tuazon labor rev

8/15/2019 Tuazon Labor Rev

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Labor Law

Bar 2011 Notes

Roland Glenn T. Tuazon

Ateneo de Manila University

Table of contents:

1. FUNDAMENTAL PRINCIPLES AND POLICIES

2. RECRUITMENT AND PLACEMENT

3. LABOR STANDARDS

4. TERMINATION

5. SOCIAL LEGISLATION

6. SELF-ORGANIZATION

7. COLLECTIVE BARGAINING

8. CONCERTED ACTS

9. PROCEDURE

FUNDAMENTAL PRINCIPLES AND POLICIES

• What is labor law?

o A regulatory devise, which regulates the relationship between

the employer and the worker – the two factors of production• What is labor standards law?

o Establishes the minimum terms and conditions of employment

o Rationale: these are necessary for the worker and his family to

survive

o These are beyond then negotiation of the parties; they cannot

agree to terms less than those provided in the law. If they do,

these are void.

• What is labor relations law?

o It is concerned with institutional relationships and does not look

as the laborer as an individual, but as a group of workers

(union)

o Two aspects of labor relations law:

1. Union and State relationship 2. Union as an organization and its relationship to the

members

• What is social or welfare legislation?

o It solves the problem of avoiding making the worker a charge

on society and solves the problem of continuity of income

either in whole or in part if and when some contingencies

occur, such as sickness, injuries, premature death, and final

death

o What are the laws covered by social legislation?

1. Employees compensation and State InsuranceFund (ECSIF)

2. SSS Law

3. GSIS Law

4. Limited portability law

o Which are applicable to what workers?

SSS, to private sector employees

GSIS, to government employees and those in GOCCs

Both, to those employed in both fields

Limited portability provides a “tacking provision” for

those who have partially fulfilled GSIS and SSS

requirements

SSS and GSIS for non-work-connected injuries and

ECSIF for work-connected injuries

What is the basis for enacting labor law?

o Constitutional provisions mandating the State to protect

laborers

o Police power of the State

What are the sources of labor law?

o 1. Contract law – gives rise to rights and obligations

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A. Civil code provisions on contracts

B. Collective Bargaining Agreements

o 2. Past practices, which are:

Those given voluntarily by the employer without

compulsion by law for a sufficient duration

What is sufficient period or duration?

Case by case

o 3. Company policies

Those unilaterally designed and implemented by the

employer, stating rules and regulations of the

company. These can be the source of rights and

obligations.

N.B. these are unilaterally imposed by the employer;

otherwise, it would fall under contract law.

• What is a labor case?

o 1. Involves employer and employee

o 2. Subject of controversy and laws of resolution fall under labor

law

Thus, if the area of resolution is civil law and not labor

law, such as replevin, then it is not a labor dispute

What is management function?

o These are rules based on the right of ownership, designed for

efficient and economical management of the enterprise. It

permeates the entire labor code, regardless of field.

o What is the limit to management function?

The law reserves the right to inquire as to themanner

of exercise of such right.

• How does the law look upon waivers and compromises?

o It looks upon it with disfavor, although not all waivers and

compromises are void under law.

o What are the tests of validity of waivers and

compromises?

1. Arithmetic measure – is what was received for

settlement unconscionable?

2. Relative positions of the employer and employee –

what is the educational attainment of each? Was the

employee in dire need?

3. Freedom on the part of the worker – was there

absence of coercion?• What are the guaranteed rights of laborers under Art XIII, Sec. 3?

o 1. Self-organization

o 2. Collective bargaining and negotiations

o 3. Peaceful concerted activities, including right to strike

o 4. Security of tenure

o 5. Humane conditions of work

o 6. Living wage

o 7. Participation in policy and decision-making processes

How does LC Art. 255 operationalize this?

• Workers can participate in policy and

decision-making processes of the

establishment where they are employed as

far as it would directly affect their rights,

benefits, and welfare

• What are the other goals set by this provision?

o Full protection to labor

o Full employment and equality of opportunities

o Shared responsibility between ER and EEs

o Preferential use of voluntary dispute settlement

o Two fold rights:

Right of labor to just share in fruits of production Right of enterprises to reasonable returns to

investments

• What does the NCC say?

o Art 1700 – relations between labor and capital are not just

contractual, but impressed with public interest – must yield to

common good

• What factors does labor law consider as to contracts?

o 1. Due process clause

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Labor is considered property

Due process and EPC can protect the employer too,

not just the employee

o 2. Liberty of contract and laissez faire

N.B. but the State still retains an interest on the

worker as part of society no matter how reckless he

may be; thus, the State continues to interfere in

contract. Laissez faire is not totally adopted.

When does the Labor code apply?

o 1. There must be an employer-employee relationship

o 2. Generally applies to all kinds of employment

N.B. but for GOCCs created and governed by special

charter, apply the Civil Service Law instead

o What is the rule on international organizations?

Beyond the coverage of the Labor Code, but the

international agreement must contain provisions on

method of dispute settlement.

N.B. if not provided, the worker can ask for withdrawal

of immunity of suit so that Philippine legal processes

can apply.

o What about school teachers?

Public school teachers are covered by the Civil

Service Law.

Private school teachers are covered by the Dep. Ed.

Manual But for all matters not covered by these, the Labor

Code applies. The most important is probationary

employment.

o Does the Labor Code apply to religious corporations?

If thenature of the controversy is not religious, then

the Labor Code applies.

o Does the Labor Code apply to managerial employees?

Yes, although certain aspects like Hours of Work do

not apply.

RECRUITMENT AND PLACEMENT

RECRUITMENT OF LOCAL AND MIGRANT WORKERS

• What is recruitment and placement?

o Any act of:

Canvassing, enlisting, contracting,

Transporting, utilizing, hiring, procuring workers

Includes referrals, contact services, promising or

advertising employment for profit or not, here or

abroado When is there a presumption of R&P?

When a person or entity offers or promises for a fee

employment to two or more persons

o How do you harmonize the definition and the

presumption?

Any one act under the definition is sufficient to

establish R&P, regardless of number of persons. The

presumption is only a rule of evidence which operates

when there are two persons to whom employment is

promised for a fee and the acts defined above cannot

clearly be established.

o Who are “workers”?

All members of the labor force, whether employed or

unemployed

• What is the State policy under MWA?

o Promotion of overseas recruitment is not State policy, because

it seeks to create local opportunities. But while there are

workers deployed abroad, there must be protections for them.

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o Does the POEA have jurisdiction over ER-EE relations

cases for OFWs?

Not anymore. It’s been retransferred to NLRC. The

POEA only handles administrative cases.

o

What is the nature of employment of seafarers? They are contractual employees

Differentiate license from authority:

o License is authorization to operate a private employment

agency. A Private Employment Agency is an entity engaged in

R&P for a fee (charged from employer, worker, or both)

o Authority is authorization to operate a private recruitment entity.

A Private Recruitment Entity is an entity engaged in R&P

without charging any fee

Illegal recruitment

o What is the definition of illegal recruitment under the LC?

Any recruitment activities (Art. 13) or prohibitions (Art.

34) undertaken by non-licensees or non-holders of

authority

o What is the definition of illegal recruitment under the MWA

(RA 8042)?

Any recruitment activities (Art. 13) undertaken by non-

licensees or non-holders of authority

Any prohibited acts (Art. 34), whether licensed or non-

licensed

o What are the prohibited acts (Art. 34)?

1. Overcharging (whether vis-à-vis schedule of fees or

what has been loaned/advanced)

2. Public false information re: recruitment

3. Misrepresentation to secure license or authority

4. Induce or attempt to induce employed worker to

leave job to offer him to another

• Except to save him from oppressive

employment

5. Influence employer not to hire worker unless

coursed through his agency

6. Engage in R&P for harmful or anti-public policy

work

7. Obstruct or attempt to obstruct inspection by Sec ofLabor or representatives

8. Fail to file reports required by Sec of Labor

9. Substitution or alteration of approved contracts

without approval of Sec of Labor

10. Becoming officer or being involved in

management of travel agency

11. Withhold or deny travel documents from workers

before departure due to financial considerations

• Unless authorized by LC

o What are the additional grounds added by MWA, apart

from these?

12. Failure to deploy the worker without valid reason

13. Failure to reimburse worker when deployment

does not happen without his fault

Differentiate simple illegal recruitment, illegal recruitment in large

scale, illegal recruitment as syndicate:

o Large scale – if committed against 3 or more persons

individually or as a group

o By a syndicate – carried out by a group of 3 or more persons

conspiring or confederating with each othero What are these two types of illegal recruitment called?

Illegal recruitment as economic sabotage

Can illegal recruitment and estafa coincide?

o If there are pecuniary damages due to previous or

simultaneous false pretense resorted to by the entity, then the

latter can be sued for estafa under Art. 315

o This suit may prosper aside from illegal recruitment

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What are the liabilities of the local employment agency and the

employer?

o The agency is solidarily liable for the unpaid salaries of the

worker, along with the principal/employer. This holds true even

if the agency agreement has been severed, if no notice wasgiven to the employee.

o What is the theory of imputed knowledge?

The presumption that knowledge of he agent can be

ascribed to the principal as well.

o When is an employee of the entity liable as a principal?

When he had knowledge of the offense and had

active and conscious participation. NOT liable as

principal when merely carrying out orders of superior.

What is the rule on pre-termination of contract of a MW?

o

If there was pre-termination without just cause, the employerwill be ordered to pay the workers:

o 1. Full placement fee with 12% interest AND

o 2. Salary for unexpired portion of the contract OR for 3 months

for every year of the unexpired term, whichever is lesser

o Isn’t this unconstitutional?

Yes, according to Serrano v. Gallant, but R.A. 10022

passed 1 year after reinstated the provision

Is direct hiring allowed for overseas employment?

o As a general rule, no, direct hiring is not allowed. It must be

through boards and authorized entities.

o What are the exceptions?

1. Diplomatic corps

2. IOs

3. Other employers allowed by the DOLE

What is the rule on employment of Non-Resident Aliens?

o Either the alien or the employer must obtain an employment

permit from the DOLE

o When is the permit issued?

Upon determination of non-availability or 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

o What is the special rule for those preferred areas ofinvestment?

Permit issued upon recommendation of the

government agency in charge of that enterprise

• Upon issuance of the employment permit to the NRA, what are the

regulations?

o Cannot transfer employment without prior approval from DOLE

Secretary

o Else, punished under the LC and/or deported

REGULATION AND ENFORCEMENT

• What is the rule on remittance of foreign exchange earnings?

o Employment contracts must contain a proviso that makes

remittance of the following rates mandatory –

1. Seamen – 70% of basic salary

2. Workers of Filipino contractors or construction firms

– 70%

3. Doctors, nurses, engineers, teachers, other

professionals whose contract gives free board and

lodging – 70%

4. Professionals without free board and lodging – 50%

5. Domestic and service workers – 50%

6. All others – 50%

• What are regulations?

o 1. Travel agents and sales agencies of airline companies

cannot engage in R&P for overseas employment, w/n for profit

o 2. Citizenship requirement for recruitment entities:

Filipino

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OR 75% Filipino ownership (authorized and voting

stock)

o 3. Minimum capitalization as required by Sec. of Labor

o 4. Non-transferability of authority or license

Cannot transfer to another person or use in another

place

What if you want to transfer offices?

• Get prior approval of Sec. of Labor, as with

appointing an agent or getting additional

offices

• What are the prohibited activities?

o See above enumeration (Art. 34)

• What is the nature of the regulatory and visitorial powers of the

Labor Secretary?

o The Secretary can restrict and regulate R&P activities of all

agencies covered

o Can issue orders and R&Rs

o Visitorial Powers – Sec of Labor or representatives may inspect

premises, inspect books/records of entities, require submission

of reports, etc.

• What must be given by those applying for license or authority?

o 1. Prescribed registration fees

o 2. Cash/surety bonds to guarantee compliance with provisions

What is the nature of the license?

o It is beyond the commerce of man, and subject to prior

approval

• What are the penalties for illegal recruitment?

o 1. Simple illegal recruitment – 12 y 1 d to 20 y imprisonment

And fine of P1M to 2M

o 2. Economic sabotage – life imprisonment

And fine of P2M to 5M

Maximum if the one recruited is less than 18 years, or

committed by a non-licensee or holder of

authorization

o 3. Prohibited acts – 6 y 1 d to 12 y

And fine of P500K to P1M

If alien, deported without further proceedings

o 4. In all cases:

Revoke license or authorization

LABOR STANDARDS

• Where do benefits come from?

o 1. Law (Labor standards law)

o 2. Contact (ex. CBA)

o 3. Vested benefits

HOURS OF WORK

• What is the rationale for the hours of work provisions?

o 1. To safeguard health and welfare of the laborer

o 2. Prevent unemployment (companies that operate more than 8

hours have to hire more workers or pay more)

o 3. The employee usually just accepts what the employer says,

so this will prevent begrudging acceptance of long work days

• Who are covered by the provisions on hours of work?

o By default, employees in all establishments and undertakings,

whether for profit or not

• Who are excluded by the provisions?

o 1. Government employees

Covered by Civil Service Law

Exception?

• Employees of GOCCs incorporated under

the Corporation Code

N.B. even GSIS-covered employees are not excluded

from the employee’s compensation program under the

Labor Code

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o 2. Managerial employees

What are managerial employees?

• 1. Primary duty is management of the

establishment, department, or subdivision

• 2. Customarily or regularly directs work of

two or more employees

• 3. Has authority to hire/fire employees of

lower rank, or at least their suggestions are

given particular weight

• N.B. this is not the same definition for

manager in labor relations. This is broader

in scope and covers even supervisory

employees, while the labor relations

definition does not.

Ratio: they are not hired for quantity of hours of workput in but the special training, knowledge, or

experience that requires discretion and independent

judgment

o 3. Field personnel

Who are these?

• Non-agricultural employees regularly

performing their duties away from the

principal place of business

What is essential?

Actual hours of work cannot be determinedwith reasonable certainty

Test: whether the employee is supervised on

the field

What about bus conductors and drivers?

NOT field personnel because inspectors

check their hours of work.

o 4. Members of the family of the employer who are dependent

on him for support

o 5. Domestic helpers

o 6. Persons in the personal service of another

o 7. Workers paid by results

Is this determinative of employer-employee

relationship?

• No. Always follow the four-fold test. This is

just a method to compute compensation.

Ratio: they are paid based on work output, regardless

of time employed

• What are the normal hours of work?

o Not exceeding 8 hours a day

Can normal hours of work be less than 8?

• Yes. It says “not exceeding”

Can an employer and employee contractually

agree that work must be 12 hours a day, or any

number above 8?

• Yes, it’s a contractual commitment – but the

extra 4 hours are covered by OT pay.

What is the “day” here?

• Work day (24 hour period starting from the

time an employee regularly starts to work)

• NOT calendar day


1. Health workers –

• In cities and municipalities with population at

least 1 million• Or in hospitals/clinics with bed capacity at

least 100

• What are their hours?

o 8 hours a day, 5 days a week

(N.B., it’s doesn’t say “not

exceeding” this time, so

they really must work 8

hours)

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Other types of time spent at work:

Type of work Counted as working time?

Idle time Yes, if the employee was engaged to

wait or he waited to be engaged.

The controlling factor: whether the

waiting time was for the employer’s

benefit or the employee’s benefit

Waiting time Yes, if waiting is integral part of the

work, or if the ER engaged him to

wait.

“On call” working Yes. It is when an EE is required to

remain on call that he cannot

gainfully and effectively use his timefor his own purposes.

Travel from home to work No.

Except, when:

1. EE made to work on

emergency call and travel is

necessary to get to work

2. Travel through conveyance

provided by ER

3. Travel under supervision

and control of ER

4. Travel under vexing and

dangerous circumstances

X was a company driver and was

engaged to pick up and drop off

other employees to and fro work.

Is this working time?

Yes, because it is done for the

employer’s benefit

Travel incidental in day’s work Yes, if part of EE’s regular activity

Travel away from home Yes, if it keeps an EE away fromhome overnight and it cuts across an

EE’s workday. It substitutes for

normal working time.

Semestral break, for teachers Yes. It is an interruption beyond

their control.N.B. this only applies

to regular full-time teachers

Attendance in lectures, meetings,

trainings, or programs

Yes.

Except if the ff requisites concur:

1. Attendance is outside

regular working hours

2. Attendance is voluntary

3. There is no productive work

done during attendance

Nightshift differential

What is the nightshift differential?

o 10% of regular wage, for each hour of work between 10 pm

and 6 am

Who are not covered by nightshift differential?

o 1. In government or GOCCs


o 3. Field personnel or other employees whose time/performance

is unsupervised


o 5. Those in personal service

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o 6. Working on contract basis, purely commission basis, or paid

fixed amount irrespective of time worked

o 7. In retail or service establishments regularly hiring only up to

five workers

o N.B. So this is just like the hours of work enumeration, but

including retail and service establishments hiring only up to 5

workers.

o Reason?

It’s onerous for the small business to pay NSD, but in

also, it will be harsh if they don’t have to comply with

hours of work just because they have few employees.

What is the rationale for the NSD?

o 1. Social disarrangement

o 2. Lower efficiency and output

o 3. Higher risk going to and fro work in darknesss

What if it is also overtime work?

o The 10% is calculated against OT pay as base

Overtime Work

What is OT work?

o Work performed beyond 8 hours a day

What is the rate for each hour of work done beyond 8 hours?

o Regular wage + 25%

N.B.Base excludes fringe benefits/bonuses – just

regular payo What if the OT work was done during a holiday?

The +25% becomes +30%

o What if the OT work was done during a rest day?

The +25% becomes +30%

What are conditions to be entitled to OT pay?

o 1. Actual rendition of OT work

o 2. Submission of sufficient proof that work was actually

performed

o 3. With knowledge and consent of employer

Is it legal for the employment contract that the monthly salary

would be treated as covering even pay for rest days and holidays?

o Yes, as long as the wage is still equal to or above the minimum

wage

What is the anti-offset rule?

o Under-time work on one day cannot be offset by overtime work

on another day

o Neither does permission given to the employee to go on leave

some other day of the week exempt the employer from paying

additional compensation

Can OT pay be waived?

o No.

o Unless the waiver was in consideration of other benefits or

salary that equals or exceeds the OT pay.

• What are the emergency situations when OT work can be made

mandatory by the ER?

o 1. RP is at war, or national/local emergency declared by

Congress or President

o 2. Necessary to prevent loss of life/property or imminent

danger due to disaster or calamity

o 3. Urgent work on machines, installations, equipment to avoid

serious loss or damage to the employer

o 4. Necessary to prevent loss or damage to perishable goods

o 5. Completion or continuation of work started before the 8th

hour must be completed to avoid serious obstruction or

prejudice to the business

o 6. Necessary to avail of favorable weather or environmental

conditions

o When OT is required under these 6 circumstances, must

there be extra compensation nonetheless?

Yes. It just becomes mandatory, rather than optional.

What prevails, CBA provision or OT work rate?

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o CBA may stipulate higher OT pay rate. The court cannot

impose upon the parties anything beyond what they agreed

upon. If there is none, impose regular OT rate.

WAGES

• What is the “no work no pay” principle?

o If there is no work performed by the employee, there can be no

wage or pay.

o Exceptions to “no work no pay”:

1. The laborer was willing, able, and ready to work but

was prevented by management

2. Illegally locked out, suspended, or dismissed.

o What if the failure to work was the employee’s fault?

He doesn’t get paid

o What is the principle established under ISA v.Quisumbing?

Equal work for equal pay; no distinction can be made

based on nationality

Facilities and supplements:

Facilities Supplements

Included in “wages” Not included in “wages”

Can be credited as wages or

deducted from wages

Over and above wages

Articles or services like

board/lodging which benefit the EE

and his family

Requisites:

1. Customarily furnished in

trade

2. EE voluntarily accepted it in

Extra remuneration or special

privileges received over and above

the EE’s ordinary wages

N.B. For facilities and supplements,

the nature of the benefit or item is

not a controlling criterion. It is the

purpose that controls. Check if it’s

writing

3. Charged at reasonable

value

meant to be part of his wages or

over and above them.

Generally for the benefit of the

employee. So it’s usually at theinitiative of the EE.

Usually on the initiative of the ER.

Tools of trade or other articles for the

benefit of the ER or the business

Who are excluded from the rules on wages?

o 1. Farm tenancy/leasehold

o 2. Cottage industries and other small businesses that probably

cannot afford to pay the wage rates set by law.

N.B.Consult wage orders established by regional

wage boards

o 3. Domestic service

o 4. Barangay Micro Business Enterprises (BMBE) under R.A.

9178

Business entities engaged in producing or processing

of products (including agro-processing), whose total

assets do not exceed 3M pesos

What does the term “assets” cover?

Includes loans

Excludes land where the office, plant, or

equipment are situated

Differentiate wages and salaries:

o Wages –

Manual labor, skilled or unskilled

Paid at stated times

Measured by day, week, month, or season

Usually for lower and less responsible character of

employment

o Salaries –

Higher degree of employment, superior grade of

services, and implies position/office

Larger and more permanent/fixed compensation

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• What is the non-diminution rule?

o The benefits being given to employees cannot be taken back or

reduced unilaterally by the employer, because the benefit has

become part of the employment contract (whether written or

unwritten)o When does a benefit set-in and cannot be diminished?

1. When the benefit is based on express policy or has

ripened into practice for a long period of time

2. AND that it is consistent and deliberate

o What can be diminished?

1. Conditional or contingent benefits (ex. bonuses)

2. Those granted due to error or doubtful application

or law

• What is the exception to this?

o When the error has stood so long

and has been left uncorrected that it

has ripened into company policy

• What is the rule on those paid by results?

o If paid according to piece rates in DOLE Pierce Rate Orders:

Wages = number of pieces * Piece Rate

No overtime pay

o If paid according to output rates prescribed by the employer

and not yet approved by DOLE:

If number of pieces * Rate is >= to legal daily wage,

they receive the former

If formula is < than the legal daily wage, they receive

the latter

• What are piece-rate employees entitled to?

o 1. Applicable minimum daily rate

o 2. SIL

o 3. Night shift differential

Huh? I thought those paid by results are excluded

by NSD?

• Yes – but that covers those paid by

commission, contract basis, or by end-result.

• That doesn’t include piece-rate workers who

are just like normal workers in every respect

except they are paid by pieces made.o 4. Holiday pay

How calculated?

• Not less than his average daily earnings for

the last seven actual working days

• It must not be less than the minimum wage

o 5. Meal and rest periods

o 6. OT pay

Conditional

o 7. Premium pay

Conditional

o 8. 13th month pay

o 9. Other benefits granted by law or by agreement

o N.B. So the rule is that piece-work EEs are entitled to the

normal benefits because the difference between them and the

usual employees is justmanner of payment and nothing else

• What are the legal forms of payment?

o Must be legal tender

o Cannot be in PNs, vouchers, coupons, tokens, tickets, etc.

o What if the employee requested for PNs, vouchers, etc?

Even so. It’s not allowed.

o When is payment by check allowed? 1. Customary manner of wage payment in that place

2. Stipulated in CBA

3. Or where all of the following requisites are met:

• A. Bank or encashment facility within 1 km

radius from workplace

• B. the ER or his agents do not receive

pecuniary benefit from the arrangement

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• C. EEs given reasonable time during banking

hours to withdraw wages from bank

o This is compensable working time

• D. Written consent of employee if there is no

CBA provision

4. Special circumstances provided in labor regulations

o Is payment by ATM allowed?

Yes, under 25 Nov 1996 labor advisory

Requisites for payment through ATM:

• 1. Written permission of majority of EEs

• 2. 25 or more EEs in the establishment

• 3. Establishment is within 1 km from bank

• What is the time of payment?

o At least once every 2 weeks or twice a month at intervals not

exceeding 16 days

o What if there is force majeure preventing payment? Payment made as soon as force majeure disappears

o In all cases, what is prohibited?

Payment with less frequency than once a month

o What is the rule for employees made to perform tasks

which cannot be completed in 2 weeks?

1. Payments at intervals not exceeding 16 days, in

proportion to amount of work completed

2. Pay balance upon completion of work

o What is required by the IRRs?

1. Individual time record of employees

2. Payroll

• Where and how must wages be paid?

o At or near the place of undertaking

N.B. Remember the ATM exception

o When can there be payment in any other place?

1. Impossible to pay in place of work due to

emergency or calamity

2. ER provides free transportation back and forth

3. Analogous circumstances

N.B. For all: time spent is compensable work time

o What are prohibited places of payment?

Bar, night/day club, drinking place, massage clinic,

similar places

Except if the people are employed there

o Who must receive the payment?

The worker himself

o Exceptions to this rule?

1. Force majeure – can be paid to another person with

written authority given by EE

2. Decease of EE –

• Can pay wages to heirs directly without need

of intestate proceedings

• What is the procedure?

o The heirs submit an affidavit stating

relationship to deceased

o ER pays through Sec. of Labor or

his representatives

o Sec. of Labor acts as referee to

divide the amount

3. Worker’s family member authorized in writing

• What is the rule on workers’ preference under Art. 110?

o In case of bankruptcy or judicial liquidation, the worker’s unpaid

wages are preferred.

o It is not a lien, but a reordering of credits (see Concurrence and

Preference of Credits in Civil Law)• What is the rule on attorney’s fees?

o In case of unlawful withholding of wages –culpable party may

be assessed attorney’s fees equal to 10% of wages recovered

o In any proceeding, cannot recover attorney’s fees exceeding

10% of the wages recovered

• What is non-interference in disposal of wages?

o No employer can limit or interfere with the employee’s disposal

of his wages.

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o Can an employer compel his employees to purchase any

merchandise or commodity?

No, whether it be from himself or another person

• Can an employer deduct his employees’ wages?

o In general, no.

o What are the exceptions under the Labor Code?

1. To pay for insurance premiums that employee

consented to

2. Union dues, where right to check-off is authorized

in writing by the employee or recognized by the

employer

3. Authorization by the Sec. of Labor

o What are the exceptions under other laws?

1. Employee is indebted to the employer, and it is due

and demandable

2. Court ordered attachment of wages for debts

incurred for food, shelter, clothing, or medical

attendance only

3. Withholding tax

4. Salary deductions for coop members

5. Payment to third persons, upon written

authorization by employee

• And agreement by the employer, who is not

obliged to do so

6. Agency fee

7. Facilities

8. Loss or damage under Art. 114 (see below)

9. SSS, Medicare, Pag-ibig premiums

• Can the employer require the employees to make deposits to cover

for deductions for loss/damage to tools or equipment?

o In general, no.

o What is the exception?

When it is shown that such practice is long-

established and recognized in the trade

o If allowed, when can deductions be made (requisites)?

1. Employee is responsible for the loss/damage

2. Employee given chance to show cause against

deduction

3. Amount is fair and reasonable, and not exceeding

the loss/damage

4. Deduction does not exceed 20% of employee’s

wages in a week

• Can wages be withheld by the employer, if the employee violated

company rules, failed to perform tasks, or for any other reason?

o No. It can be dealt with in some way but not by withholding

wages.

o Other express prohibitions?

Deduction to ensure employment

Retaliatory deductions

False reporting

• Which body has the power to prescribe rules and guidelines for

determination of wages in the country?

o National Wages and Productivity Commission (NWPC)

o What is the status of guidelines issued by Regional

Tripartite Wages and Productivity Boards?

These are void, if without the approval of or contrary

to NWPC guidelines

o What is the status of a wage order without required public

consultation and publication in newspapers?

Void as well

Who sets the minimum wage?

o Regional Tripartite Wages and Productivity Boards

o Is poor financial condition of the company an exemption to

payment of minimum wage?

No.

o What does “minimum wage” relate to?

A day’s work which comprises 8 hours at most

o When is a worker “daily paid”?

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Paid only for days he actually worked

o When is a worker “monthly paid”?

When the monthly rate covers all the days of the

month.

Calculated through the following formula:

• Monthly wage x 12 / 365 = daily rate

Must exceed the following formula:

• Minimum wage x 365 / 12

• Distinguish agricultural from industrial rates:

o Agricultural rates – farming in all its branches

o Industrial – manufacturing and processing

o What determines which rate applies?

Nature of the work. It is permissible for one company

to pay agricultural rate to some, and industrial rate to

others.

• What is wage distortion?o When the pay advantage of a position over another is removed

or significantly reduced due adjustment required by a wage

order

o The advantage must thereafter be restored

o Must there be full elimination of salary differences?

No. A “severe contraction” is enough.

o Are efforts to rectify mandatory?

Yes, whether the establishment is organized or

unorganized

What if it’s an organized establishment? (Neg-GM-VA)

• 1. Employer and union must negotiate

• 2. Any dispute must be resolved through

grievance machinery in CBA

• 3. If unsolved, through voluntary arbitration

What if it’s an unorganized establishment? (Neg-

Labor-NLRC)

• 1. Employer and union must endeavor to

correct it

• 2. Any dispute must be resolved through

Labor Arbiter (R.A. 6727 says NCMB)

• 3. In unsolved after 10 days of conciliation,

refer to NLRC

o Must the new difference be the same as before?

No, not to the last peso. Restoration of appreciable

differential is sufficient.

o Is any issue involving wage distortion a valid ground for

strike or lockout?

No. Check the enumeration – it’s not there.

o What is the “just and equitable” formula forwarded by the

SC inMetrobank?

(minimum wage / actual salary) * (prescribed

increase) = distortion adjustment

o Is there inter-region wage distortion?

No. Just intra-region. The wage-fixing rates are fixed

per region, and comparison must be within these

regions and not across regions.

o What if the salary distortion was created due to employer-

initiated salary restructuring?

There is no legal duty to rectify the distortion because

the legal duty only arises from distortions brought

about government wage orders.

o What are the prohibitions pertinent to wage orders?

1. No TROs or injunctions are allowed for proceedings

before the NWPC or RTWPBs.

2. Wage orders must respect the statutory minimum

wage set by Congress.

o Who are not covered by wage orders?

1. Household/domestic workers, and those in

personal service

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2. Workers in retail/service establishments employing

not more than 10 workers, when exempted from

compliance for a certain period fixed by

commission/boards

3. Workers in new business enterprises, within 2-3years from start of operations, when exempted and:

Outside NCR

Or in EPZs

o How often can there be a wage order?

Once every 12 months

Except when there is a Congressional law

o What are factors considered in wage orders? (don’t

memorize but understand and familiarize)

1. Standards of living

2. Needs of workers/families

3. Wage adjustment vis-à-vis consumer price index

4. Prevailing wage levels

5. Effects on employment family income

6. Cost of living and changes

7. Fair return of capital investment and employers’

capacity

8. Need to induce investment in rural areas

9. Equitable distribution of income

10. Demand for living wages

REST DAY

• When does the right to rest day accrue?

o For every six consecutive normal work days

• When is the rest day set?

o Depending on the CBA or subject to RRs

o What if the employee has preference based on religion?

It is respected, but he must inform the employer at

least 1 week before the day preferred

What if it might cause prejudice to business?

• Resort to other remedial measures. If there

are none, must schedule the preferred rest

day on that chosen day at least twice a

month.

•

When may an employee be required to work on a rest day?o 1. Actual or impending emergencies caused by disaster or

calamity, to prevent loss of life/property

o 2. Urgent work on machinery, equipment, or installation to

avoid serious loss

o 3. Abnormal pressure of work due to special circumstances

And there are no other measures

o 4. Prevent loss or damage to perishables

o 5. Nature of work requires continuous operations and stoppage

of work may result in irreparable injury or loess to employer

o 6. Analogous circumstances

o 7. Favorable weather or environmental conditions, when

performance is dependent on such

o (N.B. If you notice, this is the same as the Mandatory OT

enumeration, except for “abnormal pressure of work due to

special circumstances”)

• What is the rate of rest-day compensation?

o Regular wage plus 30% (“premium pay”)

o What if because of the nature of the employee’s job, there

are no regular workdays and no regular rest days can be

scheduled?

The extra 30% applies to Sunday work

• What is the rate for work on aspecial holiday?

o Regular wage plus 30%

o What if it is also his scheduled rest day?

Regular wage plus 50%

N.B. if he works OT, then it’s plus 30% of 150%

• What are the special holidays?

o 1. All Saints’ Day (Nov 1)

o 2. Last day of the year (Dec 31)

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o 3. Ninoy Aquino day (Aug 21)

• What if the employee does not work on a special holiday?

o No pay

• What is the implication when a day is declared as a special

workingholiday?

o Then no premium pay is given. An employee just earns 100%

if he works.

HOLIDAYS

• Which employers are not required to pay this holiday pay?

o 1. Government and GOCC employees


o 3. Those in personal service of another


o

5. Field personnelo 6. Those paid based on contract, commission, or for end-result

regardless of time spent working

o 7. Those in retail and service establishments employing less

than 10 workers

o (N.B. This is the same as NSD enumeration, and the same as

hours of work exemption + 10 workers-rule)

• Are monthly-paid employees excluded from holiday pay?

o No. They are included. The IRR provision establishing this is

void.

• For hourly-paid teachers, will the calling off of class or declaration

of special public holiday deprive them of income?

o No. They should receive what they would have been paid.

o What about when extensions are given?

Then they are paid their hourly rates.

• Are private school teachers entitled to holiday pay?

o Yes if the holiday falls during Christmas vacation

o No if the holiday falls during semestral breaks

• What about employees paid by results?

o Paid average daily earnings for 7 days preceding holiday

o But must not be less than minimum wage

• What about seasonal workers?

o Not paid holiday pay during off-season

Compensation:

Holiday and EE does not work 100% pay

Holiday and EE works 200% pay

Double-holiday (ex. Maundy

Thursday and Araw ng Kagitingan)

200% if EE rests; 300% if EE works

Holiday falls on Sunday 100% if EE rests; 200% if EE works

(no special rule)

Holiday falls on rest day 100% if EE rests; 230% if EE works;

N.B.+30% of 230% if EE works OT

• What is the rule in case of absences?

o Employee on LOA with pay –

entitled to benefit

o Employee on LOA without pay on the day immediately

preceding a regular holiday –

not entitled to holiday pay unless he works on such

regular holiday

o If immediately preceding day to a holiday is a non-working day

or is the scheduled rest day –

entitled to benefit only if he worked on the dayimmediately preceding the rest day or non-working

day

• What if there are successive regular holidays, like Maundy

Thursday and Good Friday?

o To be entitled to two successive holidays, employee must:

1. Be present on the day immediately preceding the

first holiday

2. Or be on paid leave

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18/78

o If he absents himself on the day immediately preceding

the first holiday, what is the consequence?

He may not be paid for the two holidays

What is the remedy?

He can go to work on the first holiday.

• What is the rule if there is temporary shutdown or cessation of

work?

o If regular holiday falls in period of temporary shutdown (ex.

inventory, repair, etc.) –

Entitled to benefit

o If it falls in period where operations cease due to business

reverses, as authorize by Sec. of Labor –

No holiday pay

• What is an ECOLA? Is the employee entitled to it during a legal

holiday?

o Emergency Cost of Living Allowance, which is not part of the

regular wage

o Yes, whether or not the employee works on a legal holiday, he

is entitled to ECOLA

• What are the legal holidays?

o New Year

o Maundy Thursday

o Good Friday

o Araw ng Kagitingan (April 9)

o Labor Day (May 1)

o Independence Day (June 12)o National Heroes Day (Last Sunday of August)

o Bonifacio day (November 30)

o Eidul Fitr

o Eidul Adha

o Christmas Day

o Rizal Day (December 30)

• What is the “holiday economics” rule?

o For the following seven holidays, the holiday is moved to the

nearest Monday –

Araw ng Kagitingan

Labor Day

Independence Day

National Heroes Day (becomes Last Monday of

August)

Bonifacio Day

Rizal Day

Ninoy Aquino Day Special holiday

LEAVES

• What is the right of Service Incentive Leave?

o Every employee who has rendered 1 year of service is entitled

to SIL of 5 dayso To whom will SIL not apply?

0. USUAL (Government/GOCCs, domestic workers,

those in personal service of another, managerial, field,

contractual/commission/end-result)

1. Those already enjoying this benefit

2. Those with Vacation Leave (VL) with pay of at least

5 days

3. Those in establishments with less than 10

employees

4. Establishments exempt by the Sec. of Labor, afterconsidering viability or financial condition of the

establishment

o (N.B. There are actually just three categories: a) those who

already grant it, and b) those who can’t grant it, c) usual)

What is the prohibition as to benefits granted in excess of what is

provided herein?

o It cannot be the subject of arbitration or any court/admin action

Is VL or Sick Leave required to be given?

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19/78

o No, it is not required by law. It is dependent on employer policy

and CBAs.

o These are voluntary benefits.

What are required by law (mandatory benefits)?

o 1. SIL

o 2. Paternity Leave (RA 8187)

o 3. Maternity Leave (SSS Law)

o 4. Solo Parent Leave (RA 8972)

o 5. Battered Woman Leave (RA 9262)

o Does the “less than ten employees” rule apply to Paternity

or Maternity Leave?

No. It only applies to SIL.

Why?

Kawawa naman sila, nanganak na nga,

papapasukin mo pa. It doesn’t matter how

many employees are there. What happens to unused SIL?

o Converted to cash.

Maternity Leave:

o Who is covered?

Female who has paid at least 3 monthly contributions

in the 12-month period immediately preceding the

semester of herchildbirth or miscarriage

o What does she receive?

100% of average daily salary for 60 days

100% of average daily salary for 78 days, if caesariano What are the conditions?

The employee must notify the employer of her

pregnancy – and this information is transmitted to the

SSS

Full payment is advanced by the employer within 30

days from filing the maternity leave application

o Can the woman recover sickness benefits concurrent with

maternity leave?

No.

o When does the SSS reimburse the employer?

Upon satisfactory proof that the employer has

advanced to the employee the benefits required

o How many times can maternity leave benefits be availed

of?

First four deliveries or miscarriages

o What is the consequence if the employer fails to turnover

to the SSS the employee’s contributions, or fails to inform

the SSS of her pregnancy?

Employer pays damages to the SSS equal to what the

employee would have been entitled to

o Is the identity of the father material?

No, it doesn’t matter who the father is

Paternity Leave:

o What is given?

Seven days of paternity leave with full pay to married

male employees in the private/public sectors

Are these 7 working days or 7 calendar days?

• No. 7 calendar days.

o What are the conditions to entitlement?

1. Married male employee and is employed when the

child is born

2. Cohabiting with his legitimate spouse when she

gives birth or suffers miscarriage

3. Applied for paternity leave according to rules 4. Wife gave birth or suffered miscarriage

• Is abortion included?

o No, not anymore.

o For how many deliveries is paternity leave valid?

First 4 deliveries

What is Solo Parent Leave?

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20/78

o A solo parent employee who has rendered service for at least

one year shall be given parental leave of not more than 7

working days

o What does a “solo parent” cover?

Women who gave birth as a result of rape

Widow or widower

Spouse separated legally or de facto for at least one

year

o What must the solo parent prove?

He or she is left alone with responsibility of

parenthood

o What must he or she show?

Solo parent identification card issued by a

representative of the DSWD

• What is the Battered Woman Leave (BWL) under RA 9262?

o A victim of physical, sexual, or psychological violence can

apply for the issuance of a “protection order.” In addition to

other reliefs, if she is an employee, she is entitled to a paid

leave of up to 10 days in addition to other leaves.

o Is it extendible?

Yes, when necessity arises as specified in the

protection order.

o What is a pre-requisite?

Must submit certification from punong brgy, kagawad,

prosecutor, or clerk of court that an action under RA

9262 has been filed and is pending

o Is use of the 10 day leave mandatory?

No. It’s up to the woman employee.

It can be used for days where she attends to medical

and legal concerns.

Are unused leave days convertible to cash or

cumulative?

• No.

o What if the employer refuses to implement BWL?

Liable under RA 9262.

o How is recovery of BWL benefits enforceable?

Under Art. 129, with the Regional Director (same

provision as simple money claims)

SERVICE CHARGES

What is the rate of distribution for service charges collected by

establishments?

o 85% to all covered employees – distributed equally among

employees, regardless of position or rank

How often is distribution?

Once or twice a month

o 15% to management

What is the integration rule?

o

If service charge is abolished, the share of covered employeesis considered integrated in their wages

What is covered by the 15% management share?

o To answer for losses and breakages, or it can be distribution to

managers at management’s prerogative

13TH MONTH PAY

• What is the rule on 13th month pay?

o It is required by law. It is not part of the basic wage, but it is

based on that wage.

• What is the value of the 13th month pay?

o It is 1/12 of total salary earned within a calendar year.

Are other bonuses included in the base rate?

• No. Just the regular wage.

When is it paid?

• Not later than December 24

What is not part of the “basic salary” base?

1. Cost of living allowances

2. Profit-shares

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3. All allowances and monetary benefits not

integrated in the basic salary

• Who is entitled to 13th month pay?

o All rank and file employees regardless of designation and

status – as long as they worked at least one month in that year

o And irrespective of method of payment (even piece-rate

employees)

o What about managerial employees?

Excluded by law, but can be included by stipulation

• What if an employee is terminated or has resigned before payment

of 13th month pay?

o Entitled to 1/12 of what he has earned anyway

• Which employers are exempted?

o 1. Government/GOCCs (usual)

o 2. Employers of household helpers

o 3. Employers of those under the personal service of anothero 4. Employers of those paid on commission, boundary, or end-

result basis

Except: piece-rate workers, who are covered

What is the rule on commissions?

• If the commissions may properly be

considered as part of the basic salary, then

it’s covered by 13th month pay

• If it’s not part of the basic salary, it’s excluded

o 5. Those already paying 13th month pay or its equivalent

Check intent of the bonus to see if it is credited as inlieu of the 13

th month pay or if it’s additional

o N.B. This is almost the usual enumeration + those who already

get an equivalent. Managers may or may not be given (see

above).

o EXCEPT field workers are supposed to be given 13th month

pay, because this provision is not re: hours of work.

• What if someone has multiple employers?

o Can get 13th month pay from all private employers, regardless

of total earnings

Summary of exemptions:

Hours of

work

NSD Wages Holiday

pay

SIL 13th MP

Govt,

GOCCs

Govt,

GOCCs

Farm

tenancy/

leasehold

Govt,

GOCCs

Govt,

GOCCs

Govt,

GOCCs

Managers Managers Cottage

industries

Managers Managers Managers

(may still

be given)

Field

personnel

Field

personnel

BMBE Field

personnel

Field

personnel

DH DH DH DH DH DH

Supported

family

members

Supported

family

members

Supported

family

members

Supported

family

members

Supported

family

members

Personal

service

Personal

service

Personal

service

Personal

service

Personal

service

Paid by

results

Paid by

results

Paid by

results

Paid by

results

Paid by

results

Only up to

5 EEs

Only up to

10 EEs

Only up to

10 EEs

Exempted

by Labor

Sec

Already

have SIL

Already

have 13th

MP

With paid

VL of at

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22/78

least 5

days

Compulsory OT work Compulsory rest day work

War or emergency War or emergency

Prevent loss or imminent danger Prevent loss or imminent danger

Urgent work on equipment Urgent work on equipment

Prevent loss or damage to

perishables

Prevent loss or damage to

perishables

Completion of work to avoid

prejudice

Completion of work to avoid

prejudice

Favorable weather conditions Favorable weather conditions

Abnormal pressure to work due to

special circumstances

WOMEN WORKERS

What is the non-discrimination rule?

o Cannot discriminate against a woman as to terms and

conditions of employment solely due to her sex

o What are the reliefs available?

Criminal action

Civil action for money claims, with damages, and

other affirmative reliefs

Are these mutually exclusive?

No. They proceed independently of each

other.

Are stipulations against marriage allowed?

o No. An employee cannot be hired with the condition that she

does not get married, or be terminated due to marriage

What are the prohibited acts?

o 1. Deny a woman employee benefits here or discharge her to

prevent her from enjoying the benefits

o 2. Discharge a woman due to pregnancy, or while on maternity

leave

o 3. Discharge or refuse to re-admit a woman after leave

What is the special rule on classification?

o Woman who is permitted or suffered to work, with or without

compensation in night clubs, massage clinics, bars (and similar

establishments), if under effective control/supervision of the

employer considered an employee of such establishment

o For what purposes?

Labor and social legislation

Who may be a victim of sexual harassment?

o Either a male or female

When is sexual harassment committed?

o When a person demands, requests, or requires sexual favor

from another

Must it be put in an oral or written statement?

No, it can be by inference

o Who may commit sexual harassment?

Anyone with authority, influence, or moral ascendancy

over the person harassed

o Where may it happen?

In work,

training,

or education environmento What if the person harassed refused the demand, request,

or requirement?

It does not matter. It’s still sexual harassment.

MINOR WORKERS

• Where can minors from 15 to below 18 be hired?

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o For any employment, as long as it is non hazardous. A person

has to be at least 18 years old to perform hazardous work

o Give examples of hazardous workplaces:

Exposed to contaminants

Construction, logging, fire-fighting, mining,

mechanized farming, deep sea fishing, etc.

Handling explosives or pyrotechnics

Using heavy equipment or machinery

Using power tools

o What are the allowed working hours?

Not more than 40 hours a week, no more than 8 hours

a day

No work from 10 pm – 6 am

N.B. in other words, no OT, no night shift

Can children below 15 be employed?

o No, except under very strict conditionso What are these exceptions?

1. The child works directly under the sole

responsibility of his/her parents/guardian and where

only members of the family are employed, and as long

as:

The child’s safety, life, health, or morals are

not endangered

• Does not impair child’s normal development

• Parent or guardian gives primary/secondary

education to the child 2. Child actors or talents, as long as:

• Employment contract is concluded by

parents or guardian with express agreement

of child, and if possible, DOLE approval

• The child’s safety, morals, health are not

endangered

• Employer takes measures to prevent child

exploitation or discrimination – taking into

account remuneration, duration, and working

time

• Implement continuing skills and training

acquisition program for the child

o What is required for these two situations?

The employer must secure a work permit from DOLE

o What are the allowed working hours?

No more than 20 hours a week, no more than 4 hours

a day

No work from 8 pm – 6 am

What does RA 7323 provide?

o Employers can hire at least 50 students during vacation period

and pay those students only 60% of their wages, and 40%

through education vouchers to be paid by government

o But the wages must meet the legal minimum

What are the prohibitions on employment of children in certain

advertisements?

o Cannot be employed as model in advertisements for alcoholic

beverages, tobacco, gambling, violence, or pornography

What are the worst forms of child labor?

o 1. Slavery

o 2. Prostitution

o 3. Production and trafficking of dangerous drugs and prohibited

substances

o 4. Work which by its nature or circumstances in which it is

carried is hazardous or harmful to health, safety, morals of

children

EMPLOYMENT OF HOUSE HELPERS

• What are house helpers?

o Those providing services in the employer’s home which is

usually necessary and desirable for the maintenance and

enjoyment thereof

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Includes ministering personal comfort and

convenience of the members of the household

Including family drivers

o Is a driver, laundrywoman, houseboy, etc. who works in

company staff-houses a house helper?

No. He or she is an industrial worker and must be

paid the industrial rate

o What is the criterion?

Personal comfort and enjoyment of the family of the

employer in the home of said employer

• What benefits are accorded house helpers?

o 1. Minimum wage

o 2. Cannot be assigned to work in commercial, industrial, or

agricultural enterprise at a wage lower than what is prescribed

o 3. What if the house helper is less than 18 years old?

If the house helper is less than 18 years old, the

employer must afford opportunity for at least

elementary education

Cost of education is part of the helper’s compensation

o 4. Must be treated in just and humane manner. No physical

violence must be used.

o 5. Free lodging, board, and medical attendance

o 6. Upon termination, given a written statement of the nature

and duration of the service and his/her efficiency as house

helper (employment certification)

o 7. Contract does not exceed 2 years (renewable)

o 8. Funeral expenses paid by employer if house helper has no

relatives with sufficient means in the place

• What are the hours of work allowed?

o Not to work for more than 10 hours a day

If the house helper agrees to work OT and there is

additional compensation, it is permissible

What is the vacation privilege?

o Right to 4 days vacation each month with pay. Failure to use

this does not allow accumulation – the helper can just get

monetary value.

• What if the period of household service is fixed?

o Cannot be terminated before end of the period without just

cause

o What if a house helper is unjustly dismissed?

Paid compensation already earned plus that of 15

days indemnity

o What if a house helper leaves without justifiable reason?

Forfeits unpaid salary not exceeding 15 days

What if the period of household service is not fixed?

o He must give 5 days notice before intended date of termination

EMPLOYMENT OF HOME WORKERS

• What is a homeworker?

o Any person who performs industrial homework for an employer,

contractor, or sub-contractor

• Under what circumstances are persons considered employers of

homeworkers?

o 1. Delivers or causes to be delivered any goods to be

processed or fabricated in or about a home and then returned

or disposed of or distributed according to his directions

o 2. Sells goods to be processed or fabricated in or about a

home and then re-buys them after such processing• Who can be deemed an employer of homeworkers?

o Any person, natural or artificial

o For his account or benefit, or on behalf of a non-resident

o Directly or indirectly

• Can industrial home workers form a labor organization?

o Yes.

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• What are the conditions before there can be deductions from a

homeworker’s income, due to loss, damage, or destruction to

materials?

o 1. Homeworker is clearly shown to be responsible for the loss

o 2. Employee is given reasonable opportunity to explain

o 3. Amount of deduction is fair and reasonable and not exceed

loss/damage

o 4. Deduction is made such that it does not exceed 20% of the

earnings in a week

o N.B. this is the same rule for breakages for regular employees

• What is the nature of the liability of the employer vis-à-vis the

contractor and the latter’s homeworkers?

o Same as in an independent contracting arrangement. The

provisions for homeworkers must be inserted in the contract.

o The employer is held liable when there is failure to pay wages

by the contractor.

• Prohibitions for homework:

o 1. Explosives, fireworks, similar articles

o 2. Drugs and poisons

o 3. Articles where processing involves exposure to toxic

substances

APPRENTICES AND LEARNERS

• What is an apprenticeable occupation?

o

Any trade, form of employment, or occupation which requiresmore than 3 months of practical training on the job

supplemented by theoretical instruction

o Involving a contract between the apprentice and employer, on

an approved apprenticeable occupation by the TESDA

• Who may employ apprentices?

o Only employers in highly technical industries AND approved by

the DOLE

• Who can qualify as an apprentice?

o 1. At least 14 years of age

o 2. With vocational aptitude and capacity for appropriate tests

o 3. And possesses the ability to comprehend and follow

written/oral instructions

• What is the maximum period of apprenticeship?

o 6 months

• Can there be payment of less than the minimum wage?

o Yes, but not below 75% and it must be pursuant to an approved

apprenticeship program approved by the DOLE

• What if there is no prior approval of the DOLE?

o The “apprentice” is in fact a regular employee.

• What are the possible venues of the program?

o 1. Entirely within the sponsoring firm

o 2. In a DOLE training facility

o 3. In a training facility, and then in the sponsoring firm

•

What is the remedy for violation of apprenticeship agreement?o Complaint filed with DOLE

o Appeal within 5 days from receipt of decision to Sec. of Labor

• What the conditions for tax deductibility of training costs?

o 1. The program must be approved by the DOLE

o 2. The deduction must not exceed 10% of direct labor wage

o 3. The apprentices are paid at least the minimum wage

o How much can be deducted?

½ of value of labor training expenses

• When can apprentices be hired without compensation?

o When training on the job is required by the school or

curriculum, or as a requisite for graduation/board examination• Are students who work for the school for free education deemed

employees?

o No, as long as they are given real opportunities to finish their

chosen courses

o What if the student causes damage to a third person in the

course of these duties?

The school will be deemed an employer.

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The school is only not deemed an employer as

regards labor regulations, rest periods, etc.

• What are learners?

o Persons hired as trainees in semi-skilled and other industrial

occupations which are non-apprenticeable

o And which may be learned through practical training on the job

in a relatively short period of time, not exceeding 3 months

• When can learners be hired?

o 1. When no experienced workers are available

o 2. Necessary to prevent curtailment of employment

opportunities

o 3. Does not create unfair competition in terms of labor costs or

standards

• Contents of learnership agreement?

o 1. Names and addresses of learners

o 2. Duration of learnership period (at most, 3 months)o 3. Wages and salaries of learners, which must be at least 75%

of minimum wage

What if the learners are in piecework?

• Must be paid in full for the work done

o 4. Commitment to employ the learners if they want as regular

employees after the period

o When are learners automatically deemed regular

employees?

When they have worked for at least 2 months and

then training is terminated by the employer before theend of the stipulated period, through no fault of the

learner

Contrast:

Apprenticeship Learnership

Highly skilled or technical jobs Semi-skilled job or industry

Not learnable in less than 3 months Learnable in less than 3 months

Approved by DOLE No such requirement

No commitment to hire after

termination of period (no certainty it

will be learned)

Commitment to hire after termination

of period

HANDICAPPED WORKERS

• Who are handicapped workers under the LC?

o Those whose earning capacity is impaired by age or

physical/mental deficiency or injury, disease, or illness

o What if the disability is not related to the work performed?

Then the employee will not be considered a

handicapped worker

Who are handicapped persons under RA 7277 (Magna Carta for

Disabled Persons)?

o Those suffering from restriction or different abilities as a resultof mental, physical, or sensory impairment, to perform an

activity in the manner or within the range considered normal for

a human being

What is the rule on non-discrimination?

o No disabled person can be denied access to opportunities for

employment

o If qualified, must be hired under same terms, privileges,

benefits, etc.

• What are the reserved positions for handicapped workers?

o 5% of all casual, emergency, and contractual positions inDSWD, DOH, Dep Ed, and other government agencies

engaged in social development

o What if suitable employment for handicapped persons

cannot be found through open employment?

State endeavors to provide sheltered employment

o Can handicapped workers be hired as learners or

apprentices?

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Yes, if their handicap is not such as to effectively

impede performance in the job for which they are

hired

• What are the incentives given to employers of handicapped

persons?

o 1. Tax deduction from employer’s gross income of up to 25% of

amount paid as salaries to handicapped workers

Must present proof of employment

And DOLE certification of worker’s disability

o 2.Tax deduction from employer’s gross income of up to 50% of

direct costs for improvement of facilities for handicapped

workers

But does not include improvements under BP 344

(Accessibility Law)

TERMINATION OF EMPLOYMENT

EMPLOYER-EMPLOYEE RELATIONSHIP

• Why is it important to determine EER?

o It determines the legal relationship between the parties, and

their rights and obligations.

How do you determine whether there is an EER?

o Four-fold test 1. Selection and hiring

2. Payment of wages

3. Power to dismiss the employee

4. Control over how the employee performs his

functions

o Does it matter what kind of system for payment of wages

is present (e.g. by compensation)?

No. EER is not determined by basis of employee’s

compensation, because “wage” is paid no matter how

designated.

o What is the most important?

Control (#4)

o How do you determine when there is control?

Determine how the employee performs the functions

(manner and means used), not just the end product

There is no control under the EER if the employer just

says the end product or goal

o What about employees working outside the facilities, are

they still under control of the employer?

They still can be under the control of the employer.

Ex. taxi cab drivers.

Distinguish giving details on the work, supervision on the manner

of doing the work:

o Instructions, no matter how detailed, may not actually indicate

control. If the details pertain to the product itself, then you are

not controlling the work. (Ex. you say that you want a barong

that has gold buttons, long sleeves, made of a certaintela,

etc.)

o If the details pertain to the work itself, there is control.

o N.B. So reporting about collections, or progress of the chair

being constructed these reports are really just about the end

product, and do not indicate control. So even reports do not

always indicate control.

o What if the alleged employee works more or less at his

own pleasure and is not subject to definite

hours/conditions of work, and is compensated for the end

result only?

No EER.

o X was an insurance agent required to solicit business

exclusively for Company Y. Is this control?

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It may seem like it, but it’s not. In this case, the

exclusivity clause stems from an Insurance Memo

Circular, to protect the public. There was no intention

by Corp Y to exercise control over the method and

manner by which X sells insurance. Should the power be exercised?

o No, need not be. Just as long as it’s available.

o How can you prove it if it’s not exercised?

If there is a written agreement, you can point to

certain provisions.

o What if there is no written contract or any proof of the

instructions given?

Usually you can prove it by the fact that he is within

the company premises. That his presence is required

by the company, and he is given an ID, are strong

indicators. Working in a place controlled by the

employer is a good indicator.

In the above examples, there are only two parties. But if there are

multiple parties involved and there are multiple suspected

employers, how do you determine who the employer is?

o Control is the strongest factor. For instance, A hires, B fires, C

pays, and D controls. D is the employer.

What is the subordinate test?

o “Economic Relations Test” – existing economic conditions

between the parties are used to determine whether EER exists:

1. Payment of pag-ibig contributions

2. Payment or remittance of contributions to the State

Insurance Fund

3. Deduction of withholding tax

4. Deduction or remittance of SSS contributions

o W/N the employee is dependent on the alleged employer for

his continued employment in that line of business

What is the value of ID cards?

o It’s not just a security measure but it usually mainly identifies

the holder as a bona fide employee of the corporation.

What are the special cases?

o 1. No EER between students and their school if there is written

agreement that the student works in exchange for free

education and the student is given real opportunity to finish the

course

o 2. There is EER between resident physicians and training

hospital UNLESS there is training agreement between them

and it is duly accredited by the government

PROBATIONARY EMPLOYMENT

Do all regular employees have to start as probationary employees?

o No. There is only probationary employment when there is an

agreement for probationary employment.

o But for probationary employees, after the lapse of the period,

he/she becomes a regular employee.

• What should the agreement contain?

o 1. Apprise employee of the nature of employment

o 2. Inform employee of standards to be met to become regular

How long should the probationary period be?

o Six months. It cannot go beyond the six month period. It is

non-extendible.


1. Covered by an apprenticeship program stipulatinglonger period

2. Voluntary agreement of parties (esp. when the

nature of work requires longer period)(Mariwasa v.

Leogardo)

3. Employer gives employee a second chance to pass

the standards test

What will make the probationary employment invalid?

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o If the employer did not give reasonable standards for the

employee to meet within that period.

o The standards have to be given at the start of the employment.

o What is the legal effect of this?

The employee becomes regular.

Before you reach the end of the probationary period, can you still

terminate the employee on the grounds for which a regular

employee may be terminated?

o Yes.

When will the employee become regular?

o Evaluate within the period.

o If there is no evaluation and he is hired beyond the period, then

he becomes a regular employee.

You start a probationary work agreement, and the six month period

ended. The employee continues working. There is no evaluation

yet. What is the legal implication?

o He becomes a regular employee.

o At what point?

As soon as you go beyond the six month period.

• How do you count six months?

o There are conflicting decisions, but Atty. MM prefers the same

day from the sixth month from when you started employment

(Jan. 3 July 3)

o Although there is another case that says 180 days.

• Can a person who has been promoted be probationary again?

o No. Only probationary as to the position, but you can never beprobationary as to employment in general again.

• What are the requirements for private school teachers to acquire

permanent employment?

o 1. The teacher is full-time

o 2. Must have rendered three consecutive years of service

o 3. The service must be satisfactory

KINDS OF EMPLOYMENT

Regular employees

When is an employee regular?

o When he performs tasks that areusually necessary and

desirable to the business.

How does “usually necessary and desirable” here compare to

“directly related” in contracting arrangements?

o “Necessary and desirable” here applies to class of

employment, and “directly related” in contracting only relates to

whether there is an employer-employee relationship.

A worker who performs work usually necessary and desirable to

the company becomes an employee of the company. T/F?

o False. The conclusion is off-tangent.

o You use the necessity and desirability test to determine what

class of employee he is, and not whether or not he is an

employee.

o To determine employer-employee relationship, you apply the

four-fold test.

There is a company with security guard A, and security guard B.

Can it be that A is a regular employee, and B is not because he was

hired by a contractor?

o Yes, this is legally possible.

o But isn’t the nature of the work of the employee the

determinant?

Yes. But you determine the nature of his work in

relation to the contractor.

How do you determine if a particular work is usually necessary and

desirable, hence leading to regular employment?

o Look at the nature of the business of the employer

o What if an employee is tasked to perform a job for at least

one year already?

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Performance of a job for at least a year – evidence

that the job is necessity and indispensable for

business

• How can a regular employee be terminated?

o For just or authorized causes only

Casual employee

Who is a casual employee?

o One doing work not “usually necessary or desirable” to the

employer, and is not project nor seasonal

When do they become regular employees?

o After one year of service, continuous or broken.

o He becomes regular as to the activity for which he is employed

and is regular as long as the activity exists

o

When does one year period vest?

NOT your one year anniversary.

It must be “cumulative period of service” of one year.

Fixed term employment

• What are the requisites?

o 1. They should have agreed upon a time frame for when work

must be done

How is this different from project?

• Fixed term is time bound, project is task

bound. Fixed term does not care if the

project or job is done.

o 2. The agreement was voluntarily entered into by parties

Consider level of parity

o 3. Employment scheme is not designed to circumvent the

law/Labor Code

• What if the job is usually necessary and desirable to the business

of the employer?

o The employee is deemed regular

• If all the employees are fixed-term, it is proof of illegality, because the

employer is seemingly circumventing the law.

• Is there a conversion?

o If you work beyond this period, you become regular

• Rememberthe general rule: you are regular if you are not covered by a

special agreement. If you are hired but not placed under a special

category, you are regular.

Seasonal employees

When will seasonal employees become regular?

o After repeated rehiring.

What if after harvesting season, they still work FOR the employer

but doing other seasonal tasks (ex. harvesting then the next

season, drying)?

o They become regular.o If you are employed throughout the year, doing different tasks,

although all are seasonal, you are regular.

What is the status of seasonal workers who are called to work from

time to time and are not made to work during off-season?

o They are not separated from service. They are considered on

leave until re-employed. They are seasonal workers.

o But if they have repeatedly done that job for years, they

become regular.

Project employees

What are project employees?

o They are hired for a specific undertaking or project.

o His employment ends after the project ends.

o They cannot be terminated without just cause before the

project ends.

o What is the “day certain” rule?

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It ends on a certain date, but not an exact date – just

upon completion of project

• If there is a construction project ongoing, can we assume the

construction workers are project employees?

o No, it doesn’t follow.

What is an example of a project within a company that is different

from its main line of business?

o Mango Orchard owner hiring workers to build a water pipeline

for irrigation.

When can project employees become regular employees?

o Working beyond the project

o Repeated rehiring, for the same task or tasks that are

necessary for the business

o Is a second project a repeated rehiring?

No, it’s the first rehiring. A third project will be the first

instance of repeated rehiring.

Is the date material?

o Not always, because it can also be another determinant, such

as the completion of the project, even if the date is not

determinable.

o What if there is no such given standard?

Considered a r

tuazon labor rev

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