6 MCLE ACCREDITED

th

NATIONAL CONVENTION
OF PUBLIC ATTORNEYS

UPDATES IN LABOR LAW

SEPTEMBER 20, 2017
1:30 PM – 2:30 PM
Failure to include a cause of action in
the pro-forma complaint form

What to do in case an
amendment of the pro-forma
complaint form could no
longer be done since the
filing of position paper is
already due?
Include in the statement of facts and arguments all
matters pertaining to the excluded cause of action.
Then justify the inclusion by citing the following:
A party’s cause of action should be ascertained not
from a reading of his/her complaint alone but also
from a consideration and evaluation of both his/her
complaint and position paper. (Our Haus Realty
Development Corporation v. Parian, 732 SCRA 351;
Samar-Med Distribution v. NLRC (701 SCRA 148).
The parties could allege and present
evidence to prove any cause or
causes of action included, not only in
the complaint, but in the position
papers as well. (Dee Jay’s Inn and
Café v. Ma. Lorina Rañeses, G.R. No.
191823, October 5, 2016)
In D. M. Consunji Corporation v.
Bello (702 SCRA 347), it was Construction
ruled that the worker’s workers as
successive re-engagement in regular
order to perform the same kind
of work as a mason firmly
employees!
manifested the necessity and
desirability of his work in DMCI’s
usual business of construction.
In D.M. Consunji, Inc. v. Jamin (670 SCRA
235), the Supreme Court ruled that the
repeated, continuous and successive
engagement of Jamin’s services as a
carpenter necessarily made him DMCI’s
regular employee.
 Illegal Dismissal

In illegal dismissal cases, the employer has the

burden of proving that the employee's dismissal was
legal. However, to discharge this burden, the
employee must first prove, by substantial evidence,
that he had been dismissed from employment. (Brown
Madonna Press Inc. v. Maria Rosario M. Casas, G.R.
No. 200898, June 15, 2015)
Before employers are burdened to prove that they did
not commit illegal dismissal, it is incumbent upon the
employee to first establish by substantial evidence the
fact of his or her dismissal. (Tri-C General Services v.
Nolasco B. Matuto, G.R. No. 194686, September 23,
2015)

Supreme Court decisions vis-à-vis claim of verbal

illegal dismissal.
In MZR Industries v. Colambot (704 SCRA 150), the Supreme
Court ruled:

In the present case, other than Colambot's unsubstantiated

allegation of having been verbally terminated from his work,
there was no evidence presented to show that he was
indeed dismissed from work or was prevented from returning
to his work. In the absence of any showing of an overt
or positive act proving that petitioners had dismissed
respondent, the latter's claim of illegal dismissal
cannot be sustained – as the same would be self-
serving, conjectural and of no probative value.
In Noblejas v. Italian Maritime Academy Phils. Inc. (725
SCRA. 570), it was ruled:

Aside from his mere assertion, no corroborative

and competent evidence was adduced by
Noblejas to substantiate his claim that he was
dismissed from employment. The record is bereft
of any indication that he was prevented from
returning to work or otherwise deprived of any work
assignment.
 What to do if client’s claim of illegal
dismissal is based upon a narration
that he/she was verbally dismissed?

Determine if the person who allegedly

dismissed client categorically denied the
conversation.
If yes, look for possible witnesses to the
conversation who would support client’s claim of
dismissal.

If conversation was not denied, then said failure

amounts to an admission by silence.
Why? Silence constitutes an admission that fortifies
the truth of the employee's narration. (Gregorio
Balais, Jr. v. Se'lon By Aimee, G.R. No. 196557,
June 15, 2016)
 DISMISSAL DUE TO A FACEBOOK POST

Interadent Zahntechnik Philippines, Inc. v. Rebecca F.

Simbillo (G.R. No. 207315, November 23, 2016)

Simbillo was dismissed due to loss of trust and confidence when

she allegedly disclosed sensitive and confidential information on her
Facebook account on July 15, 2010. Her post read:
Sana maisip din nila na ang kompanya
kailangan ng mga taong di tulad nila,
nagtatrabaho at di puro #$,*% ang
pinaggagagawa, na kapag super demotivated
na yung tao nayun baka iwan narin nya ang
kawawang kumpanya na pinagpepyestahan
ng mga b_i_r_. Wala na ngang credibility wala
pang conscience, portraying so respectable
and so religious pa. Hay naku talaga,
nakakasuka, puro nalang animus lucrandi ang
laman ng isip.
Supreme Court found her illegally dismissed.

Facebook entry did not mention any specific name of

employer/company/ government agency or person. Contrary to
petitioners' insistence, the intended subject matter was not
clearly identifiable. As acknowledged by petitioners themselves,
Simbillo's Facebook account contained a list of her former and
present employers. If anything, the entry would merely merit
some suspicion on the part of Interadent being the present
employer, but it would be far-fetched to conclude that Interadent
may be involved in anomalous transactions with the BIR. Clearly,
petitioners' theory was based on mere speculations.
If at all, Simbillo can only be said to have
acted "carelessly, thoughtlessly, heedlessly
or inadvertently'' in making such a comment on
Facebook; however, such would not amount to loss
of trust and confidence as to justify the termination
of her employment. When the breach of trust or
loss of confidence conjectured upon is not borne by
clearly established facts, as in this case, such
dismissal on the ground of loss of trust and
confidence cannot be upheld.
 CIRCUMSTANCES MITIGATING A CLAIM OF
ILLEGAL DISMISSAL

1. Simultaneous invocation of actual and

constructive dismissal as grounds for illegal
dismissal since both could not exist at the same time
inasmuch as these are grounded upon substantially
dissimilar acts.
Constructive dismissal exists where there is cessation
of work because continued employment is rendered
impossible, unreasonable or unlikely, as an offer
involving a demotion in rank or a diminution in pay
and other benefits. (Central Azucarera De Bais, Inc.
v. Janet T. Siason, G.R. No. 215555, July 29, 2015)
On the other hand, there is actual illegal dismissal
when an employee was notified of his dismissal or
was prevented from returning to work. (Chong Guan
Trading v. NLRC, 172 SCRA 831)
2. Discrepancy between the date of dismissal indicated
in the complaint form and the date of dismissal as
narrated in the pleadings.

3. Failure to specify the exact day when complainant

was allegedly dismissed. Example, “in June 2017”.

4. Complainants simply stated that they were illegally

dismissed without any particular narration as to the
surrounding circumstance thereof, i.e., who, where,
when and how they were allegedly dismissed.
5. Complainants never claimed that they were notified
of their dismissals or were barred from reporting to
work.

6. Complainants simply stated that they were illegally

dismissed without mentioning that they were
dismissed due to a just or authorized cause/s. In
other words, they conveniently omitted to state in
their pleadings that they were validly dismissed.
7. Complainants simply stated that they were illegally
dismissed without mentioning that they informed their
employer that they would no longer report for work or
that they resigned. In other words, they conveniently
omitted to state in their pleadings that they were the
ones who unilaterally severed the employer-employee
relationship.

8. Failure to identify the person who allegedly barred

the worker from entering company premises.
 Memorandum of Appeal and Motion To Reduce Bond

What to check if you received a memorandum of appeal

from respondent:

1. Filed within the reglementary period.

2. In case Labor Arbiter’s decision has a monetary
award, check if appeal bond is equivalent to the
judgment award exclusive of damages and
attorney’s fees.
3. If appeal bond is below the judgment award exclusive of
damages and attorney’s fees, check if respondent filed a
motion to reduce bond.

If no motion is filed, oppose the appeal and move for its

dismissal due to non-perfection.

4. If there is a motion to reduce bond, determine if the

appeal bond is equivalent to 10% of the judgment award
and if respondents propounded a meritorious ground to
justify the granting of the motion.
If the appeal bond is less than 10% of the
judgment award, move for the dismissal of the
appeal due to non-perfection.
If the appeal bond is equivalent to 10% of the
judgment award, determine if the reason
propounded for the reduction of the bond is
meritorious. If unmeritorious, then move for the
dismissal of the appeal due to non-perfection. If
meritorious, file a comment/answer to the appeal.
 MOTION TO REDUCE BOND

In Mcburnie v. Ganzon (707 SCRA 646), the Supreme Court

issued the guidelines to be observed in connection with the
filing and acceptance of motions to reduce appeal bond.
Among the guidelines are:

(1) The filing of a motion to reduce appeal bond shall be

entertained by the NLRC subject to the following conditions:
(a) there is meritorious ground; and (b) a bond in a reasonable
amount is posted;
(2) For purposes of compliance with condition
no. (2), a motion shall be accompanied by the
posting of a provisional cash or surety bond
equivalent to ten percent (10%) of the
monetary award subject of the appeal,
exclusive of damages and attorney’s fees;
(3) The NLRC retains its (4) In the event that the
authority and duty to NLRC denies the motion to
resolve the motion to reduce bond, or requires a
reduce bond and bond that exceeds the
determine the final amount of the provisional
amount of bond that shall bond, the appellant shall be
be posted by the given a fresh period of ten
appellant, still in (10) days from notice of
accordance with the the NLRC order within which
standards of “meritorious
to perfect the appeal by
grounds” and “reasonable
posting the required appeal
amount”; and
bond.
What are deemed as meritorious grounds to justify
the reduction of appeal bond?

For purposes of justifying the reduction of the appeal

bond, the merit referred to may pertain to (a) an appellant's
lack of financial capability to pay the full amount of the bond,
or (b) the merits of the main appeal such as when there is a
valid claim that there was no illegal dismissal to justify the
award, the absence of an employer-employee relationship,
prescription of claims, and other similarly valid issues that are
raised in the appeal. (Quantum Foods, Inc. v. Marcelino
Esloyo, G.R. No. 213696, December 9, 2015)
 What to do if When the return of a writ of execution issued
judgment award against the property of a losing party shows
remained that the judgment remains unsatisfied, in
unsatisfied? whole or in part, the prevailing party, at any
time after such return is made, shall, upon
File a motion be entitled to an order from the
motion for handling Labor Arbiter requiring such losing
party to appear and be examined concerning
examination of his property and income before such Labor
the party who Arbiter x x x (NLRC En Banc Resolution No. 6,
was held liable Series of 2016 amending Section 19, Rule XI
to the client. of the 2011 NLRC Rules of Procedure, as
amended)
Department Order No. 150, Series of 2016 (Revised
Guidelines Governing The Employment And Working
Conditions Of Security Guards And Other Private Security
Personnel In The Private Security Industry)
Valid reasons for placing security guards on floating status:
A security guard and other private security personnel may be placed in
a work pool or on reserved status due to lack of service assignment
after the expiration or termination of the Service Agreement with the
principal where he/she is assigned, or due to the temporary
suspension of security service operations, or due to valid relief from
the current place of work and there is no work assignment available.
An assignment of the security guard and other private
security personnel as a reliever for less than one-month
shall not be considered as an interruption of the six (6)
months period.

If, after a period of six (6) months, the agency cannot

provide work or give an assignment to the reserved
security guard, the latter can be separated from
service and shall be entitled to separation pay of one-
half (½)-month pay per year of service, but
guaranteed to one (1) month pay. (Section 10.3)
In Soliman Security Services, Inc. v. Igmedio C.
Sarmiento (G.R. No. 194649, August 10, 2016),
the Supreme Court held that when the floating
status is justified, the lapse of a continuous period
of six (6) months results in an authorized cause for
termination of employment, the security guard
being entitled, however, to separation pay
equivalent to one-half (½)-month pay per year of
service, but guaranteed to one (1) month pay.
To validly terminate a security guard for lack of
service assignment for a continuous period of six
months, the agency must comply with the
provisions of Article 298 (previously Art. 283) of the
Labor Code, which mandates that a written notice
should be served on the employee on temporary
off-detail or floating status and to the DOLE one (1)
month before the intended date of termination.
Transfer of Assignment. – In case of transfer, the
wage rate most favorable to the security guards shall
apply. Thus, transfer of security guards to areas
outside the region of the domicile or head office of the
agency shall not result to reduction of the wage rate
being enjoyed by the security guards prior to such
transfer. Transfer to an area or region with higher
wage rate shall render the higher rate the applicable
wage rate for the transferred security guards. (Section
7.4, Department Order No. 150, Series of 2016)
Department Order No. 147, Series of 2015 (Amending The
Implementing Rules And Regulations Of Book VI Of The
Labor Code Of The Philippines, As Amended)

Important points to take note when advocating clients’ causes of

action:
• Tests to determine existence of employer-employee relationship.
(Section 3)
• What comprises procedural due process in termination of
employment. (Section 5.1)
• Elements of a valid dismissal due to just cause (Section 5.2)
• Elements of a valid dismissal due to authorized cause (Section 5.3)
• Amount of separation pay due to employee terminated due to
authorized cause (Section 5.5)
Department Order No. 174, Series of 2017 (Rules
Implementing Articles 106 to 109 of the Labor Code, as
amended)
Labor-only contracting
prohibited (Section 5) Solidary liability of principal
Other illicit forms of and contractor (Section 9)
employment arrangements Rights of contractor’s/sub-
(Section 6) contractor’s employees
Permissible contracting or (Section 10)
subcontracting Effect of termination of
arrangements (Section 8) employment (Section 13)
How to counter respondent agency’s claim
of being an independent contractor?

Determine if respondent agency is duly registered

with the Department of Labor and Employment
(DOLE) as an independent contractor.
If registered, see date of
registration. If date of
registration is after date If date of registration is
of hiring of complainant, before date of hiring of
then agency is a labor
only contractor at the
complainant, then respondent
time of engagement. agency is deemed to be an
Registration does not independent contractor.
have retroactive effect. However, other circumstances
could be used to prove that
respondent agency is a labor-
only contractor.
In San Miguel Corporation v. Semillano (623 SCRA
114) the Supreme Court ruled that:
The fact of registration simply prevents the legal
presumption of being a mere labor-only contractor
from arising. In distinguishing between permissible
job contracting and prohibited labor-only
contracting, the totality of the facts and the
surrounding circumstances of the case are to be
considered.
Factors that would support claim that
respondent agency is a labor-only contractor:
1. Respondent agency does not have substantial
capital;
Substantial capital is defined as the paid-up
capital stock/shares at least P5M in the case of
corporations, partnerships and cooperatives; in
the case of single proprietorship, a net worth of
at least P5M. (Section 3[l], DO 174-17)
2. Respondent agency does not own the tools,
equipment, machineries and work premises
that were actually used by complainant in the
performance or completion of his/her job;

3. Complainant’s job is directly related to the

main business operation of principal;
4. Complainants are under the control and supervision
of the principal because they followed the work
schedule prepared by the latter, they exclusively
worked within the latter’s premises and nowhere else
and the principal established the working procedure
and methods that complainants used in performing
their jobs.
Power to determine the work schedule obviously
implies power of control. (David v. Macasio, 729
SCRA 67)

Control is also present when principal determines

work assignments and performance targets.
(Diamond Farms, Inc. v. Southern Philippines
Federation of Labor (SPFL)-Workers Solidarity of
DARBMUPCO/Diamond-SPFL, G.R. Nos. 173254-55
& 173263, January 13, 2016)
5.Respondent agency does not have clients aside
from principal.

In the cases of Aliviado v. Procter & Gamble Phils., Inc.

(650 SCRA 400), San Miguel Corporation v. Semillano
(623 SCRA 114) and San Miguel Corporation v. MAERC
Integrated Services, Inc. (405 SCRA 579) the agencies
were declared to be labor-only contractors on account of
their failure to prove that they had other clients aside
from their respective principals.
 LABOR-ONLY CONTRACTING
Edward C. De Castro v. Court of Appeals (G.R. No. 204261, October
5, 2016)
Respondent agency was declared to be a labor-only contractor due
to the following reasons: (1) It was not registered with the
Department of Labor and Employments as an independent
contractor; (2) It did not have substantial capital since out of its
authorized capital stock of P4M only P1M was subscribed; (3) It did
not have substantial equipment in the form of tools, equipment,
machinery, and work premises; (4) Its services was exclusively
offered to the principal; and (5) It shared the same officers and
employees with that of the principal.
In Jack C. Valencla v. Classique Vinyl Products Corporation
(G.R. No. 206390, January 30, 2017), the Supreme Court
ruled :

Generally, the presumption is that the contractor is a labor-

only contractor unless such contractor overcomes the burden
of proving that it has the substantial capital, investment, tools
and the like. Here, to prove that CMS was a legitimate
contractor, Classique Vinyl presented the former's Certificate
of Registration with the Department of Trade and Industry
and, License as private recruitment and placement agency
from the Department of Labor and Employment.
Indeed, these documents are not conclusive
evidence of the status of CMS as a contractor.
However, such fact of registration of CMS
prevented the legal presumption of it being a
mere labor-only contractor from arising.
For failing to register as a contractor, a
presumption arises that one is engaged in
labor-only contracting unless the contractor
overcomes the burden of proving that it has
substantial capital, investment, tools and the
like. (Manila Memorial Park Cemetery, Inc. v.
Ezard D. Lluz, G.R. No. 208451, February 3,
2016)
DOLE Department Circular No. 1, Series of 2017 issued on
June 9, 2017 states that D.O. No. 174-17 does not cover
technology-enable services involving an entire or specific
business process such as:
Business Process Outsourcing
Knowledge Process Outsourcing
Legal Process Outsourcing
IT Infrastructure Outsourcing Hardware and/or Software Support
Application Development Medical Transcription
Animation Services
Back Office Operations/Support
Department Circular No. 1 also stated that D.O. No.
174-17 does not apply to:

Contracting or subcontracting
arrangements in the
construction industry as it is
governed by D.O. No. 19,
Series of 1993 (Guidelines
Governing the Employment of
Workers in the Construction
Industry)
Contracting or subcontracting
arrangements in the private security
industry as it is governed by
Department Order No. 150, Series
of 2016 (Revised Guidelines
Governing The Employment And
Working Conditions Of Security
Guards And Other Private Security
Personnel In The Private Security
Industry)
Thank you !!!