LABOR LAW I1st Semester, AY 2009-2010

Prof. E. (Leo) D. BattadCollege of Law

University of the Philippines

“Among the most important duties of employersthe principal one is to give every worker

what is justly due him… (N)o laws, either human or divine,permit them for their own profit

to oppress the needy and the wretchedor to seek gain from another’s want.”

- Pope Leo XIII in Rerum Novarum, 1891

REFERENCES:

1987 Philippine Constitution The Labor Code of the Philippines and its Implementing Rules &

Regulations Pertinent International Human Rights Instruments and ILO Conventions,

Recommendations and Labor-related laws Assigned Readings

I. INTRODUCTION TO LABOR LAW

A. Capital and Labor

Readings:

Pope Leo XIII, Rerum Novarum, 15 May 1891

Pope John Paul II, Laborem Exercens, 14 September 1981

Reflection Paper: Choice of any of the two readings.

B. Labor Law

1. Definition

2. Classification

a. Labor Standards

b. Labor Relations

c. Welfare Legislation

3. Social Justice, Const., Art. II, Sec. 10; Art. XIII, Sec. 1-3

a. Definition/Balancing of Interest

Calalang v. Williams, 70 Phil. 726 (1940) Manila Electric Co. v. Hon. Sec. of Labor Quisumbing, 337 SCRA 90 (2000)

b. Foundation: Police Power and State Protection

CMS Estate, Inc. v. Social Security System, 132 SCRA 108 (1984)

c. Limits of Use

PLDT v. NLRC, 164 SCRA 671 (1988)

5. Legal Bases

a. International Instruments

1) International Covenant on Civil and Political Rights, Art. 22International Covenant on Economic, Social and Cultural Rights, Arts. 6, 7, 8, 9International Convention on the Elimination of All Forms of Discrimination Against Women, Art. 11

2) International Labor Organization (ILO) Conventions

International School Alliance of Educators v. Quisumbing, 333 SCRA 13 (2000)

b. 1987 Constitution, Art. II, Secs. 5, 9, 10, 13, 14, 18; Art. XIII, Secs. 1, 3, 14

See also: 1935 Const., Art. XIV, Sec., 6; 1973 Const., Art. II, Sec. 9

c. Labor Code (LC) and Omnibus Rules Implementing the Labor Code

d. New Civil Code of the Philippines (NCC), Arts. 19, 21, 1700-1701

6. Sources of Rights, Privileges and Benefits

a. International and Domestic Laws

b. Collective Bargaining Agreement, Art. 1305-1306, NCC

DOLE Phils. v. Pawis ng Makabayang Obrero, 395 SCRA 112 (2003)

c. Past Practices

Davao Fruits Corporation v. Associated Labor Union, 225 SCRA 562 (1993)

American Wire and Cable Daily Rated Employees Union American Wire and Cable Co., Inc., 457 SCRA 684 (2005)

d. Company Policies

China Banking Corporation v. Borromeo, 440 SCRA 621 (2004)

II. LABOR CODE OF THE PHILIPPINES

A. Brief History

B. General Provisions

1. Decree Title, Art. 1

2. Effectivity, Art. 2

3. Policy Declaration, Art. 3

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4. Construction in Favor of Labor, Art. 4

Salinas Jr. v. NLRC, 319 SCRA 54 (1999) Reyes v. Court of Appeals, 409 SCRA 267 (2003) G&M Philippines, Inc. v. Romil Cuambot, 507 SCRA 552 (2006)

5. Rule Making Power, Art. 5

ART. 5. Rules and regulations. - The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation.

Kapisanan ng mga Manggagawang Pinagyakap v. NLRC, 152 SCRA 6 (1987)

6. Technical Rules Not Binding, Art. 221

ART. 221. Technical rules not binding and prior resort to amicable settlement. - In any proceeding before the Commission or any of the Labor Arbiters, the rules of evidence prevailing in courts of law or equity shall not be controlling and it is the spirit and intention of this Code that the Commission and its members and the Labor Arbiters shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure, all in the interest of due process. In any proceeding before the Commission or any Labor Arbiter, the parties may be represented by legal counsel but it shall be the duty of the Chairman, any Presiding Commissioner or Commissioner or any Labor Arbiter to exercise complete control of the proceedings at all stages.

Any provision of law to the contrary notwithstanding, the Labor Arbiter shall exert all efforts towards the amicable settlement of a labor dispute within his jurisdiction on or before the first hearing. The same rule shall apply to the Commission in the exercise of its original jurisdiction. (As amended by Section 11, Republic Act No. 6715, March 21, 1989).

Huntington Steel Products, Inc. v. NLRC, 442 SCRA 551 (2004)

7. Applicability, Art. 6, 276; Constitution, Art. IX-B, Sec. 2(1)

ART. 6. Applicability. - All rights and benefits granted to workers under this Code shall, except as may otherwise be provided herein, apply alike to all workers, whether agricultural or non-agricultural. (As amended by Presidential Decree No. 570-A, November 1, 1974)

ART. 276. Government employees. - The terms and conditions of employment of all government employees, including employees of government-owned and controlled corporations, shall be governed by the Civil Service Law, rules and regulations. Their salaries shall be standardized by the National Assembly as provided for in the New Constitution. However, there shall be no reduction of existing wages, benefits and other terms and conditions of employment being enjoyed by them at the time of the adoption of this Code.

Section 2. (1) The civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government, including government owned or controlled corporations with original charters.

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8. Enforcement and Sanctions – Arts. 217 (a) (2), (3), (4), (6); 128-129; 288-292; Consti., Art III, Secs. 11 and 16

ART. 217. Jurisdiction of the Labor Arbiters and the Commission. - (a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural:

1. Unfair labor practice cases; 2. Termination disputes; 3. If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; 4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations; 5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and 6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement.

ART. 128. Visitorial and enforcement power. - (a) The Secretary of Labor and Employment or his duly authorized representatives, including labor regulation officers, shall have access to employer’s records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of this Code and of any labor law, wage order or rules and regulations issued pursuant thereto.

(b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee still exists, the Secretary of Labor and Employment or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representatives shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the findings of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. (As amended by Republic Act No. 7730, June 2, 1994).

An order issued by the duly authorized representative of the Secretary of Labor and Employment under this Article may be appealed to the latter. In case said order involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Secretary of Labor and Employment in the amount equivalent to the monetary award in the order appealed from. (As amended by Republic Act No. 7730, June 2, 1994). chanroblesvirtuallawlibrary

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(c) The Secretary of Labor and Employment may likewise order stoppage of work or suspension of operations of any unit or department of an establishment when non-compliance with the law or implementing rules and regulations poses grave and imminent danger to the health and safety of workers in the workplace. Within twenty-four hours, a hearing shall be conducted to determine whether an order for the stoppage of work or suspension of operations shall be lifted or not. In case the violation is attributable to the fault of the employer, he shall pay the employees concerned their salaries or wages during the period of such stoppage of work or suspension of operation.

(d) It shall be unlawful for any person or entity to obstruct, impede, delay or otherwise render ineffective the orders of the Secretary of Labor and Employment or his duly authorized representatives issued pursuant to the authority granted under this Article, and no inferior court or entity shall issue temporary or permanent injunction or restraining order or otherwise assume jurisdiction over any case involving the enforcement orders issued in accordance with this Article.

(e) Any government employee found guilty of violation of, or abuse of authority, under this Article shall, after appropriate administrative investigation, be subject to summary dismissal from the service.

(f) The Secretary of Labor and Employment may, by appropriate regulations, require employers to keep and maintain such employment records as may be necessary in aid of his visitorial and enforcement powers under this Code.

ART. 129. Recovery of wages, simple money claims and other benefits. - Upon complaint of any interested party, the Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the Department is empowered, through summary proceeding and after due notice, to hear and decide any matter involving the recovery of wages and other monetary claims and benefits, including legal interest, owing to an employee or person employed in domestic or household service or househelper under this Code, arising from employer-employee relations: Provided, That such complaint does not include a claim for reinstatement: Provided further, That the aggregate money claims of each employee or househelper does not exceed Five thousand pesos (P5,000.00). The Regional Director or hearing officer shall decide or resolve the complaint within thirty (30) calendar days from the date of the filing of the same. Any sum thus recovered on behalf of any employee or househelper pursuant to this Article shall be held in a special deposit account by, and shall be paid on order of, the Secretary of Labor and Employment or the Regional Director directly to the employee or househelper concerned. Any such sum not paid to the employee or househelper because he cannot be located after diligent and reasonable effort to locate him within a period of three (3) years, shall be held as a special fund of the Department of Labor and Employment to be used exclusively for the amelioration and benefit of workers.

Any decision or resolution of the Regional Director or hearing officer pursuant to this provision may be appealed on the same grounds provided in Article 223 of this Code, within five (5) calendar days from receipt of a copy of said decision or resolution, to the National Labor Relations Commission which shall resolve the appeal within ten (10) calendar days from the submission of the last pleading required or allowed under its rules.chan robles virtual law library

The Secretary of Labor and Employment or his duly authorized representative may supervise the payment of unpaid wages and other monetary claims and benefits, including legal interest, found owing to any employee or househelper under this Code. (As amended by Section 2, Republic Act No. 6715, March 21, 1989).

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ART. 288. Penalties. - Except as otherwise provided in this Code, or unless the acts complained of hinge on a question of interpretation or implementation of ambiguous provisions of an existing collective bargaining agreement, any violation of the provisions of this Code declared to be unlawful or penal in nature shall be punished with a fine of not less than One Thousand Pesos (P1,000.00) nor more than Ten Thousand Pesos (P10,000.00) or imprisonment of not less than three months nor more than three years, or both such fine and imprisonment at the discretion of the court. 

In addition to such penalty, any alien found guilty shall be summarily deported upon completion of service of sentence. chanroblesvirtuallawlibrary

Any provision of law to the contrary notwithstanding, any criminal offense punished in this Code, shall be under the concurrent jurisdiction of the Municipal or City Courts and the Courts of First Instance. (As amended by Section 3, Batas Pambansa Bilang 70).

ART. 289. Who are liable when committed by other than natural person. - If the offense is committed by a corporation, trust, firm, partnership, association or any other entity, the penalty shall be imposed upon the guilty officer or officers of such corporation, trust, firm, partnership, association or entity.

 Title II

PRESCRIPTION OF OFFENSES AND CLAIMS

ART. 290. Offenses. - Offenses penalized under this Code and the rules and regulations issued pursuant thereto shall prescribe in three (3) years.

All unfair labor practice arising from Book V shall be filed with the appropriate agency within one (1) year from accrual of such unfair labor practice; otherwise, they shall be forever barred.

ART. 291. Money claims. - All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three (3) years from the time the cause of action accrued; otherwise they shall be forever barred.

All money claims accruing prior to the effectivity of this Code shall be filed with the appropriate entities established under this Code within one (1) year from the date of effectivity, and shall be processed or determined in accordance with the implementing rules and regulations of the Code; otherwise, they shall be forever barred.

Workmen’s compensation claims accruing prior to the effectivity of this Code and during the period from November 1, 1974 up to December 31, 1974, shall be filed with the appropriate regional offices of the Department of Labor not later than March 31, 1975; otherwise, they shall forever be barred. The claims shall be processed and adjudicated in accordance with the law and rules at the time their causes of action accrued.

ART. 292. Institution of money claims. - Money claims specified in the immediately preceding Article shall be filed before the appropriate entity independently of the criminal action that may be instituted in the proper courts.

Pending the final determination of the merits of money claims filed with the appropriate entity, no civil action arising from the same cause of action shall be filed with any court. This provision shall not apply to employees compensation case which

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shall be processed and determined strictly in accordance with the pertinent provisions of this Code.

 

Section 11. Free access to the courts and quasi-judicial bodies and adequate legal assistance shall not be denied to any person by reason of poverty.

Section 16. All persons shall have the right to a speedy disposition of their cases before all judicial, quasi-judicial, or administrative bodies.

Cireneo Bowling Plaza, Inc. v. Sensing, 448 SCRA 175 (2005)

C. Work Relationship

1. Employer and Employee Relationship

a. Definition of Employer and Employee, Arts. 97 (a) (b) (c), 167 (f)(g) (h), 212 (e) (f)

ART. 97. Definitions. - As used in this Title:

(a) "Person" means an individual, partnership, association, corporation, business trust, legal representatives, or any organized group of persons.

(b) "Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the government and all its branches, subdivisions and instrumentalities, all government-owned or controlled corporations and institutions, as well as non-profit private institutions, or organizations.

(c) "Employee" includes any individual employed by an employer.

Art. 167:(f) "Employer" means any person, natural or juridical, employing the services of the employee.

(g) "Employee" means any person compulsorily covered by the GSIS under Commonwealth Act Numbered One hundred eighty-six, as amended, including the members of the Armed Forces of the Philippines, and any person employed as casual, emergency, temporary, substitute or contractual, or any person compulsorily covered by the SSS under Republic Act Numbered Eleven hundred sixty-one, as amended.

(h) "Person" means any individual, partnership, firm, association, trust, corporation or legal representative thereof.

Art. 212

(e) "Employer" includes any person acting in the interest of an employer, directly or indirectly. The term shall not include any labor organization or any of its officers or agents except when acting as employer.

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(f) "Employee" includes any person in the employ of an employer. The term shall not be limited to the employees of a particular employer, unless the Code so explicitly states. It shall include any individual whose work has ceased as a result of or in connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other substantially equivalent and regular employment.

b. Factors/Tests

Ruga v. NLRC, 181 SCRA 437 (1990) Perpetual Help Credit v. Faburada et al., 366 SCRA 693 (2001) Vicente Sy v. Court of Appeals, 398 SCRA 301 (2003) Chavez v. NLRC, 448 SCRA 478 (2005) Francisco v. NLRC, 500 SCRA 690 (2006)

c. Piercing the Veil of Corporate Veil

Pamplona Plantatin Co., Inc. v. Tinghil, 450 SCRA 421 (2005)

2. Independent Contractor and Labor-only Contractor, Art. 106-107, 109; DO No. 18-02, S 2002

Art. 106. Contractor or subcontractor. Whenever an employer enters into a contract with another person for the performance of the former’s work, the employees of the contractor and of the latter’s subcontractor, if any, shall be paid in accordance with the provisions of this Code.

In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him.

The Secretary of Labor and Employment may, by appropriate regulations, restrict or prohibit the contracting-out of labor to protect the rights of workers established under this Code. In so prohibiting or restricting, he may make appropriate distinctions between labor-only contracting and job contracting as well as differentiations within these types of contracting and determine who among the parties involved shall be considered the employer for purposes of this Code, to prevent any violation or circumvention of any provision of this Code.

There is "labor-only" contracting where the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others, and the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer. In such cases, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him.

Art. 107. Indirect employer. The provisions of the immediately preceding article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project.

Art. 109. Solidary liability. The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or

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subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers.

DEPARTMENT ORDER NO. 18 - 02 (Series of 2002)

.

. RULES IMPLEMENTING ARTICLES 106 TO 109

OF THE LABOR CODE, AS AMENDED . .

By virtue of the power vested in the Secretary of Labor and Employment under Articles 5 (Rule-making) and 106 (Contractor or Subcontractor) of the Labor Code of the Philippines, as amended, the following regulations governing contracting and subcontracting arrangements are hereby issued: Section 1. Guiding principles. - Contracting and subcontracting arrangements are expressly allowed by law and are subject to regulation for the promotion of employment and the observance of the rights of workers to just and humane conditions of work, security of tenure, self-organization, and collective bargaining. Labor-only contracting as defined herein shall be prohibited.

Section 2 . Coverage. - These Rules shall apply to all parties of contracting and subcontracting arrangements where employer-employee relationship exists. Placement activities through private recruitment and placement agencies as governed by Articles 25 to 39 of the Labor Code are not covered by these Rules.

Section 3. Trilateral Relationship in Contracting Arrangements. - In legitimate contracting, there exists a trilateral relationship under which there is a contract for a specific job, work or service between the principal and the contractor or subcontractor, and a contract of employment between the contractor or subcontractor and its workers. Hence, there are three parties involved in these arrangements, the principal which decides to farm out a job or service to a contractor or subcontractor, the contractor or subcontractor which has the capacity to independently undertake the performance of the job, work or service, and the contractual workers engaged by the contractor or subcontractor to accomplish the job work or service.

Section 4. Definition of Basic Terms. - The following terms as used in these Rules, shall mean:

(a) "Contracting" or "subcontracting" refers to an arrangement whereby a principal agrees to put out or farm out with a contractor or subcontractor the performance or completion of a specific job, work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal.

(b) "Contractor or subcontractor" refers to any person or entity engaged in a legitimate contracting or subcontracting arrangement.

(c) "Contractual employee" includes one employed by a contractor or subcontractor to perform or complete a job, work or service pursuant to an arrangement between the latter and a principal.

(d) "Principal" refers to any employer who puts out or farms out a job, service or work to a contractor or subcontractor.

Section 5. Prohibition against labor-only contracting. - Labor-only contracting is hereby declared prohibited. For this purpose, labor-only contracting shall refer to an arrangement

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where the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal, and any of the following elements are present: (i) The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal; or

(ii) the contractor does not exercise the right to control over the performance of the work of the contractual employee.

The foregoing provisions shall be without prejudice to the application of Article 248 (C ) of the Labor Code, as amended.

"Substantial capital or investment" refers to capital stocks and subscribed capitalization in the case of corporations, tools, equipment, implements, machineries and work premises, actually and directly used by the contractor or subcontractor in the performance or completion of the job, work or service contracted out.

The "right to control" shall refer to the right reserved to the person for whom the services of the contractual workers are performed, to determine not only the end to be achieved, but also the manner and means to be used in reaching that end.

Section 6. Prohibitions. - Notwithstanding Section 5 of these Rules, the following are hereby declared prohibited for being contrary to law or public policy:

(a) Contracting out of a job, work or service when not done in good faith and not justified by the exigencies of the business and the same results in the termination of regular employees and reduction of work hours or reduction or splitting of the bargaining unit;

(b) Contracting out of work with a "cabo" as defined in Section 1 (ii), Rule I, Book V of these Rules. "Cabo" refers to a person or group of persons or to a labor group which, in the guise of a labor organization, supplies workers to an employer, with or without any monetary or other consideration whether in the capacity of an agent of the employer or as an ostensible independent contractor;

(c) Taking undue advantage of the economic situation or lack of bargaining strength of the contractual employee, or undermining his security of tenure or basic rights, or circumventing the provisions of regular employment, in any of the following instances:

(i) In addition to his assigned functions, requiring the contractual employee to perform functions which are currently being performed by the regular employees of the principal or of the contractor or subcontractor;

(ii) Requiring him to sign, as a precondition to employment or continued employment, an antedated resignation letter; a blank payroll; a waiver of labor standards including minimum wages and social or welfare benefits; or a quitclaim releasing the principal, contractor or subcontractor from any liability as to payment of future claims; and

(iii) Requiring him to sign a contract fixing the period of employment to a term shorter than the term of the contract between the principal and the contractor or subcontractor, unless the latter contract is divisible into phases for which substantially different skills are required and this is made known to the employee at the time of engagement;

(d) Contracting out of a job, work or service through an in-house agency which refers to a contractor or subcontractor engaged in the supply of labor which is owned, managed or controlled by the principal and which operates solely for the principal;

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(e) Contracting out of a job, work or service directly related to the business or operation of the principal by reason of a strike or lockout whether actual or imminent;

(f) Contracting out of a job, work or service being performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to self organization as provided in Art. 248 (c) of the Labor Code, as amended.

Section 7. Existence of an employer-employee relationship. - The contractor or subcontractor shall be considered the employer of the contractual employee for purposes of enforcing the provisions of the Labor Code and other social legislation. The principal, however, shall be solidarily liable with the contractor in the event of any violation of any provision of the Labor Code, including the failure to pay wages. The principal shall be deemed the employer of the contractual employee in any of the following cases as declared by a competent authority:

(a) where there is labor-only contracting; or

(b) where the contracting arrangement falls within the prohibitions provided in Section 6 (Prohibitions) hereof.

Section 8. Rights of Contractual Employees. - Consistent with Section 7 of these Rules, the contractual employee shall be entitled to all the rights and privileges due a regular employee as provided for in the Labor Code, as amended, to include the following:

(a) Safe and healthful working conditions; (b) Labor standards such as service incentive leave, rest days, overtime pay, holiday pay, 13th month pay and separation pay; (c) Social security and welfare benefits; (d) Self-organization, collective bargaining and peaceful concerted action; and (e) Security of tenure.

Section 9. Contract between contractor or subcontractor and contractual employee. - Notwithstanding oral or written stipulations to the contrary, the contract between the contractor or subcontractor and the contractual employee, which shall be in writing, shall include the following terms and conditions:

(a) The specific description of the job, work or service to be performed by the contractual employee;

(b) The place of work and terms and conditions of employment, including a statement of the wage rate applicable to the individual contractual employee; and

(c) The term or duration of employment, which shall be coextensive with the contract of the principal and subcontractor, or with the specific phase for which the contractual employee is engaged, as the case may be.

The contractor or subcontractor shall inform the contractual employee of the foregoing terms and conditions on or before the first day of his employment.

Section 10. Effect of Termination of Contractual Employment. - In cases of termination of employment prior to the expiration of the contract between the principal and the contractor or subcontractor, the right of the contractual employee to separation pay or other related benefits shall be governed by the applicable laws and jurisprudence on termination of employment.

Where the termination results from the expiration of the contract between the principal and the contractor or subcontractor, or from the completion of the phase of the job, work or service for which the contractual employee is engaged, the latter shall not be entitled to

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separation pay. However, this shall be without prejudice to completion bonuses or other emoluments, including retirement pay as may be provided by law or in the contract between the principal and the contractor or subcontractor.

Section 11. Registration of Contractors or Subcontractors. - Consistent with the authority of the Secretary of Labor and Employment to restrict or prohibit the contracting out of labor through appropriate regulations, a registration system to govern contracting arrangements and to be implemented by the Regional Offices is hereby established.

The registration of contractors and subcontractors shall be necessary for purposes of establishing an effective labor market information and monitoring.

Failure to register shall give rise to the presumption that the contractor is engaged in labor-only contracting.

Section 12. Requirements for registration. - A contractor or subcontractor shall be listed in the registry of contractors and subcontractors upon completion of an application form to be provided by the DOLE. The applicant contractor or subcontractor shall provide in the application form the following information:

(a) The name and business address of the applicant and the area or areas where it seeks to operate;

(b) The names and addresses of officers, if the applicant is a corporation, partnership, cooperative or union;

(c) The nature of the applicant's business and the industry or industries where the applicant seeks to operate;

(d) The number of regular workers; the list of clients, if any; the number of personnel assigned to each client, if any and the services provided to the client;

(e) The description of the phases of the contract and the number of employees covered in each phase, where appropriate; and

(f) A copy of audited financial statements if the applicant is a corporation, partnership, cooperative or a union, or copy of the latest ITR if the applicant is a sole proprietorship.

The application shall be supported by: (a) A certified copy of a certificate of registration of firm or business name from the Securities and Exchange Commission (SEC), Department of Trade and Industry (DTI), Cooperative Development Authority (CDA), or from the DOLE if the applicant is a union; and

(b) A certified copy of the license or business permit issued by the local government unit or units where the contractor or subcontractor operates.

The application shall be verified and shall include an undertaking that the contractor or subcontractor shall abide by all applicable labor laws and regulations.

Section 13. Filing and processing of applications. - The application and its supporting documents shall be filed in triplicate in the Regional Offices where the applicant principally operates. No application for registration shall be accepted unless all the foregoing requirements are complied with. The contractor or subcontractor shall be deemed registered upon payment of a registration fee of P100.00 to the Regional Office.

Where all the supporting documents have been submitted, the Regional Office shall deny or approve the application within seven (7) working days after its filing.

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Upon registration, the Regional Office shall return one set of the duly-stamped application documents to the applicant, retain one set for its file, and transmit the remaining set to the Bureau of Local Employment. The Bureau shall devise the necessary forms for the expeditious processing of all applications for registration.

Section 14. Duty to produce copy of contract between the principal and the contractor or subcontractor. - The principal or the contractor or subcontractor shall be under an obligation to produce a copy of the contract between the principal and the contractor in the ordinary course of inspection. The contractor shall likewise be under an obligation to produce a copy of the contract of employment of the contractual worker when directed to do so by the Regional Director or his authorized representative.

A copy of the contract between the contractual employee and the contractor or subcontractor shall be furnished the certified bargaining agent, if there is any.

Section 15. Annual Reporting of Registered Contractors. - The contractor or subcontractor shall submit in triplicate its annual report using a prescribed form to the appropriate Regional Office not later than the 15th of January of the following year. The report shall include:

(a) A list of contracts entered with the principal during the subject reporting period;

(b) The number of workers covered by each contract with the principal;

(c) A sworn undertaking that the benefits from the Social Security System (SSS), the Home Development Mutual Fund (HDMF), PhilHealth, Employees Compensation Commission (ECC), and remittances to the Bureau of Internal Revenue (BIR) due its contractual employees have been made during the subject reporting period.

The Regional Office shall return one set of the duly-stamped report to the contractor or subcontractor, retain one set for its file, and transmit the remaining set to the Bureau of Local Employment within five (5) days from receipt thereof.

Section 16. Delisting of contractors or subcontractors. - Subject to due process, the Regional Director shall cancel the registration of contractors or subcontractors based on any of the following grounds:

(a) Non-submission of contracts between the principal and the contractor or subcontractor when required to do so;

(b) Non-submission of annual report;

(c) Findings through arbitration that the contractor or subcontractor has engaged in labor-only contracting and the prohibited activities as provided in Section 6 (Prohibitions) hereof; and

(d) Non-compliance with labor standards and working conditions.

Section 17. Renewal of registration of contractors or subcontractors. - All registered contractors or subcontractors may apply for renewal of registration every three years. For this purpose, the Tripartite Industrial Peace Council (TIPC) as created under Executive Order No. 49, shall serve as the oversight committee to verify and monitor the following: (a) Engaging in allowable contracting activities; and

(b) Compliance with administrative reporting requirements.

Section 18. Enforcement of Labor Standards and Working Conditions. - Consistent with Article 128 (Visitorial and Enforcement Power) of the Labor Code, as amended, the Regional Director through his duly authorized representatives, including labor regulation officers shall

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have the authority to conduct routine inspection of establishments engaged in contracting or subcontracting and shall have access to employer's records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of the Labor Code and of any labor law, wage order, or rules and regulations issued pursuant thereto.

The findings of the duly authorized representative shall be referred to the Regional Director for appropriate action as provided for in Article 128, and shall be furnished the collective bargaining agent, if any.

Based on the visitorial and enforcement power of the Secretary of Labor and Employment in Article 128 (a), (b), (c) and (d), the Regional Director shall issue compliance orders to give effect to the labor standards provisions of the Labor Code, other labor legislation and these guidelines.

Section 19. Solidary liability. - The principal shall be deemed as the direct employer of the contractual employees and therefore, solidarily liable with the contractor or subcontractor for whatever monetary claims the contractual employees may have against the former in the case of violations as provided for in Sections 5 (Labor-Only contracting), 6 (Prohibitions), 8 (Rights of Contractual Employees) and 16 (Delisting) of these Rules. In addition, the principal shall also be solidarily liable in case the contract between the principal and contractor or subcontractor is preterminated for reasons not attributable to the fault of the contractor or subcontractor.

Section 20. Supersession. - All rules and regulations issued by the Secretary of Labor and Employment inconsistent with the provisions of this Rule are hereby superseded. Contracting or subcontracting arrangements in the construction industry, under the licensing coverage of the PCAB and shall not include shipbuilding and ship repairing works, however, shall continue to be governed by Department Order No. 19, series of 1993.

Section 21. Effectivity. - This Order shall be effective fifteen (15) days after completion of its publication in two (2) newspapers of general circulation.

. Manila, Philippines, 21 February 2002.

a. Requirements for Independent Contractor

San Miguel Corp v. NLRC, 510 SCRA 181 (2006) LIKHA-PMPB v. Burlingame Corp., 524 SCRA 690 (2007)

b. Desirable – Unnecessary

Coca-Cola Bottlers Phil., Inc. v. NLRC, 307 SCRA 131 (1999)

c. Labor Contractor Only; Requisites and Prohibition

Manila Water Co., Inc. v. Pena, 434 SCRA 52 (2004)

d. Effect of Finding

San Miguel Corporation v. Aballa, 461 SCRA 392 (2005)

3. Liability of Indirect Employer

Lanzaderas v. Amethyst Security & General Services, Inc., 404 SCRA 505

14

D. Pre-employment, Recruitment and Placement of Workers

Reference: Arts. 12-42; POEA Rules; Book 1, Rules III-VIII, Omnibus Rules; Migrant Workers and Overseas Filipinos Act of 1995 (RA 8042); Anti-Trafficking in Persons Act 2003 (RA 9208) and Rules and Regulations Implementing RA 9208 1. Pre-employment Policy – Statement of Objectives, Art. 12 (a) (f);

Const., Art. II, Sec. 9; RA 8042, Sec. 2, 4 & 5.

2. Private Sector – Agencies and Entities

a. Parties

1) Worker – Art. 13 (a)

2) Private Employment Agency – Arts. 13 (c) (d), 12 (f), 14 (a)

3) Private Recruitment Entity – Arts. 13 (e) (f), 12 (f), 14 (a)

b. Recruitment and Placement

1) Local Employment, Art. 13 (b)

2) Overseas Employment, Sec. 6, RA 8042

People v. Panis, 142 SCRA 664 (1986) People v. Sualo, 344 SCRA 605 (2000)

c. Allowed and Protected Entities

1) Allowed Private Agencies and Entities, Arts. 16, 18, 12 (f); POEA Rules and Regulations, Part I, Rule I, Sec. 1

2) Prohibited Business Agencies and Entities, Arts. 16, 18, 26; POEA Rules and Regulations, Part I, Rule I, Sec. 2

d. Government Techniques of Regulation – Private Recruitment

1) Licensing, Arts. 27, 28, 29, 30, 31, POEA Rules and Regulations, Part II, Rules II

2) Workers’ Fees, Art. 32

3) Reports/Employment Information, Arts. 33, 14 (d)

4) Prohibited Practices, Art. 34

5) Illegal Recruitment, Art. 38; Sec. 6, RA 8042

People v. Sagayaga, 423 SCRA 468 (2004) People v. Bujua, 422 SCRA 169 (2004) People v. Fortuna, 395 SCRA 354 (2003)

6) Enforcement

a) Regulatory Power, Art. 36b) Rule-Making Power, Art. 36

c) Visitorial Power, Art. 37

15

7) Joint and Several Liability of Agent and Principal, POEA Rules, Part II, Rule II, Sec. 1 (f)

e. Jurisdiction

1) RTC over Criminal Action arising from Illegal Recruitment, RA No. 8042, Sec. 9

2) LA over Money Claims, RA 8042, Sec. 10

3) POEA over Administrative Cases

a) Pre-employment Cases, Omnibus Rules Impl. RA No. 8042,Sec. 28 (a)

b) Disciplinary Cases, Sec. 28 (b)

3. Public Sector Agencies – Employment Offices, Art. 12 (f); 14 (a); Sec. 3, Reorganizing POEA (EO No. 247); POEA Rules and Regulations

4. Sanctions, Arts. 35, 39 (a) (b) (c) (d) (e); RA 8042, Secs. 6 , 7, 10

a. Local Employment, Art. 39

b. Overseas Employment, Art. 35; RA 8042, Sec. 7

5. Issues and Questions on Overseas Employment

Readings:

Soriano, Ma. Teresa M., Implications of International Migration, AFocus on the Philippine Experience, PLR, Vol 20. No. 2 (1996)

King, Amelia M., Social and Economic Benefits and Costs, PLR, Vol. 9, No. 1 (1985).

Licuanan, Patricia B. Katas ng Saudi, a closer look. PLR Vol. 9, No. 1 (1985).

6. Trafficking in Persons, Convention on the Suppression of the Traffic in Persons and of the Prostitution of Others; RA 9208 and Rules and Regulations Implementing RA 9208,

7. Alien Employment Regulation

Reference: Arts. 12 (e), 40-42; Omnibus Rules, Book I, Rule XIV, DO 12, 16 Nov. 2001; Omnibus Guidelines for Issuance of Employment Permits to Foreign Nationals); Const., Art. XII, Sec. 12a. Coverage

Almodiel v. NLRC, 223 SCRA 341 (1993)

b. Conditions for grant of Permit, Omnibus Guidelines, Rule III. 1, 2, 3

General Milling Corp. v. Torres, 196 SCRA 215 (1991)

c. Validity of AEP, Omnibus Rules, Rule II.7

d. Revocation/Cancellation/Grounds, Omnibus Guidelines, Rule III.1

E. Human Resources Development

16

Reference: Arts. 57-81; Technical Education and Skills Development Authority Act of 1994 (TESDA) (RA 7796); Dual Training Systems Act of 1994 (RA 7686); Magna Carta for Disabled Persons (RA 7277)

1. Policy Objectives, RA 7796, Secs. 2-3

2. Apprentice

a. Definition, RA 7796, Sec. 4 (j)

b. Apprenticeable Occupation, RA 7796, Sec. 4 (m)

c. Qualification, RA 7610, as amended by RA 7658, Sec. 12

d. Allowed Employment; Requirement Program Approval

Nitto Enterprises v. NLRC, 258 SCRA 654 (1995)

e. Terms and Conditions of Employment, Art. 61, 72

2. Costs, Art. 71

3. Enforcement, Arts. 65, 66, 67

4. Learners

a. Definition, RA 7796, Sec. 4

b. Allowed Employment, Art. 74 (b)

c. Terms and Conditions of Employment, Arts. 75, 76

5. Differently-Abled Worker (Handicapped), ILO Convention 159 (1983); RA 7277

a. Definition, RA 7277, Sec. 4 (a) (b) (c) (d)b. Policy Declaration, RA 7277, Sec. 2

c. Coverage, RA 7277, Sec. 3

d. Rights and Privileges, RA 7277, Secs. 5, 6, 7

Bernardo v. NLRC & FEBTC, 310 SCRA 186 (1999)

e. Discrimination, RA 7277, Secs. 32, 33

f. Enforcement, Secs. 44, 45, 46

F. Conditions of Work

Reference: Arts. 82-90; Omnibus Rules, Book III, Rules l, lA, ll

1. Hours of Work

a. Regulation; Rationale

Manila Terminal Co. Inc. v. CIR, 91 Phil. 625 (1952)

b. Coverage/Exemptions, Art. 82, 276; Rule l, Secs 1-4

1) Government Employees, Const., Art. IX-B, Sec. 2 (1)

17

2) Managerial Employees, Art. 82; Rule I, Sec. 2 (b)(c)

Asia Pacific Christening, Inc. v. Farolan, 393 SCRA 454 (2004) Charlito Peñaranda v. Baganga Plywood Corp., 489 SCRA 94 (2006)

3) Field Personnel, Art. 82; Rule I, Sec. 2 (f)

Merdicar Fishing Corp v. NLRC, 297 SCRA 440 (1998) Auto Bus Transport Systems, Inc. v. Bautista, 458 SCRA 578 (2005)

4) Dependent Family Members

5) Domestic Helpers, Art. 141, 145; Rule I, Sec. 2 (d)

6) Persons in the Personal Service of Another, Rule I, Sec. 2 (d)

7) Piece Workers, Rule I, Sec. 2 (e)

Labor Congress v. NLRC, 290 SCRA 509 (1998)

c. Normal Hours of Work, Art. 83

d. Compensable Hours of Work – In general

1) On Duty, Art. 84 (a); Rule I, Sec. 3 (a), Sec. 4 (a)`

2) At Work, Art. 84 (b); Rule I, Sec. 3 (b)

e. Specific Rules

1) Rest Period

a) Short Duration or “Coffee Break”, Art. 84, 2nd par.; Book III, Rule I, Sec. 7, 2nd par.

b) More than 20 min., Rules I, Sec. 4 (b)

2) Meal Period

a) Regular Meal Period (One Hour), Art. 85; Rule I, Sec. 7, 1st par.

Philippine Airlines, Inc. v. NLRC, 302 SCRA 582 (1999)

b) Shorter Meal Period (Less than One Hour, but Not Less than20 min.), Rule I, Sec. 7, 1st par.

3) Waiting Time, Rule I, Sec. 5 (a)

Arica v. NLRC, 170 SCRA 776 (1989)

4) On Call, Rule I, Sec. 5 (b)

5) Inactive due to Work Interruptions, Book III, Rule I, Sec. 4 (d)

University of Pangasinan Faculty Union v. University of Pangasinan, 127 SCRA 691 (1984)

6) Work after Normal Hours, Rule I, Sec. 4 (c)

18

7) Lectures, Meetings, Training Programs, Rule I, Sec. 6

8) Travel Time

Rada v. NLRC, 205 SCRA 69 (1992)

f. Overtime Work Pay, Arts. 87-90; Rule I, Secs. 8-11

1) Overtime in Ordinary Working Day, Art. 87; Rule I, Sec. 8

2) Emergency or Compulsory Overtime Work, Art. 89

3) Undertime Work/Leave, Art. 88

4) Additional Compensation, Art. 87

5) No Computation Formula Basic Contract

Manila Terminal Co., Inc. v. CIR, supra

6) Proof of Work/Employer Obligation

Social Security System v. Court of Appeals, 348 SCRA 1 (2000)

g. Nightwork, ILO Conventions 89 (1948) and 171 (1990); Art. 86; Rule II, Secs. 1-6

1) Coverage/Exclusion, Rule II, Sec. 1

2) Additional Compensation, Art. 86

Shell Company v. National Labor Union, 81 Phil. 315 (1948)

2. Weekly Rest Periods

Reference: Arts. 91-93; Omnibus Rules, Book III, Rule III, Secs. 1-9

a. Coverage, Art. 82, 91; Rule III, Sec. 1

b. Determination; compulsory Work; Compensation, Arts. 91, 92

Manila Electric Co. v. Public Utilities Employees’ Assn, 79 Phil. 409

c. Premium Pay, Art. 93 (a) (b) (c)

d. CBA on Higher Premium Pay, Art. 93 (d)

3. Holidays

Reference: Art. 94; Executive Order 203 (1987); Omnibus Rules, Book III, Rule IV

a. Definition

1) Retail Establishments, Rule Impl. RA 6727, par. f

2) Service Establishment, Rule Impl. RA 6727, par. g

b. Coverage/Exclusions, Art. 94 (a)

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Mantrade/FMMC Division Employees and Workers Union v. Bacungan, 144 SCRA 510 (1986)

c. Holiday Pay, Art. 94 (b)

1) Faculty in Private School, Rule IV, Sec. 8 (a)

2) Divisor as Factor

Trans-Asia Phil. Employees Association v. NLRC, 320 SCRA 347 (1999)

3) Sunday, Art. 93 9a), 2nd Sentence; Rule III, Sec. 2

Wellington Investment Inc. v. Trajano, 245 SCRA 561 (1995)

4) Muslim Holiday, Art. 169-172; PD 1053 (Feb. 1977)

San Miguel Corp. v. Court of Appeals, 375 SCRA 311 (2002)

d. Absences, Rule lV, Secs. 6 (a), 10

e. Non-Working/Schedule of Rest Day, Rule IV, Sec. 6 (c)

4. Service Incentive Leave

Reference: Art. 95; Omnibus Rules, Book III, Rule V

a. Coverage, Art. 95 (a) (b)

Makati Haberdashery Inc. N. NLRC, 179 SCRA 449 (1989) Labor Congress v. NLRC, supra

b. Computation and Liability

Sentinel Security Agency, Inc. v. NLRC, 295 SCRA 123 1998) Auto Bus Transport Systems, Inc. v. Bautista, supra

5. Paternity Leave, Paternity Leave of 1996 (RA 8187), Secs. 1-6; Impl. Rules

6. Parental Leave, Solo Parents’ Welfare Act of 2000 (RA 8972); Impl. Rules

7. Service Charges

Reference: Art. 96; Omnibus Rules, Book III, Rule VI

a. Covered Employees, Art. 96

b. Sharing, Art. 96

G. Minimum Wages and Wage Fixing Machinery

Reference: Art. 97-119; Omnibus Rules, Book III, Rules VII-VIII

1. Minimum Wage, Art. 99; Consti., Art. XIII, Sec. 3

a. Coverage, Arts. 97 (b) (c) (e), 98

20

Philippine Fisheries Development Authority v. NLRC, 213 SCRA 621 (1992)

b. Definition

Chavez v. NLRC, supra

c. Rules

1) No Work, No Pay (A fair day’s wage for a fair day’s labor)

Aklan Electric Corp., Inc. v. NLRC, 323 SCRA 259 (2000)

2) Equal Pay for Work of Equal Value, ILO Convention 100 (1951)

International School Alliance of Educators v. Quisumbing, supra Bankard Employers Union-WATU v. NLRC, 423 SCRA 148 (2004)

3) Form: Agreement for Compensation of Services

Arms Taxi v. NLRC, 219 SCRA 306 (1993)

c. Minimum Wage

1) Determination of Compliance with Minimum Wage

Iran v. NLRC, 289 SCRA 433 (1998)

2) Facilities and Supplements/Allowances

Millares v. NLRC & PICOP, 305 SCRA 500 (1999)

3) Cash Wage/Commission

Songco v. NLRC, 183 SCRA 610 (1990) Boie Takeda v. De la Serna, 228 SCRA 329 (1993) Philippine Duplicators v. NLRC, 241 SCRA 380 (1995)

4) Gratuity and Salary/Wages, Difference

Plastic Town Center Corp. v. NLRC, 172 SCRA 580 (1989)

5) Effect on Benefits

Davao Fruits Corporation v. Associated Labor Union, supra

2. Wage Fixing Machinery

Reference: ILO Convention 26 (1928); Wage Rationalization Act (RA 6727); Art. 120-127; Omnibus Rules, Book III, Rule IX

a. Rationale for Wage Rationalization, RA 6727, Sec. 2

b. Agencies in Wage Fixing Machinery

1) National Wages and Productivity Commission, RA 6727, Sec. 3; Arts. 120, 121, 126

21

2) Regional Tripartite Wages and Productivity Board, RA 6727, Sec. 3; Arts. 122, 126

Nasipit Lumber Company, Inc. v. NLRC, 289 SCRA 667 (1998)

c. Standards/Criteria for Minimum Wage Fixing, RA 6727, Sec. 3; Art. 124

d. Wage Order, Arts. 123, 124

1) Methods of Fixing

a) Floor Wage method

b) Salary – Ceiling Method

Employers Confederation of the Phils. V. National Wageand Productivity Commission, 201 SCRA 759 (1991)

2) Validity

Cagayan Sugar Milling Co. v. Secretary of Labor and Employment, 284 SCRA 150 (1998)

3) Wage Distortion

Prubankers Association v. Prudential Bank & Trust Co., 302 SCRA 74 (1999)

3. Wage Payment and Protection, ILO Convention 95 (1949)

a. Form of Payment, Art. 102; Civil Code, Art. 1705; Rule VIII, Secs. 1, 2

Congson v. NLRC, 243 SCRA 260 (1995)

b. Time of Payment, Art. 103, Sec. 3

c. Place of Payment, Art. 104, Sec. 4

See: Labor Advisory on Payment of Salaries Thru Automated Teller Machines (ATM)

d. Direct Payment of Wages, Art. 105, Secs. 5, 6

Bermiso v. Escano, Inc., 105 Phil. 231 (1959)

4. Wage Prohibitions, ILO Convention 95 (1949)

a. Wage Interference in Disposal of Wages, Art. 112; Rule VIII, Sec. 9

b. Wage Deduction, Art. 113; Rule VIII, Sec. 10

Apodaca v. NLRC, 172 SCRA 442 (1989)

c. Requirement to Make Deposits for Loss or Damage, Art. Arts. 114, 115; Rule VIII, Sec. 11

Dentech Manufacturing Corp. NLRC, 172 SCRA 588 (1989)

22

Five J Taxi v. NLRC, 235 SCRA 556 (1994)

e. Withholding of Wages, Art. 116; Civil Code, Art. 1706

f. Deduction to Ensure Employment, Art. 117

g. Retaliatory Measures, Art. 118

h. False Reporting, Art. 119; Rule X, Sec. 13

i. Keeping of Employee’s Records in a Place other than the Workplace

South Motorists Enterprises v. Tosoc, 181 SCRA 386 (1990)j. Garnishment/Execution, Civil Code, Art. 1708

GAA v. Court of Appeals, 140 SCRA 304 (1985)

5. Work Preference in the Event of Bankruptcy, Art. 110; Book III, Rule VIII, Sec. 7; Civil Code, Arts. 1207, 2241 (6), 2242 (3), 2244 (2)

Republic v. Peralta, 150 SCRA 37 (1987) Manila Banking Corp. v. NLRC, 279 SCRA 602, 621-642 (1997)

6. Wage Recovery/Jurisdiction, Arts. 128, 129, 217, 111; Book III, Rule X, Secs. 1-5

Cirineo Bowling Plaza v. Gerry Sensing, supra Guico Jr. v. Sec. of Labor, 298 SCRA 667 (1998)

H. Thirteenth Month Pay

1. History of the Law

Dentech Mfg. Corp. v. NLRC, supra

2. Coverage

Archilles Manufacturing Corp. v, NLRC, 244 SCRA 750 (1995) Ultra Villa Food Haus v. Geniston, 309 SCRA 17 (1999)

3. Rationale, PD 851, Whereas Clauses and LImitations

4. Amount and Date of Payment, Revised Guidelines on the Implementation of the 13th Month Pay Law

a. Basic Wage/Commissions

Boie Takeda v. Dela Serna, Supra Iran v. NLRC, supra Honda Phils. Inc. v. Samahan ng Malayang Manggagawa sa Honda, 460

SCRA 186 (2005)

b. Substitute Payment

Framanlis Farms, Inc. v. NLRC, 171 SCRA 87 (1989)

c. 14th Month Pay

Kamaya Port Hotel v. NLRC, 177 SCRA 160 (1989)

d. Diminution

23

Davao Fruits Corp. v. Associated Labor Unions, supraI. Bonus

1. Nature

Philippine Duplicators Inc. v. NLRC, supra

2. Definition; When Demandable

Marcos v. NLRC, 248 SCRA 146 (1995) Business Information Systems and Services, Inc. v. NLRC, 221 SCRA 9 (1993) Philippine Appliance Corp. v. Court of Appeals, 430 SCRA 525 (2004)

J. Working Conditions for Special Group of Workers

1. Women

References: Arts. 130-138; Omnibus Rules, Book III, Rule XII, Sec. 1; Constitution, Arts. II, Sec. 13 & XIII, Sec. 14;

Reflection Paper/Guide Questions: Do the provisions on the Employment of Women Engender Equality? What amendments would you propose to make them gender-fair and gender-friendly?

a. Equality: Formal Equality vs. Substantive Equality

Readings:

Bartlett, Katharine, Gender Law, in Duke Journal of Gender Law and Policy (1994)

Formal Equality and Substantive Equality in the Textbook on Gender and the Law by Angela Harris

Baldoz, Rosalinda, Job discrimination against women in the work environment: the Philippine setting, PLR, Vol. 24, No. 1 (2000).

b. Women under the Constitution, Art. II, Sec. 14; Art XIII, Sec 14

Philippine Association of Service Exporters v. Drilon, 163 SCRA 386 (1988)

c. Coverage, Rule XII, Sec. I

d. Prohibited Acts

1) Night Work/Exception, ILO Convention 89 (1948); Art. 130-131

2) Discrimination, ILO Conventions 100 (1951) and 111 (1958); CEDAW Art. 11; Art. 135

3) Stipulation Against Marriage, Art. 136

Phil. Telegraph and Telephone Co. v. NLRC, 272 SCRA 596 (1997)

4) Discharge on Account of Pregnancy, Art. 137

e. Facilities, Art. 132, 134

f. Special Women Workers, 138

24

g. Maternity Leave, Social Security Law of 1997 (RA 1161, as amended by RA 8282), Sec. 14-A, RA 828

h. Sexual Harassment (RA 7877)

Libres v. NLRC, 307 SCRA 675 (1999) Philippine Aelous Automotive United Corp. v. NLRC, 331SCRA 237

(2000)

2. Minors

References: Arts 139-140; Omnibus Rules, Book III, Rule XII, Secs. 2-3; Special Protection of Children Act of 2003 (RA 7610, as amended by RA 9231); ILO Convention Nos.130 and182 (1999); ILO Recommendation No. 190

a. Minors under the Constitution, Art. II, Sec. 13

b. Coverage, RA 9231, Sec. 2, par. 3 on Sec. 12; Book III, Rule XII, Sec. 1

c. Employment of Children, ILO Convention 138 (1973); Art. 139; RA 7610, Sec. 12-16; DOLE DO No. 04, S 1999 Re: Hazardous and Non-Hazardous Establishments

d. Hours of Work, RA 9231, Sec. 3 on Sec. 12-a

e. Prohibitions Against Worst Forms of Child Labor, ILO Convention 182 (1999); Sec. 3 on Sec. 12-d; Sec 5 on sec. 14

f. Discrimination, Art. 140

g. Jurisdiction, Sec. 9 on Sec. 16-A

Reading:

Del Rosario and Bonga, Issues and Gaps Governing Child Labor, in Child Labor in the Philippines, A Review of Selected Studies and Policy Papers, pp. 178-183 (2000).

3. Househelpers/Caregivers

Reference: Arts. 141-152; Omnibus Rules, Book III, Rule XIII

a. Definition, Rule XIII, Sec. 1 (b)

b. Coverage, Art. 141

c. Non-Household Work, Art. 145

Apex Mining Co. NLRC, 196 SCRA 251 (1991)

d. Conditions of Employment, Arts. 142-152; Civil Code, Arts. 1689-1699

4. Homeworkers

a. Coverage and Regulation, Arts. 153-155; DO 5, DOLE, 4 Feb. 1992, now Book III, Rule XIV

b. Definition, DO 5, Sec. 2, DO 5

c. Registration, Secs. 4-6

25

d. Conditions of Employment/Deductions, Secs. 6-9

e. Joint and Several Liability of Employer/Contractor, Sec. 11

f. Prohibitions, Sec. 13

g. Enforcement, Sec. 10

K. Mental, Dental and Occupational Safety

Reference: Art. 156-165; Omnibus Rules, Book IV, Rule I, Secs. 1-10; Rule II, Secs. 1-!0

1. Coverage, Rule I, Sec. 1

2. First Aid Treatment, Art. 156

3. Emergency Medical and Dental Servicesa. When Required, Art. 157

b. When Not Required, Art. 158

4. Employer assistance, Art. 161

5. Occupational Safety and Health Standards, Training ofSupervisor/Techniciana. When Required, Rule II, Secs. 5 (a) (d)

b. When Not Required, Rule II, Sec. 5 (e)

6. Enforcement/DOLE Obligations, Arts. 162-165

Note: Arts. 166-208: repealed by SSS Law of 1997 (RA 1161, as amended); Re: Art. 209, see National Health Insurance act of 1995 (RA 7875); Book IV, Rule II, Sec. 8

L. Employee Classification

1. Coverage, Art. 278

2. Employer Recognition

Pangilinan v. General Milling Corp., 434 SCRA 159 (2004)

3. Employer Determination/Designation

De Leon v. NLRC, 176 SCRA 615 (1989) Violeta v. NLRC, 280 SCRA 520 (1997) San Miguel Corporation v. NLRC, 297 SCRA 277 (1998)

4. Management Prerogative

Manila Electric Co. v. NLRC, 263 SCRA 531 (1996) PAL, Inc. v. Pascua, 409 SCRA 195 (2003) Coca-cola Bottlers Phil., Inc. Sales Force Union-PTGWO-BALAIS v. Coca-

cola Bottlers Phil., Inc., GR No. 155651, 464 SCRA 507 (2005)

5. Kinds of Employee

a. Regular Employees, art. 280, 1st par.; 280, 2nd par.; 281, last sentence; 75(d); Omnibus rules, Book VI, Rule 1, Secs. 5(a), (b) and 6.

26

1) Type

Pangilinan v. General Milling Corporation., 434 SCRA 159 (2004)

2) Nature of Work

Perpetual Help Credit Corp., Inc. v. Faburada, et al., 366 SCRA 693 ( 2001)

Hacienda Fatima v. National Federation of Sugarcane Workers Food and General Trade, 396 SCRA 518 (2003)

Pentagon International Shipping, Inc. v. Adelantar, 435 SCRA 342 (2004) Lopez v. Metropolitan Waterworks and Sewerage System, 462 SCRA

428 (2005)

3) Extended Period

Audion Electric co., Inc. v. NLRC, 308 SCRA 340 (1999)

4) Repeated Renewal of Contract Maraguinot v. NLRC, 284 SCRA 539 (1998) Universal Plastic Corp. v. Catapang, 473 SCRA 189 (2005)

b. Project Employee, art. 280, 1st par.

1) Definition

Imbuido v. NLRC, 329 SCRA 357 (2000)

2) Project Employees

Sandoval Shipyards, Inc. v. NLRC, 136 SCRA 674 (1985) Villa v. NLRC, 284 SCRA 105 (1998) Chua v. Court of Appeals, 440 SCRA 121 (2004)

3) Workpool Employees J & D.O. Aguilar Corp. v. NLRC, 269 SCRA 596 (1997) Maraguinot v. NLRC, supra

c. Casual, Art. 280, 2nd par.; Omnibus rules, Book VI, Rule 1, Sec. 5 (b)

1) Nature of Work

A.M. Oreta and Co. Inc. v. NLRC, 176 SCRA 218 (1989)

2) One Year Service

Kimberly Independent labor Union for Solidarity, Activism and Nationalism-OLALIA v. Drilon, 185 SCRA 190 (1990)

Integrated Contractor and Plumbing Works, Inc. v. Court of Appeals, 466 SCRA 544 (2005)

San Miguel Corp. v. Aballa, supra

d. Fixed-Term

Brent School v. Zamora, 181 SCRA 702 (1990) Palomares v. NLRC, 277 SCRA 439 (1997) Philips Semiconductor (Phils.), Inc. v. Fadriquela, 427 SCRA 408 (2004)

27

e. Seasonal

Phil. Tobacco Flue-curing & Redrying Corp. v. NLRC, 300 SCRA 37 (1998)

Hacienda Bino/Hortencis Starke, Inc. v. Cuenca, 456 SCRA 300 (2005)

f. Probationary

1) Definition

Philippine Federation of Credit Cooperatives, Inc. v. NLRC, 300 SCRA 72 (1998)

Cebu Marine Beach Resort v. NLRC, 414 SCRA 173 (2003)

2) Employer Right to Set Period/Obligation

Orient Express Placement Philippines v. NLRC, 273 SCRA 256 1997)

3) Duration/Exception

A Prime Security Services, Inc. v. NLRC, 322 SCRA 283 (2000) Mitsubishi Motors v. NLRC, 226 SCRA 417 (1993)

4) Criteria Regularization

Alcira v. NLRC, 431 SCRA 508 (2004)

5) Extension of Contract

Mariwasa Manufacturing, Inc. v. Leogardo, 169 SCRA 465 (1989)

6) Absorbed Employees

Cebu Stevedoring Co. Inc. v. Regional Director, 168 SCRA 315 (1988)

7) Rule on Private School Teachers

Escorpizo v. Univ. of Baguio, 306 SCRA 497 (1999) La Consolacion College v. NLRC, 366 SCRA 226 (2001) Chiang Kai Shek College v. Court of Appeals, 437 SCRA 171 (2004)

I. Termination of Employment

1. Coverage, Art. 278; Book VI, Rule 1, Sec. 1

2. Security of Tenure, Art 279; 277 (b)

a. Nature/Rationale

Llosa Tan v. Silahis Internatioinal Hotel, 181 SCRA 738 (1990) Sonza v. ABS-CBN Broadcasting Corp., 431 SCRA 381 (2004)

b. Coverage

Labajo v. Alejandro, 165 SCRA 747 (1988) Skillworld Management and marketing Corporation v. NLRC, 186 SCRA

465 (1990) Inter-Orient Maritime Enterprises Inc. v. NLRC, 235 SCRA 268 (1994)

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c. Management Prerogative

The Philippine American Life & General Insurance Co. v. Gramaje, 442 SCRA 274 (2004)

Duncan Association of Detailman-PTGWO v. Glxo Wellcome Philippines, Inc., 438 SCRA 343

d. Guidelines on Imposition of Penalty

Associated Labor Union v. NLRC, 302 SCRA 708 (1999) Philippine Long Distance Telephone Company v. NLRC, 303 SCRA 9

(1999) Farrol v. Court of Appeals, 435 SCRA 543 (2000) Valiao v. Court of Appeals, 435 SCRA 543 (2004) Etcuban v. Sulpicio Lines, Inc. 448 SCRA 516 (2005)

3. Termination of Employment by Employee

a. Resignation

Cheniver Deco Print v. NLRC, 325 SCRA 758 (2000) Willi Hahn Enterprises v. Maghuyo, 447 SCRA 349 (2004) BMG Records (Phils.), Inc. et al. v. Aida C. Aparecio, et al., GR 153290,

Sept. 5, 2007

1) Just Causes, Art. 285 (b)

2) Without Just Cause – Requisites, Art. 285 (a); Const. Art. III, Sec. 18 (2)

Pascua v. NLRC, 287 SCRA 554 (1998) Azcor Manufacturing v. NLRC, 303 SCRA 26 (1999) Phil. Wireless Inc. v. NLRC, 310 SCRA 653 (1999) A Prime Security Services, Inc. v. NLRC, supra

b. Performance of Military or Civic duty, Art. 286, Book VI, Rule I, Sec. 12

4. Termination of Employment by Employer

a. Basis of Right and Requirements, Arts. 282-284; 277 (b)

1) Basis

Philippine Long Distance Telephone Company v. Tolentino, 438 SCRA 555 (2004)

2) Substantive and Procedural Due Process

Philippine National Bank v. Cabanag, 460 SCRA 514 (2005) Metro Eye Security, Inc. v. Julie V. Solsona, 534 SCRA 375 (2007)

b. Just Causes – Substantive Due Process

1) Serious Misconduct/Willful Disobedience (Insubordination)

Villamor Golf Club v. Pehid, 472 SCRA 36 (2005) Coca-Cola Bottlers, Phils., Inc. v. Kapisanan ng Malayang

Manggagawa sa Coca-Cola, 452 SCRA 480 (2005) R Transport Corp. v. Ejandra, 428 SCRA 725 (2004) Micro Sales Operation Network v. NLRC, 472 SCRA 328 (2005)

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2) Gross and Habitual Neglect of Duties

Valiao v. Court of Appeals, supra Cebu Filveneer Corp. v. NLRC, 286 SCRA 556 (1998) Tres Reyes v. Maxim’s Tea House, 398 SCRA 288 (2003) Chua v. NLRC, 453 SCRA 244 (2005)

3) Fraud or Willful Breach of Trust

Santos v. San Miguel Corp., 399 SCRA 172 (2003)

4) Commission of Crime, Art. 282 (d)

Sampaguita Garments Corporation v. NLRC, 233 SCRA 260 (1994)

5) Analogous, Art. 282 (e)

Cathedral School of Technology v. NLRC, 214 SCRA 551, 559 (1992)

6) Others – Just Causes Claimed by Employer

a) Abandonment

Nueva Ecija Electric Cooperative (NEECO) II v. NLRC, 461 SCRA169 (2005)

Chavez v. NLRC, supra Floren Hotel v. NLRC, 456 SCRA 128 (2005)

b) Courtesy Resignation

Batongbacal v. Associated Bank, 168 SCRA 600 (1988)

c) Change of Ownership

Manlimos v. NLRC, 242 SCRA 145 (1995)

d) Habitual Absenteeism

Manila Electric Co. v. NLRC, 263 SCRA 531 (1996)

e) Fixed-Term Employment

Magsalin v. National Organization of Working Men, supra

f) Past offenses

La Carlota Planters Association, Inc. v. NLRC, 298 SCRA 252 (1998) Ramoran v. Jardine CMG Life Insurance Co., Inc. 326 SCRA 208

(2000)

g) Immorality

Santos v. NLRC, 287 SCRA 117 (1998)

h) Conviction of Crime

Sampaguita Garments Corp. v. NLRC, supra

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i) Qualification Requirements

Lanzaderas v. Amethyst Security & General Services, Inc., supra

7) Constructive Dismissal

The Philippine American Life and General Insurance Co. v. Gramaje, supra

R.P. Dinglasan Construction, Inc. v. Atienza, 433 SCRA 263 (2004)

Dusit Hotel Nikko v. National Union in Hotel, Restaurant and Allied Industries (NUWHRAIN)-Dusit Hotel Nikko Chapter, 466 SCRA 374 (2005)

Francisco v. NLRC, et al., supra

8) Transfer

OSS Security & Allied Services Inc. v. NLRC, 325 SCRA 157 (2000) Lanzaderas v. Amethyst Security and General Services, Inc., supra Mendoza v, Rural Bank of Lucban, 433 SCRA 756 (2004)

9) Promotion

Phil. Telegraph & Telephone Corp. v. Court of Appeals, 412 SCRA 263 (2003)

10) Preventive Suspension

Philippine Airlines, Inc. v. NLRC, 292 SCRA 40 (1998)

11) Residency Training

Felix v. Buenaseda, 240 SCRA 139 (1995)

c. Substantive Requirements – Business Related Causes, Art. 283

1) Basis

Edge Apparel Inc. v. NLRC, 286 SCRA 302 (1998)

2) Business Related or Authorized Causes

a) Installation of Labor Saving Devices, Art. 283

b) Retrenchment to Prevent Losses, Art. 283

Asian Alcohol Corp. v. NLRC, 305 SCRA 415 (1999) NDC-Guthrie Plantations, Inc. v. NLRC, 362 SCRA 416.(2001) Composite Enterprises, Inc. v. Emilio M. Caparoso, et al., GR

No. 159919, Aug. 8, 2007

c) Redundancy, Art. 283

Asufrin v. San Miguel Corp., 425 SCRA 270 (2004) Golden Thread Knitting Industries, Inc. v. NLRC, 304 SCRA 568 Lopez Sugar Corp. v. Franco, 458 SCRA 515 (2005)

d) Closure of Business, Art. 283

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Mac Adams Metal Engineering Workers Union-Independent v. Mac Adams Metal Engineering, 414 SCRA 411 (2003)

ME-SHURN Corporation v. ME-SHURN Workers Union-FSM, 448 SCRA 41 (2005)

e) Temporary Closure, Art. 286

Valdez v. NLRC, 286 SCRA 87 (1998)

3) Disease, Art 284

Vicente Sy v. Court of Appeals, supra

d. Procedural Requirements, Art. 277 (b); Book VI, Rule I, Secs. 1-3 Omnibus Rules

1) In General/Liability for Non-Compliance with Procedural Requirements

Serrano v. NLRC, 323 SCRA 445 (2000) Santos v. San Miguel Corp., supra Agabon v. NLRC, 442 SCRA 573 (2004)

2) Right to Counsel

Salaw v. NLRC, 202 SCRA 7, 12-15 (1991)

3) Notice

Agabon v. NLRC, supra Caingat v. NLRC, 453 SCRA 142 (2005)

4) Hearing

a) Hearing

Permex, Inc. v. NLRC, 323 SCRA 121 (2000) Arboleda v. NLRC, 303 SCRA 39 (1999)

b) Use of Position Paper

Shoppes Manila, Inc. v. NLRC, 419 SCRA 354 (2004)

5) Burden of Proof

Equitable PCI Bank v. Caguioa, 466 SCRA 658 (2005) ME-SHURN Corporation v. ME-SHURN Workers Union-FSM, supra

6) Degree of Proof/Substantial Evidence

Philtread Tire & Rubber Corp. v. Vicente, 441 SCRA 574 (2004) Etcuban v. Sulpicio Lines, Inc., supra

7) Decision – Const., Art. VIII, Sec. 14

Pepsi-Cola Products Phil., Inc. v. Court of Appeals, 443 SCRA 580 (2004)

Quintano v. NLRC, 446 SCRA 195 (2004)

8) Prescription

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Salvador v. Phil. Mining service Corp., 395 SCRA 729 (2003)

9) Criminal Cases

Quiambao v. NLRC, 254 SCRA 211 (1996

5. Reliefs/Remedies in Illegal Dismissal, Art. 279; 223

a. In General; Twin Remedies

Nueva Ecija Electric Cooperative v. NLRC, supra Mt. Carmel College v. Resuena, 555 SCRA 519 (2007) Aguilar v. Burger Machine Holdings Corp., 516 SCRA 413 (2007)

1) Reinstatement

a) Definition

Pheschem Industrial Corp. v. Moldez, 458 SCRA 339 (2005) PNOC-EDC v. Abella, 448 SCRA 549 (2005)

b) Effect of Failure to Ask Relief

Pheschem Industrial Corp. v. Moldez, supra

c) Exceptions

i) Closure of Business

ii) Economic Business Conditions

Union of Supervisors (RB) NATU, etc. v. Sec. of Labor, 128 SCRA 442 (1984)

iii) Employee’s Unsuitability

Divine Word High School v. NLRC, 143 SCRA 346 (1986)

iv) Employee’s Retirement/Overage

Espejo v. NLRC, 255 SCRA 430 (1996)

v) Antipathy and Antagonism – Strained Relations

Acesite Corp. v. NLRC, 449 SCRA 360 (2005) BPI Employees Union v. BPI, 454 SCRA 357 (2005) Sagum v. Court of Appeals, 459 SCRA 223 (2005)

vi) Not Feasible

Bustamante v. NLRC, 265 SCRA 1 (1996)

d) Offer to Reinstate

Ranara v. NLRC, 212 SCRA 631 (1992)

2) Backwages

a) Effect of Failure to Claim

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De La Cruz v. NLRC, 299 SCRA 1 (1998)

b) Effect of Failure to Order

Aurora Land Projects Corp. v. NLRC, 266 SCRA 48 (1997)

b) Computation

Mercury Drug Co., Inc. v. CIR, 56 SCRA 694 (1974) Bustamante v. NLRC, supra Torres v. NLRC, 330 SCRA 311 (2000) Kay Products, Inc. v. CA464 SCRA 544 (2005) Standard Electric Manufacturing Corp. v. Standard Electric

Employees Union-NAFLU-KMU, 468 SCRA 316 (2005) BPI Employees Union v. BPI, supra

c) Fringe Benefit

Aurora Land Projects Corp. v. NLRC, supra

b. Damages

Collegio de San Juan de Letran-Calamba v. Villas, 399 SCRA 550 (2003) Tolosa v. NLRC, 401 SCRA 391 (2003) Maguiling v. Phil. Tuberculosis Society, Inc. 450 SCRA 465 (2005) Acesite Corp v. NLRC, supra Sagum v. Court of Appeals, 459 SCRA 223 (2005) Central Luzon Conference v. CA, 466 SCRA 711 (04)

c. Separation Pay

1) When – As Alternative

Coca-Cola Bottlers Phils., Inc. v. Vital, 438 SCRA 278 (2004) National Federation of Labor v. Court of Appeals, 440 SCRA 604 (2004) Etcuban Jr. v. Sulpicio Lines, Inc., supra Composite Enterprises, Inc. v. Emilio M. Caparoso, et al., supra

2) Computation/Rationale

Businessday Information Systems and Services, Inc. v. NLRC, 221 SCRA 9 (1993)

Millares v. NLRC, 305 SCRA 500 (1999)

3) Effect of Acceptance

Anino v. NLRC, 290 SCRA 489 (1998)

d) Financial Assistance

1) When Allowed

Philippine Long Distance Telephone Co. v. NLRC, 164 SCRA 671 (1988)

Piñero v. NLRC, 437 SCRA 112 (2004)

2) When Not Allowed

Phil. National Construction Corp. v. NLRC, 170 SCRA 207 (1989) Chua v. NLRC, 218 SCRA 545 (1993)

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e. Indemnity

Arms Taxi v. NLRC, supra Serrano v. NLRC, supra

f. Liability of Corporate Officers

Acesite Corp. v. NLRC, supra

J. Retirement, Art. 287; Book VI, Rule II, Omnibus Rules; RA No. 7641; RA No. 8558 (1998); Labor Advisory on Retirement Pay (Oct. 1999)

1. Retirement

a. Types of Retirement Plan

Gerlach v. Reuters Ltd., Phil. 448 SCRA 535 (2005)

1) Basis

Gamogamo v. PNOC Shipping and Transport Corp., 381 SCRA 742 (2002)

2) Interpretation

Lopez v. National Steel Corp., 423 SCRA 109 (2004) Salomon v. Association of International Shipping Lines, Inc., 457

SCRA 254 (2005)

4) Eligibility

Brion v. South Phil. Union Mission of the Seventh Day Adventist Church, 307 SCRA 497 (1999)

2. Accrual of Benefits

Cruz v. Phil. Global Communications, Inc., 430 SCRA 185 (2004)

3. Benefits and Gratuity

Sta. Catalina College v. NLRC, 416 SCRA 233 (2003)

REMINDERS:

1. Read the cases in the original.2. Voluntary recitation is encouraged. The professor however reserves the right to call

on students for recitation.3. The 20% rule on absences will be strictly observed. Three times of tardiness will be

considered absent. All those who come between 15 to 30 minutes after the class will be marked “late”; after 30 mins, “absent”.

4. No make-up examination will be given.

REQUIREMENT:

Recitation/Assigned Work - 30%

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Mid-Term Examination - 30%Final Examination - 40%

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