Department Order No. 147-15,Series of 2015

Republic of the Philippines

DEPARTMENT OF LABOR AND EMPLOYMENT

OUTLINEI. BACKGROUNDII. SALIENT FEATURESIII. GUIDING PRINCIPLEIV. COVERAGEV. DUE PROCESS: TERMINATION OF EMPLOYMENT

a) Just Causes1. Substantive2. Procedural

b) Authorized Causes1. Substantive2. Procedural

c) Other CausesV. CONCILIATION-MEDIATION

D.O. No. 147-15, Series of 2015

PHILIPPINE LABOR & EMPLOYMENT PLANRights at Work

Outcome: Strengthened compliance with Constitutionally protected rights of workers

Issues: Outdated Labor Code Increased insecurity of jobs

Strategies: Guarantee the rights and protection of workersReview the Labor Code provisions on contracting or sub-contracting and security of tenure

D.O. No. 147-15, Series of 2015

UPDATES ON ADDRESSING SOT12 pending SOT bills

Endorsement of House Bill No. 5415 (Contracting and Subcontracting Bill), House Bill No. 5416 (Termination of Employment Bill) and House Bill No. 5806 (Employment Relations Bill)

Department Order No. 18-A, series of 2011

Department Order No. 131 (LLCS), series of 2013

D.O. No. 147-15, Series of 2015

Presidential Decree No. 442 - Labor Code of the Philippines

D.O. No. 147-15, Series of 2015

Rule I, Implementing Rules and Regulations of the Labor Code of the Philippines, as amended

Jurisprudence

D.O. No. 147-15, Series of 2015Source: National Labor Relations Commission, 2014 Annual Report

D.O. No. 147-15, Series of 2015

4,192 5,165 4,289 5,121 6,532 6,214 5,599 5,972 6,604 5,558 3,307

5,110 5,0625,453 5,333

6,8957,290

6,947

5,845

5,1065,518

7,551

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Cases Won by the Management and Labor in the Commission Proper: 2004 - 2014

Won by Management Won by Labor

Source: National Labor Relations Commission, 2014 Annual Report

D.O. No. 147-15, Series of 2015Source: National Labor Relations Commission

YEAR

AVE. TIME TO DISPOSE

(From filing to NLRC)

AVE. TIME TO DISPOSE

(From NLRC to CA)

AVE. TIME TO DISPOSE

(From CA to SC)

AVE. TIME TO DISPOSE(From filing to SC)

20102 years

756.3 days2 years

(876.5 days)4 years

(1,419 days)8 years

(3,051 days)

20112 years

(784.1 days)3 years

(898.2 days)4 years

(1,560.4 days)9 years

(3,526.5 days)

Average Time of DispositionLabor Cases, 2010-2011

D.O. No. 147-15, Series of 2015

• Workers:• Loss of income/direct impact on family• Litigation cost

• Employers:• Loss of skills and experience• Loss of capital and productivity• Litigation cost

• Opportunity cost

D.O. No. 147-15, Series of 2015

• Cost on litigation: (₱100,500.00)• Ordinary Attorney’s Fee

• Paper fees = ₱ 1,000• Appearance fees = ₱ 3,000/hearing• Acceptance fee = ₱ 60,000

• Extraordinary Attorney’s Fee (10% of the Award)• Php12,753.5 per case

• Cost on execution of judgment:• Travel expenses (estimate) = ₱200.00 on travel expenses or

approximately ₱ 4,000.00 per case• 5 years maximum effectivity of writ of execution

D.O. No. 147-15, Series of 2015

COST DISMISSAL: EMPLOYEE

• Dismissal case that gets to higher court costs large dismissal award

of 96 months

D.O. No. 147-15, Series of 2015

COST DISMISSAL: EMPLOYER

ILLEGAL DISMISSAL CASES ARE NOT ONLY TOO MANY BUT ALSOLENGTHY AND UNFORTUNATELY, SO COSTLY

Department Order No. 147-15,Series of 2015

Signed by the Secretary on 07 September 2015

Published in PDI and Phil. Star on 03 October 2015

D.O. No. 147-15, Series of 2015

TRIPARTITE CONSULTATIONS • 3 Small Tripartite TWG

Meetings• TWG Members

• Employer Representatives• Labor Representatives

• 3 TEC Meetings• Approved by TIPC

21 May 2015

D.O. No. 147-15, Series of 2015

SALIENT FEATURES of D.O. NO. 147-15 • Specifying the standards on just and

authorized causes of termination ofemployment based on jurisprudence

• Clarifying other grounds for termination suchas those provided in the CBA andanalogous causes which must be expresslyprovided for in company rules and policies

D.O. No. 147-15, Series of 2015

SALIENT FEATURES of D.O. NO. 147-15

• Applying the Last In, First Out Rule

• Subjecting all issues of termination based onjust and authorized causes to mandatoryconciliation-mediation and Request forAssistance before the SEADOs

GUIDING PRINCIPLES• Right to security of tenure is guaranteed under the

Philippine Constitution and other laws andregulations

• No employee shall be terminated from work exceptfor just or authorized cause and upon observance ofdue process.

D.O. No. 147-15, Series of 2015

COVERAGE• Parties of work arrangements

where employer-employee(er-ee) relationship exists

• Parties of legitimatecontracting/subcontractingarrangements with existingemployer-employeerelationships

D.O. No. 147-15, Series of 2015

Just Cause of TerminationSubstantive

a) Serious Misconductb) Willful Disobedience or Insubordinationc) Gross and Habitual Neglect of Dutiesd) Fraud or Willful Breach of Truste) Loss of Confidencef) Commission of a Crime or Offenseg) Analogous Causes

D.O. No. 147-15, Series of 2015

Just Cause of Termination

Procedural

a) First written noticeb) Hearing c) Second written notice

D.O. No. 147-15, Series of 2015

Authorized Cause of Termination

Substantive

a) Installation of Labor-saving Devicesb) Redundancyc) Retrenchment or Downsizingd) Closure or Cessation of Operatione) Disease

D.O. No. 147-15, Series of 2015

Authorized Cause of TerminationProcedural

1. Written notice to the employee andthe appropriate Regional Office of theDepartment of Labor and Employment(DOLE) at least thirty days (30) beforethe effectivity of the termination,specifying the ground or grounds fortermination.

2. Separation pay

D.O. No. 147-15, Series of 2015

Authorized Cause of TerminationSeparation Pay

1. Installation of labor-saving devices – one (1) month pay2. Redundancy –one (1) month pay3. Retrenchment - (1) month pay or at least one-half (1/2) month pay4. Closure or cessation of business operation not due to serious

business losses - one (1) month pay or at least one-half (1/2) monthpay

5. Disease - one (1) month pay or at least one-half (1/2) month pay

No separation pay for termination based on just cause except as expressly provided for in the company policy or Collective Bargaining Agreement (CBA).

D.O. No. 147-15, Series of 2015

Authorized Cause of Termination

Quick Response Team

D.O. No. 147-15, Series of 2015

Conciliation-Mediation under SEnA

Compulsory Arbitration or VoluntaryArbitration

Other causes of Termination1. Company policy2. Collective Bargaining Agreement3. Use of Dangerous Drugs4. Sexual Harassment

D.O. No. 147-15, Series of 2015

MANDATORY CONCILIATION-MEDIATION

Settlement agreement shall be final and binding

Referral to compulsoryarbitration, or if both parties so agree, to voluntary arbitration

Condition Precedent to Compulsory Arbitration

D.O. No. 147-15, Series of 2015

End of Presentation

D.O. No. 147-15, Series of 2015