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FUNDAMENTAL PRINCIPLES AND POLICIES
1U N I V E R S I T Y O F S A N T O T O M A S
F A C U L T Y O F C I V I L L A W
LEGEND
BFOQ
BLR
CB
CBA
CE
DOLE
Ee
Er
LA
LC
LLO
LOA
NCMB
NLRC
NSD
OFW
OTPCE
POEA
RAB
RD
RH
RTWPB
RW
RWD
SIL
SLE
ULP
UT
VA
VR
WD
WRD
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Bona Fide Occupational Qualification
Bureau of Labor Relations
Collective Bargaining
Collective Bargaining Agreement
Certification Election
Department of Labor and
Employment
Employee
Employer
Labor Arbiter
Labor Code
Legitimate Labor Organization
Leave of Absence
National Conciliation and Mediation
Board
National Labor Relations Commission
Night Shift Differential
Overseas Filipino Worker
OvertimePetition for Certification Election
Philippine Overseas Employment
Administration
Regional Arbitration Branch
Regional Director
Regular Holiday
Regional Tripartite Wages and
Productivity Boards Regular Wage
Regular Working Days
Service Incentive Leave
Secretary of Labor and Employment
Unfair Labor Practice
Undertime
Voluntary Arbitrator
Voluntary Recognition
Wage Distortion
Weekly Rest Day
LABOR LAW
Q: What is labor?
A: It is the exertion by human beings of physical ormental efforts, or both, towards the production of
goods and services.
Q: What is labor Law?
A: The law that defines State policies on labor andemployment and governs the rights and duties of the
employer (Er) and employees (Ee) with respect to:
1. The terms and conditions of employment, and
2. Labor disputes arising from collective bargaining
or other concerted activity respecting such terms
and conditions.
Q: What matters may properly fall under the term“labor law”?
A: The term “labor law” covers the following:
1. Statutes passed by the State to promote thewelfare of the workers and Ees and regulate their
relations with their Ers.
2. Judicial decisions applying and interpreting the
aforesaid statutes.
3. Rules and regulations issued by administrative
agencies, within their legal competence, to
implement labor statutes.
Q: What is the purpose of labor legislation? (2006Bar Question)
A: The purpose of labor legislation is to affordprotection to labor, promote full employment, ensureequal work opportunities regardless of sex, race or
creed and regulate the relations between workers
and Ers. The State shall assure the rights of workers
to self-organization, collective bargaining (CB),
security of tenure and just and humane conditions of
work.
Q: What are the classifications of labor laws?
A:1. Labor Standards – That which sets out the
minimum terms, conditions and benefits ofemployment that Ers must provide or comply
with and to which Ees are entitled as a matter of
legal right.
e.g. 13th
month pay
2. Labor Relations – Defines and regulates thestatus, rights and duties, and the institutional
mechanisms, that govern the individual and
collective interactions of Ers, Ees or their
representatives. It is concerned with the
stabilization of relations of Ers and Ees and seeks
to forestall and adjust the differences between
them by the encouragement of CB and the
settlement of labor disputes through conciliation,
mediation and arbitration.
e.g. Collective Bargaining Negotiations
3. Social Legislation – All laws passed by the Stateto promote public welfare. It includes statutes
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Labor Law and Social Legislation
2U N I V E R S I T Y O F S A N T O T O M A S2 0 1 3 G O L D E N N O T E S
intended to enhance the welfare of the people
even where there is no Er-Ee relationship.
e.g. GSIS Law, SSS Law, Philhealth benefits,
Agrarian Laws
Q: How do the provisions of the law on laborrelations interrelate, if at all, with the provisions
pertaining to labor standards? (2003 Bar Question)
A: The law on Labor Relations provides for rights andprocedures by which workers may obtain from their
Er benefits which are over and above the minimum
terms and conditions of employment set by labor
standards law. Labor Standards law alone does not
guarantee lasting industrial peace. It is assured
through Labor Relations law which enables workers
to obtain better benefits guaranteed by labor
standards laws and by providing for a mechanism to
settle disputes between the Er and his Ees.
Q: Is there any distinction between Labor Legislationand Social Legislation? Explain.
A: Labor Legislation is sometimes distinguished fromsocial legislation by the former referring to labor
statutes, like Labor Relations Law and Labor
Standards, and the latter to Social Security Laws.
Labor legislation focuses on the rights of the worker
in the workplace.
Social Legislation are those laws that provide
particular kinds of protection or benefits to society or
segments thereof in furtherance of social justice.
Note: All Labor laws are social legislations, but not all sociallegislations are labor laws.
Q: What are the sources of labor laws?
A:1. Labor Code (LC) and other related special
legislation [including their respective
Implementing Rules and Regulations (IRR)] 2. Contracts 3. Collective Bargaining Agreement (CBA)
4. Company practice
5. Company policies
Q: How does the CBA operate as a source of law?
A: The CBA is the norm of conduct between Er andEes and compliance therewith is mandated by the
express policy of the law [DOLE Philippines, Inc.,
vs. Pawis ng Makabayang Obrero (PAMAO-NFL), G.R.
No. 146650, (2003) in citing E. Razon, Inc. vs.
Secretary of Labor and Employment, G.R. No. 85867,
(1993)].
Q: What are the requisites before past practiceswould be considered as a source of labor law?
A: There must be:1. Voluntarily institution by Er without any legal
compulsion2.
A passage of time- should have been done over a
long period of time, and must be shown to have
been consistent and deliberate [American Wire
and Cable Daily Rated Employees Union vs.
American Wire and Cable Co., Inc., G.R. No.
155059, (2005)].
Note: No passage of time is required for a company policyto become a source of labor law.
Q: What is a contract of labor?
A: It is a consensual, nominate, principal, andcommutative contract whereby one person, called
the Er, compensates another, called the laborer,
worker or Ee, for the latter’s service. It is relationship
impressed with public interest in keeping with our
constitutional policy of social justice.
Q: What are the essential characteristics of acontract of labor?
A:1. Er freely enters into a contract with the Ee;
2. Er can select who his Ee will be;3. Er can dismiss the Ee; the Ee in turn can quit his
job;
4. Er must give remuneration; and
5. Er can control and supervise the conduct of the
Ee.
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FUNDAMENTAL PRINCIPLES AND POLICIES
3U N I V E R S I T Y O F S A N T O T O M A S
F A C U L T Y O F C I V I L L A W
FUNDAMENTAL PRINCIPLES AND POLICIES
CONSTITUTIONAL PROVISIONS
Q: What are the constitutional mandates on LaborLaw?
A:
1. Sec. 3, Art. XIII – The State shall afford fullprotection to labor, local and overseas, organized
and unorganized, and promote full employment
and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-
organization, collective bargaining and
negotiations, and peaceful concerted activities,
including the right to strike in accordance with
law. They shall be entitled to security of tenure,
humane conditions of work, and a living wage.
They shall also participate in policy and decision-
making processes affecting their rights andbenefits as may be provided by law.
The State shall promote the principle of shared
responsibility between workers and employers
and the preferential use of voluntary modes in
settling disputes, including conciliation, and shall
enforce their mutual compliance therewith to
foster industrial peace.
The State shall regulate the relations between
workers and employers, recognizing the right of
labor to its just share in the fruits of production
and the right of enterprises to reasonable returnsto investments, and to expansion and growth.
2. Sec. 9, Art. II – The State shall promote a just and
dynamic social order that will ensure the
prosperity and independence of the nation and
free the people from poverty through policies
that provide adequate social services, promote
full employment, a rising standard of living, and
an improved quality of life for all.
3. Sec. 10, Art II - The State shall promote social
justice in all phases of national development.
4. Sec. 11, Art II - The State values the dignity of
every human person and guarantees full respect
for human rights.
5. Sec. 13, Art. II - The State recognizes the vital role
of the youth in nation-building and shall promote
and protect their physical, moral, spiritual,
intellectual, and social well-being. It shall
inculcate in the youth patriotism and
nationalism, and encourage their involvement in
public and civic affairs.
6. Sec. 14, Art. II - The State recognizes the role of
women in nation-building, and shall ensure the
fundamental equality before the law of women
and men.
7. Sec. 18, Art. II – The State affirms labor as aprimary social economic force. It shall protect the
rights of workers and promote their welfare.
8. Sec. 20, Art. II – The State recognizes the
indispensable role of the private sector,
encourages private enterprise and provide
incentives to needed investments.
9. Sec. 1, Art. III - No person shall be deprived of
life, liberty, or property without due process of
law, nor shall any person be denied the equal
protection of the laws.
10. Sec. 4, Art. III - No law shall be passed abridging
the freedom of speech, of expression, or of the
press, or the right of the people peaceably to
assemble and petition the government for
redress of grievances.
11. Sec. 8, Art. III – The right of the people, includingthose employed in the public and private sectors,
to form unions, associations, or societies for
purposes not contrary to law shall not be
abridged.
12. Sec. 10, Art. III – No law impairing the obligation
of contracts shall be passed.
13. Sec. 16, Art. III – All persons shall have the right
to a speedy disposition of their cases before all
judicial, quasi-judicial or administrative bodies.
14. Sec. 18 (2), Art. III – No involuntary servitude in
any form shall exist except as a punishment for a
crime whereof the party shall have been duly
convicted.
15. Sec. 1, Art. XIII - The Congress shall give highest
priority to the enactment of measures that
protect and enhance the right of all the people to
human dignity, reduce social, economic, and
political inequalities, and remove cultural
inequities by equitably diffusing wealth and
political power for the common good.
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To this end, the State shall regulate the
acquisition, ownership, use, and disposition of
property and its increments.
16. Sec. 2, Art. XIII - The promotion of social justice
shall include the commitment to create
economic opportunities based on freedom of
initiative and self-reliance.
17. Sec. 13, Art. XIII – The State shall establish a
special agency for disabled persons for their
rehabilitation, self-development and self-reliance
and their integration into the mainstream of
society.
18. Sec. 14, Art. XIII – The State shall protect working
women by providing safe and healthful working
conditions, taking into account their maternal
functions, and such facilities and opportunities
that will enhance their welfare and enable them
to realize their full potential in the service of thenation.
Q: What is the State policy on labor as found in theConstitution (Sec. 3, Art. XIII)?
A:1. Afford full protection to labor
2. Promote full employment
3. Ensure equal work opportunities regardless of
sex, race, or creed 4. Assure the rights of workers to self-organization,
security of tenure, just and humane conditions of
work, participate in policy and decision-makingprocesses affecting their right and benefits
5. Regulate the relations between Ers and workers
Q: What are the basic rights of workers guaranteedby the Constitution (Sec. 3, Art. XIII)?
A: The Right to: 1. Security of tenure
2. Living wage
3. Humane working conditions
4. Share in the fruits of production
5. Self-organization
6. Collective bargaining and negotiation
7. Engage in peaceful concerted activities, including
the right to strike
8. Participate in policy and decision making
processes
Q: What is the principle of non-oppression?
A: The principle mandates capital and labor not to actoppressively against each other or impair the interest
and convenience of the public. The protection to
labor clause in the Constitution is not designed to
oppress or destroy capital [Capili vs. NLRC, G.R. No.
117378, (1997)].
The law in protecting the rights of the Ees authorizes
neither oppression nor self-destruction of the Er
[Pacific Mills Inc. vs. Alonzo, G.R. No. 78090, (1991)].
It should be made clear that when the law tilts thescale of justice in favor of labor, it is but a recognition
of the inherent economic inequality between labor
and management. The intent is to balance the scale
of justice; to put the two parties on relatively equal
positions. There may be cases where the
circumstances warrant favoring labor over the
interests of management but never should the scale
be so tilted if the result is an injustice to the
employer. Justitia nemini neganda est (Justice is to be
denied to none ) [Philippine Geothermal, Inc. vs. NLRC
and Edilberto M. Alvarez, G.R. No. 106370, (1994)].
NEW CIVIL CODE AND OTHER LAWS
Q: What are other related laws to labor?
A:1. New Civil Code (NCC)
a. Art. 19 – Every person must, in the exercise
of his rights and in the performance of his
duties, act with justice, give everyone his
due, and observe honesty and good faith.
b. Art. 1700 - The relations between capital
and labor are not merely contractual. They
are so impressed with public interest thatlabor contracts must yield to the common
good. Therefore, such contracts are subject
to the special laws on labor unions,
collective bargaining, strikes and lockouts,
closed shop, wages, working conditions,
hours of labor and similar subjects.
c. Art. 1701 - Neither capital nor labor shall
act oppressively against the other, or
impair the interest or convenience of the
public.
d. Art. 1702 - In case of doubt, all labor
legislation and all labor contracts shall be
construed in favor of the safety and decent
living for the laborer.
e. Art. 1703 - No contract which practically
amounts to involuntary servitude, under
any guise whatsoever, shall be valid.
f. Art. 1704 - In collective bargaining, the
labor union or members of the board or
committee signing the contract shall be
liable for non-fulfillment thereof.
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5U N I V E R S I T Y O F S A N T O T O M A S
F A C U L T Y O F C I V I L L A W
g. Art. 1705 - The laborer's wages shall be
paid in legal currency.
h. Art. 1706 - Withholding of the wages,
except for a debt due, shall not be made by
the employer.
i. Art. 1707 - The laborer's wages shall be a
lien on the goods manufactured or the
work done.
j. Art. 1708 - The laborer's wages shall not besubject to execution or attachment, except
for debts incurred for food, shelter,
clothing and medical attendance.
k. Art. 1709 - The employer shall neither seize
nor retain any tool or other articles
belonging to the laborer.
l. Art. 1710 - Dismissal of laborers shall be
subject to the supervision of the
Government, under special laws.
2. Revised Penal Code (RPC)
Art. 289 – Formation, maintenance and prohibition of combination of capital or labor
through violence or threats. – Any person
who, for the purpose of organizing,
maintaining or preventing coalitions or
capital or labor, strike of laborers or lock-out
of employees, shall employ violence or
threats in such a degree as to compel or
force the laborers or employers in the free
and legal exercise of their industry or work,
if the act shall not constitute a more serious
offense in accordance with the provisions of
the RPC.
3. Special Laws
a. E.O. 180 - Providing guidelines for the
exercise of the Right to Organize of
Government Employees, creating a Public
Sector Labor-Management Council, and for
other purposes
b. R.A. 8291 - Government Service Insurance
Act of 1997
c. 13th
Month Pay Law
d. Retirement Pay Law
e. SSS Law
f. Paternity Leave Actg. Anti – Child Labor Act
h. Anti – Sexual Harassment Act
i. Magna Carta for Public Health Workers
j. Solo Parents Welfare Act of 2000
k. National Health Insurance Act as amended
by R.A. 9241
l. Migrant Workers and Overseas Filipinos Act
of 1995 as amended by RA 10022
m. PERA Act of 2008
n. Home Development Mutual Fund Law of
2009
o. The Magna Carta of Women
p. Comprehensive Agrarian Reform Law as
amended by R.A. 9700
LABOR CODE
Q: What is the aim of labor law?
A: The aim of labor law is social justice.
Q: What is social justice?
A: Social Justice is “neither communism, nordespotism, nor atomism, nor anarchy,” but the
humanization of laws and the equalization of social
and economic force by the State so that justice in its
rational and objectively secular conception may at
least be approximated. Social Justice means the
promotion of the welfare of all the people, theadoption by the government of measures calculated
to insure economic stability of all the competent
elements of society, through the maintenance of a
proper economic and social equilibrium in the
interrelations of the members of the community,
constitutionally, through the adoption of measures
legally justifiable, or extra-constitutionally, through
the exercise of powers underlying the existence of all
governments on the time-honored principle of salus
populi est suprema lex [Calalang vs. Williams, G.R.
No. 47800, (1940)].
Q: What are the limitations in invoking the principleof social justice?
A:1. Not to undermine property rights resulting in
confiscation [Guido vs.Rural Progress Adm, L-
2089, (1949)]
2. May only protect the laborers who come to court
with clean hands [Phil.Long Distance Telephone
Co. vs. NLRC, G.R. 80609, (1988)]
3. Never result to an injustice or oppression of the
Er [Phil.Geothermal Inc. vs. NLRC, G.R. No.
106370, (1994)]
Q: May social justice as a guiding principle in laborlaw be so used by the courts in sympathy with theworking man if it collides with the Equal protectionclause of the Constitution? (2003 Bar Question)
A: Yes. The State is bound under the Constitution toafford full protection to Labor and when conflicting
interests collide and they are to be weighed on the
scales of social justice, the law should accord more
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sympathy and compassion to the less privileged
workingman [Fuentes v. NLRC, 266 SCRA 24, (1997)].
However it should be borne in mind that social justice
ceases to be an effective instrument for the
“equalization of the social and economic forces” by
the State when it is used to shield wrongdoing
[Corazon Jamer v. NLRC, 278 SCRA 632 (1997)].
Q: What agency exercises the “rule-making power”granted in the Labor Code?
A: The Department of Labor and Employment (DOLE)thru the Secretary of Labor and Employment (SLE)
and other Government agencies charged with the
administration and enforcement of the LC or any of
its parts shall promulgate the necessary IRRs.
Note: Such rules and regulations shall become effective 15days after announcement of their adoption in newspapers
of general circulation.
Q: What are the limitations to the “rule-makingpower” given to the Secretary of Labor and
Employment and other Government agencies?
A: It must: 1. Be issued under the authority of law
2. Not be contrary to law and the Constitution
Q: To whom shall all rights and benefits under theLabor Code apply?
A: GR: All rights and benefits granted to workersunder the LC shall apply alike to all workers,
whether agricultural or non-agricultural.
XPNs:1. Government Ees 2. Ees of government corporations created by
special or original charter 3. Foreign governments 4. International agencies 5. Corporate officers/ intra-corporate disputes
which fall under P.D. 902-A and now fall under
the jurisdiction of the regular courts pursuant
to the Securities Regulation Code. 6. Local water district except where NLRC’s
jurisdiction is invoked. 7. As may otherwise be provided by the LC.
Q: What is the test in determining whether a GOCCis subject to the provisions of the LC?
A: It is determined by the manner of their creation.Government corporations incorporated under the
Corporation Code are covered by the LC while those
created by special (original) charter from Congress
are subject to Civil Service rules.
Art. 3, Declaration of Basic Policy
Q: What is the policy of the State on labor as foundin the LC?
A: It is the policy of the State to: 1. Afford full protection to labor
2. Promote full employment
3. Ensure equal work opportunities regardless of sex,
race, or creed
4. Assure the rights of workers to self organization,
security of tenure, just and humane conditions of
work, participate in policy and decision-making
processes affecting their right and benefits
5. Regulate the relations between Ers and workers.
Art. 4, Construction in favor of Labor
Q: What is “Compassionate Justice”?
The social justice policy mandates a compassionate
attitude toward the working class in its relation to
management. In calling for protection to labor, the
Constitution does not condone wrong doing by the
Ee. However, it urges a moderation of the sanctions
that maybe applied to him in the light of the many
disadvantages that weigh heavily on him like an
albatross on his neck.
It is disregarding rigid rules and giving due weight to
all equities of the case [Gandara Mill Supply andMilagros Sy vs. NLRC and Silvestre Germano, G.R.
126703, (1998)].
e.g. An Ee who was validly dismissed may still begiven severance pay.
Q: What is the concept of liberal approach ininterpreting the Labor Code and its IRR?
A: The LC and its IRR, being remedial in charactermust be accorded the broadest scope and most
beneficial interpretation. It is only in this way that
their purpose, which is to remedy evils ofexploitation, manipulation and oppression, may be
achieved. Strict adherence to the letter of labor law is
not allowed; the spirit thereof prevails and must be
given effect. Under Art. 4 of the LC, all doubts in the
implementation and interpretation of the provisions
thereof, including its IRR, are to be resolved in favor
of labor.
Q: Are all labor disputes resolved in favor of labor?
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7U N I V E R S I T Y O F S A N T O T O M A S
F A C U L T Y O F C I V I L L A W
A: No. The law also recognizes that management hasrights which are also entitled to respect and
enforcement in the interest of fair play [St. Luke’s
Medical Center Ees Ass’n vs. NLRC, G.R. No. 162053,
(2007)].
Art. 166, Policy
Q: What is the policy of the State in relation toEmployees’ Compensation and State Insurance
Fund?
A: The State shall promote and develop a tax-exemptEes’ compensation program whereby Ees and their
dependents, in the event of work-connected
disability or death, may promptly secure adequate
income benefits and medical related benefits. [Art.
166, LC]
Q: What is the purpose of a Workmen’s
Compensation Act?
A: The primary purpose of a Workmen’sCompensation Act is to provide compensation for
disability or death resulting from occupational
injuries or diseases, or accidental injury to, or death
of Ees.
Art. 211, Declaration of Policy
Q: What are the policy objectives of our LaborRelations law?
A: The state aims to promote:1. Free CB and negotiations, including voluntary
arbitration, mediation and conciliation as modes
of settling labor or industrial disputes;
2. Free trade unionism;
3. Free and voluntary organization of a strong and
united labor movement;
4. Enlightenment of workers concerning their rights
and obligations as union members and as Ees;
5. Adequate administrative machinery for the
expeditious settlement of labor or industrial
disputes;
6. Stable but dynamic and just industrial peace;
7. Participation of workers in the decision-making
processes affecting their rights, duties and
welfare;
8. Truly democratic method of regulating the
relations between the Ers and Ees by means of
agreements freely entered into through CB, no
court or administrative agency or official shall
have the power to set or fix wages, rates of pay,
hours of work or other terms and conditions of
employment, except as otherwise provided
under the LC.
Art. 212, Definitions
Q: Who is an employer?
A: Any person acting in the interest of an Er, directlyor indirectly. The term does not include a labor
organization or any of its officers and agents, except
when acting as an Er. (Art. 212[e], LC)
An Er is defined as any person or entity that employs
the services of others; one for whom work is done
and who pays their wages of salaries; any person
acting in the interest of an Er; refers to the enterprise
where the labor organization operates or seeks to
operate. (Sec.1[s], Rule I, Book V, IRR)
Note: The term “employer” is not restricted to businessowners alone because it includes any person as long as he
acts in the interest of the Er.
Q: When is a labor organization deemed an
employer?
A: When it is acting as such in relation to personsrendering services under hire, particularly in
connection with its activities for profit or gain.
Note: The mere fact that respondent is a labor union doesnot mean that it cannot be considered an Er for persons
who work for it. Much less should it be exempted from
labor laws [Bautista vs. Inciong, G.R. No. L-52824, (1988)].
Q: Who is an employee?
A: The term “employee” covers: 1. Any person in the employ of the Er
2. 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
3. One who has been dismissed from work but the
legality of dismissal is being contested in a forum
of appropriate jurisdiction. (D.O. No. 40-03)
Note: The term shall not be limited to the Ees of a
particular Er unless the LC explicitly states.
Any Ee, whether employed for a definite period or not,
shall, beginning on the first day of service, be considered an
Ee for purposes of membership in any labor union. (Art.
277[c], LC)
Q: What is a labor dispute?
A: A labor dispute includes any controversy or matterconcerning:
1. Terms and conditions of employment, or
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2. The association or representation of persons in
negotiating, fixing, maintaining, changing or
arranging the terms and conditions of
employment
3. Regardless of whether the disputants stand in
the proximate relation of Er and Ee. (Art. 212[l],
LC)
Q: What are the tests on whether a controversy is alabor dispute?
A: 1. As to nature – It depends on whether the dispute
arises from Er-Ee relationship, although
disputants need not be proximately Er or Ee of
another.
2. As to subject matter – The test depends on
whether it concerns terms or conditions of
employment or association or representation of
persons in negotiating, fixing, maintaining or
changing terms or conditions of employment.
Q: What are the kinds of labor disputes?
A: 1. Labor standard disputes
a. Compensation – E.g. Underpayment of
minimum wage; stringent output quota; illegal
pay deductions
b. Benefits – E.g. Non-payment of holiday pay, OT
pay or other benefits
c. Working Conditions – E.g. Unrectified work
hazards
2. Labor relations disputes
a. Organizational right disputes/ Unfair Labor
Practice (ULP) – E.g. Coercion, restraint or
interference in unionization efforts; reprisal or
discrimination due to union activities;
company unionism; ULP, strike or lockout;
union members’ complaint against union
officers
b. Representation disputes – E.g. Uncertainty as
to which is the majority union; determination
of appropriate CB unit; contests for recognition
by different sets of officers in the same union
c. Bargaining disputes – E.g. Refusal to bargain;
bargaining in bad faith; bargaining deadlock;
economic strike or lockout
d. Contract administration or personnel policy
disputes – E.g. Non-compliance with CBA
provision (ULP if gross non-compliance with
economic provisions); disregard of grievance
machinery; non observance of unwarranted
use of union security clause; illegal or
unreasonable personnel management policies;
violation of no-strike/no-lockout agreement
e. Employment tenure disputes – E.g. Non-
regularization of Ees; non-absorption of labor-
only contracting staff; illegal termination; non-
issuance of employment contract
Q: Who are the parties to a labor dispute?
A: 1. Primary parties are the Er, Ees and the union.
2. Secondary parties are the voluntary arbitrator,
agencies of DOLE, NLRC, SLE and the Office of the
President.
Q: What is an inter-union dispute?
A: Any conflict between and among legitimate laborunions involving representation questions for thepurposes of CB or to any other conflict or dispute
between legitimate labor unions.
Q: What is an intra-union dispute?
A: Any conflict between and among union members,grievances arising from any violation of the rights and
conditions of membership, violation of or
disagreement over any provision of the union’s
constitution and by-laws, or disputes from chartering
or affiliation of union.
Q: What are rights disputes?
A: They are claims for violations of a specific rightarising from a contract, i.e. CBA or company policies.
Q: What are interest disputes?
A: They involve questions on “what should beincluded in the CBA.” Strictly speaking, the parties
may choose a voluntary arbitrator to decide on the
terms and conditions of employment, but this is
impracticable because it will be a value judgment of
the arbitrators and not of the parties.
Q: What are “contract–negotiation disputes”?
A: These are disputes as to the terms of the CBA.
Q: What are “contract–interpretation disputes”?
A: These are disputes arising under an existing CBA,involving such matters as the interpretation and
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application of the contract, or alleged violation of its
provisions.
Art. 255, Exclusive Bargaining Representation andWorker’s Participation in Policy and Decision-
Making
Q: Who shall be the bargaining representative of
the employees for purposes of collective bargaining?
A: The labor organization designated or selected bythe majority of the Ees in an appropriate collective
bargaining unit shall be the exclusive representative
of the Ees in such unit for the purpose of CB.
However, an individual Ee or group of Ees shall have
the right at any time to present grievances to their Er.
(Art. 255, LC, as amended by Sec. 22 of R.A. No. 6715,
1989)
Q: What is the extent of the worker’s right to
participate in policy and decision-making processesin a company?
A: Such right refers not only to formulation ofcorporate programs and policies but also to
participation in grievance procedures and voluntary
modes of settling disputes.
Q: Explain the extent of the workers’ right to
participate in policy and decision-making process asprovided under Art. XIII, Sec. 13 of the 1987Constitution. Does it include membership in theBoard of Directors of a corporation? (2008 Bar
Question)
A: No. The Supreme Court recognized the right of theunion to participate in policy formulation and
decision-making process on matters affecting the
union members’ rights, duties and welfare. However,
such participation of the union in committees of the
Er is not in the nature of a co-management control of
the business. Impliedly, therefore, workers’
participatory right in policy and decision-making
processes does not include the right to put a union
member in a corporation’s Board of Directors.
[Manila Electric Company vs. Quisumbing, G.R. No.
127598, (1999)].
Q: May the management be compelled to share withthe union or its employees its prerogative offormulating a Code of Discipline?
A: Yes. The Code of Discipline involves security oftenure and loss of employment — a property right. It
is time that management realizes that to attain
effectiveness in its conduct rules, there should be
candidness and openness by Management and
participation by the union, representing its members.
In fact, our Constitution has recognized the principle
of shared responsibility between Ers and workers and
has likewise recognized the right of workers to
participate in policy and decision-making process
affecting their rights [PAL vs. NLRC, G.R. No. 85985,
(1993)].
Q: What is the principle of codetermination? (2007Bar Question)
A: It refers to the right of workers to participate inpolicy and decision-making process affecting their
rights and benefits [PAL vs. NLRC, G.R. No. 85985
(1993); Art. XIII, Sec. 3, 1987 Constitution].
Q: May an employer solicit questions, suggestionsand complaints from employees who arerepresented by a union?
A: No, unless:1. The CB representative executes an agreement
waiving the right to be present on any occasion
when Ee grievances are being adjusted by the Er;
and
2. Er acts strictly within the terms of his waiver
agreement.
Q: The hotel union filed a Notice of Strike with theNational Conciliation and Mediation Board (NCMB)due to an unfair labor practice against the DiamondHotel who refused to bargain with it. The hotel
advised the union that since it was not certified bythe DOLE as the exclusive bargaining agent, it couldnot be recognized as such. The union sought tobargain for members only. May the Union bargaincollectively?
A: No. Art. 255 of the LC declares that only the labororganization designated or selected by the majority
of the Ees in an appropriate CB unit is the exclusive
representative of the Ees in such unit for the purpose
of CB. The union is admittedly not the exclusive
representative of the majority of the Ees of the hotel,
hence, it could not demand from the hotel the right
to bargain collectively in their behalf [Manila
Diamond Hotel vs. Manila Diamond Hotel Ees Union,
G.R. No. 158075, (2006)].
Q: Who is a managerial employee?
A: The person who is vested with the powers orprerogatives to lay down and execute management
policies and/or to hire, transfer, suspend, lay-off,
recall, discharge, assign or discipline Ees.
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Q: Who is a supervisory employee?
A: The person who effectively recommends suchmanagerial actions if the exercise of such authority is
not merely routinary or clerical in nature but requires
the use of independent judgement.
Q: Who are rank-and-file employees?
A: Those persons who are neither Managerial norSupervisory Ees are considered rank-and file.
Art. 277, Miscellaneous Provisions
Q: What is the right to security of tenure?
A: The right to security of tenure connotes that no
worker shall be dismissed upon employment without
cause and without due process.
Q: What is the worker’s right to notice and hearingprior to dismissal?
A: Art. 277 (b) of the LC provides that:1. The Er shall furnish the Ee whose employment is
sought to be terminated a written notice containing a statement of the causes for
termination; and
2. Afford the Ee ample opportunity to be heard and
to defend himself
Note: In connection with dismissals for authorized causes,the Er must serve a written notice upon the worker and the
DOLE at least 1 month before the intended date oftermination. (Art. 283, LC)
Q: Why is notice and hearing necessary in cases ofemployee dismissal?
A: The twin requirement of notice and hearingconstitutes essential elements of due process in cases
of Ee dismissal. The requirement of notice is intended
to inform the Ee concerned of the Er’s intent to
dismiss and the reason for the proposed dismissal,
upon the other hand, the requirement of hearing
affords the Ee opportunity to answer his Er’s charges
against him and accordingly to defend himself
therefrom before dismissal is effected. Neither of
these two requirements can be dispensed with
without running afoul of the due process
requirement of the 1987 Constitution [Century Textile
Mills, Inc., et al. v. NLRC, et al. G.R. No. 77859, May
25, 1988].
Q: May the employer be allowed to dismiss anemployee and let him explain later? Why?
A: No. While the procedure laid down by the law forthe dismissal of an Ee need not be observed to the
letter of the law, at least it must be done in the
natural sequence of notice, hearing and judgment.
Dismissing the Ee and let him explain later is not in
accord with the requirement of due process[Batangas Laguna Tayabas Bus Co. v. NLRC, et al. G.R.
No. 94429, May 29, 1992].
Q: Under what circumstances may the terminationof employees be suspended by the SLE?
A: The SLE may suspend the effects of thetermination in the event of a prima facie finding bythe appropriate official of the DOLE before whom
such dispute is pending that the termination may
cause a serious labor dispute or is in implementation
of a mass lay-off. (Art. 277(b), as amended by Sec. 33,R.A 6715)
Q: Who has the burden of proving the existence of avalid or authorized cause of termination?
A: The Er has the burden of proof in proving that thetermination was for a valid or authorized cause. The
existence of a just or authorized cause for dismissal
cannot be presumed. A contrary rule would
contravene the constitutional policy of affording
protection to the worker. (Art. 277, LC)
Q: Is a labor organization responsible for thepreservation of industrial peace?
A: Yes. The Ministry shall help promote and graduallydevelop, with the agreement of labor organizations
and Ers, labor-management cooperation programs at
appropriate levels of the enterprise based on the
shared responsibility and mutual respect in order to
ensure industrial peace and improvement in
productivity, working conditions and the quality of
working life. [Art. 277(g), LC, incorporated by B.P Blg.
130]
Q: How about in establishments where no legitimatelabor organization exists?
A: Labor management committees may be formedvoluntarily by workers and Ers for the purpose of
promoting industrial peace. [Art. 277(h), LC, as
amended by Sec. 33, R.A. 6715]
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RECRUITMENT AND PLACEMENT
RECRUITMENT OF LOCAL AND MIGRANT WORKERS
Q: Who is a worker?
A: Any member of the labor force, whether employedor unemployed. (Art. 13 [a], LC)
Q: What is recruitment and placement?
A: 1. Any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring
workers; and
2. Includes referrals, contact services, promising or
advertising for employment, locally or abroad,
whether for profit or not. (Art. 13 [b] ,LC)
Q: What are the essential elements in determining
whether one is engaged in recruitment andplacement?
A: It must be shown that:1. The accused gave the complainant the distinct
impression that she had the power or ability to
send the complainant for work, 2. Such that the latter was convinced to part with
his money in order to be so employed [People vs.
Goce, G.R. No. 113161, (1995)].
Q: Who is deemed engaged in recruitment andplacement?
A: Any person or entity which, in any manner, offersor promises for a fee employment to 2 or more
persons. (Art. 13[b], LC)
Q: Who may engage in recruitment and placement?
A: GR: No person or entity other than the publicemployment offices, shall engage in the
Recruitment and Placement of workers.
XPNs:1. Construction contractors if authorized by the
DOLE and Construction Industry Authority
2. Other persons or entities as may be
authorized by the SLE
3. Members of the diplomatic corps (but hiring
must go through POEA)
4. Public employment offices
5. Private recruitment offices
6. Private employment agencies
7. POEA
8. Shipping or manning agents or
representatives
9. Name hires (Sec. 1(i) of Rule II, Omnibus Rulesand Regulations implementing the Migrant
Workers and Overseas Filipinos Act of 1995 as
amended by R.A. 10022)
Q: Who are name hires?
A: They are individual workers who are able to securecontracts for overseas employment opportunities
with Ers without the assistance or participation of any
agency. [Rule II, Omnibus Rules and Regulations
implementing the Migrant Workers and Overseas
Filipinos Act of 1995 as amended by R.A. 10022]
Q: Is recruitment and placement constituted even ifemployment is offered only to one person?
A: Yes, the number of persons dealt with is not an
essential ingredient of the act of recruitment andplacement of workers. The proviso merely lays down
a rule of evidence that where a fee is collected in
consideration of a promise or offer of employment to
2 or more prospective workers, the individual or
entity dealing with them shall be deemed to be
engaged in the act of recruitment and placement. The
words "shall be deemed" create that presumption
[People vs. Panis, G.R. L-58674-77, (1986)].
Q: What is a private employment agency?
A: Any person or entity engaged in the recruitment
and placement of workers for a fee which is charged ,directly or indirectly, from the workers or Ers or both.
(Art. 13, LC)
Q: What is a private recruitment agency?
A: It is any person or association engaged in therecruitment and placement of workers without
charging any fee, directly or indirectly, from the
workers or Ers.
Q: Who is a seafarer?
A: It refers to any person who is employed orengaged in overseas employment in any capacity on
board a ship other than a government ship used for
military or non-commercial purposes. The definition
shall include fishermen, cruise ship personnel and
those serving on mobile offshore and drilling units in
the high seas. [Sec. 1(ss), Rule II, Omnibus Rules and
Regulations Implementing Migrant Workers Act as
amended by R.A. 10022 (2010)]
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Q: What is overseas employment?
A: It is the employment of a worker outside thePhilippines.
Q: Who is an Overseas Filipino Worker (OFW)?
A: A person who is to be engaged, is engaged or has
been engaged in a remunerated activity in a State ofwhich he or she is not a citizen or on board a vessel
navigating the foreign seas other than a government
ship used for military or non-commercial purposes or
on an installation located offshore or on the high
seas. [Sec.(jj), Rule II, Omnibus Rules and Regulations
Implementing Migrant Workers Act as amended by
R.A. 10022 (2010)]
Note: The term “OFW” is to be used interchangeably with“migrant worker” as provided in R.A. 10022.
Q: Who is an Emigrant?
A: Any person, worker or otherwise, who emigratesto a foreign country by virtue of an immigrant visa or
resident permit or its equivalent in the country of
destination. (Art. 13, LC)
EMPLOYMENT OF NON-RESIDENT ALIENS
Q: What are the requirements in employment ofnon-resident aliens?
A: Any alien seeking admission to the Philippines for
employment purposes and any domestic or foreign Erwho desires to engage an alien for employment in the
Philippines: 1. Shall obtain an employment permit from the
DOLE
2. The permit may be issued to a non-resident alien
or to the applicant Er after a determination of
the non-availability of 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
3. For an enterprise registered in preferred areas of
investments, said permit may be issued upon
recommendation of the Government agency
charged with the supervision of said registered
enterprise
Q: The DOLE issued an alien employment permit forEarl Cone, a U.S. citizen, as sports consultant andassistant coach for GMC. Later, the Board of SpecialInquiry of the Commission on Immigration andDeportation approved Cone’s application for a
change of admission status from temporary visitorto pre-arranged employee. A month later, GMC
requested that it be allowed to employ Cone as full-fledged coach. The DOLE Regional Director grantedthe request. The Basketball Association of the Phils.appealed the issuance of said permit to theSecretary of Labor who cancelled Cone’semployment permit because GMC failed to showthat there is no person in the Philippines who iscompetent and willing to do the services nor that
the hiring of Cone would redound to the nationalinterest. Is the act of the Secretary of Labor valid?
A: Yes. GMC’s claim that hiring of a foreign coach isan Er’s prerogative has no legal basis. Under Art. 40
of the LC, an Er seeking employment of an alien must
first obtain an employment permit from the DOLE.
GMC’s right to choose who to employ is limited by
the statutory requirement of an employment permit.
[GMC vs. Torres, G.R. No. 9366, (1991)]
PROHIBITION AGAINST TRANSFER OF EMPLOYMENT
Q: Who are required to obtain employment permit?
A: GR: Only non-resident aliens;
XPNs:1. Diplomatic services and foreign government
officials;
2. Officers and staff of international
organizations and their legitimate spouses;
3. Members of governing board who has voting
rights only;
4. Those exempted by special laws;
5. Owners and representatives of foreignprincipals who interview Filipino applicants
for employment abroad;
6. Aliens whose purpose is to teach, present
and/or conduct research studies;
7. Resident aliens. (D.O. 75-06)
Q: May the non-resident alien transfer employmentafter issuance of the employment permit?
A: After the issuance of an employment permit, thealien shall not transfer to another job or change his Er
without prior approval of the SLE.
Q: What is required for immigrants and residentaliens?
A: An Alien Employment Registration Certificate.
Q: What is the duration of the employment permit?
A: GR: Minimum of 1 year
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XPN: Unless the employment contract,consultancy services, or other modes of
engagement provides otherwise, which in no
case shall exceed 5 years. [DOLE Department
Order 97-09, Revised Rules for the Issuance of
Employment Permits to Foreign Nationals
(2009)]
Q: May aliens be employed in entities engaged innationalized activities?
A: GR: No.
XPNs: 1. Secretary of Justice specifically authorizes the
employment of technical personnel;
2. Aliens are elected members of the board of
directors or governing body of corporations or
associations engaging in partially nationalized
activities shall be allowed in proportion to their
allowable participation or share in the capitalof such entities [Section 2-A of Anti-Dummy
Law, as amended by P.D. 715]; or
3. Enterprises registered under the Omnibus
Investment Code in case of technical,
supervisory or advisory positions, but for a
limited period.
PRIVATE SECTOR PARTICIPATION IN THERECRUITMENT AND PLACEMENT OF WORKERS
Q: What are the entities in the private sectors thatcan participate in recruitment and placement of
workers?
A:1. Shipping or manning agents or representatives
2. Private recruitment offices
3. Public employment offices
4. Construction contractors if authorized by the
DOLE and Construction Industry Authority.
5. Persons that may be authorized by the SLE
6. Private employment agencies. (Sec. 1, Rule VII,
Book I, IRR of the LC)
Q: What are the qualifications for participation inrecruitment and placement of workers?
A:1. Filipino citizens, or partnerships or corporations
with at least 75% of the authorized capital stock
is owned and controlled by Filipino citizens; (Art.
27, LC)
2. Capitalization
a. Single proprietorship or partnership
-A minimum capitalization of P2 million
b. Corporation
-A minimum paid-up capital of P2 million
Provided, that those with existing licenses shall,within 4 yrs. from the affectivity hereof, increase
their capitalization or paid up capital, as the case
may be, to P2 million at the rate of Php
250,000.00 every year. (Art. 28, LC)
3. Not otherwise disqualified by law or other
government regulations to engage in therecruitment and placement of workers for
overseas employment. (Rule I, Part II, POEA
Rules) 4. Payment of registration fees
5. Posting of surety/cash bonds
Q: How will POEA regulate private sectorparticipation in the recruitment and overseasplacement of workers?
A: By setting up a licensing and registration system.
(Sec. 14, R.A. 10022)
Q: Is a corporation, 70% of the authorized andvoting capital of which is owned and controlled byFilipino citizens, allowed to engage in therecruitment and placement of workers, locally oroverseas? Explain briefly. (2002 Bar Question)
A: No. It is because Art. 27 of the LC requires at least75%.
Q: Who are disqualified to engage in the business ofrecruitment and placement of workers?
A:1. Travel agencies and sales agencies of airline
companies; (Art. 26, LC)
2. Officers or members of the board of any
corporation or members in a partnership
engaged in the business of a travel agency;
3. Corporations and partnerships, when any of its
officers, members of the board or partners, is
also an officer, member of the board or partner
of a corporation or partnership engaged in the
business of a travel agency;
4. Persons, partnerships or corporations which have
derogatory records, such as but not limited to
those:
a. Certified to have derogatory record or
information by the NBI or by the Anti-Illegal
Recruitment Branch of the POEA;
b. Against whom probable cause or prima facie
finding of guilt for illegal recruitment or
other related cases exists;
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c. Convicted for illegal recruitment or other
related cases and/or crimes involving
moral turpitude; and
d. Agencies whose licenses have been
previously revoked or cancelled by the
POEA for violation of R.A. 8042, P.D. 442
as amended and their IRRs as well as these
rules and regulations.
5. Any official or Ee of the DOLE, POEA, OWWA,DFA and other government agencies directly
involved in the implementation of R.A. 8042
and/or any of his/her relatives within the 4th
civil
degree of consanguinity or affinity; and
6. Persons or partners, officers and directors of
corporations whose licenses have been
previously cancelled or revoked for violation of
recruitment laws. (Sec. 2, Rule I, 2002 Rules and
Regulations on the Recruitment and Employment
of Land-Based Workers)
TRAVEL AGENCIES PROHIBITED FROMRECRUITMENT AND PLACEMENT
Q: What is the rule on recruitment of travel agenciesand sales agencies of airline companies?
A: They are prohibited from engaging in the businessof recruitment and placement of workers for
overseas employment whether for profit or not.
Q: WTTA is a well-known travel agency and anauthorized sales agent of the PAL. Since majority ofits passengers are overseas workers, WTTA applied
for a license for recruitment and placementactivities. It stated in its application that its purposeis not for profit but to help Filipinos findemployment abroad. Should the application beapproved? (2006 Bar Question)
A: The application should be disapproved, as it isprohibited by Art. 26 of the LC, to wit: "Art. 26. Travel
agencies and sales agencies of airline companies are
prohibited from engaging in the business of
recruitment and placement of workers for overseas
employment whether for profit or not." Rule I, Part II
POEA Rules and Regulations Governing the
Recruitment and Employment of Land-Based Workers
(2002) disqualifies any entity having common director
or owner of travel agencies and sales agencies of
airlines, including any business entity from the
recruitment and placement of Filipino workers
overseas, whether they derive profit or not.
FEES TO BE PAID BY WORKERS
Q: When may a worker be charged any fee?
A: Only when:1. He has obtained work through recruiter’s efforts,
and
2. The worker has actually commenced working
Note: A land-based agency may charge and collect from itshired workers a placement fee in an amount equivalent to 1
month salary, exclusive of documentation costs. (Sec. 3,
Rule V, POEA Rules and Regulations)
Q: What are the only authorized payments that maybe collected from a hired worker?
A:1. Placement fee in an amount equivalent to one
month’s salary of the worker, and
2. Documentation costs (Sec. 3, Rule V, POEA Rules
and Regulations)
ILLEGAL RECRUITMENT, ART. 38 (LOCAL), SEC. 6,MIGRANT WORKERS ACT, R.A. 8042
Q: What are prohibited practices in recruitment orplacement?
A:1. Furnishing or publishing any falsie
notice/information/document related to
recruitment/employment
2. Failure to file reports required by SLE
3. Inducing or attempting to induce a worker
already employed to quit his employment in
order to offer him another unless the transfer is
designed to liberate a worker from oppressiveterms and conditions
4. Recruitment/placement of workers in jobs
harmful to public health or morality or to the
dignity of the country
5. Engaging directly or indirectly in the
management of a travel agency
6. Substituting or altering employment contracts
without approval of DOLE
7. Charging or accepting any amount greater than
that specified b DOLE or make a worker pay any
amount greater than actually received by him
8. Committing any act of misrepresentation to
secure a license or authority9. Influencing or attempting to influence a
person/entity not to employ any woker who has
not applied employment through his agency
10. Obstructing or attempting to obstruct
inspection by SLE or by his representatives
11. Withholding or denying travel documents from
applicant workers before departure for
monetary considerations other than authorized
by law
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12. Granting a loan to an overseas Filipino worker
with interest exceeding eight percent (8%) per
annum, which will be used for payment of legal
and allowable placement fees and make the
migrant worker issue, either personally or
through a guarantor or accommodation party,
postdated checks in relation to the said loan
13. Refusing to condone or renegotiate a loan
incurred by an OFW after his employmentcontract has been prematurely terminated
through no fault of his or her own
14. For a suspended recruitment/manning agency
to engage in any kind of recruitment activity
including the processing of pending worker’s
applications; and
15. For recruitment/manning agency or a foreign
principal/Er to pass on the OFW or deduct from
his or her salary the payment of the cause of
fees, premium or other insurance related
charges, as provided under the compulsory
worker’s insurance coverage 16. Imposing a compulsory and exclusive
arrangement whereby an OFW is required to:
a. Avail a loan only from specifically designated
institutions, or entities or persons
b. To undergo health examinations only from
specifically designated medical, entities or
persons, except seafarers whose medical
examination cost is shouldered by the ship
owne
c. To undergo training of any kind only from
designated institutions, entities or persons,
except for recommendatory trainings
mandated by principals/shipowners (Sec. 6,R.A. 8042, Migrant Workers and Overseas
Filipino Act, as amended by R.A. 10022)
Q: What are the differences between the prohibitedacts under the Labor Code and R.A. 8042 or theOverseas Filipinos and Overseas Migrant WorkersAct, as amended by R.A. 10022?
A:
Labor Code(Art. 38)
R.A. 8042, as amended by RA10022
Local recruitment Applies to recruitment foroverseas employment
Illegal recruitment
under Art. 38
means any
recruitment
activity including
prohibited acts
under Art. 34
committed by non-
licensees or non-
Illegal recruitment under Sec.
6 means any recruitment
activity committed by non-
licensees/ non-holders of
authority or prohibited acts
(same as Art. 34, LC)
Added to the following in the
list of prohibited acts:
holders of
authority.
1. Failure to actually deploy
without valid reason;
2. Failure to reimburse
expenses incurred by the
worker in connection
with his/her
documentation and
processing for purposes
of deployment;3. To allow a non-Filipino
citizen to head or
manage a licensed
recruitment/ manning
agency.
Q: Who are the persons prohibited from engagingthe business of recruiting migrant workers?
A:1. Unlawful for any official or Ee of the:
a.
DOLEb. POEA
c. Overseas Workers Welfare Administration
(OWWA)
d. DFA
e. Other Government agencies involved in the
implementation of this Act
2. Their relatives within the 4th
civil degree of
consanguinity or affinity, to engage, directly or
indirectly in the business of recruiting migrant
workers. (Sec. 8, R.A. 8042)
LICENSE vs. AUTHORITY
Q: How does the law regulate the business orrecruitment and replacement?
A: By requiring license and authority.
Q: What is a license?
A: It is issued by DOLE authorizing a person or entityto operate a private employment agency.
Q: What is an authority?
A: It is a document issued by the DOLE authorizing aperson or association to engage in recruitment and
placement activities as a private recruitment entity.
Q: Who may be issued license and authority?
A: 1. Natural persons – Filipino (citizenship requirement)
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2. Artificial persons – question of owners of capital
and voting stock (75% Filipino).
Q: Who is a non-licensee / non-holder of authority?
A: Any person, corporation or entity:1. Which has not been issued a valid license or
authority to engage in recruitment and
placement by the SLE, or2. Whose license or authority has been suspended,
revoked or cancelled by the POEA or the SLE
Q: Is the license or authority transferable?
A: No, they are non-transferable (Art. 29, LC). Licenseor authority is granted on the basis of personal
qualifications of the grantee. Thus, it is beyond the
commerce of man. The law prohibits alienation of
license or authority.
Q: A recruitment and placement agency declaredvoluntary bankruptcy. Among its assets is its licenseto engage in business. Is the license of the bankruptagency an asset which can be sold in public auctionby the liquidator? (1998 Bar Question)
A: No, because of the non-transferability of thelicense to engage in recruitment and placement. The
LC ( Art. 29) provides that no license to engage in
recruitment and placement shall be used directly or
indirectly by any person other than the one in whose
favor it was issued nor may such license be
transferred, conveyed or assigned to any other
person or entity. It may be noted that the grant of alicense is a governmental act by the DOLE based on
personal qualifications, and citizenship and
capitalization requirements. (Arts.27-28, LC).
Note: Change of ownership or relationship of a singleproprietorship licensed to engage in overseas employment
shall cause the automatic revocation of the license.
ESSENTIAL ELEMENTS OF ILLEGAL RECRUITMENT
Q: What are the elements of illegal recruitment?
A: 1. Offender is a non-licensee or non-holder of
authority to lawfully engage in the
recruitment/placement of workers.
2. Offender undertakes:
a. Any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring
workers and includes referring, contract
services, promising or advertising for
employment abroad, whether for profit or
not, when undertaken by non-licensee or
non-holder of authority [Art. 13(f), as
amended by R.A. 10022] ; or
b. Any of prohibited practices under Art. 34 of
the LC.
3. For complex illegal recruitment, an additional
element is the offender commits the act against
three or more persons, individually, or as a group[People vs. Baytic, (2003)] or there are three or
more offenders.
Q: Larry Domingo was accused of the crime of illegalrecruitment. He argued that he issued no receipt ordocument in which he acknowledged as havingreceived any money for the promised jobs. Hence,he should be free him from liability. Was Larryengaged in recruitment activities?
A: Yes. Even if at the time Larry was promising
employment no cash was given to him, he is stillconsidered as having been engaged in recruitment
activities, since Art. 13(b) of the LC states that the act
of recruitment may be for profit or not. It suffices
that Larry promised or offered employment for a fee
to the complaining witnesses to warrant his
conviction for illegal recruitment [People vs.
Domingo, G.R. No. 181475, (2009)].
Q: How does one prove illegal recruitment? `
A: It must be shown that the accused gave thedistinct impression that he had the power or ability to
send complainants abroad for work such that thelatter were convinced to part with their money in
order to be deployed [People vs. Fortuna, 395 SCRA
353 (2003)].
Q: May a licensee or holder of authority be heldliable for illegal recruitment?
A: Yes, any person (whether non-licensee, non-holderof authority, licensee or holder of authority) who
commits any of the prohibited acts, shall be liable for
Illegal recruitment. (R.A. 8042, as amended by R.A.
10022)
Q: What are the kinds of illegal recruitment?
A: 1. Simple Illegal Recruitment2. Complex Illegal Recruitment
SIMPLE ILLEGAL RECRUITMENT
Q: What is simple illegal recruitment?
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A: It is the violation of Arts. 13(b) and 34 of the LCinvolving less than three recruiters or victims.
Q: What is complex illegal recruitment?
A: It is the violation of Arts. 13(b) and 34 of the LCinvolving at least three recruiters or victims. It may
either be:
1. committed by a syndicate;2. in large Scale
ILLEGAL RECRUITMENT IN LARGE SCALE (SEC. 6, R.A.10022)
Q: When is illegal recruitment committed in largescale?
A: When it is committed against three or morepersons individually or as a group.
Q: When is illegal recruitment considered to becommitted by a syndicate?
A: It is committed by a syndicate if Illegal Recruitmentwas carried out by a group of three or more persons
conspiring or confederating with one another.
Note: Illegal Recruitment in Large Scale pertains to thenumber of victims while Syndicated Illegal Recruitment
pertains to the number of recruiters.
Q: While her application for renewal of her licenseto recruit workers for overseas employment was
still pending Maryrose Ganda recruited Alma andher 3 sisters, Ana, Joan, and Mavic, for employmentas housemates in Saudi Arabia. Maryroserepresented to the sisters that she had a license torecruit workers for overseas employment anddemanded and received P30,000.00 from each ofthem for her services. However, her application forthe renewal of her license was denied, andconsequently failed to employ the four sisters inSaudi Arabia. The sisters charged Maryrose withlarge scale illegal recruitment. Testifying in herdefense, she declared that she acted in good faithbecause she believed that her application for the
renewal of her license would be approved. Sheadduced in evidence the Affidavits of Desistancewhich the four private complainants had executedafter the prosecution rested its case. In the saidaffidavits, they acknowledge receipt of the refundby Maryrose of the total amount of Php 120,000.00and indicated that they were no longer interested topursue the case against her. Resolve the case withreasons. (2005 Bar Question)
A: Illegal recruitment is defined by law as anyrecruitment activities undertaken by non-licenses or
non-holders of authority [People vs. Senoron, G.R. No.
119160, (1997)]. It is large scale illegal recruitment
when the offense is committed against 3 or more
persons, individually or as a group (Art. 38[b], LC). In
view of the above, Maryrose is guilty of large scale
illegal recruitment. Her defense of good faith and the
Affidavit of Desistance as well as the refund given willnot save her because R.A. 8042 is a special law, and
illegal recruitment is malum prohibitum [People vs.
Saulo, G.R. No. 125903, (2000)].
ILLEGAL RECRUITMENT AS ECONOMIC SABOTAGE
Q: When is illegal recruitment considered aseconomic sabotage?
A: When complex illegal recruitment is committed,such that it is syndicated or done in a large scale.
ILLEGAL RECRUITMENT vs. ESTAFA
ILLEGAL RECRUITMENT ESTAFA
Malum prohibitum, thus:
1. Criminal intent is NOT
necessary
2. it is a crime which involves
moral turpitude
Malum in se,
thus:
1. criminal intent is
necessary
2. Same
It is not required that it be
shown that the recruiter
wrongfully represented
himself as a licensedrecruiter
Note: It is enough that thevictims were deceived as they
relied on the misrepresentation
and scheme that caused them
to entrust their money in
exchange of what they later
discovered was a vain hope of
obtaining employment abroad
Accused defrauded
another by abuse of
confidence, or by
means of deceit
Note: It is essential thatthe false statement or
fraudulent
representation
constitutes the very
cause or the only motive
which induces the
complainant to part
with the thing of value.
Illegal recruitment and estafa cases may be filed
simultaneously or separately. The filing of charges forillegal recruitment does not bar the filing of estafa,
and vice versa.
Double jeopardy will not set
Q: Bugo, by means of false pretenses and fraudulentrepresentation, convinced Dado to give the amountof Php 120,000.00 for processing the latter’s papersso that he can be deployed to Japan. Dado later onfound out that Bugo had misappropriated,misapplied and converted the money to her own
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personal use and benefit. Can Dado file the cases ofillegal recruitment and estafa simultaneously?
A: Yes, illegal recruitment and estafa cases may befiled simultaneously or separately. The filing of
charges for illegal recruitment does not bar the filing
of estafa, and vice versa. Bugo’s acquittal in the illegal
recruitment case does not prove that she is not guilty
of estafa. Illegal recruitment and estafa are entirelydifferent offenses and neither one necessarily
includes or is necessarily included in the other. A
person who is convicted of illegal recruitment may, in
addition, be convicted of estafa under Art. 315, par.
2(a) of the RPC. In the same manner, a person
acquitted of illegal recruitment may be held liable for
estafa. Double jeopardy will not set in because illegal
recruitment is malum prohibitum, in which there is no
necessity to prove criminal intent, whereas estafa is
malum in se, in the prosecution of which, proof of
criminal intent is necessary [Sy vs. People, G.R. No.
183879, (2010)].
LIABILITIES
LOCAL RECRUITMENT AGENCY
Q. What is the liability of the Local RecruitmentAgency?
A. A Local Recruitment Angency shall be jointly andsolidarily liable with its principal or foreign-based Er
for any violation of the recruitment agreement and
violation of contracts of employment. [Sec. 10(a)(2)
Rule V, Book I, IRR]
Q. What is the liability of corporate officers,directors or partners if the recruitment/ placementagency is a juridical being?
A. If the recruitment/placement agency is a juridicalbeing, the corporate officers, directors or partners as
the case may be, shall themselves be jointly and
solidarily liable with the corporation or partnership
for the claims and damages [Becmen Service Exporter
and Promotion vs. Cuaresma, G.R. Nos. 182978-79,
(2009)].
Q: What are the remedies under the MigrantWorkers Act and how may they be enforced?
A:
CRIMINAL ACTIONS
RTC
Province or city:
1. Where the offense was committed or
2. Where the offended party actually resides at the
same time of the commission of the offense
MONEY CLAIMS
NLRC
Original and exclusive jurisdiction to hear and decide
claims arising out of an Er-Ee relationship or by virtue
of any law or contract involving Filipino workers for
overseas deployment including claims for actual,
moral, exemplary and other forms of damages.
The liability of the principal/ Er and the
recruitment/ placement agency for any and all
claims shall be joint and several.
The performance bond to be filed by therecruitment/ placement agency shall be answerable
for all money claims or damages that may be
awarded to the workers.
If the recruitment/placement agency is a juridical
being, the corporate officers and directors and
partners as the case may be, shall themselves be
jointly and solidarily liable with the corporation or
partnership for the claims and damages.
ADMINISTRATIVE ACTIONS
POEA
Original and exclusive jurisdiction to hear and decide:
1. All cases which are administrative in character,
involving or arising out of violations of rules and
regulations relating to licensing and registration of
recruitment and employment agencies or entities
and
2. Disciplinary action cases and other special cases
which are administrative in character, involving Ers,
principals, contracting partners and Filipino migrant
workers.
a. It may be filed with the POEA Adjudication
Office or the DOLE/POEA regional office of the
place where the complaint applied or was
recruited at the option of the complainant. Theoffice with which the complaint was first filed
shall take cognizance of the case.
b. DA cases and other special cases, as mentioned
in the preceding Section, shall be filed with
POEA Adjudication Office.
Q: Is compromise agreement on money claimsallowed?
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A: Yes. Consistent with the policy encouragingamicable settlement of labor disputes, Sec. 10 of R.A.
8042 allows resolution by compromise of cases filed
with the NLRC.
Q: When shall compromise agreements on moneyclaims be paid?
A: Any compromise/amicable settlement or voluntaryagreement on money claims inclusive of damages
shall be paid within four months from the approval of
the settlement by the appropriate authority.
Q: Are overtime and leave pay included in the termswhich is the basis in the computation of themonetary award?
A: No. The word “salaries” in Sec. 10(5) of the LC doesnot include OT and leave pay. For seafarers, DO No.
33, series of 1996, provides a Standard Employment
Contract of Seafarers, in which salary is understoodas the basic wage, exclusive of OT, leave pay and
other bonuses; whereas OT pay is compensation for
all work “performed” in excess of the regular 8 hours,
and holiday pay is compensation for any work
“performed” on designated rest days and holidays
[Serrano vs. Gallant Maritime Services & Marlow
Navigation Co., Inc., G.R. No. 167614, (2009)].
FOREIGN EMPLOYER
THEORY OF IMPUTED KNOWLEDGE
Q: What is the theory of imputed knowledge?
A: A rule in insurance law that any informationmaterial to the transaction, either possessed by the
agent at the time of the transaction or acquired by
him before its completion, is deemed to be the
knowledge of the principal, at least so far as the
transaction is concerned, even though in fact the
knowledge is not communicated to the principal at all
[Leonor vs. Filipinas Compania, 48 OG 243].
Q: Sunace International Management Services(Sunace), deployed to Taiwan Montehermozo as adomestic helper under a 12-month contracteffective Feb. 1, 1997. The deployment was with theassistance of a Taiwanese broker, Edmund Wang,President of Jet Crown International Co., Ltd. Afterher 12-month contract expired on Feb. 1, 1998,Montehermozo continued working for herTaiwanese employer for two more years, afterwhich she returned to the Philippines on Feb. 4,2000. Shortly after her return she file before theNLRC against Sunace, one Perez, the Taiwanese
broker, and the employer-foreign principal allegingthat she was jailed for three months and that shewas underpaid. Should Sunace be held liable for theunderpayment for the additional two years that sheworked for her Taiwanese employer under thetheory of imputed knowledge?
A: No, the theory of imputed knowledge ascribes the
knowledge of the agent, Sunace, to the principalTaiwanese Er, not the other way around. The
knowledge of the principal-foreign Er cannot,
therefore, be imputed to its agent Sunace.
There being no substantial proof that Sunace knew of
and consented to be bound under the 2-year
employment contract extension, it cannot be said to
be privy thereto. As such, it and its owner cannot be
held solidarily liable for and of Montehermozo’s
claims arising from the 2-year employment extension
[Sunace vs. NLRC, G.R. No. 161757, (2006)].
SOLIDARY LIABILITY
Q: What is the liability of the private employmentagency and the principal or foreign-based employer?
A: They are jointly and solidarily liable for anyviolation of the recruitment agreement and the
contracts of employment.
Note: This joint and solidary liability imposed by law againstrecruitment agencies and foreign Ers is meant to assure the
aggrieved worker of immediate and sufficient payment of
what is due him [Becmen Service Exporter and Promotionvs. Cuaresma, G.R. Nos. 182978-79, (2009)].
Q. May the absence of employment contract, specialpower of attorney and affidavit of responsibility, asrequired by the POEA Rules and Regulations,absolve the private employment agency and theprincipal from liability?
A. No. Non-compliance with POEA Rules andRegulations cannot be utilized to relieve the agency
and its principal from liabitliy. In fact, such non-
compliance is a ground for the cancellation or
suspension of their license [Hornales vs. NLRC, et al.,G.R. No. 118934 (2001)].
PRETERMINATION OF CONTRACT OF MIGRANTWORKER
Q: Serrano, a seafarer, was hired by GallantMaritime and Marlow Navigation Co. for 12 monthsas Chief Officer. On the date of his departure, hewas constrained to accept a downgradedemployment contract for the position of Second
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Officer, upon the assurance that he would be madeChief Officer after a month. It was not done; hence,he refused to stay on as Second Officer and wasrepatriated to the Phils. He had served only 2months & 7 days of his contract, leaving anunexpired portion of 9 months & 23 days.
Serrano filed with the LA a Complaint against
Gallant Maritime and Marlow for constructivedismissal and for payment of his money claims. TheLA rendered a favorable decision to Serranoawarding him $8,770.00, representing his salary for3 months of the unexpired portion of his contract ofemployment applying R.A. 8042, Sec 10, par. 5:
Money Claims. - In case of termination of
overseas employment without just, valid
or authorized cause as defined by law or
contract, the workers shall be entitled to
the full reimbursement of his placement
fee with interest of 12% per annum, plushis salaries for the unexpired portion of
his employment contract or for 3 months
for every year of the unexpired term,
whichever is less.
Is the subject clause constitutional?
A: No. The subject clause contains a suspectclassification in that, in the computation of the
monetary benefits of fixed-term Ees who are illegally
discharged, it imposes a 3-month cap on the claim of
OFWs with an unexpired portion of one year or more
in their contracts, but none on the claims of otherOFWs or local workers with fixed-term employment.
The subject clause singles out one classification of
OFWs and burdens it with a peculiar disadvantage.
The clause is a violation of the right of Serrano and
other OFWs to equal protection and right to
substantive due process, for it deprives him of
property, consisting of monetary benefits, without
any existing valid governmental purpose.
Furthermore, prior to R.A. 8042, all OFWs, regardless
of contract periods or the unexpired portions thereof,
were treated alike in terms of the computation of
their monetary benefits in case of illegal dismissal.
Their claims were subjected to a uniform rule of
computation: their basic salaries multiplied by the
entire unexpired portion of their employment
contracts. The same applies local workers with fixed-
term employment.
Thus, Serrano is entitled to his salaries for the entire
unexpired period of nine months and 23 days of his
employment contract, pursuant to law and
jurisprudence prior to the enactment of RA 8042
[Serrano vs. Gallant Maritime Services & Marlow
Navigation Co., Inc., G.R. No. 167614, (2009)].
Q: What is the basis in computing an employee’s
compensation in case of premature termination ofcontract?
A: A worker dismissed from overseas employmentwithout just, valid or authorized cause as defined by
law or contract is entitled to full reimbursement of
his placement fee with interest at 12% per annum,
plus his salary for the unexpired portion of his
employment contract or for three months for every
year of the unexpired term, whichever is less. (Sec. 7,
R.A. 10020, 2010)
Q: What is the basis in computing an employee’s
compensation in case of premature termination of
contract?
A: The Migrant Workers Act provides that salaries for
the unexpired portion of the employent contract or
three months for every year of the unexpired term,
whichever is less, shall be awarded to the overseas
Filipino worker, in cases of illegal dismissal. However
in Serrano v. Gallant Maritime Services (G.R. No.
167614, 2009), the clause “or for three months for
every year of the unexpired term, whichever is less”
is declared unconstitutional and awarded the entire
unexpired portion of the employment contract to theoverseas Filipino worker.
Nonetheless, Sec. 7 of R.A. 10022 amended Sec. 10 of
the Migrant Workers Act, and once again reiterated