LABOR STANDARDS QUIZ

1. Ada was employed by ABACADA University to cook for the members of a

religious congregation who teach and live inside the campus. While
performing her assigned task, Ada accidentally poured the hot water and
burned herself. Because of the extent of her injuries, she went on medical
leave. Meanwhile, ABACADA University engaged a replacement cook Ida.
Ada filed a complaint for illegal dismissal, but her employer ABACADA
University contended that she was not a regular employee but a Kasambahay.

A. Distinguish a Kasambahay from a Homeworker.

A Kasambahay and a Homeworker are distinguished as follows:

1. As to definition:

Domestic worker or “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.

On the other hand, a homeworker is a worker who is engaged in industrial

homework, a system of production under which work for an employer or
contractor is carried out by a homeworker at his/her home. The materials may or
may not be furnished by the employer or contractor.

2. As to governing law:

For Domestic worker or “Kasambahay” the governing law is R.A. No. 10361 or
the “Domestic Workers Act” or “Batas Kasambahay,” while the homeworker is
subject to the provisions of Book Ill of the Labor Code.

3. As to place of work:

The househelper works in another person's home, while the homeworker does
his/her job in the confines of his own home.

4. As to employer:
The househelper has a definite employer, while the homeworker has none.

c. As to security of tenure:

The househelper has security of tenure, which the homeworker does not have.

B. Is the contention of ABACADA University valid?

ABACADA University's contention is invalid.

Under the law, a domestic servant or househelper is 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 its business warrants
the conclusion that such househelper or domestic servant is and should be
considered as a regular employee.

Here, Ada 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.

Thus, ABACADA University's argument has no merit.

2. A total of fifty (50) Employees who are deaf-mutes were hired and re-hired
on various periods by TANG Bank as money sorters and counter attendants
through a uniformly worded agreement called “Employment Contract for
Handicapped Workers.” The company disclaimed that these employees were
regular employees and maintained among others that they are a special class
of workers, who were hired temporarily under a special employment
arrangement which was a result of overtures made by some civic and political
personalities to the Bank.

A. Should the deaf-mute employees be considered as regular employees of the

bank?

No, the deaf-mute employees are not regular employees of the bank.

Case law provides that an employment contract with a fixed term terminates by its
own terms at the end of such period. The same is valid if the contract was entered
into by the parties on equal footing and the period specified was not designed to
circumvent the security of tenure of the employees.

Here, the deaf-mute employees were hired temporarily under an employment

contract, meaning their employment would be terminated upon the expiration of
the fixed term.

In other words, the deaf-mute employees were aware of their contractual status;
thus, they should not be considered as regular employees.

B. Supposed, they are considered legitimate employees of the bank, are they
entitled to the salaries or wages of the full-able bodied employees as well as the
benefits given to them?

Yes, they are entitled to the salaries and benefits given to full-able bodied
employees. Under the Magna Carta for Disabled Persons, no disabled persons shall
be denied access to opportunities for suitable employment. A qualified disabled
employee shall be subject to the same terms and conditions of employment and the
same compensation, privileges, benefits, fringe benefits, incentives or allowances
as a qualified able-bodied person.

3. Jas worked as a chambermaid in Nivel Inn with a basic wage of PhP560.00

for an eight-hour workday. On Good Friday, she worked for one (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. Nivel Inn 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 Jas’ wage to be below
the prescribed 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.

A. Does the hotel have valid legal grounds to deduct food and lodging costs
from Jas’ basic salary?

No, the hotel cannot legally deduct food and lodging costs from Jas' salary.
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 third, facilities must he charged at fair and reasonable value.

Here, the second and third requisites on voluntary acceptance of deductible

facilities in writing, at fair and reasonable value, were not met.

Therefore, the deduction of food and lodging costs from Jas' salary has no legal
basis.

B. Applying labor standards law, how much should Jas be paid for work done
on Good Friday?

Jas should be paid Php 154.00 for work done on Good Friday. Under the law, if the
is work performed on a regular holiday, an employee is entitled to a holiday pay of
100% daily wage plus his wage for that day. If the covered employee is
compensable for his entire day’s work, he is entitled to 100% of his day’s wage.
However, in the present case, Jas only worked for one hour; thus, her wage shall be
computed by dividing the wage by eight (8) hours work, with additional night shift
differential. The computation is as follows:

Regular Work
Php 560.00/ 8 hours = Php 70.00

Holiday Computation
Php 70.00 x 2= Php 140.00

Php 140.00 plus 10% night shift differential = Php 154.00

4. Chris has been working with Fran Land for almost 15 years. Wanting to
work in the public sector, Chris applied with and was offered a job at DPWH
Region VII Office. Before accepting the offer, he wanted to consult you
whether the payments that he and Fran Land made to the Social Security
System (SSS) can be transferred or credited to the Government Service
Insurance System (GSIS). Is such case possible? Discuss.

Yes, Chris' payments to the SSS can be transferred to the GSIS.

Under 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.

5. How is 13th Month Pay computed? What is its composition? Who are
excluded from the coverage of the law?

A. 13th month pay is computed pro-rata according to the number of months within
a year that the employee has rendered service to the employer. The employee must
have worked for at least one (1) month during a calendar year.

B. 13th month pay is a form of monetary benefit equivalent to the monthly basic
compensation received by an employee.

C. The following employers are not covered by the law:

1. The government and any of its political subdivisions, including government-

owned and controlled corporations, except those corporations operating essentially
as private subsidiaries of the government;
2. Employers who are already paying their employees 13th month pay or more in a
calendar year or its equivalent at the time of the issuance of PD 851;
3. Persons in the personal service of another in relation to such workers; and
4. Employers of those who are paid on purely commission, boundary or task basis,
and those who are paid a fixed amount for performing specific work, irrespective
of the time consumed in the performance thereof (except those workers who are
paid on piece-rate basis, in which case their employer shall grant them 13th month
pay).

6. Distinguish the scope of labor standards from labor relations.

Labor standards pertain to the least terms and conditions of employment that
employers must comply with and to which employees are entitled as a matter of
legal right. More specifically, labor standards are the minimum requirements
prescribed by existing laws, rules and regulations relating to wages, hours of work,
cost-of-living allowance, and other monetary and welfare benefits, including
occupational, safety, and health standards.
On the other hand, labor relations define the status, rights and duties, and the
institutional mechanisms that govern the individual and collective interactions of
employers, employees or their representatives.

7. Paul is a well-known TV talk show host. He signed a contract with TAI

Entertainment Corporation to host an early morning show. He was hired due
to his unique skills and talent. He was paid a monthly remuneration of
500,000.00. The program had been airing for almost two years when
sponsors’ advertising revenues dwindled, constraining the network to cancel
the show upon the expiration of its latest contract. Paul protested the
discontinuance of his monthly talent fee, claiming that it was tantamount of
illegal dismissal from the network.

a. Rule with reasons whether Paul is an employee of TAI Entertainment

Corporation.

I would argue that Paul is not an employee of TAI Entertainment Corp. and,
therefore, no employer-employee relationship exists between the network and Paul.
Jurisprudence holds that a radio broadcast specialist who works under minimal
supervision is an independent contractor. Here, Paul is not an employee of the
network, as the network has no control over the means and methods by which he
performs his work.

b. What is the four -fold test of employer-employee relationship?

The four-fold test of employer-employee relationship has the following elements:

(1) the selection and engagement of the employee; (2) the payment of wages; (3)
the power of dismissal; and (4) the employer’s power to control the employee on
the means and methods by which the work is accomplished.

8. Distinguish between job contracting and labor-only contracting?

The distinctions between job contracting and the prohibited labor-only contracting
are the following:

a. In job contracting, the contractor or subcontractor is engaged in a distinct and

independent business and undertakes to perform the job or work on its own
responsibility according to its own method, and the contractor or subcontractor has
substantial capital to carry out the job farmed out by the principal on his account,
manner and method, investment in the form of tools, equipment, machinery and
supervision; while in labor-only contracting, 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 person are performing activities which are directly related to
the principal business of such employer.

b. In job contracting, no employer-employee relationship exists between the

contractual employees of the job contractor/subcontractor and the principal; while
in labor-only contracting, an employer-employee relationship is created by law
between the principal and the contractual employees of the labor-only contractor.

c. In job contracting, the principal is considered only an “indirect employer”; while

in labor-only contracting, the principal is considered the “direct employer” of the
contractual employees.

d. In job contracting, the joint and several obligation of the principal and the
legitimate job contractor is only for a limited purpose, that is, to ensure that the
employees are paid their wages. Other than this obligation of paying the wages, the
principal is not responsible for any claim made by the contractual employees; on
the other hand, in labor-only contracting, the principal becomes solidarily liable
with the labor-only contractor for all the rightful claims of the contractual
employees.

9. Distinguish service charge and service incentive leave?

Service charges and service incentive leaves are distinguished as follows:

a. As to definition, service charges refer to the additional payment for services

collected by hotels, restaurants, and similar establishments which are given to
covered employees; while service incentive leaves are leave credits given to
covered employees who may desire to use them anytime they may want take a
leave of absence, ensuring that they are still compensated during that time off.

b. As to employees covered, service charges are paid to all employees, except

managerial employees as defined by law, under the direct employ of the covered
establishment, regardless of their positions, designations or employment status, and
irrespective of the method by which their wages are paid; while service incentive
leave applies to every employee who has rendered at least one year of service and
shall be entitled to a yearly service incentive leave of five days with pay.
10. Maye is an employee of Cante Philippines Incorporated, a business process
outsourcing company in Cebu City. She suffered a gynecological disease and
undergo medical operation at the time she delivered her fifth child out of
wedlock. What leave benefit under existing laws can Maye avail?

Maye is entitled to a special leave benefit of 2 months with full pay (Gynecological
Leave) pursuant to the Magna Carta of Women. She can also claim Sickness Leave
Benefit in accordance with the SSS Law.