUCTIVE DISMISSAL
(2019, 2018, 2014, 2004, 1996 BAR)
Nicanor was prevailed upon by his employer to
voluntarily resign. In exchange, he demanded payment
of salary differentials, 13th month pay, and financial
assistance, as promised by his employer. Management
promised to pay him as soon as it is able to pay off all
retrenched rank-and-file employees.

Five years later, and before management was able to

Q: Ms. T was caught in the act of stealing the company
pay Nicanor the amount promised to him, Nicanor died
property of her employer. When Ms. T admitted to the
of a heart attack. His widow, Norie, filed a money claim
commission of the said act to her manager, the latter
against the company before the NLRC, including
advised her to just tender her resignation; otherwise,
interest on the amount of the unpaid claim. She also
she would face an investigation which would likely
claimed additional damages arguing that the supposed
lead to the termination of her employment and the
resignation letter was obtained from her spouse
filing of criminal charges in court. Acting on her
through undue pressure and influence.
manager's advice, Ms. T submitted a letter of
resignation. Later on, Ms. T filed a case for constructive
The employer filed a motion to dismiss on the ground
dismissal against her employer. While Ms. T conceded
that (a) the NLRC did not have jurisdiction over money
that her manager spoke to her in a calm and unforceful
claims, and (b) the action has prescribed. (2018 BAR)
manner, she claimed that her resignation was not
completely voluntary because she was told that should
a. May Nicanor's spouse successfully claim
she not resign, she could be terminated from work for
additional damages as a result of the alleged
just cause, and worse, criminal charges could be filed
undue pressure and influence?
against her. (2019 BAR)

A: Norrie failed to establish that Nicanor’s consent was

(a) What is the difference between resignation
vitiated when he filed his resignation letter. In BMG Record
and constructive dismissal?
v. Aparecio, (G.R. No. 153290, 05 Sept. 2007), the SC ruled
that the matter of “financial assistance” was an act of
A: A resignation is a voluntary self-termination when
generosity on the part of management. Under the
personal reasons cannot be sacrificed in favor of the
circumstances, Nicanor had the intention to resign. Once
exigency of the employer's business. (Gan v. Galderma
management had accepted the resignation, Nicanor could
Philippines, Inc., et al., G.R. No.177167, 17 Jan. 2013)
not unilaterally withdraw this voluntary act of termination
of employment.
Constructive dismissal is a quitting because the employer
has made continued employment impossible, unreasonable
b. Does the NLRC have jurisdiction to award
or unlikely. (Phil. Japan Active Carbon Corp. v. NLRC, G.R. No.
money claims including interest on the amount
83239, 8 March 1989)
unpaid?
Resignation is at the instance of the employee, whereas
A: The NLRC has jurisdiction over money claims arising
constructive dismissal is at the instance of the employer.
from an employer-employee relationship where the
amount claimed is more than P5,000, including interest,
Resignation is voluntary, whereas in constructive dismissal
regardless of whether or not there is a claim for
there is vitiated consent.
reinstatement. (Sec. 10, R.A. 8042, as amended by R.A.
10022)
Resignation means no separation pay, whereas constructive
dismissal means payment of separation pay and damages.
Q: An accidental fire gutted the JKL factory in Caloocan.
JKL decided to suspend operations and requested its
Resignation must be at least with 30 days’ notice on the part
employees to stop reporting for work. After six (6)
of the employee, whereas in constructive dismissal the
months, JKL resumed operations but hired a new set of
employee can leave anytime. (UPLC Suggested Answers)
employees. The old set of employees filed a case for
illegal dismissal. If you were the Labor Arbiter, how
(b) Will Ms. T's claim for constructive dismissal
would you decide the case? (2014 BAR)
prosper? Explain.

U N IV E R S I T Y O F S A N T O T O M A S 68
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
A: I will rule in favor of the employees. JKL factory merely
suspended its operations as a result of the fire that gutted
its factory. Art. 286 [now Art. 301] of the Labor Code states
that an employer may bona fide suspend the operation of
its business for a period not exceeding 6 months. In such a
case, there would be no termination of the employment of
the employees, but only a temporary displacement. Since,
the suspension of work lasted more than six months, there
is now constructive dismissal. (Sebuguero v. NLRC, G.R. No.
115394, 27 Sept. 1995)
Q: RS, a security guard, filed a complaint for illegal
dismissal against Star Security Agency. He alleged he
was constructively dismissed after ten years of service
to the Agency. Having been placed on "off detail" and
"floating status" for 6 months already, he claimed the
Agency just really wanted to get rid of him because it
required him to take a neuropsychiatric evaluation test
by Mahusay Medical Center. RS said he already
submitted the result of his evaluation test by Brent
Medical Clinica – precondition to a new assignment, but
the report was rejected by the Agency. RS added that
Mahusay Medical Center had close ties with Star's
president. It could manipulate tests to favor only those
guards whom the Agency wanted to retain. Star
defended its policy of reliance on Mahusay Medical
Center because it has been duly accredited by the
Philippine National Police. It is not one of those dubious
testing centers issuing readymade reports. Star cited
its sad experience last year when a guard ran amuck
and shot an employee of a client bank. Star claimed
management prerogative in assigning its guards, and
prayed that RS' complaint be dismissed. What are the
issues? Identify and resolve them. (2004 BAR)
A: The first issue is whether or not RS was constructively
dismissed. He was. RS cannot be placed on "off - detail" and
"floating status" indefinitely. If it lasts for more than 6
months, RS shall be, deemed to have been constructively
dismissed thus entitling him to separation benefits.
(Superstar Security Agency v. NLRC, G.R. No. 81493, 03 Apr.
1990)
premises. Lionel then filed a complaint with the Labor
Arbiter claiming constructive dismissal. Among
others, the company sought the dismissal of the
complaint alleging that the case involved an intra-
corporate controversy which was within the
jurisdiction of the RTC. If you were the Labor Arbiter
assigned to the case, how would you rule on the
company’s motion to dismiss? (2014 BAR)
A: I will deny the motion to dismiss. "Corporate officers" in
the context of Presidential Decree No. 902-A are those
officers of the corporation who are given that character by
the Corporation Code or by the corporation's by-laws. Sec.
25 of the Corporation Code enumerates three specific
officers that in law are considered as corporate officers –
the president, secretary, and treasurer. Lincoln is not one of
them. There is likewise no showing that his position as
Assistant Vice-President is a corporate officer in the
company's by-laws. The Labor Arbiter, therefore, has
jurisdiction over the case. (Art. 217(a)(2) [now Art.
224(a)(2)], LC; 2009-2017 UST FCL Bar Q&A)
D. PREVENTIVE SUSPENSION
(2022, 2015 BAR)
Q: As Human Resources Manager of a five-star hotel,
you were told in confidence by several fearful
employees in the housekeeping department that Joy,
the head of housekeeping, was a harsh disciplinarian
who would pinch the ears of her staff or rap their heads
to drill instructions on the proper way to clean and tidy
up the hotel rooms. One day, the assistant housekeeper
urgently called you to the supply room of the hotel,
where you found housekeeping staff Erika and Patricia
slumped on the floor with bloody faces. The assistant
housekeeper reported that she saw Joy beat up Erika
and Patricia with a mop for allegedly stealing
complimentary toiletries for guests. Erika and Patricia
were hospitalized for a couple of days due to the
injuries they sustained. (2022 BAR)

The second issue is whether or not Star validly exercised its

a. Can Joy be placed on preventive suspension
management prerogative. It did not. Star's claim of
pending administrative investigation? If so, for
management prerogative in assigning its guards cannot be
what maximum period? Explain briefly.
exercised to defeat or circumvent RS' right to security of
tenure.
A: YES, Joy can be placed under preventive suspension for a
maximum period of 30 days pending her investigation. This
Q: Lincoln was in the business of trading broadcast
is to protect her subordinates from acts of reprisal,
equipment used by television and radio networks. He
especially witnesses against her, particularly the assistant
employed Lionel as his agent. Subsequently, Lincoln
housekeeper who told on her. Serious threat against the life
set up Liberty Communications to formally engage in
of co-employees warrants preventive suspension. (Secs. 3 &
the same business. He requested Lionel to be one of the
4, Rule XIV, ORILC; Maricalum Mining Corp. vs Decorion,
incorporators and assigned to him 100 Liberty shares.
158673, 12 Apr. 2006) (Central Bar Q&A by Kato, 2023)
Lionel was also given the title Assistant Vice-President
for Sales and Head of Technical Coordination. After
b. If Joy is placed on preventive suspension, is she
several months, there were allegations that Lionel was
entitled to receive her wages and other benefits
engaged in “under the table dealings” and received
during the period? Explain briefly.
“confidential commissions” from Liberty’s clients and
suppliers. He was, therefore, charged with serious
A: NO. The period of preventive suspension is not
misconduct and willful breach of trust, and was given
compensable. The only time compensation is due is when
48 hours to present his explanation on the charges.
the employer extends the maximum 30-day period for the
Lionel was unable to comply with the 48-hour deadline
purpose of pursuing and concluding the ongoing
and was subsequently barred from entering company
investigation. In such case, the suspended employee shall be

69 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
entitled to his salaries for the extended period. If dismissed,
he is not required to reimburse. (Sec. 4, Rule XIV, ORILC)
(Central Bar Q&A by Kato, 2023)
Q: Karina Santos is a famous news anchor appearing
nightly in the country's most-watched newscast. She is
surprised, after one newscast, to receive a notice of
hearing before the station's Vice-President for Human
Resources and calls the VP immediately to ask what was
wrong. Karina is told over the phone that one of her
crew filed a complaint against her for verbal abuse and
that management is duty-bound to investigate and give
her a chance to air her side. Karina objects and denies
that she had ever verbally assaulted her crew. The VP
then informed her that pending the investigation she
will be placed on a 30-day preventive suspension
without pay and that she will not be allowed to appear
in the newscast during this time.
Is the preventive suspension of Karina valid? Discuss
the reasons for your answer. (2015 BAR)
A: NO, the preventive suspension of Karina is not valid.
The employer may place an employee under preventive
suspension if his/her continued employment would pose a
serious and imminent threat to the life or property of the
employer or of his/her co-employees. These requirements
are not present here. (2009-2017 UST FCL Bar Q&A)
E. RELIEFS FROM ILLEGAL DISMISSAL
(2017, 2016, 2009, 2008, 2007, 2002 BAR)
Q: Discuss briefly the instances when noncompliance
by the employer with a reinstatement order of an
illegally dismissed employee is allowed. (2007 BAR)
A: Despite a reinstatement order, an employer may not
reinstate an employee in the following instances:
a. When the position or any substantial equivalent
thereof no longer exists;
b. When reinstatement has been rendered moot and
academic by supervening events, such as insolvency of
the employer as declared by the court or closure of the
business;
c. The existence of strained relations between the
employer and the illegally dismissed employee,
provided the matter is raised before the Labor Arbiter.
In the event that reinstatement is no longer feasible, or if
the employee chooses not to be reinstated, the employer
shall pay him separation pay in lieu of reinstatement
pending appeal. (Art. 223 [now 229], LC)
Q: Juanito initiated a case for illegal dismissal against
Mandarin Company. The Labor Arbiter decided in his
favor and ordered his immediate reinstatement with
full backwages and without loss of seniority and other
benefits. Mandarin Company did not like to allow him
back in its premises to prevent him from influencing his
co-workers.to move against the interest of the
company; hence, it directed his payroll reinstatement
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
and paid his full backwages and other benefits even as
it appealed to the NLRC. A few months later, the NLRC
reversed the ruling of the Labor Arbiter and declared
that Juanito's dismissal was valid. The reversal
ultimately became final.
May Mandarin Company recover the backwages and
other benefits paid to Juanito pursuant to the decision
of the Labor Arbiter in view of the reversal by the NLRC?
Rule, with reasons. (2017 BAR)
A: Mandarin cannot recover the back wages and other
benefits paid to Juanito. The decision of the Labor Arbiter
insofar as the reinstatement aspect is concerned is
immediately executory pending appeal. (Felix v. Enertech
Systems Industries Inc., G.R. No. 192007, 29 Mar. 2001)
In fact, in the case of Pioneer Texturizing Corp. v. NLRC (G.R
No. 118651, 16 Oct. 1997) it was held that the order of the
Labor Arbiter is self-executory; hence, it is the obligation of
Mandarin to immediately admit Juanito back to work or
reinstate him in the payroll. When Mandarin appealed the
Labor Arbiter's decision to the NLRC, the employer-
employee relationship between the former and Juanito
never ceased; and his employment status remained
uncertain until the NLRC reversed the decision, which
became final.
Thus, the reinstatement salaries due to Juanito were, by
their nature, payment of unworked backwages. These were
salaries due to him because he was prevented from working
despite the finding of the Labor Arbiter that he had been
illegally dismissed (Wenphil Corp. v. Abing and Tuason, G.R.
No. 207983, 07 Apr. 2014; 2009-2017 UST FCL Bar Q&A)
Q: Cite four (4) instances when an illegally dismissed
employee may be awarded separation pay in lieu of
reinstatement. (2009 BAR)
A: These four instances are:
a. in case the establishment where the employee is to
be reinstated has closed or ceased operations;
b. where the company has been declared insolvent;
c. where the employee’s former position no longer
exists at the time of reinstatement for reason not
attributable to the fault of the employer; and
d. where the employee decides not to be reinstated
as when he does not pray for reinstatement in his
complaint or position paper.
Complaints had worked five (5) years as waitresses in a
cocktail lounge owned by the respondent. They did not
receive any salary directly from the respondent but
shared in all service charges collected for food and
drinks to the extent of 75%. With respondent's prior
permission, they could sit with and entertain guest
inside the establishment and appropriate for
themselves the tips given by guests. After five (5) years,
the complaints individual shares in the collected
service charges dipped to below minimum wage level
as a consequence of the lounge's marked business
decline. Thereupon, complaints asked respondent to
increase their share in the collected service charges to
85% or the minimun wage level, whichever is higher.
70
 QuAMTO (1987-2022)
Respondent terminated the services of the
complainants who countered by filing a consolidated
complaint for unlawful dismissal, with prayer for 85%
of the collected services or the minimum wage for the
appropriate periods, whichever is higher. Decide.
(2008 BAR)
A: complainants are employees of respondent as the latter
exercised substantial control over the former; hence,
pursuant to Art. 136 of the Labor Code, the latter were its
employees. Moreover, on account of the nature of their
work as necessary, vital and indispensable to respondent's
business, complainants could only be dismissed under the
Labor Code for a just cause (Art. 297) or authorized cause
(Art. 298) because they were tenured already per Art. 295.
Since their dismissal was not for either cause, their
dismissal was illegal.
As to entitlement to service charges, the new law requires
complete and equal distribution of service charges to all
employees, except managers. (R.A. No. 11360) Hence, not
only should the respondent give 85% thereof to the
complainants but 100% since the new law has done away
with the 85%-15% distribution requirement under Art. 96
of the Labor Code. (Central Bar Q&A by Kato, 2023)
Q: Lyric Theater Corp. issued a memorandum
prohibiting all ticket sellers from encashing any check
from their cash collections and requiring them instead
to turn over all cash collections to the management at
the end of the day. In violation of this memorandum,
Melody, a ticket seller, encashed five (5) checks from
her cash collection. Subsequently the checks were
dishonored when deposited in the account of Lyric
Theater. For this action, Melody was placed under a 20-
day suspension and directed to explain why she should
not be dismissed for violation of the company's
memorandum. In her explanation, she admitted having
encashed the checks without the company's
permission.
While the investigation was pending, Melody filed a
complaint against Lyric Theater for backwages and
separation pay. The Labor Arbiter ordered Lyric
Theater to pay Melody P115,420.79 representing
separation pay and backwages. The NLRC affirmed the
ruling of the Labor Arbiter. Is the ruling of the NLRC
correct? Explain briefly. (2002 BAR)
A: NO, the ruling of the NLRC affirming the Labor Arbiter's
decision ordering Lyric Theater to pay P115,420.79
representing separation pay and backwages is wrong. The
Labor Arbiter's decision is wrong because:
a. It is premature. There was still no termination. All that
was done by the employer (Lyric Theater) was to place
the employee (Melody) under a 20-day suspension,
meanwhile directing her to explain why she should not
be dismissed for violation of company's memoranda.
b. The order for Lyric Theater to pay separation pay has
no factual basis. Separation pay is to be paid to an
employee who is terminated due to the installation of
labor-saving devices, redundancy, retrenchment to
prevent losses or the closing or cessation of operation
71
of the establishment undertaking. None of these events
has taken place. Neither is separation pay here in lieu
of reinstatement applicable because there is just cause
if Melody is terminated under the circumstances.
The order for Lyric Theater to pay backwages has no factual
basis either because there is just cause if she will be
terminated after investigation. In this case, there is willful
disobedience by the employee of the lawful orders of her
employer in connection with her work. She did not just
violate the lawful order of the employer; she violated it five
times. Melody did not give any justifiable reason for
violating the company's memorandum prohibiting the
encashment of checks. (Jo Cinema Corp. v. Avellana, G.R. No.
32837, 28 June 2001)
Q: In a case for illegal dismissal and non-payment of
benefits, with prayer for Damages, Apollo was awarded
the following: 1) P200,000.00 as backwages; 2)
P80,000.00 as unpaid wages; 3)P20,000.00 as unpaid
holiday pay; 4) P5,000.00 as unpaid service incentive
leave pay; 5) P50,000.00 as moral damages, and 6)
P10,000.00 as exemplary damages. Attorney's fees of
10% of all the amounts covered by items 1 to 6
inclusive, plus interests of 6% per annum from the date
the same were unlawfully withheld, were also awarded.
(2016 BAR)
(a) Robbie, the employer, contests the award of
attorney fees amounting to 10% on all the amounts
adjudged on the ground that Article 111 of the
Labor Code authorizes only 10% “of the amount of
wages recovered". Rule on the issue and explain.
A: The attorney's fees should be granted to Robbie. There
are two commonly accepted concepts of attorney's fees, the
so-called ordinary and extraordinary. In its ordinary
concept, an attorney's fee is the reasonable compensation
paid to a lawyer by his client for the legal services he has
rendered to the latter. The basis of this compensation is the
fact of his employment by and his agreement with the client.
In its extraordinary concept, attorney's fees are deemed
indemnity for damages ordered by the court to be paid by
the losing party in a litigation. The instances where these
may be awarded are those enumerated in Art. 2208(7) of
the Civil Code which pertains to actions for recovery of
wages, and is payable not to the lawyer but to the client,
unless they have agreed that the award shall pertain to the
lawyer as additional compensation or as part thereof. The
extraordinary concept of attorney’s fees is the one
contemplated in Article 111 of the Labor Code.
Art. 111 is an exception to the declared policy of strict
construction in the awarding of attorney’s fees. Although an
express finding of facts and law is still necessary to prove
the merit of the award, there need not be any showing that
the employer acted maliciously or in bad faith when it
withheld the wages. There need only be a showing that the
lawful wages were not paid accordingly, as in this case. In
carrying out and interpreting the Labor Code's provisions
and its implementing regulations, the employees' welfare
should be the primordial and paramount consideration.
This kind of interpretation gives meaning and substance to
the liberal and compassionate spirit of the law as provided
in Art. 4 of the Labor Code, which states that all doubts in
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
the implementation and interpretation of the provisions of
the Labor Code, including its implementing rules and
regulations, shall be resolved in favor of labor, and Article
1702 of the Civil Code which provides that 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. (PCL Shipping Philippines, Inc. v. NRC, G.R. No.
153031, 14 Dec. 2006)
(b) Robbie likewise questions the imposition of
interests on the amounts in question because it
was not claimed by Apollo, and the Civil Code
provision on interests does not apply to a labor
case. Rule on the issue and explain.
A: It is now well-settled that generally, legal interest may be
imposed upon any unpaid wages, salary differential, merit
increases, productivity bonuses, separation pay, back
wages on other monetary claims, and benefits awarded
illegally dismissed employees. Its grant, however, remains
discretionary upon the courts. (Conrado A. Lim v. HMR
Philippines, G.R. No. 189871, 13 Aug. 2013)
Legal interest was imposed on all the monetary awards by
the SC in the case of Bani Rural Bank v. De Guzman. (G.R. No.
170904, 13 Nov. 2013) The Court therein declared that the
imposition of legal interest in any final and executory
judgment does not violate the immutability principle. The
Court ruled that once a decision in a labor case becomes
final, it becomes a judgment for money from which another
consequence flows - the payment of interest in case of delay.
(2009-2017 UST FCL Bar Q&A)
F. RETIREMENT
(2019, 2018, 2013, 2007, 2005, 2001, 1994 BAR)
Q: As a rule, when is retirement due? (2007 BAR)
A: Art. 287 [now 302] provides for two types of retirement:
a. Optional retirement – which may be availed of by
an employee reaching the age of 60 years;
b. Compulsory retirement – which may be availed of
by an employee upon reaching the age of 65 years.
In both instances, the law imposes the minimum service
requirement of 5 years with the establishment.
Q: When is retirement due for underground miners?
(2007 BAR)
A: Pursuant to R.A. 8558, in the absence of a retirement plan
or other applicable agreement providing for retirement
benefits of underground mine employees in the
establishment, any such employee may retire upon
reaching the age of 50 years or more if he has served for at
least five years as underground mine employee or in an
underground mine of the establishment.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: Discuss the differences between compulsory and
voluntary/optional retirement as well as the minimum
benefits provided under the Labor Code for retiring
employees of private establishments. (2019 BAR)
A: A voluntary/optional retirement is a termination of
employment based on a bilateral agreement to terminate
employment at an agreed age regardless of years in service,
or after a certain number of years in service regardless of
age. It is a matter of contract. In contrast, a compulsory
retirement is a termination of employment by operation of
law. It is a matter of statute.
Under Art. 302 of the Labor Code, retiring employees shall
be paid retirement benefits computed as follows:
(22.5 days x Daily Rate) x Length of Service
The 22.5 days consist of 15 days representing half-month
salary, 5 days as service incentive leave, and 2.5 days
representing 1/12 of 13th month pay. The full 22.5 days
shall be used if the retiree is entitled to both service
incentive leave and 13th month pay. Meantime, the 15 days
must always be used. (UPLC Suggested Answers)
Q: Narciso filed a complaint against Norte University for
the payment of retirement benefits after having been a
part-time professional lecturer in the same school since
1974. Narciso taught for two semesters and a summer
term for the school year 1974-1975, took a leave of
absence from 1975 to 1977, and resumed teaching until
2003. Since then, his contract has been renewed at the
start of every semester and summer, until November
2005 when he was told that he could no longer teach
because he was already 75 years old.
Norte University also denied Narciso's claim for
retirement benefits stating that only full-time
permanent faculty, who have served for at least five
years immediately preceding the termination of their
employment, can avail themselves of post-employment
benefits. As part-time faculty member, Narciso did not
acquire permanent employment status under the
Manual of Regulations for Private Schools, in relation to
the Labor Code, regardless of his length of service.
(2018 BAR)
(a) Is Narciso entitled to retirement benefits?
A: As a part-time employee with fixed-term employment,
Narciso is entitled to retirement benefits. Book VI, Rule II of
the Rules Implementing the Labor Code states that the rule
on retirement shall apply to all employees in the private
sector, regardless of their position, designation, or status
and irrespective of the method by which their wages are
paid, except to those specifically exempted. Part-time
faculty members do not fall under the exception. Based also
on the Retirement Pay Law and its Implementing Rules,
part-time faculty members of private educational
institutions are entitled to full retirement benefits even if
the services are not continuous, and even if their contracts
have been renewed after their mandatory age of retirement.
(UPLC Suggested Answers)
72
 QuAMTO (1987-2022)
NB: In Palgan v. Holy Name (G.R. No. 219916, 10 Feb. 2021, J.
Hernando), the Court held that only a full-time teaching
personnel can acquire regular or permanent status. In this
case, Narciso is a mere part-time teacher, thus, he can never
acquire regular or permanent status and avail the benefits
provided under the law for regular employees.
(b) If he is entitled to retirement benefits, how should
retirement pay be computed in the absence of any
contract between him and Norte University
providing for such benefits?
A: In the absence of any contract providing for higher
retirement benefits, private educational institutions,
including Norte University, are obligated to set aside funds
for the retirement pay of all its part-time faculty members.
A covered employee who retires pursuant to the Retirement
Pay Law shall be entitled to retirement pay equivalent to at
least 1/2 month salary for every year of service, a fraction
of at least 6 months being considered as one whole year.
One-half month salary shall mean 15 days plus 1/12 of the
13th month pay and the cash equivalent of not more than 5
days service incentive leaves. In total, this should amount to
22.5 days for every year of service. (De La Salle Araneta
University v. Bernardo, G.R. No. 190809, 13 Feb. 2017)
attained the compulsory retirement age of 65 years as
required by its personnel policy; moreover, it did not
have a policy on optional or early retirement. Taking up
the cudgels for Ricky Marvin, the union raised the issue
in the grievance machinery as stipulated in the CBA. No
settlement was arrived at and the matter was referred
to voluntary arbitration. If you were the Voluntary
Arbitrator, how would you decide? Briefly explain the
reasons for your award. (2007 BAR)
A: I will grant Ricky Marvin the retirement benefits under
Art. 287 [now 302] of the Labor Code. Art. 287 [now 302] of
the Labor Code, as the minimum standard in law, allows an
employee an optional retirement upon reaching the age of
60 years provided he rendered at least 5 years of service –
requirements that Ricky Marvin met under the facts of the
case.

Q: After 30 years of service, Beta Company compulsorily

retired Albert at age 65 pursuant to the company's
Retirement Plan. Albert was duly paid his full
retirement benefits of 1 month pay for every year of
service under the Plan. Thereafter, out of compassion,
the company allowed Albert to continue working and
paid him his old monthly salary rate, but without the
allowances that he used to enjoy.

After 5 years under this arrangement, the company

finally severed all employment relations with Albert;
he was declared fully retired in a fitting ceremony but
the company did not give him any further retirement
benefits. Albert thought this treatment unfair as he had
rendered full service at his usual hours in the past five
(5) years. Thus, he filed a complaint for the allowances
that were not paid to him and for retirement benefits
for his additional five (5) working years, based either
on the company's Retirement Plan or the Retirement
Pay Law, whichever is applicable.

Is he entitled to additional retirement benefits for the

additional service he rendered after age 65? (2013
BAR)

A: NO. He cannot be compulsorily retired twice in the same

company.

Q: Ricky Marvin had worked for more than 10 years in

1GB Corporation. Under the terms of the personnel
policy on retirement, any employee who had reached
the age of 65 and completed at least 10 years of service
would be compulsorily retired and paid 30 days’ pay for
every year of service. Ricky Marvin, whose immigrant
visa to the USA had just been approved, celebrated his
60th birthday recently. He decided to retire and move
to California where the son who petitioned him had
settled. The company refused to grant him any
retirement benefits on the ground that he had not yet

73 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
V. JURISDICTION AND REMEDIES
A. LABOR ARBITER
(2019, 2017, 2015, 2014, 2008, 2001, 1995, 1991,
1990 BAR)
Q: Due to serious business reverses, ABC Co. decided to
terminate the services of several officers receiving "fat"
compensation packages. One of these officers was Mr. X,
its Vice-President for External Affairs and a member of
the Board of Directors. Aggrieved, Mr. X filed a
complaint for illegal dismissal before the NLRC-
Regional Arbitration Branch.
ABC Co. moved for the dismissal of the case on the
ground of lack of jurisdiction, asserting that since Mr. X
occupied the position of Vice-President for External
Affairs which is listed in the by-laws of the corporation,
the case should have been filed before the Regional
Trial Court.
The Labor Arbiter (LA) denied ABC Co.'s motion and
proceeded to rule that Mr. X was illegally dismissed.
Hence, he was reinstated in ABC Co.'s payroll pending
its appeal to the NLRC. (2019 BAR)
(a) Did the LA err in denying ABC Co.'s motion to
dismiss on the ground of lack of jurisdiction? Explain.
A: NO, the LA did not err. There is a two-tiered test to
determine whether a dispute is with the LA or the RTC, to
wit:
1. The status or the relationship of the parties; and
2. The nature of the question that is the subject of the
controversy. (Viray v. CA, G.R. No. 92481, 09 Nov. 1990)
Distinction should be made between a labor controversy
and an intra-corporate dispute. Not all conflicts between a
corporation and a stockholder involve corporate matters.
(Cosare v. Broadcom, G.R. No. 201298, 05 Feb. 2014)
In the case at bar, since Mr. X seeks to recover his position
as a Vice-President of External Affairs and not as a member
of the board of ABC Co., then the LA has jurisdiction to try
his case and therefore the motion to dismiss was correctly
denied by the LA.
(b) Assuming that jurisdiction is not at issue and that
the NLRC reverses the LA's ruling of illegal
dismissal with finality, may ABC Co. claim
reimbursement for the amounts it paid to Mr. X
during the time that he was on payroll
reinstatement pending appeal? Explain.
A: NO, it may not. A reinstatement order by the LA is
immediately executory and no reimbursement is due even
if it is reversed on appeal. (Garcia v. PAL, G.R. No. 164856, 20
Jan. 2009)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: Marcel was the Vice President for Finance and
Administration and a member of the Board of Directors
of Mercedes Corporation. He brought a complaint for
illegal suspension and illegal dismissal against
Mercedes Corporation, which moved to dismiss the
complaint on the ground that the complaint pertained
to the jurisdiction of the RTC due to the controversy
being intracorporate based on his positions in the
corporation.
Marcel countered that he had only been removed as
Vice President for Finance and Administration, not as a
member of the Board of Directors. He also argued that
his position was not listed as among the corporate
offices in Mercedes Corporation's by-laws. Is the
argument of Marcel correct? Explain your answer.
(2017 BAR)
A: YES, Marcel's argument is correct. Only corporate
officers such as the president, secretary, treasurer, and such
other officers as may be provided in the by-laws of the
corporation are subject to the jurisdiction of the RTC.
Corporate officers are those whose position is a creation of
the corporate charter or by laws and whose election is by
virtue of the acts of the Board of Directors. (Cosare v.
BroadcomAsia, Inc., G.R. No. 201298, 05 Feb. 2014)
ALTERNATIVE ANSWER:
YES, Marcel's argument is correct. The question is whether
the complaint for illegal dismissal filed by Marcel is intra-
corporate and thus beyond the jurisdiction of the Labor
Arbiter. Marcel as the Vice-President for Finance and
Administration is not a corporate official. Although he is a
member of the Board of Directors, he was not removed as
such; he was removed only from his position as Vice-
President. Inasmuch as the core issue is his termination as
a non-corporate official, then Marcel's complaint for illegal
dismissal is not an intra-corporate controversy. (Real v.
sangu Philippines, Inc. et al., G.R. No. 168757, 19 Jan. 2011)
Q: Mario comes from a family of coffee bean growers.
Deciding to incorporate his fledgling coffee venture, he
invites his best friend, Carlo, to join him. Carlo is
hesitant because he does not have money to invest but
Mario suggests a scheme where Carlo can be the Chief
Marketing Agent of the company, earning a salary and
commissions. Carlo agrees, and the venture is formed.
After one year, the business was so successful that they
were able to declare dividends. Mario is so happy with
Carlo's work that he assigns 100 shares of stock to Carlo
as part of the latter's bonus. Much later on, it is
discovered that Carlo had engaged in unethical
conduct, which caused embarrassment to the company.
Mario is forced to terminate Carlo, but he does so
without giving Carlo the opportunity to explain.
Carlo filed a case against Mario and the company for
illegal dismissal. Mario objected on the ground that the
Labor Arbiter had no jurisdiction over the case as it
would properly be considered as an intracorporate
controversy cognizable by the RTC. Further, Mario
claimed that because Carlo's dismissal was a corporate
act, he cannot be held personally liable. (2015 BAR)
74
 QuAMTO (1987-2022)
(a) As the Labor Arbiter assigned to this case, how
would you resolve the jurisdiction question.
A: The Labor Arbiter has jurisdiction over Carlo’s illegal
dismissal complaint as he was hired by Mario on a “salary
and commission” basis. In Grepalife v. Judico (G.R. No. 73887,
21 Dec. 1989) it was held that a worker who is paid on a
salary plus commission basis is an employee. While regular
courts have jurisdiction over Mario’s corporate act of
severing ties with Carlo, the Labor Arbiter, pursuant to Art.
217(a)(2) (now 224(a)(2)) of the LC, has jurisdiction over
Carlo’s illegal dismissal complaint.
ALTERNATIVE ANSWER:
Carlo is a party to a joint-venture. Hence, he is not related to
Mario as an employee. As a business organization, the
affairs of that joint- venture are not governed by Labor Law,
except in relation to its employees. Any issue arising from
that affair, therefore, must be brought to the RTC. Thus, the
NLRC has no jurisdiction because the matter did not arise
from an employer-employee relationship and the issue
between the disputants is not resolvable solely through the
application of Labor Law. (2009-2017 UST FCL Bar Q&A)
(b) What is the rule on the personal liability of
corporate officers for a corporate act declared to
be unlawful?
A: Corporate officers are not, as a general rule, personally
liable for the corporate acts they perform in behalf of the
corporation they represent. They are, however, personally
liable for their corporate acts if they acted with malice or
bad faith. (Girly Ico v. Systems Technology Institute, Inc., G.R.
No. 185100, 09 July 2014; 2009-2017 UST FCL Bar Q&A)
Q: Lincoln was in the business of trading broadcast
equipment used by television and radio networks. He
employed Lionel as his agent. Subsequently, Lincoln set
up Liberty Communications to formally engage in the
same business. He requested Lionel to be one of the
incorporators and assigned to him 100 Liberty shares.
Lionel was also given the title of Assistant Vice-
President for Sales and Head of Technical Coordination.
After several months, there were allegations that Lionel
was engaged in “under the table dealings” and received
“confidential commissions” from Liberty’s clients and
suppliers. He was, therefore, charged with serious
misconduct and willful breach of trust and was given 48
hours to present his explanation of the charges. Lionel
was unable to comply with the 48-hour deadline and
was subsequently barred from entering company
premises. Lionel then filed a complaint with the Labor
Arbiter, claiming constructive dismissal. Among others,
the company sought the dismissal of the complaint,
alleging that the case involved an intracorporate
controversy that was within the jurisdiction of the RTC.
If you were the Labor Arbiter assigned to the case, how
would you rule on the company’s motion to dismiss?
(2014 BAR)
75
A: I will deny the motion to dismiss. "Corporate officers" in
the context of Presidential Decree No. 902-A are those
officers of the corporation who are given that character by
the Corporation Code or by the corporation's by-laws. Sec.
25 of the Corporation Code enumerates three specific
officers that, in law, are considered as corporate officers –
the president, secretary, and the treasurer. Lincoln is not
one of them. There is likewise no showing that his position
as Assistant Vice-President is a corporate officer in the
company's by-laws. The Labor Arbiter, therefore, has
jurisdiction over the case. (Art. 217 [now 224] (a)(2), LC;
2009-2017 UST FCL Bar Q&A)
1. JURISDICTION OF LABOR ARBITER VS.
JURISDICTION OF REGIONAL DIRECTOR
2. REQUISITES TO PERFECT AN APPEAL WITH THE
NATIONAL LABOR RELATIONS COMMISSION
3. REINSTATEMENT AND/OR EXECUTION PENDING
APPEAL
(2019 BAR)
Q: After due proceedings, the Labor Arbiter (LA)
declared Mr. K to have been illegally dismissed by his
former employer, AB, Inc. As a consequence, the LA
directed ABC, Inc. to pay Mr. K separation pay in lieu of
reinstatement as well as his full backwages. While ABC,
Inc. accepted the finding of illegal dismissal, it
nevertheless filed a motion for reconsideration,
claiming that the LA erred in awarding both separation
pay and full backwages, and instead, should have
ordered Mr. K's reinstatement to his former position
without loss of seniority rights and other privileges, but
without payment of backwages. In this regard, ABC, Inc.
pointed out that the LA's ruling did not contain any
finding of strained relations or that reinstatement was
no longer feasible. In any case, it appears that no
evidence was presented on this score. (2019 BAR)
a. Is ABC, lnc.'s contention to delete the
separation pay, and instead, order
reinstatement without backwages correct?
Explain.
A: As to separation pay, the LA's decision fails to state that
there is a bar to reinstatement; hence, he should have
ordered reinstatement pursuant to the general rule
prescribed by Art. 294 of the Labor Code. Since the
alternative relief of separation pay is an exception, it must
be justified with a reinstatement bar. As to backwages,
however, it cannot be deleted because it is a logical
consequence of a finding of illegal dismissal. (ICT Marketing
Services, Inc. v. Mariphil Sales, G.R. No. 202090, 09 Sept. 2015)
Hence, absent any reason for limiting or withholding it, it
should be awarded as it was awarded by the LA. (Central
Bar Q&A by Kato, 2023)
b. Assuming that on appeal, the NLRC upholds the
decision of the LA, where, how, and within what
timeframe should ABC, Inc. assail the NLRC
ruling?
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
A: After the denial of the appellant's motion for
reconsideration, the NLRC's decision and order of denial
can be assailed under Rule 65 of the Rules of Court thru the
filing of a petition for certiorari within 60 days from receipt
of said denial order. Correction of error of jurisdiction,
resulting in the nullification of the assailed dispositions,
should be sought based on the NLRC's grave abuse of its
appellate power amounting to lack of, or excess of
jurisdiction. (Central Bar Q&A by Kato, 2023)
B. NATIONAL LABOR RELATIONS COMMISSION
(2018, 2015, 2007, 2001, 1997, 1996, 1995 BAR)
d. Contempt cases; and
e. Claims arising out of an employer employee
relationship or by virtue of any law or contract
involving Filipino workers for overseas
deployment including claims for actual, moral,
exemplary and other forms of damage.
2. Exclusive Appellate Jurisdiction
a. All cases decided by the Labor Arbiters (Art.
217[b] [now 224(b)], LC); and
b. Cases decided by the Regional Offices of DOLE
in the exercise of its adjudicatory function.
(Art. 129, LC)

Q: Distinguish the jurisdiction of a Labor Arbiter from

Q: The jurisdiction of the NLRC does not include: (2014
that of the NLRC. (2015 BAR)
BAR)
a. exclusive appellate jurisdiction over all cases
A: As to jurisdiction, the Labor Arbiter can hear and resolve
decided by the Labor Arbiter.
cases under Art. 217 [now 224] of the LC, money claims
b. exclusive appellate jurisdiction over all cases
under Sec. 7 of R.A. 10022; and referred wage distortion
decided by Regional Directors or hearing
disputes in unorganized establishments, as well as the
officers involving the recovery of wages and
enforcement of compromise agreements pursuant to the
other monetary claims and benefits arising
2011 NLRC Rules of Procedure, as amended. On the other
from employer-employee relations where the
hand, the NLRC reviews decisions rendered by the LA;
aggregate money claim of each does not exceed
decisions or orders rendered by the RD under Art. 129 of the
P5,000.00.
LC; and conducts compulsory arbitration in certified cases.
c. original jurisdiction to act as a compulsory
arbitration body over labor disputes certified
As to the power to issue a labor injunction, the NLRC can
to it by the Regional Directors.
issue an injunctive writ. On the other hand, the Labor
d. power to issue a labor injunction.
Arbiter cannot issue an injunctive writ.

A: C. Original jurisdiction to act as a compulsory arbitration

Q: May the NLRC or the courts take jurisdictional
body over labor disputes certified to it by the Regional
cognizance over compromise agreements/ settlements
Directors. (Art. 129, LC) (Central Bar Q&A by Kato, 2023)
involving labor matters? (2007 BAR)
Q: What matters may be taken up by the NLRC En Banc?
A: NO, any compromise agreement, including those
involving labor standards laws, voluntarily agreed upon by
A: The NLRC shall sit en banc only for the purposes of
the parties with the assistance of the Bureau or the regional
promulgating rules and regulations governing the hearing
office of the DOLE, shall be final and binding upon the
and disposition of cases before any of its divisions and
parties. The NLRC or any court shall not assume jurisdiction
regional branches and formulating policies affecting its
over issues involved therein except in case of non-
administration and operations. (Art. 213, LC)
compliance thereof or if there is prima facie evidence that
the settlement was obtained through fraud,
Q: What is the jurisdiction of the NLRC? (1995 BAR)
misrepresentation, or coercion. (Art. 227, LC)

A:
Q: Due to his employer's dire financial situation,
1. Exclusive Original Jurisdiction:
Nicanor was prevailed upon by his employer to
a. Certified labor disputes causing or likely to
voluntarily resign. In exchange, he demanded payment
cause a strike or lockout in an industry
of salary differentials, 13th month pay, and financial
indispensable to the national interest,
assistance, as promised by his employer. Management
certified to it by the Secretary of Labor or the
promised to pay him as soon as it is able to pay off all
President for compulsory arbitration;
retrenched rank-and-file employees. 5 years later, and
before management was able to pay Nicanor the
b. Injunction in ordinary labor disputes to enjoin
amount promised to him, Nicanor died of a heart
or restrain any actual or threatened
attack. His widow, Norie, filed a money claim against
commission of any or all prohibited or
the company before the NLRC, including interest on the
unlawful acts or to require the performance of
amount of the unpaid claim. She also claimed
a particular act in any labor dispute which, if
additional damages arguing that the supposed
not restrained or performed forthwith, may
resignation letter was obtained from her spouse
cause grave or irreparable damage to any
through undue pressure and influence.
party;

The employer filed a motion to dismiss on the ground

c. Injunction in strikes or lockouts under Art. 264
that (a) the NLRC did not have jurisdiction over money
[now 279] of the LC;
claims, and (b) the action has prescribed. (2018 BAR)

U N IV E R S I T Y O F S A N T O T O M A S 76
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
(a) Does the NLRC have jurisdiction to award
money claims including interest on the amount
unpaid?
A: YES, the NLRC, thru the Labor Arbiter, has jurisdiction
over money claims reasonably connected to employer-
employee relationship (Reasonable Causal Connection
Rule); provided the money issue is resolvable through the
application solely of Labor Law (Sole Reference to Labor
Law Rule). Since both jurisdictional requirements are
present, the widow's money claims, including interest, can
be heard and determined by the NLRC. (Central Bar Q&A by
Kato, 2023)
(b) Assuming that the NLRC has jurisdiction, has
the action prescribed?
A: NO. Pursuant to the Principle of Promissory Estoppel,
the action has not prescribed. (Accesories Specialist, Inc. v.
Alabanza, G.R. No. 168985, 23 July 2008) Here, the employer
made an express promise to pay; said promise reasonably
induced belief or action; and the employee, having been
induced to believe that payment was forth- coming, did not
file a money complaint within 3 years. If his omission be
taken against him then he would be disadvantaged by his
reasonable reliance on his employer's promise of payment.
(Central Bar Q&A by Kato, 2023)
Q: Philippine News Network (PNN) engages the services
of Anya, a prominent news anchor from a rival station,
National News Network (NNN). NNN objects to the
transfer of Anya, claiming that she is barred from
working in a competing company for a period of three
years from the expiration of her contract. Anya
proceeds to sign with PNN, which then asks her to
anchor their nightly newscast.
NNN sues Anya and PNN before the National Labor
Relations Commission (NLRC), asking for a labor
injunction. Anya and PNN object claiming that it is a
matter cognizable by a regular court and not the NLRC.
(2015 BAR)
(a) Is NNN's remedy correct? Why or why not?
A: The NLRC has no jurisdiction. As to PNN, there is no
employer-employee relationship between itself and NNN;
hence, the NLRC cannot hear and resolve their dispute
(Reasonable Causal Connection Rule). As to Anya, the
injunctive power of the NLRC is ancillary in nature; hence,
it requires a principal case, which is absent. Besides, the
dispute between her and PNN is not resolvable solely
through applying the Labor Code, other labor statutes, CBA
or employment contract (Reference to Labor Law Rule)
(b) What are the grounds for a labor injunction to
issue?
A: The NLRC may issue an injunctive writ to enjoin an illegal
activity under Art. 264 [now 279] of the Labor Code; as an
ancillary remedy to avoid irreparable injury to the rights of
a party in an ordinary labor dispute pursuant to Rule X,
2011 NLRC Rules of Procedure, as amended; and to correct
the Labor Arbiter’s grave abuse of discretion pursuant to
Rule XII of the 2011 NLRC Rules of Procedure, as amended.
77
Moreover, for labor injunction to issue, it must be proven
under Art. 218(e) [now 225(e)] Labor Code:
a. That the prohibited or unlawful acts have been
threatened and will be committed and will be
continued unless restrained;
b. That substantial and irreparable injury to the
complainant’s property will follow;
c. That greater injury will be inflicted upon the
complainant by the denial of relief than will be
inflicted upon the defendants by the granting of
relief;
d. That complainant has no adequate remedy at law;
and
e. That public officers charged with the duty to
protect the complainant’s property are unable or
unwilling to furnish adequate protection.
Q: An employee filed a complaint against his employer
before the NLRC. The labor arbiter decided the case in
favor of the employee. The employer received a copy of
the decision on 10 Apr. 1984. April 20 being a Good
Friday and the following Saturday having been declared
a non-working public holiday by the President, the
employer filed his appeal with the NLRC from the said
decision on 23 Apr. 1984.
(a) Was the appeal filed on time? Explain your
reason.
A: The appeal was filed on time. The Supreme Court has
ruled that in the counting of the 10-day period within which
to file an appeal, if the 10th day is a holiday, then the appeal
may be filed on the day after said holiday. But if the day after
said holiday is also a non-working public holiday as in the
case in the question, then the appeal cannot be filed because
government offices are closed. The appeal could then be
filed on the day after such non-working public holiday. But
again, in the case, this day is a Sunday when government
offices are also closed. Thus, the filing on the following
Monday, April 23, is still within the 10-day period. (Pacana
v. NLRC, et al., G.R. No. 83513, 18 Apr. 1989)
(b) Assuming the decision of the labor arbiter is
affirmed by the NLRC. What is the recourse of
the employer? State the nature of the action, the
court which has jurisdiction over the action,
and the period within which the same must be
filed.
A: According to the Labor Code (in Art. 223), in the exercise
of its appellate jurisdiction over decisions of labor arbiters,
a decision of the NLRC is final and executory after 10
calendar days from receipt thereof by the parties.
In view of the above provision, the employer in the case in
the question who is aggrieved by the decision of the NLRC
should file a petition for certiorari with the Supreme Court
under Rule 65 of the ROC within 60 days from receipt of the
decision which is the subject of the petition for certiorari.
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
C. COURT OF APPEALS
D. SUPREME COURT
E. BUREAU OF LABOR RELATIONS
(2019, 2001, 1998, 1996 BAR)
Q: Briefly discuss the powers and responsibilities of the
following in the scheme of the Labor Code: x x x (b)
Bureau of Labor Relations (2019 BAR)
A: 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.
F. NATIONAL CONCILIATION AND MEDIATION BOARD
(2010 BAR)
1. CONCILIATION vs. MEDIATION
(2010 BAR)
Q: Distinguish the terms “conciliation,” “mediation” and
“arbitration”. (2010 BAR)
A:
(1) Conciliation is the process of dispute management
whereby parties in dispute are brought together
for the purpose of (1) amicably settling the case
upon a fair compromise; (2) determining the real
parties in interest; (3) defining and simplifying the
issues in the case; (4) entering into admissions or
stipulations of facts; and (5) threshing out all other
preliminary matters (Sec. 3, Rule V, 2005 NLRC
Rules of Procedure). In resolving labor disputes,
this comes before arbitration, as a mandatory
process, pursuant to the State policy of promoting
and emphasizing conciliation as modes of settling
labor disputes. (Art. 211 (A)(a), LC)
(2) Mediation is a voluntary process of settling
disputes whereby the parties elect a mediator to
facilitate the communication and negotiation
between the parties in dispute for the purpose of
assisting them in reaching a compromise. (Sec.
3(q), R.A. No. 9285 or the Alternative Dispute
Resolution Law)
(3) Arbitration is a system of dispute settlement that
may be compulsory or voluntary, whereby the
parties are compelled by the government or agree
to submit their dispute before an arbiter, with the
intention to accept the resolution of said arbiter
over the dispute as final and binding on them
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
(Luzon Development Bank v. Association of Luzon
Development Employees, G.R. No. 120319, 06 Oct.
1995)
In this jurisdiction, compulsory arbitration in labor
disputes is submitted to a labor arbiter, whose powers and
functions are clearly defined under Art. 217(a) of the Labor
Code; whereas in voluntary arbitration, the powers and
functions of the voluntary arbitrator or panel of voluntary
arbitrators elected to resolve the parties’ dispute involve
the interpretation and implementation of the parties’
collective bargaining agreement, pursuant to Arts. 260-262
of the Labor Code.
G. DOLE REGIONAL DIRECTORS
(2018, 2016, 2013, 2012, 2009, 2008, 2007, 1995,
1994, 1991 BAR)
The Regional Director or his representative may be
divested of his enforcement and visitorial powers
under the exception clause of Article 128 of the Labor
Code and, resultantly, jurisdiction may be vested on the
labor arbiter when three (3) elements are present.
Which of the following is not one of the three (3)
elements? (2012)
(A) Employer contests the findings of the labor
regulations officers and raises issues thereon;
(B) In order to resolve any issues raised, there is a
need to examine evidentiary matters;
(C) The issues raised should have been verifiable
during the inspection;
(D) The evidentiary matters are not verifiable in
the normal course of inspection .
A: (C) The issues raised should have been verifiable during
the inspection. (SSK Parts Corporation vs. Camas, G.R. No.
85934, 30 Jan. 1990; Art. 128(b), LC). (UPLC Suggested
Answers)
Q: Kevin, an employee of House of Sports, filed a
complaint with the DOLE requesting the investigation
and inspection of the said establishment for labor law
violations such as underpayment of wages, non-
payment of 13th month pay, non-payment of rest day
pay, overtime day, holiday pay, and service incentive
leave pay. House of Sports alleges that DOLE has no
jurisdiction over the employees’ claims where the
aggregate amount of the claims of each employee
exceeds P5,000.00, whether or not accompanied with a
claim for reinstatement. Is the argument of House of
Sports tenable? (2012 BAR)
a. Yes, Article 129 of the Labor Code shall apply,
and thus, the Labor Arbiter has jurisdiction;
b. No, Article 128(b) of the Labor Code shall apply,
and thus, the DOLE Regional Director has
jurisdiction;
c. Yes, if the claim exceeds P5,000.00, the DOLE
Secretary loses jurisdiction;
d. d. No, a voluntarily arbitrator has jurisdiction
because the matter involved is a grievable
issue.
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 QuAMTO (1987-2022)
A: b) NO, Art. 128(b) of the Labor Code shall apply, and thus,
the DOLE Regional Director has jurisdiction. (Art. 128(b),
LC) (2009-2017 UST FCL Bar Q&A)
Q: TRUE or FALSE. Answer TRUE if the statement is true,
or FALSE if the statement is false. Explain your answer
in not more than two (2) sentences.
The visitorial and enforcement powers of the DOLE
Regional Director to order and enforce compliance with
labor standard laws can be exercised even when the
individual claim exceeds P5,000.00. (2009 BAR)
A: TRUE. The visitorial and enforcement powers of the
DOLE Regional Director to order and enforce compliance
with labor standards laws can be exercised even when the
individual claims exceed P5,000.00. The authority under
Article 128 may be exercised regardless of the monetary
value involved. Under Article 129, however the authority is
only for claims not exceeding P5,000.00 per claimant.
(2009-2017 UST FCL Bar Q&A)
Q: Nelson complained before the DOLE Regional Office
about Needy Corporation's failure 10 pay his wage
increase amounting to PhP5,000.00 as mandated in a
Wage Order issued by the Regional Tripartite Wages
and Productivity Board. Consequently, Nelson asked
the DOLE to immediately Issue an Order sustaining his
money claim. To his surprise, he received a notice from
the DOLE to appear before the Regional Director for
purposes of conciliating the dispute between him and
Needy Corporation. When conciliation before the
Regional Director failed, the latter proceeded to direct
both parties to submit their respective position papers
in relation to the dispute. Needy Corporation argued
that since Nelson was willing to settle for 75% of his
money claim during conciliation proceedings, only a
maximum of 75% of the said money claim may be
awarded to him. (2018 BAR)
(a) Was DOLE's action to conduct mandatory
conciliation in light of Nelson's complaint
valid?
A: YES, in relation R.A. 10396 or the "Mandatory
Conciliation-Mediation Law," Art. 234 of the Labor Code
provides that "all issues arising from labor and employment
shall be subject to mandatory conciliation-mediation. The
Labor Arbiter or appropriate DOLE agency or office that has
jurisdiction over the dispute shall entertain only endorsed
or referred cases by the duly authorized officer." (UPLC
Suggested Answers)
(b) Should the Regional Director sustain Needy
Corporation's argument?
A: NO. Since mediation proceedings failed, judgment shall
be rendered after reception of evidence. To be valid, said
judgment must be based only on established facts and
applicable law and doctrine. Incidents, like monetary
demands or offers in a failed SENA proceedings and in failed
preliminary mandatory conferences do not constitute
evidence. In fact, they are to be treated as sacrosanct or
privileged communication. (Pentagon Steel Corp. v. CA, et al.,
79
G.R. No. 174141, 26 June 2009) (Central Bar Q&A by Kato,
2023)
Q: Inggo is a drama talent hired on a per drama
"participation basis" by DJN Radio Company. He
worked from 8:00 a.m. until 5:00 p.m., six days a week,
on a gross rate of P80.00 per script, earning an average
of P20,000.00 per month. Inggo filed a complaint before
the DOLE against DJN Radio for illegal deduction, non-
payment of service incentive leave, and 13th month
pay, among others. On the basis of the complaint, the
DOLE conducted a plant level inspection. The DOLE
Regional Director issued an order ruling that Inggo is
an employee of DJN Radio and that Inggo is entitled to
his monetary claims in the total amount of P30,000.00.
DJN Radio elevated the case to the Secretary of Labor
who affirmed the order. The case was brought to the
Court of Appeals. The radio station contended that
there is no employer-employee relationship because it
was the drama directors and producers who paid,
supervised, and disciplined him. Moreover, it argued
that the case falls under the jurisdiction of the NLRC and
not the DOLE because Inggo's claim exceeded
P5,000.00. (2016 BAR)
(a) May DOLE make a prima facie determination of
the existence of an employer-employee relationship in
the exercise of its visitorial and enforcement powers?
A: YES. Pursuant to Art. 128 (b) of the Labor Code, the DOLE
may do so where the prima facie determination of the
employer-employee relationship is for the exclusive
purpose of securing compliance with labor standards
provisions of said Code and other labor legislation.
The DOLE, in the exercise of its visitorial and enforcement
powers, somehow has to make a determination of the
existence of an employer-employee relationship. Such
determination, however, cannot be coextensive with the
visitorial and enforcement power itself. Indeed, such
determination is merely preliminary, incidental and
collateral to the DOLE's primary function of enforcing labor
standards provisions. (People's Broadcasting Bombo Radyo
Phils., Inc. v. Secretary of Labor, G.R. No. 179652, 08 May
2009)
(b) If the DOLE finds that there is an employee-
employer relationship, does the case fall under the
jurisdiction of the Labor Arbiter considering that the
claim of Inggo is more than P5,000.00. Explain.
A: NO. As held in the case of Meteoro v. Creative Creatures,
Inc. (G.R. No. 171275, 13 July 2009), the visitorial and
enforcement powers of the Secretary, exercised through his
representatives, encompass compliance with all labor
standards laws and other labor legislation, regardless of the
amount of the claims filed by workers; thus, even claims
exceeding P5,000.00. (2009-2017 UST FCL Bar Q&A)
Q: Gamma Company pays its regular employees
P350.00 a day, and houses them in a dormitory inside
its factory compound in Manila. Gamma Company also
provides them with three full meals a day. In the course
of a routine inspection, a DOLE Inspector noted that the
workers' pay is below the prescribed minimum wage of
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
P426.00 plus P30.00 allowance, and thus required
Gamma Company to pay wage differentials. Gamma
Company denies any liability, explaining that after the
market value of the company-provided board and
lodging are added to the employees' P350 cash daily
wage, the employees' effective daily rate would be way
above the minimum pay required by law. The company
counsel further points out that the employees are
aware that their food and lodging form part of their
salary, and have long accepted the arrangement. Is the
company's position legally correct? (2013 BAR)
A: NO. Even assuming the board and lodging qualify as
facilities, their value cannot automatically be deducted from
the prescribed pay rate. The deduction must be authorized
by the DOLE Regional Director by issuing the corresponding
permit which must be applied for and granted upon
satisfaction that the items are customarily provided; they
are accepted by the workers; their value is reasonable; and
the salary deduction is authorized in writing. (Central Bar
Q&A by Kato, 2023)
ALTERNATIVE ANSWER:
NO. The following requisites were not complied with:
a. proof that such facilities are customarily furnished
by the trade;
b. the provision of deductible facilities is voluntarily
accepted by the employee; and
c. the facilities are charged at the fair and reasonable
value. Mere availment is not sufficient to allow
deduction from employee’s wages. (Mayon Hotel &
Restaurant v. Adarna, 485 SCRA 609 [2005])
Q: Savoy Department Store (SDS) adopted a policy of
hiring salesladies on five-month cycles. At the end of a
saleslady’s five- month term, another person is hired as
replacement. Salesladies attend to store customers,
wear SDS uniforms, report at specified hours, and are
subject to SDS workplace rules and regulations. Those
who refuse the 5-month employment contract are not
hired. The day after the expiration of her 5-month
engagement, Lina wore her SDS white and blue uniform
and reported for work but was denied entry into the
store premises. Agitated, she went on a hunger strike
and stationed herself in front of one of the gates of SDS.
Soon thereafter, other employees whose 5-month term
had also elapsed joined Lina’s hunger strike.
Assume that no fixed-term worker complained, yet in a
routine inspection, a labor inspector of the Regional
Office of the DOLE found the 5-month term policy of SDS
violative of the Labor Code’s security of tenure
provisions and recommended to the Regional Director
the issuance of a compliance order. The Regional
Director adopted the recommendation and issued a
compliance order. Is the compliance order valid?
Explain your answer. (2008 BAR)
A: NO, the Compliance Order is not valid. The Regional
Director only exercises both visitorial and enforcement
powers over labor standard cases and is empowered to
adjudicate uncontested money claims of persons still
employed. The Regional Director has no jurisdiction to rule
on SDS’ 5-month term policy.
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
Q: AB, a non-resident American, seeks entry to the
country to work as Vice-President of a local
telecommunications company. You are with the DOLE.
What permit, if any, can the DOLE issue so that AB can
assume as Vice-President in the telecommunications
company? Discuss fully. (2007, 1995 BAR)
A: Art. 40 of the Labor Code states that “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 Department of Labor. The
employment permit may be issued to a nonresident alien or
to the applicant employer after a determination of the non-
availability of a person in the Philippines who is competent,
able, and willing at the time of application to perform the
services for which the alien is desired.” Thus, AB should be
issued the abovementioned employment permit so that AB
can assume as Vice President of the Telecommunication
Company.
Q: Tina Aquino, a domestic helper in the household of
Fidel Aldeguer, filed an action in the Regional Office of
the DOLE for recovery of unpaid wages amounting to
P3,500.00 and P1,499.00 as moral damages. Aquino
claimed that the amount of P3,500.00 is equivalent to
the P500.00 a month she failed to receive for the last
seven months of her employment with Aldeguer. based
on their agreed P2.500.00 monthly salary. Aldeguer
moved to have Aquino’s complaint dismissed, alleging
that as a domestic helper Ms. Aquino should have first
brought the matter to the Lupong Barangay. If you were
the Regional Director, how would you resolve the
matter? (1994 BAR)
A: As Regional Director. I will assume jurisdiction. The
provisions of P.D. No. 1508 requiring the submission of
disputes before the Lupong Tagapayapa prior to their filing
with the court or other government offices are not
applicable to labor cases. Art. 129 of the Labor Code
empowers the Regional Director to hear and decide any
matter involving the recovery of wages and other monetary
claims and benefits owing to an employee or person
employed in domestic or household service, provided that
the money claim does not exceed P5,000.00). (Montoya v.
Escayo, G.R Nos. 82211-12, 21 Mar. 1989) (2009-2017 UST
FCL Bar Q&A)
Q: In a letter to the Regional Director of Region VII of
the Department of Labor and Employment, employee
Ricardo Malalang claims that his employer, the Visayan
Sea Products Corp., has not compensated him for
various legal benefits, including overtime pay, holiday
pay, 13th month pay and other monetary benefits
totaling P6.000.00. Despite the fact that the amount
claimed exceeds P5.000 how may the Regional Director
exercise jurisdiction over the case? Why? (1991 BAR)
A: The power of the Regional Director over money claims
may arise under either Art. 128 or 129 of the Labor Code.
Under Art. 129, for the Regional Director to exercise
Jurisdiction, the aggregate money claims of an employee
should not exceed P5.000.00.
80
 QuAMTO (1987-2022)
Under Art. 128, as the duly authorized representative of the
Secretary of Labor, the Regional Director has the power to
order and administer, after due notice and hearing,
compliance with the labor standards provisions of the
Labor Code and other labor legislation based on the
findings of labor regulation officers made in the course of
inspection and 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
regulation officer and raises issues which cannot be
resolved without considering evidentiary matters that are
not verifiable in the normal course of inspection.
Art. 128 applies where the relationship of employer-
employee relationship still exists. (2009-2017 UST FCL Bar
Q&A)
H. DOLE SECRETARY
(2019, 2017, 2016, 2014, 2013, 2009, 2001, 1998 BAR)
Q: Briefly discuss the powers and responsibilities of the
Secretary of Labor in the scheme of the Labor Code
(2019 BAR)
A:
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. (Art. 128(a), LC)
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 an inspection.
(Art. 128(b), LC)
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 that
were not considered in the course of an inspection.
(Art. 128(b), LC)
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 a grave
and imminent danger to the health and safety of
workers in the workplace. (Art. 128(c), LC)
e. Assumption of Jurisdiction and/or Certification to
the NLRC for Compulsory Arbitration in labor
disputes causing or likely to cause a strike or lockout
in an industry indispensable to the national interest.
(Art. 278(g); Art. 128(a), LC)
81
Q: An airline which flies both the international and
domestic routes requested the Secretary of Labor and
Employment to approve the policy that all female flight
attendants upon reaching age 40 with at least 15 years
of service shall be compulsorily retired; however,
flight attendants who have reached age 40 but have
not worked for 15 years will be allowed to continue
working in order to qualify for retirement benefits, but
in no case will the extension exceed 4 years.
Does the Secretary of Labor and Employment have the
authority to approve the policy? (1998 BAR)
A: YES. The Secretary of Labor and Employment has the
authority to approve a policy dealing with the retirement of
flight attendants of airlines. Art. 132 (d) [now 130(d)] of the
Labor Code provides that the Secretary of Labor and
Employment shall establish standards that will ensure the
safety and health of women employees, including the
authority to determine appropriate minimum age and other
standards for retirement or termination in special
occupations such as those of flight attendants and the like.
CAVEAT:
It could be argued that Art. 132 (d) [now 130(d)] may be
unconstitutional because this may constitute
discrimination in violation of the spirit of Sec. 14 of Art. XIV
of the Constitution which provides that the State shall
protect working women by providing safe and healthful
working conditions, taking into account their maternal
functions, and such facilities and opportunities that will
enhance their welfare and enable them to realize their full
potential in the service of the nation.
1. JURISDICTION
(2019, 2017, 2014, 2013, 2001 BAR)
Pursuant to his power under Sec. 278(g) (263(g)) of
the LC, the Secretary of Labor assumed jurisdiction
over the 3-day old strike in Armor Steel Plates, Inc., one
of the country's bigger manufacturers of steel plates,
and ordered all the striking employees to return to
work. The striking employees ignored the order to
return to work. (2017 BAR)
a. What conditions may justify the Secretary of
Labor to assume jurisdiction?
A: The Secretary of Labor may assume jurisdiction if, in his
opinion, there is a labor dispute likely to result in a strike or
lockout in an industry indispendable to the national
interest. (Art. 278(g), Labor Code) (Central Bar Q&A by Kato,
2023)
b. What are the consequences of the assumption
of jurisdiction by the Secretary of Labor, and of
the disobedience to the return to work? Explain
your answer.
A: The assumption of jurisdiction by the Secretary of Labor
automatically results in a return-to-work of all striking
workers (if one has already taken place) or enjoins the
taking place of a strike, whether or not a corresponding
order had been issued by the Secretary of Labor. (Union of
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
Filipro Employees v. Nestle Philippines, Inc., G.R. Nos. 88710-
13; 19 Dec. 1990) When jurisdiction over a labor dispute is
assumed by the Secretary of Labor, such comprehensive
jurisdiction includes all incidental issues and cases which
otherwise would be under the original and exclusive
jurisdiction of the labor arbiters. (International
Pharmaceuticals, Inc v. Secretary of Labor, G.R. Nos. 92981-
83, 09 Jan. 1992). A disobedience or defiance of the return-
to-work order of the Secretary of Labor results in a loss of
employment status. (Allied Banking Corporation v. NLRC,
G.R. No. 116128, July 12, 1996, 258 SCRA 724) (2009-2017
UST FCL Bar Q&A)
Q: Philippine Electric Company is engaged in electric
power generation and distribution. It is a unionized
company with Kilusang Makatao as the union
representing its rank-and-file employees. During the
negotiations for their expired CBA, the parties duly
served their proposals and counter-proposals on one
another. The parties, however, failed to discuss the
merits of their proposals and counter-proposals in any
formal negotiation meeting because their talks already
bogged down on the negotiation ground rules, i.e., on
the question of how they would conduct their
negotiations, particularly on whether to consider
retirement as a negotiable issue.
Because of the continued impasse, the union went on
strike. The Secretary of Labor and Employment
immediately assumed jurisdiction over the dispute to
avert widespread electric power interruption in the
country. After extensive discussions and the filing of
position papers (before the National Conciliation and
Mediation Board and before the Secretary himself) on
the validity of the union's strike and on the wage and
other economic issues (including the retirement issue),
the DOLE Secretary ruled on the validity of the strike
and on the disputed CBA issues, and ordered the parties
to execute a CBA based on his rulings.
Did the Secretary of Labor exceed his jurisdiction when
he proceeded to rule on the parties' CBA positions even
though the parties did not fully negotiate on their own?
(2013 BAR)
A: NO. The power of the Secretary of Labor under Article
263(g) is plenary. He can rule on all issues, questions, or
controversies arising from the labor dispute, including the
legality of the strike, even those over which the Labor
Arbiter has exclusive jurisdiction. (Bagong Pagkakaisa ng
mga Manggagawa sa Triumph International v. Secretary,
G.R. Nos. 167401 and 167407, 05 July 2010) (UPLC Suggested
Answers)
U N IV E R S I T Y O F S A N T O T O M A S
2023 GOLDEN NOTES
2. VISITORIAL AND ENFORCEMENT POWERS
(2016, 2011, 2009, BAR)
Q: Which of the following acts is NOT part of the
regulatory and visitorial power of the Secretary of
Labor and Employment over recruitment and
placement agencies? The power to (2011 BAR)
a. order arrest of an illegal recruiter
b. inspect premises, books and records
c. cancel license or authority to recruit
d. garnish recruiter's bond
A: A. order arrest of an illegal recruiter. (2009-2017 UST
FCL Bar Q&A)
3. POWER TO SUSPEND EFFECTS OF TERMINATION
4. REMEDIES
I. VOLUNTARY ARBITRATOR
(2019, 2017, 2010, 2005, 1997, 1995 BAR)
Q: State the cases when a labor dispute would fall under
the jurisdiction of voluntary arbitrators or panel of
voluntary arbitrators. (2019, 2017, 1997 BAR)
A: Under the Labor Code, the jurisdiction of the Voluntary
Arbitrator or Panel of Voluntary Arbitrators includes
disputes involving:
a. Unresolved grievances arising from the
interpretation or implementation of a collective
bargaining agreement;
b. The interpretation or enforcement of company
personnel policies; and
c. All labor disputes, upon agreement of the parties,
including unfair labor practices and bargaining
deadlock.
Q: Company C, a toy manufacturer, decided to ban the
use of cell phones on factory premises. In the pertinent
Memorandum, management explained that too much
texting and phone-calling by employees disrupted
company operations. Two employees-members of
Union X were terminated from employment due to
violation of the memorandum-policy. The union
countered with a prohibitory injunction case (with
prayer for the issuance of a temporary restraining
order) filed with the Regional Trial Court, challenging
the validity and constitutionality of the cell phone ban.
The company filed a motion to dismiss, arguing that the
case should be referred to the grievance machinery
pursuant to an existing Collective Bargaining
Agreement with Union X, and eventually to Voluntary
Arbitration. Is the company correct? Explain. (2010
BAR)
82
 QuAMTO (1987-2022)
A: YES. Termination cases arising in or resulting from the
interpretation and implementation of collective bargaining
agreements and interpretation and enforcement of
company personnel policies which were initially processed
at the various steps of the plant-level Grievance Procedures
under the parties' collective bargaining agreements, fall
within the original and exclusive jurisdiction of the
voluntary arbitrator pursuant to Art. 217(c) [now 224(c)]
and Art. 261 [now 274] of the Labor Code. (2009-2017 UST
FCL Bar Q&A)
J. PRESCRIPTION OF ACTIONS
(2020-21, 2019, 2018, 2013, 2012, 2010, 2002, 1997,
1994, 1991 BAR)
Q: For purposes of prescription, within what periods
from the time the cause of action accrued should the
following cases be filed: (2019 BAR)
(a) Money claims arising from employer-employee
relations
A: All money claims arising from employer-employee
relations accruing during the effectivity of this Code shall be
filed within three (3) years from the time the cause of action
accrued; otherwise they shall be forever barred. (Art. 306
[formerly 291], LC) (UPLC Suggested Answers)
(b) Illegal dismissal
A: The prescriptive period for filing an illegal dismissal
complaint is four years from the time the cause of action
accrued. (Teekay Shipping Philippines, Inc., v. Ramier
Concha, G.R. No. 185463, 22 Feb. 2012; Art. 1146, New Civil
Code) (UPLC Suggested Answers)
(c) Unfair labor practice
A: All unfair labor practices arising from Book V shall be
filed with the appropriate agency within one (1) year from
accrual of such unfair labor practice; otherwise, they shall
be forever barred. (Art. 305 [formerly 290], LC) (UPLC
Suggested Answers)
(d) Offenses under the Labor Code
A: Offenses penalized under this Code and the rules and
regulations issued pursuant thereto shall prescribe in three
(3) years. (Art. 305 [formerly 290], LC) (UPLC Suggested
Answers)
(e) Illegal recruitment
A: Illegal recruitment cases under this Act shall prescribe in
5 years: Provided, however, that illegal recruitment cases
involving economic sabotage as defined herein shall
prescribe in 20 years. (Sec. 12, Migrant Workers and
Overseas Filipinos Act of 1995, R.A. 8042, 07 June 1995)
Note that R.A. 8042 only applies to Migrant Workers. Illegal
recruitment for local employment is subject to the
provisions of the Labor Code, in particular, Art. 305(1), to
83
wit: offenses penalized under this Code… shall prescribe in
3 years. (UPLC Suggested Answers)
1. MONEY CLAIMS
(2020-21, 2018, 2013, 2010 BAR)
Q: Chito was illegally dismissed by DEF Corp. effective
at the close of business hours of 29 Dec. 2009. If he has
money claims against DEF Corp., he can make the claim
without any legal bar within _______. (2013 BAR)
a. 3 years
b. 4 years
c. 5 years
d. 6 years
e. 10 years
A: A. 3 years. (Art. 297 [formerly 291], LC) (UPLC Suggested
Answers)
Q: Due to his employer's dire financial situation,
Nicanor was prevailed upon by his employer to
voluntarily resign. In exchange, he demanded payment
of salary differentials, 13th month pay, and financial
assistance, as promised by his employer. Management
promised to pay him as soon as it is able to pay off all
retrenched rank-and-file employees.
5 years later, and before management was able to pay
Nicanor the amount promised to him, Nicanor died of a
heart attack. His widow, Norie. filed a money claim
against the company before the NLRC, including
interest on the amount of the unpaid claim. She also
claimed additional damages arguing that the supposed
resignation letter was obtained from her spouse
through undue pressure and influence.
The employer filed a motion to dismiss on the ground
that (a) the NLRC did not have jurisdiction over money
claims; and (b) the action has prescribed. Assuming
that the NLRC has jurisdiction, has the action
prescribed? (2018 BAR)
A: NO. In Accessories Specialists, Inc. v. Alabama, (G.R. No.
168985, 23 July 2008), the Supreme Court held that the
principle of promissory estoppel could apply as a
recognized exception to the 3-year prescriptive period
under Art. 291 [now 306] of the Labor Code. Nicanor relied
on the promise of the employer that he would be paid as
soon as the claims of retrenched employees were paid. If
not for this promise, there would have been no reason why
Nicanor would delay the filing of the complaint. Great
injustice would be committed if the employee’s claim were
brushed aside on a mere technicality, especially when it was
the employer’s action that prevented Nicanor from filing
the claims within the required period.
Q: A driver for a bus company, sued his employer for
non-payment of commutable service incentive leave
credits upon his resignation after five years of
employment. The bus company argued that A was not
entitled to service incentive leave since he was
considered a field personnel and was paid on
commission basis and that, in any event, his claim had
U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW
 LABOR LAW AND SOCIAL LEGISLATION
prescribed. If you were the Labor Arbiter, how would
you rule? Explain. (2010 BAR)
A: The money claim as cause of action has prescribed
because the claim was filed after 5 years from date of
negotiation. Art. 291 [now 306] of the Labor Code provides
that all money claims arising from employer-employee
relations occurring during the effectivity of the Code shall
be filed within 3 years from that time the cause of action has
accrued, otherwise, they shall be forever barred.
2. ILLEGAL DISMISSAL
(2020-21, 2002, 1997, 1994, 1991 BAR)
A: YES, the complaint was filed within 4 years from the date
Andrew Tan was dismissed by his employer. Illegal
dismissal, as a cause of action, prescribes after 4 years from
the time the cause of action, namely, illegal dismissal took
place. This is pursuant to the NCC, which provides that
actions upon an injury to the rights of a person should be
initiated within four years from the time the right of the
action accrues. (Art. 1146, NCC)
Q: On 30 Oct. 1980, A, an employee, was served notice
of dismissal allegedly for gross dishonesty. Forthwith,
the Union to which A was a member raised A’s dismissal
with the grievance machinery as provided for in its
CBA.

Q: He can file a complaint for illegal dismissal without

At that point, negotiations for a new CBA was in
any legal bar within _________. (2013 BAR)
progress. Hence, both the Union and the Company had
very little time to address A’s grievance. In fact, said
a. 3 years
grievance, as it were, slept the sleep of the dead, being
b. 4 years
resolved only with finality on 23 Nov. 1983 when the
c. 5 years
General Manager of the Company affirmed A’s
d. 6 years
dismissal on the fifth and the last step of the grievance
e. 10 years
machinery.

A: (b) 4 years. (Art. 1146, NCC) (UPLC Suggested Answers)

A filed an action for illegal dismissal with the
Arbitration Branch of the NLRC on 25 Nov. 1983. The
Q: State your agreement or disagreement with the
Company immediately filed a Motion to Dismiss on the
following statement and explain your answer briefly: A
ground of prescription, invoking Art. 290 of the Labor
criminal case filed against an employee does not have
Code. If you were the Labor Arbiter, how would you
the effect of suspending or interrupting the running of
resolve the Company’s Motion to Dismiss? (1994 BAR)
the prescriptive period for the filing of an action for
illegal dismissal. (2002 BAR)
A: As the Labor Arbiter, I will deny the Motion to Dismiss.
When an employee was dismissed, and the matter of his
A: The two (2) cases, namely: the criminal case where the
dismissal was then referred to the grievance machinery
employee is the accused; and the case for illegal dismissal,
pursuant to the provision in the existing collective
where the employee is the complainant, are two (2)
bargaining agreement, and the grievance machinery had a
separate and independent actions governed by different
final meeting after quite a long while thereafter, the
rules, venues, and procedures. The criminal case is within
complaint for illegal dismissal was then filed, the action was
the jurisdiction of the regular courts of law and governed by
not barred by laches, as the pendency of the matter before
the rules of procedure in criminal cases. The action for the
the grievance machinery affected the ripeness of the cause
administrative aspect of illegal dismissal would be filed
of action for illegal dismissal. (Radio Communications of the
with the NLRC and governed by the procedural rules of the
Philippines, Inc. [RCPI], v. NLRC, et al., G.R No. 102958, 25
Labor Code.
June 1993)

Q: The general manager of Junk Food Manufacturing

ALTERNATIVE ANSWER:
Corporation dismissed Andrew Tan, a rank-and-file
employee on the ground of insubordination. The
If I were the Labor Arbiter, I would deny the motion to
general manager served on Andrew Tan the letter of
dismiss because the action for illegal dismissal has not yet
termination effective upon receipt which was on 08
prescribed. The prescriptive period for an action for illegal
Mar. 1992. Shocked by his unexpected dismissal.
dismissal is 4 years. (Callanta v. Carnation, G.R. No. 70615,
Andrew Tan confronted the general manager and hit
28 Oct. 1986)
the latter on the head with a leap pipe.

Junk Food Manufacturing filed a complaint in court 3. UNFAIR LABOR PRACTICES

against Andrew Tan for less serious physical injuries. (2019 BAR)
Somehow, Andrew Tan was acquitted by the court
assigned to hear the criminal case. A few days following
his acquittal, or on 01 March 1996, Andrew Tan filed
complaint against the company for illegal dismissal,
reinstatement and the payment of backwages and
damages. Was the complaint filed by Andrew Tan for
illegal dismissal within the reglementary period
granted by law? (1997 BAR)

U N IV E R S I T Y O F S A N T O T O M A S 84
2023 GOLDEN NOTES
 QuAMTO (1987-2022)
4. OFFENSES UNDER THE LABOR CODE
(2019, 2012 BAR BAR)

Q: What is the prescriptive period of all criminal

offenses penalized under the Labor Code and the Rules
Implementing the Labor Code? (2012 BAR)

a. 3 years;
b. 4 years;
c. 5 years;
d. 10 years.

A: (a) 3 years. (Art. 290, LC) (UPLC Suggested Answers)

5. ILLEGAL RECRUITMENT

85 U N IV E R S I T Y O F S A N T O T O M A S
FACULTY OF CIVIL LAW