LABOR STANDARDS

QUESTIONS AND ANSWERS

1. What are the three (3) general classifications of labor statutes? Describe and give
an example of each classification.

The three (3) general classifications of labor statutes are:

a) Labor Relations Laws;
b) Labor Standards Laws; and
c) Social Security Laws.

LABOR RELATIONS Laws are those labor statutes that deal with the
relations of labor and management, like the laws on unions, collective bargaining,
unfair labor practices, strikes, lockouts and picketing.

LABOR STANDARDS are those labor statutes that prescribe standards

relating to terms and conditions of employment for compliance by employers, like
the laws on hours of work, weekly rest periods, holiday pay, wages, and laws
dealing with women, minors, house-helpers, and industrial home-workers.

SOCIAL SECURITY Laws are those labor statutes that provide protection
not only to a worker but also to members of his family in case of loss of income or
when there is need for medical care brought about by contingencies like sickness,
disability, death, and old age. Examples of social security laws are the Social
Security Law, Revised Government Service Insurance Act, the Articles of the
Labor Code on Employees Compensation State Insurance Fund, and the National
Health Insurance.

2. What are labor relations in the Philippines?

The Labor Code of the Philippines governs employment practices and labor
relations in the Philippines. It also identifies the rules and standards
regarding employment such as pre-employment policies, labor conditions, wage rate,
work hours, employee benefits, termination of employees, and so on.

3. What is the primordial reason for the passage of Labor Laws?

The primordial reason for the passage of the labor laws is social justice.

The Constitution says that “the state affirms labor as the primary social
economic force, and therefore, it shall protect the rights of workers and promote their
welfare.” Both under the Constitution and article 3, the state is duty-bound to provide
and guarantee the following:

• Full protection to labor;

• Promotion of full employment;
• Promotion of equal work opportunities regardless of sex, race or creed;
• Regulation of the relations between workers and employers;
• Protection of the rights of workers to:
i. self-organization;
ii. collective bargaining;
iii. security of tenure; and
iv. just and humane condition of work.

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 The foregoing principles, being constitutionally mandated, should be treated as the
standard guidepost to which all labor laws and social legislations should conform and upon
which their legality and validity should be gauged and measured.

4. What is the Rule in Case of Doubt or Ambiguity in Labor Contracts?

In case of doubt or ambiguity, labor contacts should be interpreted liberally in favor

of the worker.

Article 1702 of the Civil Code which provides that all labor legislation and labor
contacts shall be construed in favor of the safe and decent living for the laborer, and Article
4 of the Labor Code which states that all Doubs shall be resolved in favor of labor, should
be applied in resolving such doubt or ambiguity in contacts between management and the
unions Contracts which are not ambiguous are to be interpreted according to their literal
meaning and not beyond their obvious intendment.6 And in College de San Juan de Letran,
the Supreme Court re-affirmed the rule that the ambiguity in labor contracts should be
strictly construed against whoever is the author thereof.

5. Does the monthly-paid employees enjoy the benefits of a holiday pay?

The Labor Code is clear that monthly-paid employees are not excluded from the
benefits of holiday pay. But said implementing rules excluded monthly-paid employees
from the said benefits by inserting under Rule IV, Book III thereof, Section 2 which
provides that monthly-paid employees are presumed to be paid for all days in the month,
whether worked or not.

6. Is there an exception to the rule of Publication?

Yes, there is an exception to the rule of publication.

In the case of Tanada the supreme court ruled that, it is clear and categorical that
administrative rules and regulations must be published if their purpose is to enforce or
implement existing laws pursuant to a valid delegation. The only exceptions are
interpretative regulations or those that are merely internal in nature or the so-called letters
of instructions issued by administrative superiors concerning the rules and guidelines to be
followed by their subordinate in the performance of their duties (Philsa international
Placement and Services Corporation v. Hon. Secretary of Labor and Employment, G.R.
No. 103144, April 4, 2001).

7. Is there any form of evidence required to prove the existence of an employer-employee

relationship?

The well-settled rule is that no particular from evidence is required to prove the
existence of an employer-employee relationship. Any competent and relevant evidence to
prove the relationship may be admitted. There is no hard and fast rule designed to establish
the aforesaid elements. Any competent and relevant evidence to prove the relationship may
be admitted. For if only documentary evidence would be required to show that relationship
no skimming employer would ever be brought before the bar of justice, as no employer
would wish to come out with any trace of the illegality he has authored considering that is
should take much weightier proof to invalidated a written instrument.

8. Whether the Labor Arbiter has jurisdiction to take cognizance of the complaint for
illegal dismissal, damages and attorney’s fees filed by petitioners who was not
deployed overseas despite the signing of a POEA?

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 Yes, the Labor Arbiter has jurisdiction to take cognizance of the complaint for
illegal dismissal, damages and attorney’s fees filed by petitioners who was not deployed
overseas despite the signing of a POEA. It was ruled that despite the absence of an
employer-employee relationship between petitioner and respondent the Labor Arbiter has
jurisdiction over petitioner’s complaint. This is so because the jurisdiction of Labor
Arbiters is not limited to claims arising from employer-employee relationships. Based on
Section 10 of R.A. No. 8042, Labor Arbiters have jurisdiction not only over money claims
arising out of an employer-employee relationship but also “by virtue of any law or
contract involving Filipino workers for overseas deployment” including claims for
actual, Moral, exemplary and other forms of damages. Considering that petitioner was not
able to depart from the airport or seaport in the point of hire, the employment contract did
not commence to be effective and no employer-employee relationship was created between
the parties.

9. What is the two-tiered test?

Under the two-tiered test, the following determines the existence of an employer-
employee relationship:
a. The putative employer’s power to control the employee with respect to the means and
methods by which the work is to be accomplished; and
b. The underlying economic realities of the activity or relationship.

Control Test – The control test is commonly regarded as the most crucial and
determinative indicator of the presence or absence of an employer-employee relationship.
Under the control test, an employer-employee relationship exists where the person for
whom the services are performed reserves the right to control not only the end achieved,
but also the manner and means to be used in reaching that end.
The Economic Reality/Dependence Test – Existing economic conditions between
the parties are used to determine whether employer-employee relationship exists. This is
resorted to when there is serious doubt as to the relationship of the employee with the
employer.

The standard of “economic dependence” of the employee is whether the worker is

dependent on the alleged employer for his continued employment in that line of business.

10. Is the absence of name in the payroll determinative of an employer-employee

relationship?

No. The presence or absence of employer-employee relationship is not determined

by the basis of employee’s compensation. Where the employer-employee relationship
between the parties was sufficiently proved by testimonial evidence, the absence of time
sheet, time record, or payroll has become inconsequential. (Opulencia Ice Plant v. NLRC,
G.R. No. L-98368, Dec. 15, 1993)

11. What is the two tiered test in determining an employer – employee relationship?

The principle that while the "control test “ is the most important and crucial among
the four tests, however, in cases where there is no written agreement to base the relationship
on and where the various tasks performed by the worker bring complexity to the
relationship with the employer, the better approach would therefore be to adopt a two-
tiered test involving, a) the putative employer’s power to control the employee with respect
to the means and methods by which the work is to be accomplished; and b) the underlying
economic realities of the activity or relationship

12. What is the TONGKO doctrine?

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 The employment relationship must be tested not only based on the provisions of
the labor code but also on the insurance code and civil code.

13. What is the "Theory of Secondment"?

The theory of secondment states that an employee who is assigned or "seconded"

by an employer to another entity remains the employee of the former. There is no cessation
of employment between the seconder-employer and the seconded-employee. If there is
severance of employment relationship between these two, there can be no secondment to
speak of.

14. What are the two (2) categories of employees paid by results? Explain each.

The two (2) categories of employees paid by results are:

a) Those whose time and performance are supervised by the
employer- there is an element of control and supervision over the means
and manner as to how the work is to be performed.

b) Those whose time and performance are unsupervised- The

employer's control is over the result of the work and not on the means
and manner of performing the work.

15. Is there an employee-employer relationship between a resident Physician and the

Training Hospital?

Yes. There is employer-employee relationship between resident physicians and the

training hospitals.

The nature of the contracts of resident physicians meets traditional tests for
determining employer-employee relationship. However, because the focus of residency is
training, they are neither here nor there. A residency or resident physician position in a
medical specialty is never a permanent one since residency connotes training and
temporary status. The upward movement from residency specialist rank, institutionalized
in the physician claiming to be a specialist will not be set loose on the community without
the basic knowledge and skills of his specialty

16. When is there no employee-employer relationship between resident physicians and

the training hospital?

There is no employee – employer relationship between the resident physician and

the training hospital when:
a) There is a training agreement between them; and

b) The training program is duly accredited or approved by the appropriate

government agency. (Section 15, Rule X, Book III, Rules to implement the
Labor Code.)

17. : What are the Objectives of pre-employment under the labor code?

The following are the objectives of pre-employment under the Labor Code:

• To promote and maintain a state of full employment through

improved manpower training, allocation and utilization;

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 • To protect every citizen desiring to work locally or overseas
by securing for him the best possible terms and conditions of
employment;

• To facilitate a free choice of available employment by

persons seeking work in conformity with the national
interest;
• To facilitate and regulate the movement of workers in
conformity with the national interest;

• To regulate the employment of aliens, including the

establishment of a registration and/or work permit system;

• To strengthen the network of public employment offices and

rationalize the participation of the private sector in the
recruitment and placement of workers, locally and overseas,
to serve national development objectives;

• To insure careful selection of Filipino workers for overseas

employment in order to protect the good name of the
Philippines abroad.

18. : Define the following terms:

a. Worker
b. Recruitment and placement
c. Private fee-charging employment agency
d. License
e. Private recruitment entity
f. Authority
g. Seaman
h. Overseas employment
i. Emigrant

• "Worker" means any member of the labor force, whether

employed or unemployed.

• "Recruitment and placement" refers to any act of canvassing,

enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services,
promising or advertising for employment, locally or abroad,
whether for profit or not: Provided, that any person or entity
which, in any manner, offers or promises for a fee,
employment to two or more persons shall be deemed engaged
in recruitment and placement.

• "Private fee-charging employment agency" means any

person or entity engaged in recruitment and placement of
workers for a fee which is charged, directly or indirectly,
from the workers or employers or both.
• "License" means a document issued by the Department of
Labor authorizing a person or entity to operate a private
employment agency.

• "Private recruitment entity" means any person or association

engaged in the recruitment and placement of workers, locally

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 or overseas, without charging, directly or indirectly, any fee
from the workers or employers.

• "Authority" means a document issued by the Department of

Labor authorizing a person or association to engage in
recruitment and placement activities as a private recruitment
entity.

• "Seaman" means any person employed in a vessel engaged in

maritime navigation.

• "Overseas employment" means employment of a worker

outside the Philippines.

• "Emigrant" means any person, worker or otherwise, who

emigrates to a foreign country by virtue of an immigrant visa
or resident permit or its equivalent in the country of
destination.

19. Who is considered a laborer?

In its broadest sense, the word laborer" includes everyone who performs any kind
of mental or physical labor, but as commonly and customarily used and understood, it only
applies to one engaged in some form of manual or physical labor. That is the sense in which
the courts generally apply this term in exemption acts, since persons of that class usually
look to the reward of a day's labor for immediate or present support and so are more in
need of the exemption than the others.

20. Distinguish license and authority.

The term "license" refers to a document issued by the DOLE authorizing a person
or entity to operate a private employment agency while the term "authority" means a
document issued by the DOLE authorizing a person or association to engage in recruitment
and placement activities as a private recruitment entity.

21. Who is an emigrant? Is the term “emigrant” still being used now?

An emigrant means any person, worker or otherwise, who emigrates to a foreign

country by virtue of an immigrant visa or resident permit or its equivalent in the country
of destination.
This term, however, is no longer found in recent enactments nor in their
Implementing Rules. Apparently, emigrant is now referred to as “legal resident” and is
defined in the 1996 Omnibus Rules and Regulation as a “person who has obtained
permanent residency status in accordance with the law of the host country.”

22. What are the differences between Migrant workers (MWs) and overseas Filipino
workers (OFWs)?

There are no differences. R.A. No. 8042 points out that the terms “migrant worker”
and “overseas Filipino worker” may be used interchangeably, thus: “Migrant worker”
refers to e person who is to be engaged, is engaged or has been engaged in a remunerated
activity in a state of which he or she is not a legal resident to be used interchangeably with
overseas Filipino worker.

23. Give the persons or entities in the private sector allowed by law to engage in the
recruitment and placement of workers, either for local or overseas employment.

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 Only the following persons or entities in the private sector may engage in the
recruitment or placement of workers, either for local or overseas employment:
a. Private employment agencies;
b. Priavte recruitment entities;
c. Shipping or manning agents or representatives;
d. Construction contractors, which shall be issued authority to operate as private
recruitment entities, subject to guidelines isued by the DOLE Secretary and the
Construction Industry Authority of the Philippiens (CIAP); and
e. Sunch other persons or entities as may be authorized by the DOLE Secretary.

24. Give at least two (2) powers and functions of the Philippine Overseas Employment
Agency.
The powers and functions of the POEA are as follows:

• Regulate private sector participation in the recruitment and overseas

placement of workers by setting up a licensing and registration system;

• Formulate and implement, in coordination with appropriate entities

concerned, when necessary, a system for promoting and monitoring the
overseas employment of Filipino workers taking into consideration their
welfare and the domestic manpower requirements;

• Protect the rights of Filipino Wworkers for overseas employment to fair

and equitable reqcruitment and employment practices and ensure their
welfare;

• Exercise original and exclusive jurisdiction to hear and decide all claims
arising out of an employeremployee relationship or by virtue of any law
or contract involving Filipino workers for overseas employment,
including the disciplinary cases whihc are administraive in character,
involving or arising out of violation of requiremtns of laws, ruels and
regulations including money claims arising therefrom, or violation of the
conditions for issuance of license or authority to recruit workers. All
prohibited recruitment activities and practices which are penal in
character as enumerated and defined under and by virtue of existing laws,
shall be prosecuted in the regular courts in close coordination with the
appropriate Departments and agencies concerned;

• Maintain a registry of skills for overseas placement.

25. What are the exemptions from the ban on direct-hiring of OFWs?

No employer is allowed to directly hire an OFW for overseas employment, except

the following:

a. Members of the diplomatic corps;

b. International organizations;
c. Heads of state and government officials with the rank of at least deputy minister;
or
d. Other employers as may be allowed by the DOLW Secretary, such as:
• Those provided in (a), (b) and (c) above, who bear lesser rank, if endorsed by
the POLO, or Head of Mission in the absence of the POLO;
• Professionals and skilled workers with duly executed/authenticated contracts
containing terms and condition over and above the standards set by the POEA.

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 The number of professional and skilled OFWs hired for the first time by the
employer shall not exceed five (5). For the purpose of determining the number,
workers hired as a group shall be counted as one; or
• Workers hired by a relative/family member who is a permanent resident of the
host country.

26. Who are “Filipinos Overseas”?

The term “Filipino emigrants” has been replaced by the term “Filipinos Overseas”
which is defined as referring to Filipinos who are permanent residents abroad, including
Filipino emigrants who are either already citizens of foreign countries or are still Filipino
citizens awaiting naturalization, recognition or admission, and their descendants.

27. What are the exceptions to Labor Arbiter’s jurisdiction on money claims?

The following are the exceptions to the Labor Arbiter’s jurisdiction on money
claims:
• Money claims of OFWs who are employed in organized employers, that is, with
existing Collective Bargaining Agreements (CBAs), are required to be submitted
for voluntary arbitration in accordance with Articles 274 (261) and 275 (262) of the
Labor Code, or
• Money claims arising from recruitment violation may also be awarded by the
POEA, in addition to the administrative penalties involved.

28. Are OFWs entitled to security of tenure?

Yes, OFWs are entitled to security of tenure guaranteed under the Constitution.

This is so because their employment contracts are perfected in the Philippines and
following the principle of lex loci contractus (the law of the place where the contract is
made), these contracts are governed by our laws, primarily the Labor Code and its
implementing rules and regulations. At the same time, our laws generally apply even to
employment contracts of OFWs as our Constitution expressly provides that the State shall
afford full protection to labor whether local or overseas. Thus, even if a Filipino is
employed abroad, he is entitled to security of tenure.

29. How are ambiguities in overseas employment contracts interpreted?

Any ambiguity in the overseas employment contract shall be interpreted against the
parties that drafted it. (Cadaln v. POEA's Administrator) Labor contracts must be
interpreted liberally in favor of the worker. (Ditan v. POEA)

30. What is the theory of imputed knowledge?

This theory refers to a cognizance of a circumstance or fact attributed to a party

because of its position, or its relationship with or responsibility for another party. The
relationship of the local recruitment agency/local manning agency vis-à-vis its foreign
principal is that of agent-principal, the former being the agent and the latter, the principal.
Consequently, the theory of imputed knowledge ascribes the knowledge of the agent to the
principal.

31. What are the rules on the termination of employment of seafarers?

a. The employment of the seafarer shall cease when the seafarer completes his period
of contractual service aboard the ship, signs-off from the ship and arrives at the
point of hire.

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 b. The employment of the seafarer is also terminated effective upon arrival at the point
of hire for any of the following reasons:

• When the seafarer signs-off and is disembarked for medical reasons

pursuant to Section 20 (A)of the POEA-SEC.
• When the seafarer signs-off due to shipwreck, ship’s sale, lay-up of ship,
discontinuance of voyage or change of ship principal in accordance with
the following provisions of the POEA-SEC:
• Section 22 (Termination Due to Shipwreck and Ship’s Foundering);
• Section 23 (Termination Due to Sale of Ship, Lay-Up or Discontinuance
of Voyage); and
• Section 26 (Change of Principal).
• When the seafarer, in writing, voluntarily resigns and signs off prior to
expiration of contract pursuant to Section 19(G) of the POEA-SEC.
• When the seafarer is discharged for just cause as provided for in Section
33of the POEA-SEC.

32. Who shall provide the burden of proof in termination cases involving OFWs?

In termination cases, where the employer-employee relationship has been

established, the burden of proof that the dismissal of an employee is for a just cause, lies
with the employer. The employer must affirmatively show rationally adequate evidence
that the dismissal was for justifiable cause. Failure to show that there was valid of just
cause for termination would necessarily mean that the dismissal was illegal.

33. Peter, a seafarer after the voyage was, no longer rehired for the succeeding voyages.
He filed an illegal dismissal case with the NLRC. He contends that he is a regular
employee because he has served as a seafarer for 2 years already. The maritime
services filed a motion to dismiss. Rule on the motion.

The motion to dismiss should be granted.

He is not entitled to an illegal dismissal claim because seafarers and OFWs have no
security of tenure. It is Section 10 of R.A. No. 8042, a plain reading of which readily shows
that it applies only to cases of illegal dismissal and finds no application in cases where the
OFW was not illegally dismissed. Resultantly, the remedies provided for under Article 294
[279], such as reinstatement or its alternative remedy of separation pay in lieu thereof, or
full back wages, are not available to OFWs. This is as it should be since OFWs are
contractor's employees whose rights and obligations are governed primarily by the POEA
Standard Employment Contract (POEA-SEC), the Rules and Regulations Governing
Overseas Employment

34. Arturo, an OFW, was illegally dismissed by Gallant Hotel Corporation. He filed a
case with the labor arbiter claiming monetary benefits and damages. Gallant Hotel
Corporation filed a motion to dismiss claiming that the Labor Arbiter has no
jurisdiction over the case. Rule on the motion.

The motion to dismiss should not be granted.

The labor arbiter may exercise jurisdiction over an OFW case even absent the
employment relationship, such as when the cause of action arose from violation of law or
breach of contract. This is an exception to the general rule that the existence of employer-
employee relationship between the party litigants is a pre-requisite for the exercise of
jurisdiction over labor disputes by the Labor Arbiters.

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 35. Bautista signed an employment contract for 31 months with ABC Corporation, with
a monthly salary of P115,850. He was deployed in Papua New Guinea. Nine months
into the contract, Bautista was illegally dismissed. How much can Bautista claim as
indemnity?

The clause "or for three months for every year of the unexpired term, whichever is
less" having been declared unconstitutional in Serrano and Sameer after the provision
found its way again in R.A. No. 10022 which took effect in 2010, the proper indemnity in
illegal dismissal cases, according to Gopio v. Bautista, GR No. 205953, June 06, 2018,
should be the amount equivalent to the unexpired term of the employment contract. In this
case, since respondent Bautista's contract is for 31 months with a monthly salary of
P115,850.00 and he was illegally dismissed just nine (9) months after his deployment in
Papua New Guinea, therefore, there remain 22 months of his unexpired contract. Hence,
said amount should be simply multiplied by 22 months, the remaining term of his
employment contract, or a total amount of P2,548,700.00. (Evic Human Resource
Management Inc. v. Panahon. G.R No 206890. July 31. 2017)
.
36. How are seafarers’ overtime pay treated?

As far as entitlement to overtime pay is concerned, the correct criterion in

determining whether or not sailors are entitled to overtime pay is not whether they were on
board and cannot leave ship beyond the regular eight (8) working hours a day, but whether
they actually rendered service in excess of said number of hours. (Stolt-Nielsen Marine
Services (Phils.). Inc. v NLRC. G.R. No. 105396, Nov. 19, 1996, 264 SCRA 307: 332 Phil.
340). In PCL Shipping Philippines, Inc. v. NLRC, G.R No. 153031, Dec. 14, 2006, the
Tribunal found that private respondent OFW was not entitled to overtime pay because he
failed to present any evidence to prove that he rendered service in excess of the regular
eight working hours a day. This holds true even in cases of guaranteed overtime pay as
held in several cases.(Bahia Shipping Services, Inc v Chua, G R. No. 162195, April 8, 2008;
Santiago v. CF Sharp Crew Management, Inc., GR. No. 162419, July 10, 2007; and, Stolt-
Nielsen Marine Services (Phils), Inc. v. NLRC, G R No 109156. July 11,199 328 Phil. 161).
But in Acuna v. Hon. CA. G.R No 159632, May 5, 2006, the claim for overtime pay was
allowed despite the failure of petitioner-OFWs to substantiate them on the ratiocination
that the claim of overseas workers against foreign employers could not be subjected to the
same rules of evidence and procedure easily obtained by complainants whose employers
are locally based. While normally the presentation of payrolls, daily time records and
similar documents before allowing claims for overtime pay may be required, however, in
this case, that would be requiring the near-impossible. Here, it is private respondents who
could have obtained the records of their principal to refute petitioners' claim for overtime
pay. By their failure to do so, private respondents waived their defense and in effect
admitted the allegations of the petitioners. Accordingly, it was ruled that private
respondents were solidarily liable with the foreign principal for the claims for overtime pay
of petitioners.

In regard to allowances, they are also not included in such computation. However,
this rule on exclusion of allowances does not apply in case they are encapsulated in the
basic salary clause.

37. Are illegally dismissed OFWs entitled to damages?

Yes. As a result of illegality of dismissal, an OFW is entitled to the following

damages:
o Actual or compensatory damages
o Moral and exemplary damages and attorney’s fees.
o Indemnity in the form of nominal damages.

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38. Is an OFW, who executed a waiver or quitclaim, estopped to file a suit against his
employer to demand benefits he is entitled of or to file a case for illegal dismissal?

The execution of a waiver or quitclaim by an OFW in favor of his employer does

not preclude him from subsequently filing a suit demanding benefits to which he is entitled
and from filing an illegal dismissal case.

This is because waiver or quitclaim is looked upon with disfavor, and is frowned
upon for being contrary to public policy. Unless it can be established that the person
executing the waiver voluntarily did so, with full understanding of its contents, and with
reasonable and credible consideration, the same is not a valid and binding undertaking.

Even if the OFW has signed a quitclaim, it does not necessarily follow that he freely
and voluntarily agreed to waive all his claims against his employer.

39. Distinguish permanent disability from total disability.

Permanent disability' transpires when the inability to work continues beyond 120
days, regardless of whether or not he loses the use of any part of his body. On the other
hand, total disability means the incapacity of an employee to earn wages in the same or
similar kind of work that he was trained for, or is accustomed to perform, or in any kind of
work that a person of his mentality and attainments can do. It does not mean absolute
helplessness.

40. Is SSS coverage of OFWs compulsory?

Yes, SSS coverage of OFWs are mandatory.

The SSS Law has been amended in 2019 with the signing into law on February 07,
2019 of R.A. No. 11199, otherwise known as the "Social Security Act of 2018”. Under this
new law, coverage in the SSS shall be compulsory upon all sea-based and land-based
OFWs as defined under RA 8042 otherwise known as the Migrant Workers
and Overseas Filipinos Act of 1995 as amended by RA 10022
provided that they are not over sixty (60) years of age.

41. What are the requisites for the compensability of injury or illness?

For disability to be compensable under Section 20 (A) of the 2010 POEA-SEC, two
elements must concur:
• The injury or illness must be work-related; and
• The work-related injury or illness must have existed during the term of the
seafarer’s employment contract.

The same provision defines a work-related illness as “any sickness as a result of an

occupational disease listed under Section 32-A of [the POEA-SEC] with the conditions set
therein satisfied.” There should be a “reasonable linkage between the disease suffered by
the employee and his work.”

42. What are the requisites in order for an occupational disease to be compensable?

In order for an occupational disease and the resulting disability or death to be

compensable, Section 32-A of the 2010 POEA-SEC requires that all of the following
conditions, as supported by substantial evidence, must be established:
a. The seafarer’s work must involve the risks described in the POEA-SEC;
b. The disease was contracted as a result of tire seafarer’s exposure to the described
risks;

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 c. The disease was contacted within a period of exposure and under such other factors
necessary to contract it; and
d. There was no notorious negligence on the part of the seafarer.

43. What are the condition so that a seafarer’s illness or injury is compensable?

Based on this provision, an injury or illness is compensable when it is work related

and the injury or illness existed during the term of the seafarer’s employment contract

44. Question: “A” contracted rectal illness while on a ship due to the dietary provisions
in the ship having no other choice but to eat what is in the ship. Soon it developed into
colon cancer. May A ask for a compensation for the illness he contracted?

Yes, A may ask for compensation for the illness he contracted.

Indeed, settled is the rule that for illness to be compensable, it is not necessary that
the nature of the employment be the sole and only reason for the illness suffered by the
seafarer? It is sufficient that there is a reasonable linkage between the disease suffered by
the employee and his work to lead a rational mind to conclude that his work may have
contributed to the establishment or, at the very least, aggravation of any pre-existing
condition he might have had.

45. Rule on self-inflicted injury with respect to compensation and benefits granted to an
employee; and who has the burden of proving it?

No compensation and benefits shall be payable in respect of any injury,

incapacity, disability, or death of the seafarer resulting from his willful or criminal act
or intentional breach of his duties; Provided, however, that the employer can prove
that such injury, incapacity, disability or death is directly attributable to the seafarer”
the onus probandi falls on the employer to establish or substantiate its claim that the
seafarer's injury was caused by his willful or intentional act with the requisite quantum of
evidence.

46. Rule on non-disclosure of illnesses with respect to compensation and benefits.

A seafarer who knowingly conceals a pre-existing illness or condition in the Pre-

Employment Medical Examination (PEME) shall be liable for misrepresentation and
shall be disqualified from any compensation and benefits. This is likewise a just came
for termination of employment and imposition of appropriate administrative sanctions."

47. If the company-designated physician fails to give his assessment within the period of
120 days without any justifiable reason, may the 120-day period be extended?

No. In this case, the seafarer’s disability becomes permanent and total, as upheld
and reiterated in a number of cases. One of the rules on the periods when the company-
designated physician must, as a duty, assess the seafarer and issue a final medical
assessment is that if the company-designated physician fails to give his assessment within
the period of 120 days without any justifiable reason, then the seafarer’s disability becomes
permanent and total.

48. Marino, a seafarer, suffered an injury while performing daily maintenance works on
the ship’s engine. He was unable to work for a period of 120 days. He now applies for
permanent and total disability benefits. To support his claim, he submits the
certification by his personal doctor and friend, who happened to be on board the ship,
that he is unfit for sea duty. However, the company-designated physician, wanted to
re-examine Marino himself to conclusively determine his fitness for work. Marino

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 refused, saying that he had already been examined by a doctor and that his inability
to work for 120 days already entitles him to permanent and total disability benefits.
Is Marino correct? Suppose that the company-designated physician had examined
Marino only once during the first 120 days, but wasn’t able to do a follow-up check-
up because Marino refuses to be re-examined, may the period of treatment be
extended?

No, Marino is not correct.

The determination of the fitness of a seafarer for sea duty is within the province of
the company-designated physician, subject to the periods prescribed by law. Here, the
physician who examined him was his personal doctor and friend, whose findings cannot
be made the basis as to his entitlement to permanent and total disability benefits.

Further, he is also incorrect when he claimed that his inability to work for 120 days
already entitles him to permanent and total disability benefits. Jurisprudence instructs that
mere inability to work for a period of 120 days does not entitle a seafarer to permanent and
total disability benefits.

Yes, the period of treatment may be extended up to 240 days. Although the
company-designated physician has an initial 120 days to determine the fitness or disability
of the seafarer, such period may be extended until 240 days is sufficient justification exists.
Here, there is sufficient justification to extend the 120-day period because Marino is
uncooperative.

49. Is the company-designated physician still obligated to assess the seafarer after the
lapse of the 120-day period from the date of medical repatriation?

Yes, the company designated physician is still obligated to assess the seafarer.

Upon sufficient justification by the company-designated physician, the period of

medical treatment of the seafarer may be extended to 240 days.

50. When does the seafarer’s cause of action for total and permanent disability benefits
accrues?

The cause of action by the seafarer accrues when the company-designated physician
failed to issue a declaration as to his fitness to engage in sea duty or disability even after
the lapse of the 120-day period and there was no indication that further medical treatment
would address his temporary total disability, hence, justify an extension of the period to
240 days, or upon the lapse of the 240-day period without any certification being issued by
the company-designated physician.

51. Who is a “company-designated physician” in relation to the mandatory rule of

submitting oneself to post-employment medical examination required of seafarers to
prove their disability?

Under Section 20(A)(3) of the 2010 POEA-SEC, the first procedure to determine
the validity of a seafarer's claim for disability benefits is to refer him to a company-
designated physician of the employer who shall conduct the medical examination and
assessment of his disability. The company-designated physician mentioned in this
provision necessarily refers to the physician designated by the employer to medically
examine the seafarer after his repatriation to the Philippines; it could not refer to any doctor
who examined and assessed him before his repatriation.

52. Is an interim disability grading made by company-designated physician a proper

basis for the award of disability benefits for seafarers?

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 No, the interim disability grading by the company designated physician is not a
proper basis.
Under the case of Magsaysay (Magsaysay Maritime Corp. v. Cruz, G.R. No.
204769, June 6, 2016), stated that an interim disability grading is merely an initial
prognosis and does not provide sufficient basis for an award of disability benefits. Being
an interim disability grade, this declaration is an initial determination of respondent's
condition for the time being. It is only an initial prognosis of the health status of respondent
because after its issuance, respondent was still required to return for re-evaluation, and to
continue therapy and medication; as such, it does not fully assess respondent's condition
and cannot provide sufficient basis for the award of disability benefits in his favor.
Respondent needed further treatment and physical therapy even after the Interim Disability
Grade was given by the company-designated doctor. Carcedo (Carcedo v. Maine Marine
Philippines, Inc., G.R. No. 203804, April 15, 2015), thus did not give credence to the
disability assessment given by the company-designated doctor as the same was merely
interim and not definite. This is because after its issuance, Dario A. Carcedo (seafarer
therein) still continued to require medical attention.

53. What is the effect of extensive evaluation and treatment of seafarer by company-
designated physician?

While labor tribunals and the courts are not bound by the medical findings of the
company-designated physician since the inherent merits of such medical findings will have
to weighed and duly considered, however, if there is ample basis in the extensive evaluation
and treatment of the seafarer by such company-designated physician, as opposed to the
evaluation and treatment of physician-of-choice which is perfunctory and fleeting, the
medical findings of the former should prevail. Indeed, the doctor who had a personal
knowledge of the actual medical condition, having closely, meticulously and regularly
monitored and actually treated the seafarer’s illness, is more qualified to assess the
seafarer’s disability.

54. When does right to seek second opinion accrue?

At the outset, it bears pointing out that the seafarer has the right to seek a second
opinion once the company-designated physician makes a, definitive and final assessment
within the 120-day period; otherwise, no such obligation devolves on the seafarer to consult
his own doctor.

55. When is referral to a third-party doctor required?

The conflicting findings of the company's doctor and the seafarer's physician often
stir suits for disability compensation. As an extrajudicial measure of settling their
differences, the POEA-SEC gives the parties the option of agreeing jointly on a third doctor
whose assessment shall break the impasse and shall be the final and binding diagnosis.
While it is the company-designated doctor who is given the responsibility to make
a conclusive assessment on the degree of the seafarer's disability and his capacity to resume
work within 120/240 days, the parties, however, are free to disregard the findings of the
company doctor as well as the chosen doctor of the seafarer, in case they cannot agree on
the disability gradings issued and jointly seek the opinion of a third-party doctor pursuant
to Section 20 (A) (3) of the 2010 POEA-SEC which states that the liabilities of the
employer when the seafarer suffers work-related injury or illness during the term of his
contract are as follows: If a doctor appointed by the seafarer disagrees with the assessment,
a third doctor may be agreed jointly between the Employer and the seafarer. The third
doctor's decision shall be final and binding on both parties.

In other words, the referral to a third doctor is mandatory when: 1) there is a valid
and timely assessment by the company-designated physician; and 2) the appointed doctor
of the seafarer refuted such assessment.

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56. When referral to a third doctor need not be resorted to

It bears noting, however, that as aptly ruled in C.F. Sharp (C.F. Sharp
Crew Management, Inc. v. Taok, G.R. No. 193679, July 18, 2012), "a seafarer
may pursue an action for total and permanent disability benefits if xxx the
company-designated physician failed to issue a declaration as to his fitness to
engage in sea duty or disability even after the lapse of the 120-day period and
there is no indication that further medical treatment would address his temporary
total disability, hence, justify an extension of the period to 240 days xxx.”
Further, a claimant-seafarer's complaint for disability compensation is not
rendered premature by his failure to refer the matter to a third-party doctor
pursuant to Section 20 (A) (3) of the 2010 POEA-SEC, if the company-
designated physician failed to make a final assessment. Thus, according to the
2018 case of Gamboa ( Gamboa v. Maunlad Trans, Inc., G.R. No. 232905, Aug.
20, 2018), a seafarer's compliance with the conflict-resolution procedure under
the said provision presupposes that the company-designated physician had come
up with an assessment as to his fitness or unfitness to work before the expiration
of the 120-day or 240-day periods. As aptly pointed out in Kestrel (Kestrel
Shipping Co., Inc. v. Munar, G.R. No. 198501, Jan. 30, 3013), absent a final
assessment from the company-designated physician, the seafarer had nothing to
contest and the law steps in to conclusively characterize his disability as total and
permanent (Id.). Hence, although petitioner did consult an independent physician
regarding his ailment the lack of a conclusive and definite assessment from
respondents left him nothing to properly contest and as such, negates the need
for him to comply with the third-doctor referral provision under the 2010 POEA-
SEC.

57. What is medical abandonment?

The act of a seafarer in refusing to undergo medical treatment or in refusing to

continue his medical treatment with the company-designated physician is called “medical
abandonment” which would result in the denial of his disability claim. The abandonment
must take place within the 240-day period required by law.

In the case of New Filipino Maritime Agencies Inc. v. Despabeladeras (G.R. No.
193628, March 19, 2014), respondent seafarer, Michael, upon his return to the country,
underwent medical treatment in accordance with the terms of the POEA-SEC. Upon his
repatriation on August 28, 2009, he was given medical attention supervised by Dr. Cruz,
the company-designated physician. He was later on endorsed to an orthopedic surgeon.
The company-designated specialist recommended that he continue with his physical
therapy sessions. During his visit on February 10, 2010, he was required to return for a
follow-up checkup on February 17, 2010. For unknown reasons, he failed to return on the
said date. Thus, on the issue of abandonment, the Court agrees with petitioners’ stance that
Michael was indeed guilty of medical abandonment for his failure to complete his treatment
even before the lapse of the 240-day period. Due to his willful discontinuance of medical
treatment with Dr. Cruz, the latter could not declare him fit to work or assess his disability.
Thus, without any disability assessment from Dr. Cruz, Michael’s claim for disability
compensation cannot prosper.

58. What is the effect of misrepresentation on disability claims?

Misrepresentation on the part of the claimant would defeat the claim for total
permanent disability. Misrepresentation is a question of fact which may be reversed on
appeal by a contrary factual finding (OSM Shipping Phil., Inc. v. de la Cruz, G.R. No.
159146 Jan. 28, 2005).

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 Section 20. Compensation and Benefits. XXX E. A seafarer who knowingly
conceals and does not disclose past medical condition, disability and history in the
pre-employment medical examination constitutes fraudulent misrepresentation and
shall disqualify him from any compensation and benefits. This may also be a valid
ground for termination of employment and imposition of the appropriate
administrative and legal sanctions), disqualifies him from claiming any disability
benefits from his employer.

However, in De Jesus (De Jesus v. NLRC, G.R. No. 151158, Aug. 17, 2007), the
fact that the petitioner-seafarer has made misrepresentation was not taken against him. The
evidence shows that petitioner (De Jesus) previously suffered from ulcer but he ticked
“NO” in his medical history. De Jesus therefore committed misrepresentation.
Nonetheless, he passed the PEME, was reported fit to work, and was suffered to work on
board M/V Author for more than two (2) months, until his repatriation on June 19, 1997.

The rule is that an ailment contracted even prior to his employment, does not
detract from the compensability of the disease. It is not required that the employment
be the sole factor in the growth, development or acceleration of the illness to entitle
the claimant to the benefits incident thereto. It is enough that the employment had
contributed, even in a small measure, to the development of the disease. In this case,
private respondent Pacific Ocean Manning, Inc. (POMI) failed to rebut De Jesus’ claim
that he was required to work even during mealtime and that the meals served on board did
not fit dietary preference of the Filipinos. Such plight took a toll on De Jesus’ health and
surely contributed, even in a slight degree, to the relapse of his illness. De Jesus’
misrepresentation cannot therefore be made the basis by POMI for the denial of his claims
under the contract.

59. What are the requisites to be entitled to death compensation benefits from the
employer as to the death of a seafarer?

To be entitled to death compensation benefits from the employer, the death of the
seafarer:
• Must be work-related: and
• Must happen during the term of the employment contract.

Under the Amended POEA Contract, work-relatedness is now an important

requirement. The qualification that death must be work-related has made it necessary to
show a causal connection between a seafarer’s work and his death to be compensable. (Sy
v. Philippine Transmarine Carriers, Inc., G.R. No. 191740, Feb. 11, 2013)

60. When should the termination of employment of a seafarer who died be reckoned?

Section 18 of the 2010 POEA-SEC definitively reckons the termination of

employment of a seafarer in two (2) ways, to wit:
a. When the seafarer completes his period of contractual service aboard the ship,
signs-off from the ship and arrives at the point of hire.
b. Effective upon arrival at the point of hire or any of the following reasons:
• When the seafarer signs-off and is disembarked for medical reasons;
• When the seafarer sign-off due to shipwreck, ship’s sale, lay-up of ship,
discontinuance of voyage or change of ship principal;
• When the seafarer, in writing, voluntarily resigns and signs off prior to
expiration of contract;
• When the seafarer is discharged for just cause

FERNANDEZ, SHELVIN ECHO

PAGES 206-211

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61. What is the legal basis for non-compensability of death caused by the seafarer
himself?
Under Section 20 (D) of the 2010 POEA-SEC provides:

No compensation and benefits shall be payable in respect of any injury, incapacity,

disability or death of the seafarer resulting from his willful or criminal act or intentional
breach of his duties, provided however, that the employer can prove that such injury,
incapacity, disability or death is directly attributable to the seafarer."

62. Is the rule that the employer is liable for the death of a seafarer on the term of his
employment absolute?

No the rule is not absolute.

While the death of a seafarer during the term of his employment makes the
employer liable to the seafarer’s heirs for death compensation benefits, this rule, however,
is not absolute. The employer may be exempt from liability if it can successfully prove that
the seafarer's death was caused by an injury directly attributable to his deliberate or willful
act. Hence, the claim of the heirs for entitlement to any death benefit depends on whether
the employer's evidence suffices to prove that the seafarer committed suicide, and the
burden of proof rests on his employer.

63. When is death attributable to the seafarer?

Death by suicide is not compensated. In the case of mabuhay shipping service vs

NLRC, no compensation and benefits shall be payable in respect of any injury, incapacity,
disability, or death of the seafarer resulting from his willful or criminal act or intentional
breach of his duties, provided however that the employer can prove such injury, incapacity,
disability or death is directly attributable to the seamen.

64. What are the modes of satisfying monetary judgment rendered in favor of OFWs?

There are a number of modes of satisfying monetary judgments rendered in favor

of OFWs, to wit:
• Voluntary agreement or compromise agreement,
• Resort to:
(a) Performance bond;
(b) Compulsory insurance:
(c) Optional insurance;
(d) Foreign Employers Guarantee Fund.

65. Under R.A. 8042, who is a Legal Assistant for Migrant Workers Affairs?

Under R.A. 8042, the position of Legal Assistant for Migrant Workers Affairs is
created under the auspices of the Department of Foreign Affairs (DFA) who shall be
primarily responsible for the provision and overall coordination of all legal assistance
services to be provided to Filipino migrant workers as well to overseas Filipinos in distress.
He has the rank, salary and privileges equal to that of an undersecretary of the DFA. He is
appointed by the president and must be of proven competence in the field of law with at
least ten (1O) years of experience as a legal practitioner and must not have been a candidate
to an elective office in the last local or national elections.

66. What is the Country-team Approach under R.A. 8042?

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 Article 22 of the Labor Code and its Implementing Rules apply to every contract
worker and seamen recruited and placed in overseas employment. They also apply to
licensed agencies and authority holders (Rules to Implement the Labor Code, Rule XIII,
Section 1).

The country-team approach is the mode under which Philippine embassies or their
personnel will operate in the protection of the Filipino migrant workers as well as in the
promotion of their welfare. The protection of the Filipino migrant workers and the
promotion of their welfare, and the protection of the dignity and fundamental rights and
freedoms of the Filipino citizen abroad, in general, shall be the highest priority of the
Secretary of Foreign Affairs and the Philippine Foreign Service Posts.

Under the country-team approach, all officers, representatives and personnel of the
Philippine government posted abroad on a per country basis, act as one country-team with
a mission under the leadership of the ambassadors. In host countries where there are
Philippine consulates, such consulates shall also constitute part of the country-team under
the leadership of the ambassador.

67. What is the coverage of the mandatory remittance of foreign exchange earnings stated
in Article 22 of the Labor Code?

68. What is the form of remittance of foreign exchange earnings of a Filipino worker?

Remittance of foreign exchange may be done individually by a worker or

collectively through an employer under a payroll deduction scheme, to be approved by the
DOLE (Rules to Implement the Labor Code, Rule XIII, Section 4).
69. Remy Travel & Tours is a well-known travel agency and an authorized sales agent of
the Philippine Air Lines. Since majority of its passengers are overseas workers, Remy
Travel & Tours applied for a license for recruitment and placement activities. It
stated in its application that its purpose is not for profit but to help Filipinos find
employment abroad. Should the application be approved?

No, the application should be disapproved.

It is prohibited by Article 26 of the Labor Code, to wit: "Article 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."

70. State the functions of the regional extension units of POEA.

The POEA is authorized under Executive Order No. 247 to set up regional
extension units in such regions as the Governing Board may determine to be necessary to
promote efficient and economic delivery of its services. The regional extension units shall
be under the administrative supervision of the Labor Regional Director. It shall have,
among others, the following functions:
a. Executive the policies, plans and programs of the POEA in the regions outside of
Metro Manila area;
b. Coordinate with local government officials on the matter of implementation of the
POEA’s program on overseas employment;
c. Advise the central office on the needs of the region for particular welfare and
regulatory programs;
d. Establish linkages with other allied government agencies in the pursuance of the
objectives of the overseas employment program;
e. Coordinate the anti-illegal recruitment campaign in the regions; and
f. Perform other functions as the POEA may deem necessary. (Section 5, Executive
Order No. 247, July 24, 1987.)

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71. Who are the persons and entities that are not qualified to engage in the business of
recruitment and placement for local employment?

The following persons and entities are not qualified to engage in the business of
recruitment and placement for local employment:
a. Those who are convicted of illegal recruitment, trafficking in persons, anti-child
labor violation, or crimes involving moral turpitude;
b. Those against whom probable cause or prima facie finding of guilt for illegal
recruitment or other related cases exist particularly to owners or directors of
agencies who have committed illegal recruitment or other related cases.
c. Those agencies whose licenses have been previously revoked or cancelled by
the DOLE.
d. Cooperatives, whether registered or not under the Cooperative Act of the
Philippines.
e. Law enforcers and any official and employee of the DOLE.
f. Sole proprietorship duly licensed agencies are prohibited from securing another
license to engage in recruitment and placement.
g. Sole proprietors, partnerships or corporations licensed to engage in private
recruitment and placement for local employment are prohibited from engaging
in job contracting or sub-contracting activities.

72. What are the requirements in order for an agency to transfer to a new place of
business?

An agency intending to transfer to a new place of business should notify the

Regional Office that issued the license within fifteen (15) days prior to the date of
transfer, the agency shall:
(a) Secure a clearance of no pending case from the issuing Regional Office;
(b) Notify the Regional Office, which has jurisdiction over the new place of
business;
(c) Submit to the receiving Regional Office a clearance of no pending case,
location map of the new office and a copy of the contract of lease or certificate
of ownership;
(d) Publish the new address for two (2) consecutive weeks in a newspaper of
general circulation.

73. Define service fee.

Service fee refers to the amount charged by a private employment agency to a

local employer as payment for actual services rendered in relation to the recruitment
and placement of workers.

74. When does an employer deemed to have forfeited his right for a replacement of
the worker without cost or a refund of the service fee?

The employer is deemed to have forfeited his right for a replacement without
cost or refund of the service fee, if he failed to avail of the same within one (1)
month from the date of engagement of the worker.

75. What are the fees chargeable by the licensed manning agency to the principal or
employer of the seafarer?

Manning Fees - This fee is intended to cover services rendered in the

recruitment and deployment of seafarers.

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 Processing Fees - All processing fees required for deployment such as pre-
employment medical examination in the principal's/employer's designated clinic,
POEA and OWWA fees, visas, principal's/employer's flag State ship requirements,
principal's/ employer's required trainings and other requirements.

However, in case of seafarer's failure or unjustified refusal to join ship after all
processing fees have been incurred by the principal/employer, the said fees shall be
refunded by the seafarer within thirty (30) days from demand.

76. What is the imposable penalty to those licensed recruitment agency for charging,
imposing and accepting directly or indirectly, any amount of money, goods or
services, or any fee or bond for any purpose whatsoever before employment is
obtained for an applicant worker?

1st Offense - Suspension of License (Two Months to Six Months)

2nd Offense - Suspension of License (Sir Months and One day to One year)
3rd Offense - Suspension of License (One year and One day to TWO years)
4th Offense - Cancellation of License,

77. Who has the power to impose administrative penalty in recruitment for local
employment?
It bears emphasis that Article 36 expressly makes itself applicable to
recruitment and placement for overseas employment. For local employment,
Department Order No. 141-14, Series of 2014 [November 20, 2014], the Revised
Rules and Regulations Governing Recruitment and Placement for Local
Employment, applies. Under this issuance, it is the Regional Director who, after
observance of due process, is granted the power to impose the appropriate
administrative penalties in every recruitment violation.

78. What is the nature of the power of the Secretary of Labor to regulate recruitment
and placement activities?

The nature to regulate and restrict the recruitment and placement activities of
all agencies conferred by Article 36 to the Secretary of Labor and Employment is
a valid grant of police power. (Philippine Association of Service Exporters, Inc. v.
Torres, G.R. No. 101279, Aug. 6, 1992, 212 SCRA 298) Being regulatory, the
DOLE Secretary may validly issue rules and regulations restricting or otherwise
regulating the recruitment and placement activities of persons and entities engaged
in the recruitment and placement of workers locally or overseas.

Under R.A. 8042, as amended by R.A. No. 10022, (Section 23) it is the POEA
which is given the power to regulate private sector participation in the recruitment
and overseas placement of workers by setting up a licensing and registration
system. It is also tasked to formulate and implement, in coordination with
appropriate entities concerned, when necessary, a system for promoting and
monitoring the overseas employment of Filipino workers taking into consideration
their welfare and domestic manpower requirements. It is responsible for the
regulation and management of overseas employment from the pre-employment
stage, securing the best possible employment terms and conditions for overseas
Filipino workers, and taking into consideration the needs of vulnerable sectors and
the peculiarities of sea-based and land-based workers

79. What are the two kinds of illegal recruitment?

There are two (2) kinds of illegal recruitment, to wit:

i. Simple illegal recruitment, and

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 ii. Illegal recruitment involving economic sabotage consisting of either
illegal recruitment committed by a syndicate; or illegal recruitment
committed in large scale.

80. What is simple illegal recruitment? What are its elements?

Simple illegal recruitment or simply, illegal recruitment, covers any recruitment

and placement activity undertaken by a non-licensee or a non-holder of authority.
Simple illegal recruitment is committed when two (2) essential elements concur,
viz.:
(1) That the offender has no valid license required by law to enable him
to lawfully engage in the recruitment and placement of workers; and
(2) That the offender undertakes any activity within the meaning of
recruitment and placement" defined under Article 13(b) or any
prohibited practices enumerated under the law.

81. When is illegal recruitment considered a crime of economic sabotage?

Illegal recruitment is considered a crime involving economic sabotage when the

commission thereof is attended by any of the following qualifying circumstances:
a. When committed by a syndicate (at least three (3) recruiters); or
b. When committed in large scale (at least three (3) recruitees).

82. Is mere impression sufficient to constitute illegal recruitment?

Yes. To convict a person for illegal recruitment, it suffices to show that he gave
the victim the distinct impression that he had the power or ability to send him abroad
for work such that the latter was convinced to part with his money in order to be
employed. (People v. Fernandez, G.R No. 199211, June 04, 2014; People v. Abat, G.R.
No. 168651, March 16, 2011; People v. Laogo, G.R. No. 176264, Jan. 10, 2011;
Carmen Ritualo v. People, G.R. No. 178337, June 25, 2009)

83. Mercury, Venus, Mars and Saturn were all fresh college graduates who were all
looking for jobs. One day, while they were hanging out in a coffee shop after
attending a job fair, Jupiter approached their table and introduced himself as the
Marketing Head of Universe Manpower Services. He represented that he has the
capacity to contract, enlist and transport Filipino workers for employment of
fresh college graduates to Australia. For an initial sign-up fee of Php 2000.00, he
recruited and promised employment job placement in Australia. The victims
relied on the assurances and representations of Jupiter and was impressed by his
office. They registered, paid the necessary fees and processed their requirements.
However, the day of their departure never came. The 4 respondents returned to
the office to confront Jupiter but the office was already closed. Devastated by their
fate, the victims filed a case against Jupiter for illegal recruitment. Jupiter
contented that he cannot be held liable for illegal recruitment because he has not
expressly represented that he had authority or license from POEA as a recruiter
as he was part of the agency’s marketing team. Is Jupiter liable for illegal
recruitment?

Yes, Jupiter is liable for illegal recruitment.

The Supreme Court held in the case of People v. Ballesteros. G.R Nos. 116905-
906, that to be liable for illegal recruitment, there is no need to show that the
recruiter represented himself to his victims that be is a licensed recruiter since it is
enough to show that he did not possess the requisite authority or license to undertake
recruitment activities.

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 In the given case, it suffices that the prosecution has established that the POEA
did not authorize or license the Jupiter to engage in recruitment activities and that
despite the absence of such authority or license, he still recruited his victims.

84. What is meant by non-licensee or non-holder of authority?

As defined under the Omnibus Rules and Regulations Implementing the Migrant
Workers and Overseas Filipinos Act of 1995, the term "non-licensee" or "non-holder of
authority" refers to any person, partnership or corporation with no valid license or
authority to engage in recruitment and placement of OFWs or whose license or authority
is revoked, cancelled, terminated, expired or otherwise delisted from the roll of licensed
recruitment/manning agencies registered with the POEA.

85. What is the available defense for an employee of a company engaged in illegal
recruitment activities?

The culpability of the employee hinges on his knowledge of the offense and his
active participation in its commission. Hence, where it is shown that the employee
was merely acting under the direction his superiors and was unaware that his acts
constituted a crime, he may not be held criminally liable for an act done for and in
behalf of his employer(People vs Chowdury GR No. 129577-80)

86. X company is engaged in recruitment and placement of oversears woker, its

license will expire on November 1, 2020. Such fact of expiration was forgotten by
X company, on November 5, 2020 recruited B. subsequently, B came to know that
the license of X company has already expired. May X company be liable for illegal
recruitment and estafa?

No, X company may only be liable for illegal recruitment since the its nature is
mala prohibita, the 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
a non-license or non-holder of authority may render the X company liable.
however, as to the crime of estafa, there was no intent to deceipt performed by X
company because such company had no knowledge or failed to check the its license
already expired.

87. The prescriptive period for a case of illegal recruitment involving economic
sabotage is twenty (20) years. What is the reckoning point of such prescriptive
period?

The Supreme Court in the case of People v. Duque agreed with the view of
the Solicitor General that Act No. 3326, as amended (This law is entitled “An Act
to Establish Periods of Prescription for Violations Penalized by Special Acts and
Municipal Ordinances and to Provide When Prescription Shall Begin to Run),
supplied the applicable norm. Section 2 of this law reads as follows: Prescription
shall begin to run from the day of the commission of the violation of the law, and
if the same be not known at the time from the discovery thereof and institution of
judicial proceedings for its investigation and punishment."

Examination of the above quoted Section 2 shows that there are two (2)
rules for determining the beginning of the prescriptive period, viz: 1) On the day of
the commission of the violation, if such commission be known; and 2) If the
commission of the violation was not known at that time, then from discovery
thereof and institution of judicial proceedings for investigation and punishment.

A literal reading of Section 2 appears to suggest that two (2) elements must
coincide for the beginning of the running of the prescriptive period; First, the

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 element of discovery of the commission of the violation of the special law; and
second, the "institution of judicial proceedings for its investigation and
punishment." According to the High Court, the “institution of judicial proceedings”
for its investigation and punishment" may be either disregarded as surplusage or
should be deemed preceded by the word "until." Thus, Section 2 may be read as:

"Prescription shall begin to run from the day of the commission of the
violation of the law; and if the same be not known at the time, from the discovery
thereof;"
Or as –
“Prescription shall begin to run from the day of the commission of the
violation of this law, and if the same be not known at the time, from the discovery
thereof.

88. Where is the venue of a criminal action for illegal recruitment?

Section 9 of RA 8042, provides that a criminal action arising from illegal

recruitment as defined herein shall be filed with the RTC of the province or city where
the offense was committed or where the offended party actually resides at the time of
the commission of the offense: Provided, that the court where the criminal action is
first filed shall acquire jurisdiction to the exclusion of other courts; Provided, however,
that he aforestated provisions shall also apply in those criminal actions that have
already been filed in court at the time of the effectivity of this Act.”

89. What is the applicability of the Indeterminate Sentence Law to illegal recruitment
cases?

The application of the Indeterminate Sentence Law is mandatory to both the

Revised Penal Code and the special laws. (Argoncillo v. CA, G.R. No. 118806, July 10,
1998, 292 SCRA 313)
a. Application to offenses punishable by a special law. Section 1 of Act No.
4103 [December 5, 1933], otherwise known as the “Indeterminate Sentence
Law,” provides that if the offense is punishable by a special law (such as illegal
recruitment punishable under R.A. No. 8042), the court shall impose on the
accused an indeterminate sentence, the maximum term of which shall not
exceed the maximum fixed by the said law and the minimum of which shall not
be less than the minimum term prescribed by the same. Consequently, by
imposing a straight penalty, the trial court would be disregarding the application
of the Indeterminate Sentence Law. (Romero v. People, G.R. No. 171644, Nov.
23, 2011) Accordingly by way of illustration, in People v. Bayker, (G.R. No.
170192, Feb. 10, 2016) where the accused was convicted for large-scale illegal
recruitment and estafa, the penalty for illegal recruitment committed in large
scale, pursuant to Section 7(b) of Republic Act No. 8042, is life imprisonment
and a fine of not less than P500,000.00 nor more than P1,000,000.00. In light
of the provision of this law, the CA patently erred in reducing the fine to
P100,000.00. Hence, it was increased to P500,000.00.

b. Application to offenses punishable under the Revised Penal Code In cases

punishable under the Revised Penal Code like estafa which usually
accompanies illegal recruitment cases, Section 1 of the Indeterminate Sentence
Law provides that the maximum term of the penalty shall be “that which, in
view of the attending circumstances, could be properly imposed” under the said
Code, and the minimum shall be “within the range of the penalty next lower to
that prescribed” for the offense. The penalty next lower should be based on the
penalty prescribed by the Code for the offense, without first considering any
modifying circumstances attendant to the commission of the crime. The
determination of the minimum penalty is left by law to the sound discretion of

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 the court and it can be anywhere within the range of the penalty next lower
without any reference to the periods into which it might be subdivided. The
modifying circumstances are considered only in the imposition of the maximum
term of the indeterminate sentence. (People v. Gabres, G.R. Nos. 118950-54,
Feb. 6, 1997)

90. What are the classification of penalties under R.A. No. 8042, as amended?

Under the amended provision of R.A. No. 8042, the penalties are classified as
follows:

(a) Penalty for simple illegal recruitment. – Any person found guilty of illegal
recruitment shall suffer the penalty of imprisonment of not less than twelve (12)
years and one (1) day but not more than twenty (20) years and a fine of not less
than One million pesos (P1,000,000.00) nor more than Two million pesos
(P2,000,000.00). (Section 7 [a], R.A. No. 8042, as amended by Section 6 of R.A.
No. 10022; People v. Hu, G.R. No. 182232, Oct. 6, 2008; Section 5(a), Rule IV,
Omnibus Rules and Regulations Implementing the Migrant Workers and
Overseas Filipinos Act of 1995, as Amended by R.A. No. 10022, issued on July
8, 2010)

(b) Penalty for illegal recruitment constituting economic sabotage (syndicated

or large-scale). – The penalty of life imprisonment and a fine of not less than
Two million pesos (P2,000,000.00) nor more than Five million pesos
(P5,000,000.00) shall be imposed if illegal recruitment constitutes economic
sabotage as defined in the law. (Section 7[b], R.A. No. 8042, as amended by
Section 6 of R.A. No. 10022; People v. Hu, supra; Section 5(b), Rule IV,
Omnibus Rules and Regulations Implementing the Migrant Workers and
Overseas Filipinos Act of 1995, as Amended by R.A. No. 10022, issued on July
8, 2010)

(c) Penalty for commission of prohibited acts. – Any person found guilty of any
of the prohibited acts shall suffer the penalty of imprisonment of not less than
six (6) years and one (1) day but not more than twelve (12) years and a fine of
not less than Five hundred thousand pesos (P500,000.00) nor more than One
million pesos (P1,000,000.00). (Section 7[c], R.A. No. 8042, as amended by
Section 6 of R.A. No. 10022; People v. Hu, supra; Section 5(c), Rule IV,
Omnibus Rules and Regulations Implementing the Migrant Workers and
Overseas Filipinos Act of 1995, as Amended by R.A. No. 10022, issued on July
8, 2010)

91. How may a non-resident alien be employed in the Philippines?

Such alien must obtain an Alien Employment permit from the DOLE.
An alien employment permit may only be issued after a determination of the non-
availability of a Filipino who is competent, able and willing at the time of
application to perform the services for which the alien desires. For an enterprise
registered in preferred areas of investments, said employment permit may be issued
upon recommendation of the government agency charged with the supervision of
said registered enterprise.

92. What is an AEP?

An Alien Employment Permit (AEP) is a document issued by the DOLE

Secretary through the DOLE-Regional Director who has jurisdiction over the
intended place of work of the foreign national, authorizing the foreign national to
work in the Philippines.

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93. What is the penalty for working without AEP?

The Regional Director shall impose a fine of Php 10,000.00 for every year or a
fraction thereof to a foreign national found working without a valid AEP. Employer
found employing foreign national without a valid AEP shall also pay a fine of Php
10,000.00 for every year or fraction thereof: Provided further, that an employer
found to have failed to pay the penalty provided herein shall not be allowed to
employ any foreign national for any position in the said company.

94. Is there a remedy for denied/canceled/revoked AEP?

Yes, there is a remedy.

The aggrieved foreign national or his authorized representative may file an
appeal with the secretary of DOLE within 10 days’ receipt of copy of
denial/cancellation/revocation order. The decision of the DOLE Secretary shall be
final executor. However, the foreign national is allowed to file only a single motion
for reconsideration within ten (10) days after receipt of decision.

95. What is the Reformed industry-based training program of TESDA?

The comprehensive plan shall provide for a reformed industry-based training

program including apprenticeship dual training system and other similar schemes
intended to:

a. promote maximum protection and welfare of the worker-trainee;

b. improve the quality and relevance and social accountability of technical
education and skills development;
c. accelerate the employment-generation efforts of the government; and
d. expand the range of opportunities for upward social mobility of the school-goin
population beyond the traditional higher levels of formal education *
e. Review and endorsement of agencies’ budgets. (Section 21 ibid; Section 4, Rule
II)

96. What assistance does the TESDA provide for employers and organizations?

TESDA shall assist any employer or organization engaged in skills training

schemes designed to attain its objective under rules and regulations which TESDA
shall establish for this purpose.” (Section 24, RA, No. 77968; Section 2, Rule VIII,
Rules and Regulations Implementing the TESDA Act of 1904.)

97. What are the functions and responsibilities of TESTDA Secretariat?

The TESDA Secretariat shall have the following functions and responsibilities:
(1) To establish and maintain a planning process and formulate a national
technical education and skills development plan in which the member-
agencies and other concerned entities of TESDA at various levels
participate;
(2) To provide analytical inputs to policy decision-making of TESDA on
allocation of resources and institutional roles and responsibilities as
shall be embodied in annual agencies’ technical education and skills
development plans, in accordance with the manpower plan for middle-
level skilled workers as approved by TESDA;
(3) To recommend measures and implement the same upon approval by
TESDA, for the effective and efficient implementation of the national
technical education and skills development plan;

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 (4) To propose to TESDA the specific allocation of resources for the
programs and projects it shall undertake pursuant to approved national
technical education and skills development plan;
(5) To submit to TESDA periodic reports on the progress and
accomplishment of work or programs of implementation of plans and
policies for technical education and skills development;
(6) To prepare for approval by TESDA an annual report to the President
on technical education and skills development;
(7) To implement and administer the apprenticeship program as provided
for in Section 18 of R.A. No. 7796;
(8) To prepare and implement, upon approval by TESDA, a program for
the training, of trainers, supervisors, planners and managers as
provided for in Section 23 of R.A. No. 7796;
(9) To enter into agreements to implement approved plans and programs
and perform activities as shall implement the declared policy of R.A.
No. 7796; and
(10) To perform such other functions and duties as may be assigned by
the TESDA Board (Section 10, R.A. No. 7796; Section 2, Rule IV,
Rules and Regulations Implementing the TESDA Act of 1994).

98. Who are considered special workers?

The following are considered special workers:

a. Apprentices
b. Learners
c. Handicapped workers

99. What are the qualifications of an apprentice?

QUALIFICATIONS OF APPRENTICES.

Qualifications under Article 59.

Article 59 prescribes three (3) qualifications for apprentices, to wit:
• Be at least fourteen (14) years of age;
• Possess vocational aptitude and capacity for appropriate tests; and
• Possess the ability to comprehend and follow oral and written instructions.

Qualifications under the Rules to Implement the Labor Code.

The Implementing Rules, however, prescribe the following four (4)
qualifications:
§ Be at least fifteen (15) years of age, provided those who are at least
fifteen (15) years of age but less than eighteen (18) may be eligible for
apprenticeship only in non-hazardous occupations;
§ Be physically fit for the occupation in which he desires to be trained;
§ Possess vocational aptitude and capacity for the particular occupation
as established through appropriate tests; and
§ Possess the ability to comprehend and follow oral and written
instructions.

Appropriate educational qualifications for apprentice.

As additional requirement, Article 59 explicitly provides that trade

and industry associations may recommend to the DOLE Secretary
appropriate educational qualifications for apprentices in certain
occupations. Such qualifications, if approved, shall be the educational
requirement for apprenticeship in such occupations unless waived by an
employer in favor of an applicant who has demonstrated exceptional ability.

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 A certification explaining briefly the ground for such waiver, and signed by
the person in charge of the program, shall be attached to the apprenticeship
agreement of the applicant concerned. (Article 59. Labor Code; Seaton 11,
Rode VI, Book II, Rules to Implement the Labor Code)

100. How long can an apprentice render hours of work?

The hours of work of an apprentice should not exceed the maximum number of
hours of work prescribed by law for a worker of his age and sex. Time spent in
related theoretical instructions should be considered as hours of work and should
be reckoned jointly with the on-the-job training time in computing in the agreement
the appropriate periods for giving wage increases to the apprentice.( Section 20
Rule VI Book II Ibid)

An apprentice not otherwise barred by law from working eight (8) hours a day
may be requested by his employer to work overtime and paid accordingly, provided
that there are no available regular workers to do the job, and the time spent on
overtime work thus rendered is duly credited toward his training time (Section 20
Rule VI Book II Ibid Paragrapgh (E) Department Order ) 08-04 Series of 2004
entitled ‘GUIDELINES IN THE IMPLEMENTATION OF THEKASANAYAN
AT HANAPBUHAY PROGRAM (An Apprenticeship and Employment Program)
issued by DOLE Secretary Patricia Sto Thomas on Aug 18 2004)

101. Regarding disputes arising from TESDA apprenticeship agreement, can the
court take cognizance of the case even without the exhaustion of administrative
remedies?

No. Article 67. Exhaustion of administrative remedies. - No Person shall

institute any action for the enforcement of any apprenticeship agreement of
damages for breach of any such agreement, unless he has exhausted all available
administrative remedies.

102. Can a minor enter into an apprenticeship agreement?

Yes a minor can enter into an apprenticeship agreement provided that the
agreement shall be signed in his behalf by his parent or guardian, if the latter is not
available, by an authorize representative of the Department of Labor, and the same
shall be binding during its lifetime.

103. Who are learners?

Learners are persons hired as trainees in semi-skilled and other industrial

occupations which are non-apprenticeable and which may be learned through
practical training on the job in a relatively short period of time which shall not
exceed three (3) months.

104. When can a learner be hired?

A learner can be the hired if the following requisites concur:

• When no experienced workers are available;

• The employment of learners is necessary to prevent curtailment of
employment opportunities; and

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 • The employment does not create unfair competition in terms of labor
costs or impair or lower working standards.

105. What is meant by labor standards?

The term “labor standards” refers to the minimum requirements prescribed by

existing laws, rules and regulations and other issuances relating to wages, hours of
work, cost of living allowances and other monetary and welfare benefits, including
those set by occupational safety and health standards.’

106. Who are employees not covered by the Labor Code?

Article 82 of the Labor Code and its Implementing Rules‘ expressly exclude
the following persons or employees from the coverage of Title I, Book II thereof,
to wit:
a) Government employees;
b) Managerial employees;
c) Other officers or members of a managerial staff;
d) Domestic servants (now Kasambahays),
e) Persons in the personal service of another;
f) Workers paid by results;
g) Field personnel; and
h) Members of the family of the employer.

107. ABE was hired as a Kasambahay in the household of BAE. ABE is working
for the personal comfort and enjoyment of BAE’s family in the home. However,
when the parents are at work and the kids are in school, ABE oversees the
ONLINE SARI-SARI STORE INC. of BAE which is an online retail shop
incorporated under the Securities Exchange Commission. ABE was suddenly
dismissed because he became a member of the Purple Army, a fan-based
organization for KPOP singers. ABE sues BAE for illegal dismissal contending
that being a regular employee, he cannot be dismissed for such absurd reason.
BAE counters that ABE is not a regular employee because he was employed as a
kasambahay only and his overseeing functions is only part-time and it is online,
meaning, his role as such is conducted outside the house. Decide.

I will rule in favor of ABE. Jurisprudence states that if an employer assigns the
kasambahay to work, whether in full or part-time, in a commercial, industrial or
agricultural enterprise, the kasambahay ceases to be one and thus shall be treated
as a regular employee. When ABE was assigned to oversee BAE’s corporation, he
ceased to be merely a kasambahay but became a regular employee. Consequently,
ABE shall be entitled to all the labor standards provided in the Labor Code,
including the protection against illegal dismissal. Since ABE was dismissed
without just or authorized causes, he shall be deemed to have been illegally
dismissed.

108. Who are not covered by the Kasambahay Law?

The following are not covered by the said law:

(a) Service providers
(b) Family drivers
(c) Children under foster family arrangement
(d) Any other person who performs work occasionally or sporadically and
not on an occupational basis

109. What is the test of employment relationship?

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 The following are the requisites for a valid CWW:

There is no uniform test of employment relationship but the four elements of an

employer-employee-relationship are as follows: a) selection and engagement of
employee; b) payment of wages; c) power of dismissal; and d) power of control
(the most important test).

110. What is the rule in case of absence during successive regular holidays?

The rule in case of successive regular holidays is as follows: an employee may

not be paid for both holidays if he absents himself from work on the day
immediately preceding the first holiday, unless he works in the first holiday, in
which case, he is entitled to his holiday pay on the second holiday.

111. Is the rule on exemption of members of the family of the employer absolute?

No, the rule is not absolute. Members of the family who are not dependent for
supports are not exempted and thus are covered by the law on labor standards and
working conditions.

112. Which retail and service establishments are exempted from holiday pay and
SIL?

Under Article 82, the Labor Code grants exemption to retail and service
establishments regularly employing less than ten-(10) workers from the coverage of
Article 94 (Right to Holiday Pay) and Article 95 (Right to
Service Incentive Leave).
113. What are the requisites for a valid compress work week?
§ The employees voluntarily agree to work nine (9) hours a day from Monday
to Friday;
§ There should be no diminution in the take-home pay and fringe benefits of
the employees;
§ The value of the benefits that will accrue to the employees under the
proposed work schedule is more than or, at least, commensurate with, or
equal to, the one-hour overtime pay that is due them during weekdays based
on the employees’ quantification;
§ The one-hour overtime pay of the employees will become due and demand
able if ever they are permitted or made to work on any Saturday during the
effectivity of the new working time arrangement, since the agreement
between the employees and management is that there will be no Saturday
work in exchange for a longer work day during week-days;
§ The work of the employees does not involve strenuous physical exertion
and they are provided with adequate rest periods or coffee breaks in the
morning and afternoon; and
§ The effectivity of proposed working time arrangement should be of
temporary duration as determined by the DOLE Secretary
114. What are considered as flexible work arrangements?

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 Flexible work arrangements may refer to the following :

“Compressed Workweek” where the normal workweek is reduced to less

than six (6) days but the total number of work hours of per week shall remain.
The normal workday is increased to more than eight (8) hours but not to exceed
twelve (12) hours, without corresponding overtime premium. The concept can
be adjusted accordingly depending on the normal workweek of the company
(Pursuant to the provision fo Department Advisory no. 02, Series of 2004, dated
December 2, 2004.).

“Reduction of Workdays” where the norma workdays per week are reduced
but should not last for more than six (6) months.

“Rotation of Workers" where the employees are rotated or alternately

provided work within the workweek.
"Forced Leave" where the employees are required to go on leave for several
days or weeks utilizing their leave credits, if there are any.

"Broken-time schedule" where the work schedule is not continuous but the
work-hours within the day or week remain.

"Flexi-holiday schedule" where the employees agree to avail of the holidays

at some other days provided there is no diminution of exiting benefits as a result
of such arrangement.

115. May an employee who was required by his employer to attend a meeting a few
hours before the usual time of work, claim that his/her attendance to the said
meeting is considered as compensable working hours?

Yes. Attendance to the meeting is considered as a compensable working hour.

The law provides that attendance to lectures, meetings and trainings are not
considered as compensable working hours when the following conditions are met: a.)
attendance is outside of the employee’s regular working hours; b.) attendance is in fact
voluntary; and c.) the employee does not perform any productive work during such
attendance.

In the instant case, the attendance to the said meeting was in fact not voluntary but
is required by his employer, even if it was outside the employee’s regular working
hours. Thus, his attendance to the meeting is considered as a compensable working
hour.

116. May an employee who participated in an illegal strike claim compensation

even if he was absent by reason of his participation in the strike? If the strike was
held to be legal, would there a different effect?

No, an employee’s participation in strikes or pickets is not compensable

working time.

The law provides that, time spent in attending or participating in strikes or

pickets is not compensable working time. The excepion is when there is a "strike
duration pay" provided under a company policy, practice or CBA. There is no legal
impediment for the employer and the bargaining union to enter into an agreement
that during periods of strike or picket, the strikers or picketers shall be paid their
regular wages or be compensated in such other manner or their absence from work
be charged to their unused vacation leave or other leave benefits.

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 Thus, absent such agreement, an employee cannot claim compensation if he
participated in a strike or picket.
No. The legality of the strike does not entitle the employee to compensation.

Jurisprudence dictates that, even if the strike is declared legal because it was
occasioned by the unfair labor practice (ULP) of the employer, the strikers who
struck as a voluntary act of protest against what they considered ULP of their
employer are not entitled to backwages since the stoppage of their work was not
the direct consequence of the company's ULP. Their economic loss should not be
shifted to the employer. Thus, the employee cannot claim compensation.

117. On a dreary Saturday right before Christmas, Tina Moran, the manager of
the IT department of VG Corporation, was just finishing her work for the day
which consists of managing and supervising the IT personnel of the IT department
when a virus attack upon the Corporation's database resulted into a systemic
collapse of the entire system. Tina Moran was just finishing her work day at 5 p.m
and was, as she customarily does, issuing her instructions to five of her officers
who she hired herself and who would be managing the IT department while she
was not there when the CEO of VG Corporation asked that she help in the
resolution of the issue of the database. As a result, Tina Moran had to work
further until 1 p.m. of the following day. Her basic hourly rate was 500 pesos per
hour. Was Tina Moran eligible for Night Shift Differential Pay? If so, how much
was her Night Shift Differential Pay in total?

No. Article 82 of the Labor Code and Section 2, of Rule I, Book III, of its
Implementing Rules expressly excludes managerial employees from the coverage
of Night Shift Differential Pay. In the case at bar, Tina Moran is clearly a
managerial employee because her primary duty consists of the management of the
IT department of VG Corporation, she customarily directs the work of five
employees, and she has authority to hire the said employees. Therefore, being a
managerial employee, Tina Moran is not eligible for Night Shift Differential Pay.

118. Pining Garcia is a mother of 7 children. She is an employee of VG Corporation.

Every day, she worked from 7:45 a.m. to 3:45 p.m. with a 30-minute paid "on
call" lunch break, and the said 30-minute paid "on call" lunch break is just
enough to pay off her families’ daily debts to the nearby sari-sari store. One day,
however, the Board of Directors of the VG Corporation changed the meal time
schedule from 30 minutes to one (1) hour without pay by way of a memorandum.
Aggrieved, Pining filed a complaint with an NLRC Labor Arbiter for unfair labor
practice and discrimination. Decide the case.

I will dismiss the case. In the case of Sime Darby Pilipinas, Inc. v. NLRC, the
Supreme Court declared that the change in the work schedule as valid since with
the new work schedule, the employees are now given a one-hour lunch break
without any interruption from their employer. For a full one-hour undisturbed lunch
break, the employees can freely and effectively use this hour not only for eating but
also for their rest and comfort which are conducive to more efficiency and better
performance in their work. Since the employees are no longer required to work
during this one-hour lunch break there is no more need for them to be compensated
for this period.

119. Distinguish premium pay from overtime pay.

Premium pay refers to the additional compensation required by law to be paid

for work performed within the regular eight (8) hours on non-work days, such as
rest days and special days. Overtime pay, on the other hand, refers to the additional

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 compensation for work performed beyond or in excess of the regular eight (8) hours
of daily work. Premium pay and overtime pay are not mutually exclusive. Every
employee who is entitled to premium pay is likewise entitled to the benefit of
overtime pay, if overtime work is actually rendered

120. What is the meaning of regular wage or basic salary for purpose s of
computing overtime pay?

The relevant provision of the Labor Code which defines regular wage is Article
90 which states that "the regular wage of an employee shall include the cash wage
only, without deduction on account of facilities provided by the employer.

121. What is the rationale behind the rule that "undertime work on any particular
day shall not be offset by overtime work on any other day"?

The employee is paid his ordinary hourly rate for his undertime while he is
supposed to be paid additional overtime pay for his overtime work. Consequently,
offsetting his undertime against overtime work would be unfair to him as it will
deprive him of his entitlement to overtime pay. The law does not countenance this
situation. To allow the employer to do so would be to circumvent the law on
payment of overtime pay for overtime work (See Lagatic v. NLRC, G.R. No.
121004, Jan. 28, 1998).

122. Should facilities be included in the computation of wage computation? Why?

No. In cases where the wage compensation of the employee includes “facilities”
as this term is understood in law, the same shall not be included in the computation
of such additional remuneration as overtime and night-shift differential pay. Such
facilities should not be factored in as the term “regular wage” should mean only the
cash portion thereof (Article 90, Labor Code; Section 11, Rule I, Book III, Rules to
Implement the Labor Code).

123. As to weekly rest day, what is the duty of the Employer?

Under Article 91. of The Labor Code it gives the the right to weekly rest days
of the Employee and the duty of the employer as to the weekly rest days of the
employee. Right to weekly rest day. It shall be the duty of every employer, whether
operating for profit or not, to provide each of his employees a rest period of not less
than twenty-four (24) consecutive hours after every six (6) consecutive normal
work days. The employer shall determine and schedule the weekly rest day of his
employee’s subject to collective bargaining agreement and to such rules and
regulations as the Secretary of Labor and Employment may provide. However, the
employer shall respect the preference of employees as to their weekly rest day when
such preference is based on religious grounds.

124. What is the "Blue Sunday Law" ? Is it still applicable or operative?

No. The Blue Sunday Law is not applicable or is inoperative for It has already
been repealed.

R.A. No. 946 [June 20, 1952], otherwise known as the “Blue Sunday Law,”
provides that no commercial, industrial or agricultural enterprise or establishment,
including stores and shops of any kind, shall be open on any Sunday, Christmas
Day, New Year’s Day, Holy Thursday, and Good Friday, from 12:00 midnight to
12:00 midnight.

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 The law was repealed by the Labor Code. Consequently, the rule now is that
any establishment and enterprise may operate or open for business on Sundays and
holidays provided that employees are given the weekly rest day and the resultant
benefits as provided in the law and its implementing rules.

125. Distinguish classification and discrimination

While discrimination is considered ULP, classification is not because it

merely differentiates the employees in accordance with their respective jobs and
accords them the appropriate levels of pay or benefits due them by reason thereof.

126. What is the purpose of a union security arrangement?

The purpose of a union security arrangement is, as the term “union security”
signifies, to guarantee the continued existence of the SEBA through enforced
membership for the benefit of the workers. The employer under this clause
recognizes that the membership of employees in the SEBA which negotiated the
CBA should be maintained and continued used as a condition for and retention of
employment. The obvious purpose is to safeguard and ensure the union’s continued
existence and to strengthen and protect it rom the fickleness or perfidy of its own
members. When this clause, the existence of the SEBA is always subject to
uncertainty as its members may resign anytime resulting in the decimation of its
ranks. The SEBA becomes gradually weakened and increasingly vulnerable to
company machinations. In this security clause therefore lies the strength of the
SEBA during the administration and enforcement of the CBA; it is this clause that
provides labor with substantial power in collective bargaining.

127. How much is a covered employee paid when he works on a special day? How
about when the special day falls on the covered employee’s rest day?

A covered employee who works during a special day is paid an additional

compensation of not less than 30% of the basic pay or a total of 130%. If the he
works on a special day which also falls on his rest day, he shall be paid at least 50%
over and above the basic pay or a total of 150%.

128. April 9, 2020 was Maundy Thursday and Araw ng Kagitingan. Pedro’s daily
wage is 500 pesos. If Pedro worked on April 9, 2020, how much is he entitled to be
paid?

The law provides that when two holidays fall on the same day, a covered employee
is entitled to at least 200% of his or her basic wage. If the covered employee works on
said day, he or she is entitled to an additional 100% of the basic wage. Thus, Pedro is
entitled to 300% of his basic daily wage or 1,500 pesos.

129. Are part-time workers entitled to SIL?

Yes. Part-time workers are entitled to SIL. In an Advisory Opinion issued by

DOLE's Bureau of working conditions, it was declared that part-time workers are
entitled to the full benefit of the yearly five (5) days SIL with pay. The reason is that
the provision of Article 95 of the labor Code and its implementing rules, speak of the
number of months in a year for entitlement to said benefit. Resultantly, part-time
employees are also entitled to the full SIL benefit and not on a pro-rata basis. (Advisory
Opinion of the Bureau of Working Conditions, Department of Labor and Employment
on Conditions of Employment of part-time Workers.)

130. When does a service incentive leave which was never paid to an employee
should be computed?

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 It should be computed not from the start of employment but a year after
commencement of service, for it is only then that the employee is entitled to said
benefit. (JPL Marketing Promotions v. CA, G.R. No. 151960, July 8, 2005)

This is because the entitlement to said benefit accrues only from the time he has
rendered at least one year of service to his employer. The computation thereof should
only be up to the date of termination of employment. There is no cause for granting
said incentive to one who has already terminated his relationship with the employer.

131. Can a Solo Parent apply for Parental Leave for any child?

Yes. Provided that the solo parent solely provides parental care and support to the
child who is living with him/her, dependent for support, unmarried, unemployed and
below eighteen (18) years old, or eighteen (18) years old and above but is incapable of
self-support and/or with physical/mental defect/disability (No.10 [B], 2019 Handbook
on Worker’s Statutory Monetary Benefits, BWC-DOLE) and provided, that the person
availing for parental leave is a duly licensed as a foster parent by the Department of
Social Welfare and Development (DSWD) or duly appointed legal guardian by the
court; (No.10 [A], 2019 Handbook on Worker’s Statutory Monetary Benefits, BWC-
DOLE); Sec. 6 [b], Art. III, Rules and Regulations Implementing R.A. 8972).

132. Is a Service Charge part of employees’ wages?

No. In the case of Mayon Hotel & Restaurant v Adana (G.R. No. 157634, May 16,
2005), the petitioner-employer argues that the five (5) percent of the gross income of
the establishment being given to its employees should be considered as part of their
wages. The Supreme Court was unconvinced. It agreed with the Labor Arbiter’s ruling
that “While complainants, who were employed in the hotel, received various amounts
as profit share, the same cannot be considered as part of their wages in determining
their claims for violation of labor standard benefits. Although called profit share, such
is in the nature of share from service charges charged by the hotel. This is more
explained by the respondents when they testified that what they received are not fixed
amounts that the amounts received by respondents as profit share are to be considered
part of their wages and had been agreed by them prior to their employment.

133. ABE is a caddie who was working with the Baguio Kantry Klub Golf Course
for the past 10 years. He had always been the caddie of Sir Run Neh during his
precious golf moments and was also rendering overtime during tournaments with
ex-Mayor Domskii Ogan. When Baguio was placed on ECQ on March 16, ABE
was told not to report for work for the remaining days of March because Sir Run
Neh cannot play golf due to lockdown. ABE now claims that he is entitled to his
wages for March 16-31 because he is considered an employee that was able, willing
and ready to work but was prevented to do so for reasons what were not voluntary
on his part. Baguio Kantry Klub disagrees pursuant to the age-old rule of “no
work, no pay.” Decide.

I will rule in favor of Baguio Kantry Club. Jurisprudence states that where the
employee’s failure to work was occasioned neither by his abandonment nor by
termination, the burden of economic loss is not rightfully shifted to the employer; each
party must bear his own loss.

Even if ABE is willing and able to work, he is not illegally prevented from doing
so because of a fortuitous event. Hence, no wage is due to him. To hold otherwise
would be to grant to employee-ABE that which he did not earn at the prejudice of the
Employer-Baguio Country Klub.

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134. ABE was a legal aid of then private practitioner Atty. Ghan Nih in a law firm
specializing on estafa cases. Since ABE was renting a bachelor's pad owned by
Atty. Ghan Nih, he is not paying his rent but his salary is lower than the minimum
wage by the exact amount of the monthly rental fee.
Stumbling upon the book of Chan during his free time in the law office, ABE
realized that this set up was illegal. Although this is the usual trade in the law firm
and it is reasonable, ABE never accepted the dharging of his rent against his salary
in writing. Hence, he sues Atty. Ghan Nih. As a defense, Atty. Ghan Nih asserted
that there is a substantial distinction between the "deduction" and the "charging"
of a facility’s value to the wages. He explains that in "deduction", the amount of
the wage will be lessened by the facility’s value, thus, needing the ABE’s consent.
On the other hand, in "charging", there is no reduction of the ABE’s wage since
the facility’s value will just be theoretically added to the wage for purposes of
complying with the minimum wage requirement. Decide.

I will rule in favor of ABE.

Jurisprudence states that there is no distinction between "charging" from

"deducting" a facility because both operate to lessen the actual take-home pay of an
employee; they are two sides of the same coin.

ABE received a lessened amount because supposedly, the facility’s value, which is
part of his wage, had already been paid to him in kind. As there is no substantial
distinction between the two, the requirement of a written consent must still apply.
Failing to have done so, the charging of the facility against ABE's wages was illegal.

135. Who fixes and determine wage?

Regional Tripartite Wages and Productivity Board constituted in every region of

the country, including autonomous as may be created by law.

136. What is a Regional Minimum Wage rate?

Regional minimum wage rates refers to the lowest basic wage rates that an
employer can pay his workers, as fixed by the RTWPBs and which shall not be lower
than the applicable statutory minimum wage rates.

137. What are the legal bases for the valid invocation of the non-elimination and
non-diminution principle?

The following are the legal bases for the valid invocation of the non-elimination
and non-diminution principle:
§ Express terms of an employment agreement;
§ Company practice which refers to the implied terms of an employment
agreement which the employer has freely, voluntarily and consistently
extended to its employees and thus cannot be withdrawn except by mutual
consent or agreement of the contracting parties;
§ The Constitution (Section 18 of Article II and Section 3 of Article XIII
thereof); and
§ Article 4 of the Labor Code

138. When is the grant of benefits to employees by the employer considered a

company practice?

The benefit must be characterized by regularity and voluntary and deliberate intent
of the employer to grant the benefit over a considerable period of time. (University of
the East vs. University of the East Employees’ Association)

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139. Why is there a need to classify workers into agricultural and non-agricultural?

The classification is material since it is the nature of work which determines the
appropriate rates of wages. Observably, RTWPBs prescribe lower wage rates for
agricultural workers than those for non-agricultural.

140. Are employees of private educational institutions entitled to increases in

minimum wage rates?

As a general rule, increases in minimum wage rates are made applicable to the
employees of private educational institutions only when they have increased or are
granted authority to increase their tuition fees at the time of the issuance of the law or
wage order.

141. When is bonus demandable and enforceable?

In certain situations, however, the Supreme Court, on the basis of equitable

considerations, long practice and other peculiar circumstances, has recognized the
demand ability and enforceability of bonuses although the grant thereof is undoubtedly
discretionary and notwithstanding the fact that they do not form part of the wage or
salary of the employees. Moreover, if bonus is promised by the employer and expressly
agreed to give without any condition such as success of business or more efficient or
more productive operation, it is deemed part of wage or salary; hence, demandable.
When considered as part of the compensation and therefore demandable and
enforceable, the amount is usually fixed. However, if the amount thereof is dependent
upon productivity and the realization of profits, the bonus is not demandable and
enforceable. Thus, it cannot be considered part of an employee’s wages if it is paid only
when profits are realized or a certain amount of productivity is achieved.

142. Who are the employers not covered by the law on 13th month pay?

The following employers are not covered by the law on 13th month pay:
§ The government and any of its political subdivisions, including
government-owned and controlled corporations, except those corporations
operating essentially as private subsidiaries of the government.
§ Employers already paying their employees 13th month pay or more in a
calendar year or its equivalent at the time of the issuance of P.D. No. 851.
§ Persons in the personal service of another in relation to such workers; and
§ Employers of those who are paid on purely commission, boundary, or task
basis, and those who are paid a fixed amount for performing a specific work,
irrespective of the time consumed in the performance thereof, except where
the workers are paid on a piece-rate basis, in which case, the employer shall
grant them 13th month pay.
§ As used herein, “workers paid on piece-rate basis” shall refer to those who
are paid a standard amount for every piece or unit of work produced that is
more or less regularly replicated without regard to the time spent in
producing the same.

143. Diyun Weyters works in the daytime as a server in Mayami Eats Restaurant,
and, in the evening as a bartender for the Loose Angeles Laklakers Bar. He earns
more working for Loose Angeles Laklakers. But, he was employed first by
Mayami Eats. To whom between Mayami and Loose Angeles is Diyun entitled to
receive his 13th month pay from?

Diyun is entitled to receive his 13th month pay from both employers. Labor
laws dictate that when an employee works for multiple employers, he is entitled to

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 the 13th month pay from all his employers, regardless of total earnings. So, Diyun
can collect a separate 13th month pay from both Loose Angeles and Mayami Eats.

144. Gardon Heeward was personally engaged by Kimby Walker to be a security

guard at his cane store, Baston Seltix. During his two years as a security guard,
Gardon was caught sleeping on duty. On the fourth instance that he slept while
on duty, a robbery happened. So, Kimby dismissed Gardon for just causes of gross
neglect of duty. Gardon filed a case before the Labor Arbiter because Kimby
failed to pay his 13th Month pay. Kimby argues that Gardon should not get it
because he was dismissed by just causes. Is Kimby correct?

No. Kimby is wrong. Jurisprudence provides that the payment of the 13th
Month Pay is demandable by the employee upon his resignation or termination
under just or authorized causes, So, even if Kimby dismissed Gardon from service
due to a just cause, Kimby must still pay Gardon his 13th month pay.

145. Who has the burden of proof of payment of 13th month pay?

The burden lies on the employer to prove that it has paid the 13th month pay of the
employee as cited in Intertranz Container Lines, Inc. v. Bautista, G.R. No. 187693).

146. What is the rule for 14th and 15th month pay?

There is no law mandating the payment of 14th month pay, 15th month pay and the
like. It is therefore in the nature of a bonus or gratuity which may not be imposed upon,
or legally demandable from, the employer as cited in Kamaya Point Hotel v. NLRC,
GR No. 75289, August 31, 1989, 177 SCRA 160. However, once granted by the
employer in an employment contract, CBA or voluntary employer policy or practice,
the same becomes demandable and enforceable. But even if the company has been
paying 14th month pay but if it subsequently closed its operations, the award thereof
may not be justified on the ground of company practice. The employer, having lost its
business, cannot be penalized for its previous liberality.

147. Is the contracting out of services illegal per se?

No, contracting out services is not illegal per se. It is ruled in different labor
cases which states that Contracting out of services is not illegal per se. it is an
exercise of business judgment or universally accepted management prerogative.
Thus, a company can determine in its best judgment whether it should contract out
a part of its work for as long as the employer is motivated by good faith; the
contracting is not for purposes of circumventing the law; and does not involve or
be the result of malicious or arbitrary action. Absent of proof that the management
acted in a malicious or arbitrary manner, the Court will not interfere with the
exercise of judgment by an employer.

It certainly is expressly allowed by law and is subject-only to regulations for

the promotion of employment and the observance, recognition and protection of the
rights of workers to just and humane conditions of work, security of tenure, self-
organization, collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law. These contending
interests must be placed in proper perspective and equilibrium. Prior consultation,
however, with the union before outsourcing is made is not a reasonable
requirement.

148. What are the required contracts in permissible job contracting?

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 In a permissible job contracting arrangement, there are two kinds of contracts that
should be executed, to wit: Employment Contract between the contractor/subcontractor
and its employees. Notwithstanding any oral or written stipulations to the contrary, the
contract between the contractor/subcontractor and its employees shall be governed by
the provisions of Articles 294 [279] and 295 [280] of the Labor Code, as amended,
including the provisions on general labor standards. It shall include the following
stipulations:
Ø The specific description of the job or work to be performed by the employee, and
Ø The place of work and terms and condition of employment, including a statement
of the wage rate applicable to the individual employee.
Ø The contractor/subcontractor shall inform the employee of the foregoing
stipulations in writing on or before the first day of his/her employment.
Ø Service Agreement which refers to the contract between the principal and
contractor is containing the terms and conditions governing the performance or
completion of a specific job or work being farmed out for a definite or
predetermined period. it shall include the following:
§ The specific description of the job or work being subcontracted, including
its term or duration;
§ The place or work and terms and conditions governing the contracting
arrangement, to include the agreed amount of the contracted job or work as
well as the standard administrative fee of not less than 10% of the total
contract cost; and
§ A provision on the issuance of the bonds/renewable every year. “Bond”
refers to the bond under Article 108 of the Labor Code that the principal
may require from the contractor to be posted equal to the cost of labor under
contract.

149. When is contracting and sub-contracting allowed?

Under D.O. No. 174, Series of 2017, contracting or subcontracting shall only
be allowed if all of the following circumstances concur:
a. The contractor or subcontractor is engaged in a distinct and independent
business and undertakes to perform the job or work on its own responsibility,
according to its own manner and method;
b. The contractor or subcontractor has substantial capital to carry out the job
farmed out by the principal on his account, manner and method, investment in
the form of tools, equipment, machinery and supervision;
c. In performing the work fanned out, the contractor or subcontractor is free from
the control and/or direction of the principal in all matters connected with the
performance of the work except as to the result thereto; and
d. The Service Agreement ensures compliance with all the rights and benefits for
all the employees of the contractor or subcontractor under the labor laws. In
reference to Section 8. bid: Mago v. Sun Power Manufacturing Limited, G.R.
Na 210961, Jan 24, 2018; Fonterra Brands Phils., Inc. v. Largado G.R. No.
205300, March 18, 2015; Babas v. Lorenzo Shipping Corp., GR No. 186091,
Dec 15, 2010; Almeda v. Asahi Glass Philippines, Inc. GR. No. 177785, Sept.
3, 2008; Acevedo V. Advanstar Co., Inc., GR No. 157656, Nov. 11, 2005;
Vinoya v. NLRC, GR No. 126586, Feb. 2, 2000; Manila Electric Company v.
Benamira, GR No. 145271, July 14, 2005; Manila Water Co., Inc. v. Pena, GR.
No. 158255, July 8, 2004; De los Santos v. NLRC, G.R. No. 121327, Dec. 20,
2001, 1032; Corporal, Sr. v. NLRC, G.R. No. 129315, Oct. 2, 2000.

150. What are the elements of a labor-only contracting?

Labor-only contracting has the following elements:

§ The contractor or subcontractor does not have substantial capital, or

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 § The contractor or subcontractor does not have investments in the form of
tools, equipment, machineries, supervision and work premises, among
others; and
§ The contractor's or subcontractor's employees recruited and placed are
performing activities which are directly related to the main business
operation of the principal; or
§ The contractor or subcontractor does not exercise the right to control over
the performance of the work of the employees (Article 106 of the Labor
Code).

151. What are the distinctions between permissible job contracting and the
prohibited labor-only contracting?

The chief distinctions between permissible job contracting, on the one hand,
and the prohibited labor-only contracting, on the other, may be summed up as
follows:
• In the former, no employer-employee relationship exists between the
contractor's employees and the principal; while in the latter, an
employer-employee relationship is created by law between the principal
and the employees supplied by the labor-only contractor. (Aliviado v.
Procter & Gamble Phils., Inc, G.R No. 160506, May 9, 2010 and June
6, 2011 Resolution on the 2nd Motion for Reconsideration of
Respondent P&G; Coca-Cola Bottles Phils., Inc v. Agito, G.R. No.
179546, Feb. 13, 2009; PCI Automation Center, Inc. v. NLRC, G.R. No
115920, Jan. 29, 1996, citing Philippines Bank of Communications v.
NLRC, G.R. No. 66598. Dec. 19, 1986, 146 SCRA 347.)
• In the former, the principal is considered only an” indirect employer,”
as this term is understood under Article 107 of the Labor Code; while in
the latter, the principal is considered the "direct employer" of the
employees supplied by the labor-only contractor, in accordance with the
last paragraph of Article 106 of the Labor Code. (PCI Automation
Center, Inc. v, NLRC, supra.)
• In the former, the joint and several obligation of the principal and the
legitimate job contractor is only for a limited purpose, that is, to ensure
that the employees are paid their wages. Other than this obligation of
paying the wages, the principal is not responsible for any claim made
by the contractor’s employees while in the latter, the principal becomes
solidarily liable with the labor only contractor to the latter's employees
in the same manner and extent that the principal is liable to employees
directly hired by him/her, as provided in Article 106 of the Labor Code,
as amended. (Section27, Department 0rder No. 18-A_Series of 2011
[Nov 14 2011] See also PCI Automation Center, Inc. v. NLRC, supra,
citing Philippine Bank of Communication v. NLRC, G.R. No. 66598,
Dec. 19, 1986, 146 SCRA 347; See also Coca-Cola Bottlers Phils., Inc.
v. Agito, G.R. No. 179546, Feb. 13, 2009.)
• ln the former, the legitimate job contractor undertakes to perform a
specific job for the principal; while in the latter, the labor-only
contractor merely provides supplies, recruits and places personnel to
work for the principal. (PCI Automation Center, Inc, v. NLRC, supra.)

152. What is the right to control?

Right to control refers 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. (As
defined in Section 3[I], Department Order No, 18-A, Series of 2011 [Nov.
14,2011]. See also Locsin v. Philippine Long Distance Telephone Company, G.R.
No. 185251, 0ct. 2, 2009, citing Francisco v. NLRC, G.R. No. 170087, Aug. 31,

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 2006.) From this, it can readily be inferred that the element of control that is
determinative of an employer-relationship "does not merely relate to the mutually
desirable result intended by the contractual relationship; they must have the nature
of dictating the means and methods to be employed in attaining the result."
(Consolidated Building Maintenance, lnc., v. Asprec, Jr., G.R. No. 217301, June
06, 2018.) This is so because power of control refers merely to the existence of the
power and not to the actual exercise thereof. It is not essential for the employer to
actually supervise the performance of duties of the employee; it is enough that the
former has a right to wield the power. (Almeda v. Asahi GIass Philippines, Inc.,
G.R. No. 177785, Sept. 3, 2008,)

The "right of control" test basically addresses the issue of whether the
contractor has control over all matters connected with the performance of the
contracted job, work or service as shown by the fact that he carries on an
independent business and undertakes the contract work on his own account, under
his own responsibility, according to his own manner and method, free from the
control and direction of his principal (indirect/statutory employer) except as to the
results thereof. Simply put, the principal should only be interested in the results of
the engagement but never in the performance of the contracted job, work or service
which should be the sole domain of the contractor. Indeed, this test to determine
the existence of an independent contractorship/subcontractorship has been applied
in a catena of cases. (Some of these cases are as follows: Philippine Airlines, Inc,
v. Ligan, G.R. No. 146408, Feb. 29, 2008; Acevedo v. Advanstar Co., lnc., G.R.
No. 157656, Nov. 11, 2005; San Miguel Corp. v. Aballa, G.R. No. 149011, June
28, 2005; New Golden City Builders and Development Corporation v. CA, G.R.
No. 154715, Dec. 11, 2003, 418 SCRA 411; Tan v. Lagrama, G.R. No. 151228,
Aug. 15, 2002; Vinoya v. NLRC, G.R. No, 126586, Feb. 2, 2000, 324 SCRA 469;
Philippine Airlines, Inc, v. NLRC, G.R No. 125792, Nov. 9, 1998, 298 SCRA 430,
444; AFP Mutual Benefit Association, Inc. v. NLRC, G.R No. 102199, Jan, 28,
1997; and Bordeos v. NLRC, G.R. Nos. 115314-23, Sept. 26, 1996.)

ln most cases, despite proof of substantial capital, the Court declared a contactor
as a labor-only contractor whenever it is established that the principal - not the
alleged legitimate contractor - actually controls the manner of the employees' work.
(Mago v. Sun Power Manufacturing Limited, G.R. No. 210961, Jan. 24, 2018,
citing Vinoya v. NLRC, G.R. No.126586, Feb. 2, 2000, 324 SCRA 469, 444-445.)
The control over the employees' performance of the work is, as the Court ruled in
some cases, usually manifested through the power to hire, fire, and pay the
contractors employees, (Id., citing Coca-Cola bottlers Phils., Inc. v. Agito, G.R. No.
179546, Feb. 13, 2009.) the power to discipline the employees and impose the
corresponding penalty, (Id., Manila Water Co., Inc. v. Pena, G.R. No. 158255, July
8, 2004.) and more importantly, the actual supervision of the employees'
performance. (Id., citing Philippines Airlines, Inc. v. Ligan, G.R. No. 146408, Feb.
29, 2008; Lakas sa Industriya ng Kapatirang Haligi ng Alyansa-Pinagbuklod ng
Manggagawang Promo ng Burlingame v. Burlingame Corporation, G.R. No.
162833, June 15, 2007.)

153. Carla Maxima Security Agency is one of the security agencies operating in
Baguio City. It had an agreement with Lakandula Bank whereby it will supply
security personnel with the Lakandula Bank for a fee. In the performance of their
duties with the bank, the security personnel were furnished by Lakadula Bank
with the necessary firearms, high visibility clothing, flashlights, defense
equipment and the like as Carla Maxima has to supply other security personnel
in Magsaysay University similar equipment. When Carla Maxima failed to pay
the wages of the security personnel, the latter filed their claim against Lakandula
Bank. What is the status of Carla Maxima Security Agency?

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 Answer: Carla Maxima Security Agency is one of labor-only contractor.
In determining the existence of permissible job-contracting, substantial investment test
may be applied where it seeks to address the issue whether the contractor has the
investment in the form of tools, equipment, machineries, work premises, and other
materials which are necessary in the conduct of business.
In the case, Carla Maxima Security Agency has no substantial investment as though it
was the one which procured the Lakandula Bank with security personnel, it was not
able to meet the demands of its business to be able to provide the security personnel
with the necessary equipment in the conduct of the work they are to perform. Further,
it even failed to pay the wages of the security personnel.
Hence, Carla Maxima Security Agency is one of labor-only contractor.

Lakandula University is one of the famous universities in the City of Baguio. It

arranged an agreement with Magsaysay Security Agency whereby the latter will
provide Lakandula University with security services. Lakandula University
provided that security personnel have three shifts with 16 personnel in every shift.
The first shift is form 6 A.M to 2 P.M, the second from 2:00 PM to 10:00 PM and
the third is one form 10:01 PM to 6AM. Further, the Lakandula University
assigned two guard in every entry to the university. The university has 5 egress
points. While the 6 were required to walk through the university to ensure the
safety of everyone inside. This is also done during night time. The security
personnel checked every person entering the university using equipment given by
the same to the personnel as ordered by the school. There were several instances
also when the university shuffled those assigned in every shift. What is Magsaysay
Security Agency? Explain.

Magsaysay Security Agency is a labor-only contractor.

One of the test to determine permissible job contracting is the control test where
the contractor must undertake the work under its own responsibility according to
its own manner and method but not as to the result thereof.
In the case, the right of control was vested with the Lakandula University and not
to the Magsasay Security Agency. The situation shows that it was the university
that was directing the performance of the work by the security personnel for the
end of achieving the desired result of safety in the University.

154. What is the available defense for an employee of a company engaged in illegal
recruitment activities?

The culpability of the employee hinges on his knowledge of the offense and his
active participation in its commission. Hence, where it is shown that the employee
was merely acting under the direction his superiors and was unaware that his acts
constituted a crime, he may not be held criminally liable for an act done for and in
behalf of his employer(People vs Chowdury GR No. 129577-80)

155. X company is engaged in recruitment and placement of oversears woker, its

license will expire on November 1, 2020. Such fact of expiration was forgotten by
X company, on November 5, 2020 recruited B. subsequently, B came to know that
the license of X company has already expired. May X company be liable for illegal
recruitment and estafa?

No, X company may only be liable for illegal recruitment since the its nature is
mala prohibita, the 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
a non-license or non-holder of authority may render the X company liable.
however, as to the crime of estafa, there was no intent to deceipt performed by X

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 company because such company had no knowledge or failed to check the its license
already expired.

156. What if the contractor has substantial capital or investments but the services
to be performed requires that the tools and equipment to be used are that of the
employer because the system or specifications of the output can only be
achieved/satisfied only by such tools and equipment owned by the principal
(specialized tools), will it be considered as labor- only contracting?

There is labor- only contracting in this case.

The law provided that labor-only contracting exists when the contractor or sub-
contractor does not have substantial capital or investments in the forms of tools,
equipment, machineries, supervision, work premises among others, and that the
contractor’s or subcontractor’s employees recruited and placed are performing
activities which are directly related to the main business operation of the principal.

In this case, even though the contractor has substantial capital or investment, the
services to be performed requires the specialized tools of the principal in order to
achieve the required output, renders that the services are directly related to the
main business operation of the principal. Thus the arrangement is a labor –only
contracting.

157. What if the contractor has sufficient capital but does not have enough tools
and equipment to perform the services required by the principal/ company and
he decided to rent out tools and equipment from an independent business owned
by a person or corporation who is also a major stockholder or a member of the
Board of Directors of the principal/company for whom the services of the
contractor is to be performed, will the existence of conflict of interest be
considered and adjudge the same as labor- only contracting?

The contractor is an independent contractor.

The law provided that labor-only contracting exists when the contractor or sub-
contractor does not have substantial capital or investments in the forms of tools,
equipment, machineries, supervision, work premises among others, and that the
contractor’s or subcontractor’s employees recruited and placed are performing
activities which are directly related to the main business operation of the principal or
right to control over the performance of the work of the employee.

Moreover, jurisprudence provides that proof of either substantial capital or

investment is sufficient for purposes of determining whether the first element of Labor-
only contacting is absent.
In this case, the contractor has substantial capital but lacks investment in tools and
equipment and such were rented out from a company owned by major stockholder or
member of the Board of Director where the presence of conflict of interest is
possible, does not automatically render the agreement as labor-only contracting
because what the law requires is proof of either substantial capital or investment.

Also, absence of any indication that the services to be performed are directly related
to the main business operation of the principal and lack of control on the work
performance will not render the arrangement as labor- only contracting.

158. What is nature of liability of the Principal for Contractor’s violation of the
provision of the Labor Code?

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 Solidary. Under the Labor Code, once the job contractor, although legitimate, fails
to pay the wages of its employees supplied to the principal or violates any of the
provisions of the Labor Code, the principal would no longer be considered merely as
an indirect employer but as direct employer for the limited purpose of paying the unpaid
wages of the contractor’s employees or of complying with the particular provision of
the Labor Code violated. Being by legal fiction considered the direct employer, the
principal now becomes solidarity liable with the legitimate contractor for the payment
of the unpaid wages and for purposes of complying with the legal provision violated.

159. What are the scope and extent of such liability?

Payment of wages and violation of any provision of the Labor Code and other social
legislation. To comply with “any” violation of “any” provision of the Labor Code, one
of which is specifically mentioned therein, that is, the failure of the contractor to pay
the wages of its employees and for the enforcement of the provisions of the Labor Code
and other social legislation. The foregoing statutory scheme is designed to give the
workers ample protection, consonant with labor and social justice provisions of the
1987 Constitution.

160. May the contractor's employees collect wages and premiums from either the
principal or the legitimate job contractor?

Yes. As far as the contractor's employees are concerned, the actual source of the
payment of their wage differentials and premium for holiday and rest day work does
not matter as long as they are paid. This is the import of the principal's and contractor's
solidary liability. Creditors such as the contractor's employees may collect from anyone
of the solidary debtors. Solidary liability does not mean that, as between themselves,
two solidary debtors are liable for only half of the payment. (See for instance, Eparwa
Security Agency Inc. v. NLRC (G.R. Nos. 81314 & 81447, May 18, 1989, 173 SCRA
479).

161. When will a Principal have no right of reimbursement from Contractor?

In case it is the principal which pays directly to the contractor's employees their
unpaid wages and other monetary benefits, instead of coursing it through the contractor,
the principal certainly has no right of reimbursement as against the contractor. (Eparwa
Security and Janitorial Services, Inc. v. Liceo de Cagayan University, G.R.No. 150402,
Nov. 28, 2006) Such right of reimbursement can only be asserted by the principal if it
has been constrained to pay again the employees despite its earlier full payment of their
monetary claims through the contractor (Eagle Security Agency, Inc. v. NLRC
G.R.Nos 81314 & 81447, May 18, 1989, 173 SCRA 479).

162. Is an Independent Contractor considered as an employee?

No, because as distinguished from an employee Independent Contractor usually

provides his services to more than one entity/principal; works generally independently
from the active control of the principal as to the means and methods of performing the
work since the principal is interested only in the results of his work; has the right and
authority to decide on the means and manner of accomplishing his work without the
active participation and direction of the principal who, as earlier pointed out, is only
interested in the results of the engagement; he is given the prerogative to set his own
working hours and even if a work schedule is prescribed by his principal, the same

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 merely serves as a rule of conduct or guideline and not an indication of control;
normally performs his services either in the principal's establishment or in his
own office or house and he is paid consultancy fees or contractor's fees for his
services in accordance with the terms and conditions of the contract.

163. Are radio and television program host considered as an employee of a

broadcasting corporation or entity?

No, radio and television program host considered as an independent contractor and
not an employee. In one case it was ruled that , after using the four-fold test of
employment relationship, concluded that a TV program host was not an employee of
but an independent contractor thereof as he possesses unique skills, expertise or talent
that distinguish him from ordinary employees. The specific selection and hiring of a
TV program host, is because of his unique skills, talent and celebrity status not
possessed by ordinary employees, is a circumstance indicative of an independent
contractual relationship.

164. What are the distinctions between a contractor and a private recruitment and
placement agency?

The major distinctions between a legitimate contractor and a private recruitment

and placement agency are as follows:

a) A contractor directly undertakes a specific job, work or service for a principal

and for this purpose, employs its own workers; while a private recruitment and
placement agency cannot be a contractor since it simply recruits workers for
the purpose of placing them with another employer and as a consequence
thereof, the workers recruited will not become its employees.

b) A contractor is governed by Articles 106 to 109 of the Labor Code and its
implementing rules enunciated in Department Order No. 174, Series of 2017.
On the other hand, a private recruitment and placement agency is governed by
Articles 25 to 39 of the Labor Code and the rules implementing these articles.

c) A contractor is mandatorily required to register with the DOLE and its failure
to do this will give rise to the presumption that it is a labor-only contractor. A
private recruitment and placement agency. On the other hand, needs an
authority or license E0111 DOLE to legally undertake recruitment and
placement activities

165. Are persons engaged on retainer fee basis independent contractors?

Yes, the engagement of certain professionals like lawyers and doctors on a retainer
fee basis constitutes independent contracting agreement. As such, they may hire their
own staff without the latter becoming employees of the principal.

166. What are the reliefs available to an illegally dismissed contractor’s employee?

Irrespective of whether the arrangement is a legitimate contracting arrangement or

a labor-only contracting scheme, a contractor’s employee who is illegally dismissed is
entitled to all the reliefs under Article 294 [279] of the Labor Code, namely;
a) Reinstatement without loss of seniority and other privileges;
b) Full backwages, inclusive of allowances; and
c) Other benefits or their monetary equivalent.

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 In addition to the foregoing, the following reliefs granted under well-established
jurisprudence, are all available to an illegally dismissed contractor employee:
a. Payment of separation pay in lieu of reinstatement, if the circumstances
obtaining in a case do not warrant the reinstatement of the illegally dismissed
employee, such as, inter alia, when there is strained relations between the
employer and the employee.
b. Award of penalty in the form of nominal damages in cases of termination due
to just or authorized cause but without observance of procedural due process
per Agabon v. NLRC.
c. Moral and exemplary damages and attorney’s fees.
d. Legal interest on separation pay, backwages and other monetary awards.

167. What is a bond in relation to a legitimate contractor?

The term “bond” refers to the bond mentioned in Article 108 of the Labor Code
that the principal may require from the contractor to be posted equal the cost of labor
under contract, on condition that the bond will answer for the wages due the employees
should the contractor/subcontractor, as case may be, fail to pay the same. The same
may also refer to the security or guarantee posted by the principal for the payment of
the services of the contractors under the Service Agreement.

168. What is meant by Worker Preference in case of bankruptcy?

It means that in case of bankruptcy or liquidation of the employer's business, the

unpaid wages and other monetary claims of the employees shall be given first
preference and shall be paid in full before the claims of government and other creditors
may be paid. (Article 110, as amended)

However, in Commissioner of Internal Revenue v. NIRC, G.R No. 74965, Nov. 9,

1994, the Supreme Court held that the claim of the government predicated on a tax lien
is superior to the claim of a private litigant predicated on a judgment. Also, in
Development Bank of the Philippines v. NLRC, G.R Nos. 100264-81, Jan. 29, 1993,
the Court held that under the new Article 110 of the Labor Code, mortgage credits
(special preferred credit) are subordinate to workers' claim (ordinary preferred credit)
is merely an obiter.

169. What are the two (2) concepts of Attorney's Fees?

In its ordinary concept, an attorney's fee is the reasonable compensation paid to a

lawyer by his client for the legal services he has rendered to the latter. The basis of this
compensation is the fact of his employment by, and his agreement with the client.

In its extraordinary concept, an attorney's fee is an indemnity for damages ordered

by the court to be paid by the losing party in a litigation. The basis of this is any of the
cases provided by law where such award can be made. (e.g. Article 2208, (7) NCC. "In
the absence of stipulation of attorney's fees and expenses of litigation & other than
judicial costs, cannot be recovered, except: in actions for the recovery of wages of
household helpers, laborers and skilled workers) It is payable not to the lawyer but to
the client unless they have agreed that the award shall pertain to the lawyer as additional
compensation or as part thereof.

170. What is the extraordinary concept of attorney’s fees?

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 In its extraordinary concept an attorney’s fee is an indemnity for damages ordered
by the court to be paid by the losing party in litigation. This extraordinary concept of
attorney’s fee is payable not to the lawyer but to the client, unless they have agreed that
the award shall pertain to the lawyer as additional compensation or as part thereof.

171. What is the limit of extraordinary attorney’s fees?

The limit of extraordinary attorney’s fees is ten percent (10%) of the amount of
wages recovered.

Article 111 (b) is explicit in its prohibition against demanding or accepting, in any
judicial or administrative proceedings for the recovery of wages, attorney’s fees which
exceed ten percent (10%) of the amount of wages recovered. Consequently, in cases
where the award of attorney ‘s fees is in excess of the 10% threshold, the Court has
reduced it to 10%.

172. What are the following conditions in order for deductions from deposits to be
valid?

The following conditions are:

a. The employee concerned is clearly shown to be responsible for the loss or

damage;
b. The employee is given reasonable opportunity to show cause why
deductions should not be made;
c. The amount of such deduction is fair and reasonable and shall not exceed
the actual loss or damage; and,
d. The deduction from the wages of the employee does not exceed 20% of
the employee’s wages in a week. (Article 115, in relation to Article 114 of
the Labor Code; In relation to Section 14, Rule VIII, Chapter IV, Book III
of the Omnibus Rules to Implement the Labor Code of the Philippines)

173. What does the prohibition with respect to withholding of wages and kickbacks
say?

The prohibition states that, it shall be unlawful for any person, directly or indirectly,
to withhold any amount from the wages of a worker or induce him to give up any part
of his wages by force, stealth, intimidation, threat or by any other means whatsoever
without the worker’s consent.

174. What composes the National Wages and Productivity Commission?

The National Wages and Productivity Commission (NWPC) is composed of the

following:
a. Secretary of labor and Employment as ex-officio chairman;
b. Director-General of the National Economic and Development Authority
(NEDA) as ex-officio vice-chairman;
c. Two (2) members each from workers, and employers, sectors who shall be
appointed by the President of the Philippines upon recommendation of the
Secretary of Labor and Employment to be made on the basis of the list of
nominees submitted by the workers' and employers' sectors, respectively, and
who shall serve for a term of five (5) years; and
d. Executive Director of the Commission.

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 175. When can a retaliatory act be considered as ULP?

The commission of the retaliatory act of discharging or in any manner

discriminating against any employee who has filed any complaint or instituted any
proceeding or has testified or is about to testify in such proceeding described in Art.
118 may be considered an unfair Labor practice under Art. 259. As provided therein, it
is ULP for an employer to dismiss, discharge or otherwise prejudice or discriminate
against an employee for having given or being about to give testimony under the Labor
Code.

176. What are the two methods of initiating the issuance of a wager order?

There are (2) ways of initiating a wage order, to wit:

a. motu proprio by the Regional Board; or
b. by Virtue of a petition filed.

177. Why is Salary-Cap or Salary-Ceiling method preferred over Floor-Wage

method in fixing the
minimum wage rates.?

Salary-Cap or Salary-Ceiling is preferred over Floor-Wage Method in fixing minimum the

minimum wage rates because it minimizes disputes involving wage distortion.

For QUESTIONS 178 and 179

P.I. Manufacturing, Incorporated is a domestic corporation engaged in the manufacture and sale
of household appliances. On the other hand, P.I. Manufacturing Supervisors and Foremen
Association (PIMASUFA) is an organization of petitioner's supervisors and foremen, joined
in this case by its federation, the National Labor Union (NLU).

On December 10, 1987, the President signed into law Republic Act (R.A.) No. 6640 providing,
among
others, an increase in the statutory minimum wage and salary rates of employees and workers in
the
private sector. Section 2 provides:

“SEC. 2. The statutory minimum wage rates of workers and employees in the private
sector, whether agricultural or non-agricultural, shall be increased by ten pesos (P10.00) per
day, except non-agricultural workers and employees outside Metro Manila who shall receive
an increase of eleven pesos (P11.00) per day: Provided, That those already receiving above
the minimum wage up to one hundred pesos (P100.00) shall receive an increase of ten pesos
(P10.00) per day. Excepted from the provisions of this Act are domestic helpers and persons
employed in the personal service of another.”

Thereafter, on December 18, 1987, P.I. Manufacturing, Incorporated and PIMASUFA entered into
a new Collective Bargaining Agreement (1987 CBA) whereby the supervisors were granted an
increase of P625.00 per month and the foremen, P475.00 per month. The increases were made
retroactive to May 12, 1987, or prior to the passage of R.A. No. 6640, and every year thereafter
until July 26, 1989.

Illustration of Wage Distortion and corresponding wage adjustments as provided in RA-6640

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 PhP 109.01 OVER
NAME OF RATE BEFORE RATE AFTER - PASSED PhP
SUPERVISOR(S) INCREASE OF INCREASE 108.80
AND FOREMAN RA- 6640 PhP OF RA- 6640 RATE AFTER
(F) 10.00 PhP 10.00 ADJUSTMENT
PhP 10.00

ALCANTARA, V PhP 109.01

PhP 99.01
(S)
MORALES, A (F) PhP 94.93 PhP 104.93
SALVO, R (F) PhP 96.45 PhP 106.45
BUENCUCHILLO,
PhP 102.38 PhP 102.38 PhP 112.38
C (S)
MENDOZA, D (F) PhP 107.14 PhP 107.14 PhP 117.14
DEL PRADO, M PhP 118.80
PhP 108.80 PhP 108.80
(S)
PALENSO, A (F) PhP 109.71 PhP 109.71

On January 26, 1989, P.I. Manufacturing, PIMASUFA and NLU (federation) filed a complaint
with the Arbitration Branch of the National Labor Relations Commission (NLRC), charging
petitioner with violation of R.A. No. 6640.

178. Is the implementation of RA 6640 resulted in a wage distortion?

YES.
R.A. No. 6727, otherwise known as the Wage Rationalization Act, explicitly
defines “wage distortion” as: x x x a situation where an increase in prescribed wage
rates results in the elimination or severe contraction of intentional quantitative
differences in wage or salary rates between and among employee groups in an
establishment as to effectively obliterate the distinctions embodied in such wage
structure based on skills, length of service, or other logical bases of differentiation.
Otherwise stated, wage distortion means the disappearance or virtual disappearance of
pay differentials between lower and higher positions in an enterprise because of
compliance with a wage order.

In this case, a wage distortion occurred due to the implementation of R.A. No. 6640.
The implementation of R.A. No. 6640 resulted in the increase of P10.00 in the wage
rates of Alcantara, supervisor, and Morales and Salvo, both foremen. They are
petitioner’s lowest paid supervisor and foremen. As a consequence, the increased wage
rates of foremen Morales and Salvo exceeded that of supervisor Buencuchillo. Also,
the increased wage rate of supervisor Alcantara exceeded those of supervisors
Buencuchillo and Del Prado. Consequently, the P9.79 gap or difference between the
wage rate of supervisor Del Prado and that of supervisor Alcantara was eliminated.
Instead, the latter gained a P.21 lead over Del Prado. Like a domino effect, these gaps
or differences between and among the wage rates of all the above employees have
been substantially altered and reduced. It is therefore undeniable that the increase in
the wage rates by virtue of R.A. No. 6640 resulted in wage distortion or the elimination
of the intentional quantitative differences in the wage rates of the above employees.

179. Is the distortion cured or remedied by the 1987 CBA?

NO.

While there was A presence of wage distortions, we are convinced that the same
were cured or remedied when PIMASUFA entered into the 1987 CBA with the

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 company after the effectivity of R.A. No. 6640. The 1987 CBA increased the monthly
salaries of the supervisors by P625.00 and the foremen, by P475.00, effective May 12,
1987. These increases re-established and broadened the gap, not only between the
supervisors and the foremen, but also between them and the rank- and-file employees.
Significantly, the 1987 CBA wage increases almost doubled that of the P10.00 increase
under R.A. No. 6640. The P625.00/month means P24.03 increase per day for the
supervisors, while the P475.00/month means P18.26 increase per day for the foremen.
These increases were to be observed every year, starting May 12, 1987 until July 26,
1989. Clearly, the gap between the wage rates of the supervisors and those of the
foremen was inevitably re- established. It continued to broaden through the years.

In National Federation of Labor v. NLRC, the Supreme Court ruled:

We believe and so hold that the re-establishment of a significant gap or differential

between regular employees and casual employees by operation of the CBA was more
than substantial compliance with the requirements of the several Wage Orders (and of
Article 124 of the Labor Code). That this re-establishment of a significant differential
was the result of collective bargaining negotiations, rather than of a special grievance
procedure, is not a legal basis for ignoring it. The NLRC En Banc was in serious error
when it disregarded the differential of P3.60 which had been restored by 1 July 1985
upon the ground that such differential “represent[ed] negotiated wage increase[s] which
should not be considered covered and in compliance with the Wage Orders.”;

In Capitol Wireless, Inc. v. Bate, the Supreme Court also ruled:

x x x The wage orders did not grant across-the-board increases to all employees in
the National Capital Region but limited such increases only to those already receiving
wage rates not more than P125.00 per day under Wage Order Nos. NCR-01 and NCR-
01-A and P142.00 per day under Wage Order No. NCR-02. Since the wage orders
specified who among the employees are entitled to the statutory wage increases, then
the increases applied only to those mentioned therein. The provisions of the CBA
should be read in harmony with the wage orders, whose benefits should be given only
to those employees covered thereby.

180. Can minimum wage be subject to negotiation between the employer and the
employee?

No. The issue of minimum wage is not within the sphere of bargaining between the
employees and the employer. It is not subject to negotiation.

181. What are the conditions for a "chargeability” or "credibility” clause to be a

valid provision on the CBA?

It is a valid provision provided that after charging or crediting the increase, the
amount of wages of the employees shall remain equivalent to or over and above the
prevailing minimum wage set by law or wage order.

182. Who are the duly authorized representatives of the Labor Secretary?

The DOLE Regional Directors are the "duly authorized representatives" of the
DOLE Secretary referred to in Article 128.

183. What are the three (3) powers granted to the DOLE Secretary or his duly
authorized representatives?

The three (3) kinds of power are as follows:

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 (1) Visitorial power ;
(2) Enforcement power; and
(3)Appellate power or power of review.

184. What are the requisites of visitorial and enforcement power of the DOLE
under Article 128 of the labor Code?

For the valid exercise of the visitorial power and enforcement powers under Article
128, the following requisites should concur:
• The employer-employee relationship should still exist;
• The findings in question were made in the course of inspection by the labor
Inspector; and
• The employee should not have initiated any claim or complaint with the
DOLE

Regional Director under Article 129 (Small money claims not exceeding
P5000.00), or the Labor Arbiter under Article 224 [217] (money claims not exceeding
P5000.00).

185. What is the subject and scope of the visitorial and enforcement power of the
DOLE under Article 128 of the labor Code?

The subject of article 128 power is the establishment which is under inspection and
not the employees thereof. The visitorial power of DOLE Secretary or his/her duly
authorized representative shall be implemented through any of the following modes:
a. Routine inspection;
b. Complaint inspection; and
c. Occupational Safety and Health Standard Inspection

Pursuant to his enforcement power, The DOLE Secretary or his duly authorize
representatives, in cases where the employer-employee relationship still exists,
shall have the power:
a) To issue compliance order to give effect to labor standards provision of the
Labor Code and other labor legislation based on the findings of labor
inspections in the course of inspection.
b) To 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 Inspector and raises issues supported by documentary proofs
which were not considered in the course of inspection. (Article 128 (b),
Labor Code.)
c) To 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 regulation poses grave and imminent danger to the
health and safety of workers in the workplace. Within twenty-four hours
(24), 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. (Article 128 (c),; Section 3 [a]
and [b], Rule X, Book III, Rules to implement the Labor Code.) These
proceeding should be terminated within 72 hours and a copy of the order or
resolution should be immediately furnished the DOLE Secretary. (Section
3 [b], Rule X, Book III, Rules to implement the Labor Code.)
d) To require employers, by appropriate regulations, to keep and maintain such
employment records as may be necessary in aid of his visitorial and
enforcement powers under the Code. (Article 128 (f), Labor Code.)

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186. What are the elements of the so-called exception clause in Art. 128(b), wherein
the Regional Director or his representatives may be divested of jurisdiction over
a labor standard case?

Under prevailing jurisprudence, the so-called exception clause has the following
elements, all of which must concur:

a. That the employer contests the findings of the labor regulations officer and
raises issues thereon;
b. That in order to resolve such issues, there is a need to examine evidentiary
matters; and
c. That such matters are not verifiable in the normal course of inspection.

187. Under Art. 128(b), who has visitorial and enforcement powers regardless of
the monetary claim involved?

As Article 128(b) is now worded after its amendment by R.A. No. 7730, the
visitorial and enforcement powers granted thereunder may be exercised by the DOLE
Secretary or the Regional Directors regardless of the monetary claim involved, unlike
in Article 129 where the authority is only for claims not exceeding P5,000.00 per
claimant.

188. What are the requisites for the exercise of the adjudicatory power of DOLE
Regional Directors and Hearing Officers over claims of the employee arising from
employer-employee relations?

Under the amendatory provision of RA. No, 6715, the adjudicative power of the
DOLE Regional Directors or any of the DOLE Hearing Officers is subject to the
following requisites which must all concur, to wit:

a. The claim is presented by an employee under the Code;

b. The claimant, no longer being employed does not seek reinstatement; and
c. The aggregate money claim does not exceed P5,000.00.

In the absence of any of the requisites, who has the jurisdiction?

In the absence of any of the aforesaid three requisites, the Labor Arbiters have
original and exclusive jurisdiction over all claims arising from employer-employee
relations, other than claims for employees' compensation, social security, PhilHeallh
and maternity benefits.

189. The Office of the Regional Director, DOLE, Region XXX, San Lazaro
investigated Covilandia Services and Trading and found violations involving 21
employees who are copier operators for being underpaid and of their 13th month
pay and that there was no service incentive leave with pay. Such investigation was
conducted pursuant to the visitorial and enforcement powers of the Secretary of
Labor and Employment. Covilandia Services and Trading appealed to the NLRC
and contends that although the issues raised stemmed from an inspection case,
the appeal should be made to the NLRC and not to the DOLE Secretary
because the appeal itself specifically stated that it is being elevated to the NLRC.
Is the contention of Covilandia tenable?

No. The contention of Covilandia is untenable.

If the decision of the Regional Director is rendered pursuant to the exercise of their
visitorial and enforcement powers under Article 128 which basically involves an
inspection case, the appeal should be made to the DOLE Secretary but if the decision

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 is made in accordance with Article 129 which does not involve inspection-related
issues, the appeal should be made to the NLRC.
190. What are the special groups of employees mentioned under the law?

In the Labor Code, Title lll of Book lll thereof, there are four “special groups of
employees”, namely:

a. Women, covered by Articles 130 to 136 [138], Chapter ll , Title III of Book lll
b. Minors, covered by Articles 137 [139] to 138 [140], Chapter ll, Title lll of Book
lll
c. Househelpers, covered by Articles 139 [141 to 150 [152], Chapter lll , Title lll
of Book lll now known as “domestic workers” or “kasambahays” the entire
Chapter lll, however, has been repealed by RA. No. 10361, otherwise known
as “Domestic Workers Act” or “Batas Kasambahay” approved on January 18,
2013
d. Homeworkers, covered by Articles 151 [153] to 153 [155], Chapter IV, Title
lll of Book lll
e. Night Workers, covered by Articles 154 to 161, Chapter V, Title lll of Book
lll, added and inserted by Section 5 of RA. No. 10151 [June 21,2011].

191. Who are covered by the maternity leave and how many days can it be availed
of?

All covered female workers in government and the private sector, including those
in the informal economy, regardless of civil status or the legitimacy of her child, shall
be granted one hundred five (105) days maternity leave with full pay and an option to
extend for an additional thirty (30) days without pay: Provided, That in case the worker
qualifies as a solo parent under R.A. No. 8972, or the “Solo Parents’ Welfare Act”, the
worker shall be granted an additional fifteen (15) days maternity leave with full pay.
(Section 3, RA. No. 11210)

192. What is the prohibition on employment of children as model in certain

advertisements?

No child below eighteen (18) years of age is allowed to be employed as a model in

any advertisement directly or indirectly promoting alcoholic beverages, intoxicating
drinks, tobacco and its by-products, gambling or any form of violence or pornography.

193. What is the work permit requirement in the employment of children?

The basic rule is that no child below fifteen (15) years of age is allowed to
commence work without a work permit which refers to the permit secured by the
employer, parent or guardian from the DOLE for any child below fifteen (15) years of
age in any work allowed under the law. Its period of validity shall in no case exceed
one (1) year.

194. What is the rationale on the invalidity of stipulation against marriage?

Marriage cannot be used as a condition or criteria in the employment of a woman

for being contrary to article 134 of the Labor Code and the protection-to-labor clause
of the Constitution. Further, In Zialcita, a case decided by the Office of the President,
the provision in a contract between an airline company and a flight attendant which
states that “flight attendant-applicants must be single and that they shall be
automatically separated from employment in the event they subsequently get married
was declared a null and void provision; hence, cannot be enforced. Thus, stipulation

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 against marriage as a condition for employment is a clear discrimination against women
and is considered illegal even if agreed upon by the employer and employee.

195. What is the "Reasonable Business Necessity Rule?

It is a test whereby an employer may validly restrain its employees from marrying
based on the nature of the work of the employee.

In the case of Star Paper Corporation vs. Simbol, G.R. No. 164774, April 12, 2006,
the Supreme Court ruled that if the employer insists that its employees be prohibited
from marrying, they have to show that there is reasonable necessity to implement such
policy and failure to do so will render such policy illegal.

Also, in the cases of Duncan and PT&T, the Supreme Court ruled that the
requirement of reasonableness must be clearly established to uphold the questioned
employment policy. The employer has the burden to prove the existence of a reasonable
business necessity. The burden was successfully discharged in Duncan but not in
PT&T.

196. What does "child" and "working child" means?

The term “child” refers to any person less that eighteen (18) years of age. On the
other hand, a “working child” refers to any child engaged as follows:

i. When the child is below eighteen (18) years of age, in work or economic
activity that is not “child labor” (child labor – any work or economic
activity performed by a child that subjects him/her to any form of
exploitation or is harmful to his/her health and safety or physical, mental
or psycho-social development); and
ii. When the child below fifteen (15) years of age:

a. in work where he/she is directly under the responsibility of his/her

parents (either the biological or adoptive mother or father) or legal
guardian (any person who exercises substitute parental authority,
regardless of whether or not such parental authority over a child is
bestowed by the court), provided that only members of the child’s
family are employed.
b. when the child’s employment or participation in public entertainment
or information is essential, regardless of the extent of the child’s role.

197. What is prohibited on employment of children in certain advertisements?

No child below eighteen (18) years of age is allowed to be employed as a model in

any advertisement directly or indirectly promoting alcoholic beverages, intoxicating
drinks, tobacco, and its by-products, gambling or any form of violence or pornography.

198. Who are covered under R.A. No. 10361 or the Batas Kasambahay?

R.A. No. 10361 applies to all domestic workers or kasambahays employed and
working within the country. More specifically, this law applies to all parties to an
employment contract for the services of the following Kasambahay, whether on a live-
in or live-out arrangement, such as, but not limited to:

• General househelp;
• Yaya;
• Cook;

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 • Gardener;
• Laundry person; or
• Any person who regularly performs domestic work in one household on an
occupational basis.

The following, however, are not covered by this law:

• Service providers;
• Family drivers;
• Children under foster family arrangement; and
• Any other person who performs work occasionally or sporadically and not on
an occupational basis.

199. What are the standards for the employment of working children?

It shall be unlawful to employ any person below fifteen (15) years of age as
Kasambahay. Pursuant to R.A. No. 9231, working children shall not be subjected to
the following:

a) Work for more than eight (8) hours a day and beyond forty (40) hours a week;
b) Work between ten o’clock in the evening and six o’clock in the morning of the
following day; and
c) Work which is hazardous or likely to be harmful to the health, safety or morals
of children, as defined under existing laws and regulations.

200. What are the two kinds of rest periods with which a kasambahay is entitled
to?

The two kinds of rest periods to which a kasambahay is entitled are:

1) daily rest period of an aggregate of eight hours per day; and

2) weekly rest period of at least twenty-four consecutive hours of rest in a
week.

The employer and kasambahay shall agree in writing on the schedule of the weekly
rest day but the preference of the kasambahay, when based on religious grounds, shall
be respected. The kasambahay and the employer may agree on the following:

a) Offsetting a day of absence with a particular rest day;

b) Waiving a particular rest day in return for an equivalent daily rate of pay;
c) Accumulating rest days not exceeding five days; or
d) Other similar arrangements.

201. If the duties of a person is to cook and do other domestic works like laundry
for the staff of a company, inside their staff house, will this person be considered
as (a) a house helper or kasambahay as defined under RA 10361 or the Batas
Kasambahay; or (b) regular employee covered by the Labor Code? What is the
criteria that differentiates (a) from (b)?

The person should be considered as a regular employee. As held in the case of

Apex Mining Co v. NLRC and subsequent cases, in order for a domestic worker to be
considered as such, he/she must render services in and about the employer’s home
which are usually necessary or desirable for the maintenance and enjoyment of the
home, and ministers exclusively to the personal comfort and enjoyment of the
members of the family. This definition covers drivers, domestic servants, laundry

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 women, yayas, gardeners, houseboys, and other similar househelps. But this definition
cannot be interpreted to include househelp or laundry women working in staffhouses
of a company, like in this case.

The criteria differentiating a domestic worker from a regular employee is the

personal comfort and enjoyment of the family of the employer in the home of said
employer.

202. If there's any act of abuse committed against a kasambahay, to whom should
the report be made?

Any act of abuse committed against a kasambahay may be reported to the

following:

(a) Any official of the barangay where the abuse occurred;

(b) Any social worker from the LSWDO or the DSWD Field Office;
(c) Any police officer from the Women and Children Protection Desks; or
(d) Any officer of the PESO. (Section 4, Rule X, Id)

203. What are the causes when an employer may terminate the employment of the
kasambahay?

An employer may terminate the employment of the kasambahay at any time before
the expiration of the contract for any of the following causes:
(a) Misconduct or wilful disobedience by the kasambahay of the lawful order of
the employer in connection with the former's work;
(b) Gross or habitual neglect or inefficiency by the kasambahay in the
performance of duties;
(c) Fraud or wilful breach of the trust reposed by the employer on the
kasambahay;
(d) Commission of a crime or offense by the kasambahay against the person of
the employer or any immediate member of the employer's family;
(e) Violation by the kasambahay of the terms and conditions of the employment
contract and other standards set forth in the law and the Rules;
(f) Any disease prejudicial to the health of the kasambahay, the employer, or
members of the household; and
(g) Other causes analogous to the foregoing. (Section 34, Article V, Id.; Section
3, Rule VII, Id)

204. Distinguish industrial home worker from some field personnel.

Industrial homeworker is a worker who is engaged in industrial home work. On

the other hand, some field personnel are a non-agricultural employee who regularly
performs his duties away from the principal place of business or branch office of the
employer and whose actual hours of work in the field cannot be determined with
reasonable certainty.

205. What is telecommuting?

Telecommuting refers to a work arrangement that allows an employee in the

private sector to work from an alternative workplace with the use of telecommunication
and/or computer technologies.

206. Who are the covered employees under the Employment of Night Workers?
Who is a night worker?

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 The law shall apply to all persons who shall be employed or permitted or suffered
to work at night, except those employed in agriculture, stock raising, fishing, maritime
transport and inland navigation. (Article 154, Labor Code (As amened by R.A. No.
10151); Section 1, Rule XV, Omnibus Rules Implementing the Labor Code
(Department Order No. 119, Series of 201 2)

“Night worker” means any employed person whose work covers the period from
10 o'clock in the evening to 6 o'clock the following morning provided that the worker
performs no less than seven (7) consecutive hours of work. (Sec. 1, Rule XV, Id)

207. What are the mandatory facilities available for workers performing
nightwork?

Mandatory facilities shall be made available for workers performing night work
which include the following:

(a) Suitable first-aid and emergency facilities as provided for under Rule 1960
(Occupational Health Services) of the Occupational Safety and Health Standards
(OSHS);

(b) Lactation station in required companies pursuant to Republic Act No.

10028 (The Expanded Breastfeeding Promotion Act of 2009);

(c) Separate toilet facilities for men and women;

(d) Facility for eating with potable drinking water, and

(e) Facilities for transportation and/or properly ventilated temporary sleeping

or resting quarters, separate for male and female workers, shall be provided except
where any of the following circumstances is present:
i. Where there is an existing company guideline, practice or policy,
collective bargaining agreement (CBA) or any similar agreement between
management and workers providing for an equivalent or superior benefit;
or

ii. Where the start or end of the night work does not fall within 12
midnights to 5 o'clock in the morning; or

iii. Where the workplace is located in an area that is accessible

twenty-four (24) hours to public transportation;

iv. When the number of employees does not exceed a specified

number as may be provided for by the DOLE Secretary m subsequent
issuances. (Article 156, Labor Code (As amended by RA. No. 10151);
Section 4, Rule XV, Omnibus Rules Implementing the Labor Code
(Department Order No. 119-12, Series of 2012)

208. When is the effective date of compulsory coverage of the employer, employee
and the self-employed?

Under Section 10 of RA 11199, the effectivity date of the compulsory coverage

are as follows:
a) For employer – Compulsory coverage of the employer shall take effect on
the first day of his operation;

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 b) For employee – Compulsory coverage of the employee shall take effect on
the first day of his employment; and

c) For self-employed – The compulsory coverage of the self-employed person

shall take effect upon his registration with the SSS.

209. What are the compensation afforded to night workers?

The night workers’ compensation shall include but not be limited to working time,
pay and benefits under the Labor Code, as amended and under existing laws, such as
service incentive leave, rest day, night differential pay, 13th month pay, and other
benefits as provided for by law, company policy or CBA.

210. Who are to be considered as “dependent”?

“Dependent” means the legitimate, legitimated or legally adopted or

acknowledged natural child who is unmarried, not gainfully employed, and not over
twenty-one (21) years of age or over twenty-one (21) years of age provided he is
incapacitated and incapable of self-support due to a physical or mental defect which is
congenital or acquired during minority; the legitimate spouse living with the employee
and the parents of said employee wholly dependent upon him for regular support.

211. What contingencies are compensable under the ECP?

The following contingencies are compensable under the ECP:

1) Work-connected injury;
2) Work connected disease; and
3) Any disability or death resulting from any work-connected injury or disease.

212. With the abandonment of the doctrine of presumptive compensability and

theory of aggravation, what are the proofs needed for the sickness and resulting
disability or death to be compensable?

With the abandonment of the doctine of presumptive compensability and theory

of aggravation, the rule now under the amendatory provisions intoduced by P.D. No.
626, is that for the sickness and resulting disability or death to be compensable, the
claimant must prove that:

a. The sickness must be the result of an occupational diseese listed under

Annex "A" of the Rules on Employees' Compensation, as Amended; or

b. The risk of contractiong the disease was increased by the claimant’s

working conditions [Article 167(I), 161(I), Labor Code, Section 1(b),
Rule III, Amended Rules on Employees’ Compensation; Salalima v.
ECC, G.R. No. 146360, May 20, 2004; Salmone vs. ECC, G.R. No.
142392, Sept. 26, 2000).

213. What are the conditions needed to be satisfied for an occupational disease and
the resulting disability or death to be compensable?

For an occupational disease and the resulting disability or death to be compensable,

all of the following conditions must be satisfied:

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 a. 1)The employee's work and/or the working conditions must involve
risk/s that caused the development of the illness;
b. 2)The disease was contracted as a result of the employee's exposure to
described risks;
c. 3)The disease was contracted within a period of exposure and under
such factors, necessary to contract it; and
d. 4)There was no deliberate act on the part of the employee to disregard
the safety measures or ignore established warning or precaution.

214. A teacher who slipped and fell resulting in serious injury was brought by an
ambulance to a hospital. On the way, the ambulance taking him to the hospital
figured in a collision which resulted in his death.

a. Was the injury compensable?

Yes, the injury is compensable.

b. What doctrine/rule in Labor law is applicable in this case?

CONSEQUENTIAL INJURIES DOCTRINE. It is obvious that in this case the death

was the consequence of the first and original injury he suffered, thus, the same may well
be considered as having arisen out of and in the course of employment.

c. Supposing the same teacher was at fault or negligent as when, after suffering the
injury, he refused to be hospitalized and instead went to a beer house and while
there, was stabbed to death by an adversary. In this case, was the injury
compensable?

No. It is obvious here that the teacher has been at fault or negligent, to say the least,
and the chain of causation is effectively broken between his compensable injury and
his death which in no way may be considered as the direct and natural consequence of
his original injury.

215. A was about to leave from work. However, as soon as he stepped out of the
company premises, he was hit by a huge rock coming from a blast from one of the
plants of the company. A sustained injury from the incident and is now claiming
that he shall be compensated by reason thereof. The company, however, contends
that injuries sustained by an employee, outside the premises of the employer, while
going to or returning from work, are not compensable. Was the injury sustained
by A compensable?

Yes. The general rule is that injuries sustained by an employee, outside the
premises of the employer, while going to or returning from work, are not compensable.
However, recoveries have been allowed off the employment premises, outside business
hours, when an employee going to or coming from work is injured by a hazard distinctly
traceable to the employment, such as a traffic jam overflowing from the employment
premises, or a rock flying through the air from a blast on the premises.

216. In what instances when a disability or death of a soldier is compensable?

It is compensable under the following circumstances:

o While the soldier is “on pass” for a period not exceeding 72 hours. If the soldier
was unable to report himself or herself back for duty from a duly authorized
pass within 72-hour period, it must have been for some legitimate and
valid reasons, such as, fortuitous events or force majeure; provided that

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 no unjustified or reasonable deviation from the condition for which the pass
had been issued had been committed.

o While the soldier is on rest and recreation which is considered part of the
soldier’s military activities after the soldier had gone actual combat duty, as
duly certified to by the proper commanding officer concerned; and

o While the soldier is on academic leave, provided that particular field of study
had been approved and paid by the military, or other agencies the military had
sanctioned officially.

217. What is a special errand rule in relation to employees’ compensation?

Under this “special errand rule”, an injury sustained by an employee outside

the company premises, if it is covered by an office order or locater slip or pass for
official business, is compensable where the employees were performing official
functions outside regular working hour and beyond the place of work.
218. How is the right to freedom of association affect the compulsory coverage in
the State Insurance Fund?

The constitutional right to freedom of association is not violated by the compulsory

coverage in the state insurance fund. The insurance coverage is within the police power
of the state for general welfare.

219. What is occupational disease?

Occupational disease is any disease contracted primarily as a result of an 3xposure

to risk factors arising from work.

220. Jean San Jose was employed in Coca-Cola Bottling Co. Consolidated as a
regular employee. He was not, however, registered under the Social Security
System (SSS). Due to his hospitalization, Jean claims the applicable benefits under
the Amended Rules on Employees' Compensation. Can his claim be denied on the
ground that he cannot present proof of registration with the SSS?

No. His claim cannot be denied on the ground that he cannot present proof of
registration with the SSS.

Circular No. 04-008 issued by DOLE Employees’ Compensation Commission

states that, No EC claim of any employee should be rejected on the basis alone of
absence of SSS registration and EC contribution. In fact, the Amended Rules on
Compensation provided that every employee shall be deemed as having been duly
reported for coverage if the System has received a report or written communication
paid in his name by his employer, before a compensable contingency occurs.

Hence, the claim of Jean San Jose cannot be denied. His membership with the
System can be established not on the registration alone, rather it may be proved by a
report, written communication, or the fact of payment by the employer of his
contribution with the System.

221. Mario is a gorgeous man, who was courting a beautiful woman named
Magdalena. At the same time, he is employed by Dangwa Bus Corporation as a
regular driver. Maria inclined to accept the love of Mario and made hesitations
on the proposed love of Joselito, also courting Maria. Joselito developed grudge
against Mario. On one occasion, while Mario was on duty driving the bus bound
for Baguio City, Joselito was able to ride the bus. Joselito then stabbed Mario

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 which caused his death. Under the Employees’ Compensation and State Insurance
Fund, are the dependents of Mario entitled to compensation notwithstanding the
fact the cause of death was due to personal grudge?

Yes, the dependents of Mario are entitled to compensation.

The death shall be compensable notwithstanding the fact that the motive is
personal in nature. In several cases, the Court held in substance that the death of an
employee as a result of a murderous assault upon him/her by an enemy is still
compensable when the same occurred in the course of the performance of official
functions. The Court ruled that criminal intent should not be regarded as a
supervening cause that will nullify, the compensability of the death of an employee,
who was attacked and killed at the place where his work required him to be, and while
in the course of performing his official duties.

In the case, the death of Mario occurred at his assigned/designated workplace or

at a place where his work requires him to be. Notwithstanding the fact that his death
was motivated by personal grudge, it does not detract compensability.

222. Article 178 [172] of the Labor Code provides that the State Insurance Fund
shall not be liable for compensation when the disability or death was occasioned
by the employee’s notorious negligence. What is “notorious negligence?”

"Notorious negligence" has been defined as something more than mere or simple
negligence or contributory negligence; it signifies a deliberate act of the employee to
disregard his own personal safety (Nitura v. ECC, G.R. No. 100710, 1991; Paez v.
WCC, G.R. No. L-18438, March 30, 1963). More significantly, such kind of negligence
ignores established warning or precaution (ECC Board Resolution 93-08-0068 issued
Aug. 5, 1993). It is more than mere carelessness or lack of foresight. It is equivalent to
“gross negligence” which means such entire want of care as to raise a presumption that
the person at fault is conscious of the probable consequences of his carelessness, and
is indifferent to the danger of injury to the person or property of others. It amounts to a
reckless disregard of the safety of person or property (Amedo v. Rio y Plabarrieta, Inc.,
G.R. No. L-6870, May 24, 1954; Caunan v. Compania General de Tabacos, G.R. No.
L-34194, Feb. 20, 1932; Wall v. Cameron 6 Colo., 275; Francisco, p. 877).

223. Can a worker pursue and avail of the compensation benefits under the Labor
Code and sue the employer for damages at the same time under the Civil Code?

No. As held in the case of Ysmael Maritime v. Avelino, and Floresca v. Philex
Mining, once a worker selected his option of suing the employer in the regular court
under the Civil Code for higher damages by reason of the employer’s negligence, the
injured worker or his heirs cannot opt for the other remedy under the Labor Code.

224. What is the meaning of third party?

For purposes of Article 180 (174) third party is one upon whom no liability could
entail under the Law; or one who is not an employer of the injured employee or a
stranger to the employment relationship and who may be held liable at the common
Law for his negligence which results in an injury to the employee.

225. What is Employees’ Compensation Commission (ECC)?

It is a government corporation by status and category possessed of quasi-judicial

authority.

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226. What benefits or compensation can the employees claim?

Claims for benefits may be filed for any or a combination of the following:

(1) Disability Benefit which may take the form of:

(a) Temporary Total Disability (TTD) Benefit;

(b) Permanent Partial Disability (PPO) Benefit;
(c) Permanent Total Disability (PTD) Benefit;

(2) Death Benefit;

(3) Funeral Benefit;
(4) Medical Services;
(5) Rehabilitation Services.

227. Where can the employees file their compensation claim?

Claims for benefits of employees in the public sector should be filed with the GSIS
and those of the private sector, with the SSS. All ECC claims may be filed by the
claimant at his option in the Regional Office/Branch of the GSIS or SSS, as the case
may be, nearest to his public place of work or residence.

228. Who has the Burden of Proof in Workers’ Compensation Cases? And the
quantum of evidence required in such cases?

Under the Labor Code, it is the employee who bears the burden of proof to establish
increased risk and work-connection. The claimant must be given opportunity to submit
evidence in the light of the compassionate policy towards labor which the 1987
Constitution vivifies and enhances. The latitudinarian or expansive application of the
Workmen’s Compensation Law in favor of the employee or worker no longer prevails
in the present Labor Code, as the burden of showing proof of causation has shifted back
to the employees. This is so because the presumption of compensability and the rule of
aggravation of illness caused by the nature of the employment were abolished by the
Labor Code. Thus, the employee, assisted by the employer, should prove that the risk
of contracting the disease is increased by the working conditions. The fact the cause of
the disease was not positively identified does not dispense with the burden of proof.

According to GSIS v. Fontanares, the employee must demonstrate through

substantial evidence (1) that the risk of contracting the disease was increased by the
claimant’s working conditions; and (2) the causal relation between the ailment and
working conditions.

229. When can you invoke the defense of “Increased Risk Theory’’ in compensation
cases?

In order for the court to grant Compensation, the claimant should prove that her/his
work duties put him at an increased risk. In the case of Rino v. Employees’
Compensation Commission, the claimant must adduce reasonable proof between the
work of the deceased and the cause of his death, or that risk of contracting the disease
was increased by the deceased’s working conditions. Under the Labor Code, as
amended, beneficiaries of an employee are entitled to death benefits if the cause of
death is sickness listed as occupational disease by the ECC; or any other illness caused
by employment, subject to proof that the risk of contracting the same is increased by
working conditions.

230. What is the minimum requirement for a physician to be accredited?

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 A physician may be accredited for purposes of the Employees' Compensation
Program (ECP), upon his application, if he is a doctor of medicine duly licensed to
practice in the Philippines and an active member of the Philippine Medical Association
(PMA).

231. Is good faith a defense in non-remittance of contributions?

No, Violation of the social security Law, a special law, is malum prohibitum;
therefore, criminal liability attaches without regard to intent and good faith of the
accused once the law is violated.

Good faith or bad faith is irrelevant for purposes of assessment and collection of
the penalty for delayed remittance of premiums, since the law makes no distinction
between an employer who professes good reasons for delaying the remittance of
premiums and another who deliberately disregards the legal duty imposed upon him to
make such remittance

232. What is the legal effect when an employee refuses to submit to medical
examination or when an injured or a sick employee refuses to submit to medical
treatment?

The legal effect of such refusal is waiver on the part of the employee of his right
to medical benefits. Consequently, if the employee unreasonably refuses to submit to
medical examination or treatment, the System (GSIS/SSS) shall stop the payment of
further compensation during the time as such refusal continues.

233. What does disability mean?

“Disability” means the loss or damage of a physical or mental function resulting

from an injury or sickness that prevents an employee from performing his/her work, or
from being engaged in any gainful occupation.

234. If an OFW who is rendering service to his employer for only two weeks
suffered from a permanent injury due to performing his duty, what are the
benefits he may avail?

A disability is total and permanent if, as a result of the injury or sickness, the
employee is unable to perform any gainful occupation for a continuous period
exceeding one hundred twenty (120) days. The fact, however, that the permanently and
totally disabled employee continues to work after such disability does not deprive him
of the benefits provided under the law. For what is important consideration being the
inability to do substantially all material acts necessary for the prosecution of a gainful
occupation without serious discomfort or pain and without material injury or danger to
life. In disability compensation, it is not the injury per se which is compensated but the
incapacity to work. The test to determine its gravity is the impairment or loss of one’s
capacity to earn and not its mere medical significance.

235. Mr. A finished his contract as a crew in a ship and upon termination of
employee, he completed his clearance and was able to exit the ship. In his medical
record, he is physically fit and no disabilities indicated. Three months after his
employment contract, he begun to suffer spinal pain until he could not move
anymore making him paralyzed. It was found out later that the spinal injury was
incurred during his employment contract in the ship. He stated that while

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 carrying a heavy object the ship begun to sway strongly due to a strong wave and
he slipped hurting his back and legs. Can he avail of any benefits?

Yes, a worker who sustained work-related injuries that resulted to functional loss
and/ or physical loss of any part of his body shall be granted Temporary Total Disability
(TTD) and Permanent Partial Disability (PPD) benefits successively. Any earlier
compensation for TTD that may have been paid to an injured worker shall not be
deducted from the PPD benefit that may be later granted to him.

236. Is there a prohibition for the demand and charge of any fee for services
extended by an agent or an attorney?

Article 209[203] categorically prohibits the act of demanding or charging of any

fee for services extended by an agent, an attorney or any other person pursuing or in
charge of the preparation or filing of any claim for benefit under the employees'
compensation provision of the Labor Code, as amended. Any demand or charge
therefor or any stipulation to the contrary is a nullity. More so when it is the claimant
himself who signed and prepared the pleadings who is demanding the attorney’s fees.
Thus, in the case of Tolosa v. ECC, it was held that an employee is not entitled to
attorney’s fees as he was not assisted by counsel since he personally signed his own
pleadings.

237. When is attorney’s fees allowed?

Despite the prohibition in Article 209 [202], there are causes decided by the
Supreme Court which allow the payment of attorney’s fees. A close examination of the
aforequoted provision reveals that intent of the law is to free the award from any
liability or charge so that the claimant may enjoy and use it to the fullest. It is the
claimant who is exempt from liability for attorney’s fees. The defaulting employer or
government agency remains liable for attorney’s fees; because it compelled the
claimant to employ the services of counsel by unjustly refusing to recognize the validly
of the claim of petitioner. This actually is the rationale behind the prohibition. Nothing
is wrong with the court’s award of attorney’s fee which is separate and distinct from
the other benefits awarded. Besides, in the instant case, the participation of petitioner’s
counsel was not limited to the preparation or filing of the claim but in appealing
petitioner’s counsel was not limited to the preparation or filing of the claim but in
appealing petitioner’s case before this Court necessitating submission of pleadings to
establish his cause of action and to rebut or refute the arguments of herein respondents.
Fairness dictates that the counsel should receive compensation for his services;
otherwise, it would be entirely difficult for claimants, majority of whom are not teamed
in the intricacies of the law, to get good legal service. To deny counsel compensation
for his professional services, would amount to deprivation of property without due
process of law.

The amount of attorney’s fees usually granted is pegged at 10% of the monetary
awards. In one case, the award of 5% attorney’s fees on the principal claim was sub
subsequently raised to 10% in a later resolution in the cases where it was consolidated.

238. When is death compensable under the law on Employees’ Compensation?

Under the law on employees' compensation, death is compensable only when it

results from a work-connected injury or sickness. Thus, if the death of the employee
did not occur while in the performance of his duties as a gasoline attendant, the claimant
cannot be extended the death benefits under the law. (Luv v. WCC, G.R. No. L-43181,
Oct. 27, 1986, 145 SCRA 170)

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 In Manuzon v. ECC (G.R.No. 88573, June 25, 1990, 186 SCRA 738) where the
employee died about 4 1/2 years after retiring from the service due to a stroke, a
cardiovascular accident caused by thrombosis, the Supreme Court, in reversing the
denial of the claim by the ECC, ruled that the dependents are entitled to the benefits,
although the death occurred after the retirement, because the cause of death, myocardial
infarction, is closely related to the cause of his compulsory retirement.

239. What are the conditions for entitlement to funeral benefits under the law on
Employees’ Compensation?

The EC funeral benefits shall be granted after the SSS or the GSIS has declared
the following in the evaluation of claims for EC death benefits:

1. Death due to sickness - causal relationship between the death and the
working conditions of the covered member.

2. Death due to injury - causal relationship between the death and the work-
related accident.

3. Death of EC Permanent Partial Disability (PPD) or Permanent Total

Disability (PTD) pensioner - the cause of death is a complication or natural
consequence of previously compensated PPD or PTD (Section 2, Rule XIV, Id; As
provided under Board Resolution Nos 14-06-29 and 14-06-30, both dated June 6,
2014)

240. What is the essence for allowing the conversion of permanent partial disability
benefit to permanent total disability?

In many other cases, the Supreme Court has allowed the conversion of permanent
partial disability benefit to permanent total disability benefit in consistent with the
primary purpose of P.D. No. 626, which is to provide meaningful protection to the
working class against the hazards of disability, illness and other contingencies resulting
in the loss of income as well as the Constitutional mandate to afford full protection to
labor under the Constitution.

241. Is charging for legal service fees categorically prohibited?

Yes. Under Article 209 [203], it categorically prohibits the act of demanding or
charging of any fee for services extended by an agent an attorney or any other person
pursuing or in charge of the preparation or filing of any claim for benefit under the
employees’ compensation provisions of the Labor Code, as amended. Any demand or
charge therefor or any stipulation to the contrary is a nullity, More so when it is the
claimant himself who signed and prepared the pleadings who is demanding the
attorney’s fees. Thus, an employee is not entitled to attorney’s fees as he was not
assisted by counsel since he personally signed his own pleadings.

242. What will happen if the employer fails to record the sickness, injury or death
of any of his employees?

Any employer who fails to record in his logbook the sickness, injury or death of
any of his employees within five (5) days from knowledge or receipt of due notice
thereof as prescribed herein, gives false information or withholds material information
already in his possession, shall be liable to 50 percent of the lump sum equivalent of
the income benefit to which the employee may be found to be entitled and/ or a fine of
not less than P500 nor more than P5,000 and imprisonment for not less than 6 months

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 or more than one year, at the discretion of the Court. The sum paid by the employer
under this Section shall accrue to the Employees’ Compensation fund of the System.

243. When is notice of sickness, injury or death to the employer not necessary?

Notice of sickness, injury or death is not necessary:

A. Where the employer or his representative already had knowledge thereof,

or the contingency occurred during working hours at the work place.

B. When the employee officially files an application for leave of absence

by reason of the contingency from which he suffers;

C. When the employer provides medical services and/or medical supplies

to the employee who suffers from the contingency;

D. When the employer can be reasonably presumed to have had knowledge

of the employee ‘s contingency, in view of the following circumstances:
• The employee was performing an official function for the employer
when the contingency occurred;
• The employee's contingency has been publicized through mass
media outlets;
• The specific circumstances of the occurrence of the contingency
have been such that the employer can be reasonably presumed to
have readily known it soon thereafter; or
• Any other circumstances that may give rise to a reasonable
presumption that the employer has been aware of the contingency.

244. “Universal Health Care Law” States the automatic enrolment of all Filipinos
to PhilHealth, does it mean that payment of contribution no longer necessary?

No, the continuity of direct contributions are still necessary to be covered by such
insurance and enjoy it benefits unless categorized under indirect contributors who were
recommended by the DSWD, covered by Senior Citizen’s Act and PWD’s Act.

245. In workmen's compensation cases, how is the governing law is determined?

By the date on which the claimant contracted his illness. Thus, where an ailment
supervened before the new Labor Code took effect, the governing law is the old
Workmen's Compensation Act. On the other hand, were an ailment occurred after 1
January 1975, the new law on Employees' Compensation applies.

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 LABOR RELATIONS QUESTIONS AND ANSWERS

1. Define labor relations and give examples.

The term "labor relations" refers to that part of labor law which regulates the
relations between employers and workers. Examples are the provisions of Book V of the
Labor Code which deal with labor organizations, collective bargaining, grievance
machinery voluntary arbitration, conciliation and mediation, unfair labor practices, strikes,
picketing and lockout.

2. Are labor relations and labor standards mutually exclusive?

No, labor relations and labor standards laws are not mutually exclusive. They are
complementary to and closely interlinked with each other. For instance, the laws on
collective bargaining strikes and lockouts which are covered by labor relations law
necessarily relate to the laws on working conditions found in Book III of the Labor Code.

3. If an association is unregistered, may it still be considered an employer?

An unregistered association of landowners may be an employer independent of the

respective members it represents - it being clear that the Labor Code does not require an
employer to be registered before it may come within its purview. To treat it otherwise
would bring about a situation whereby employees are denied, not only redress of
grievances but more importantly, the protection and benefits accorded to them by law
solely because their employer happens to be an unregistered association.

4. Shepherd retired after years of being a Labor Arbiter and lived as a simple person.
After two years, he was hired by Shadow Corporation as a corporate lawyer and later
one of its Board of Directors where he became known in the business world.

Meanwhile, the seat representing the employers sector in the 6th Division of NLRC is
vacant. Due to his popularity in the business world and taking into consideration his
former job as a labor arbiter, Shepherd was nominated to occupy this vacant position.
Arbiter Makarov, objected to this as he stated members of the Commission must be
an incumbent Labor Arbiter.

Was Makarov’s contention tenable?

No, Makarov’s contention is not tenable because the seat to be occupied by

Shepherd is the one allocated for the employer’s sector and not the one allocated for the
public sector.

The main requirement for nominees of the employer’s sectors is that he should only
come from the said sector which is absolute. Even if he was a former Labor Arbiter, he
served as a corporate lawyer and currently one of the Board of Directors of Shadow
Corporation. It is sufficient to say he is qualified to represent the employers sector.

5. What are the instances the NLRC may sit en banc?

The Labor Code provides the following instances wherein the NLRC may sit en
banc:
a. To promulgate rules and regulations governing the hearing and disposition of
cases before any of its divisions and regional branches; and
b. To formulate policies affecting its administration and operations.

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6. The employer Gil appealed the case before the NLRC but it turns out the Presiding
Commissioner was Emi, the same person who decided the case being appealed. Emi
decided in favor of Altria. A motion for reconsideration was filed by Gil but was
denied, though this time Emi inhibited.

Is the decision valid?

No, the decision is not valid.

Under the law the Division that handed it down was not composed of three (3)
impartial commissioners. In order to eliminate the suspicion partiality, the officer who
reviewed the case on appeal must not be the same person whose decision is the subject of
such review. It cannot be considered impartial since he was the Labor Arbiter who decided
the case under review. He should have inhibited himself from any participation in the case.

7. What are the qualifications of NLRC Chairman and Commissioners?

The following are the qualifications of the Chairman and Commissioners of the
NLRC:
a. They must be members of the Philippine Bar;
b. They must have engaged in the practice of law in the Philippines for at least 15
years;
c. They must have experience or exposure in handling labor-management
relations for at least 5 years; and
d. Preferably residents of the region where they shall hold office (Article 222
[215], Labor Code as amended by section 3, RA No. 9347 and Section 2 RA
No. 10741).

8. Enumerate the qualifications of Labor Arbiters?

The following are qualifications to be appointed as Labor Arbiters:

a. They must be members of Philippine Bar;
b. They must have been engaged in the practice of law in the Philippines for at
least 10 years; and
c. They must have experience or exposure in handling labor-management
relations for at least 5 years. (Article 222 [215], Labor Code as amended by
section 3, RA No. 9347 and Section 2 RA No. 10741).

9. Should Labor Arbiters be residents of the region where they are appointed?

No, it is not a requirement.

Republic Act No. 10741 amended the provisions of Article 222 of the Labor Code
that previously mandated that the Labor Arbiters holding office in the region where they
are appointed should be residents thereat.

With the deletion of this requirement, Labor Arbiters may now be appointed and
assigned at large, wherever their services may be urgently needed, and they are no longer
bound by the restrictive requirement on residency.

10. What is compulsory arbitration?

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 Compulsory arbitration is arbitration of labor disputes which laws of some
communities force the two sides, labor and management, to undergo. These laws mostly
apply when the possibility of a strike seriously affects the public interest

The CIR was empowered to enforce compulsory arbitration between employers or

landlords and employees or tenants, respectively. It had jurisdiction to consider,
investigate, decide and settle all questions, matters, controversies or disputes arising
between employers and employees, landlords and tenants or farm laborers and regulate
their relations.

11. Is the existence of employer – employee relationship a requirement before the Labor
Arbiter exercises jurisdiction?

The existence of employer-employee relationship between the parties-litigants is a

pre-requisite for the exercise of jurisdiction over labor disputes by the Labor Arbiters, the
NLRC and the other labor agencies. A single unifying clement that runs through the cases
and disputes falling under the jurisdiction of the Labor Arbiters is that all the enumerated
cases and disputes under Article 224 [217] arise out of or are in connection with an
employer-employee relationship, or some aspect or incident of such relationship.
(Hawaiian Ph. Company v. Gulmalico) Thus, the jurisdiction of Labor Arbiters and the
NLRC under Article 224 [217] is limited to disputes arising from the employer-employee
relationship which can be resolved in reference to the Labor Code or and the other labor
agencies.

12. In cases of overseas Filipino workers, is the existence of employer-employee

relationship required in order for LA to acquire jurisdiction?
No. Jurisdiction may be vested even without employer -employee relationship. The
case of Santiago r. CF Sharp Crew Management, Inc, presents a unique situation where the
core issue presented was whether the Labor Arbiter has jurisdiction to take cognizance of
the complaint for illegal dismissal, damages and attorney's fees filed by petitioner who was
not deployed overseas despite the signing of a POEA-approved employment contract. It
was ruled here that despite the absence of an employer-employee relationship between
petitioner and respondent, the NLRC has jurisdiction over petitioner's complaint This is so
because the jurisdiction of Labor Arbiters is not limited to claims arising from employer-
employee relationships per Section i 10 of R.A. No. 8042.

13. How is Jurisdiction determined in Labor Cases?

The rule is that the nature of an action and its subject matter as well as the court or
agency of the government that has jurisdiction over it determined by the material
allegations of the complaint in relation to the law involved and the character of the reliefs
prayed for.

14. Does the Labor Arbiter have the power to declare a party in contempt?

Yes, The Labor Arbiter, pursuant to Article 225(d) [218(d)], may cite any person
for direct or indirect contempt and impose the appropriate penalty under certain specified
grounds.

15. What is the nature of jurisdiction of Labor Arbiters?

The jurisdiction conferred upon a Labor Arbiter is both original and exclusive,
meaning, no other officers or tribunals can take cognizance of or hear and decide the cases
falling under the jurisdiction of the Labor Arbiters.

16. Does Voluntary Arbitrators have a jurisdiction over ULP cases?

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 Under Article 275 [262] of the Labor Code, Voluntary Arbitrators or Panel of
Voluntary Arbitrators are expressly granted jurisdiction to hear and decide ULPs upon
mutual agreement of the parties. Such exercise o jurisdiction is to the exclusion of the
Labor Arbiters.

17. Can a federation initiate a ULP case before the Labor Arbiter against its local
chapter?

No. A federation cannot initiate a ULP case before the Labor Arbiter a against its
local chapter and the employer on the ground of illegal dis affiliation. The complaint should
immediately be dismissed for lack of cause of action since the federation, being mere agent
of the member of its local chapter who, in legal contemplation, are considered the principal,
cannot act separately an independently from the later and thus lacks the legal personality
to institute the complaint.

18. What is meant by Grievance or Grievable?

A "grievance" or "grievable issue" refers to any question raised by either the

employer or the union regarding any of the following issues or controversies: (1) the
interpretation or application of the CBA; (2) the interpretation or enforcement of company
personnel policies; or (3) any claim by either party that the other party is violating any
provisions of the CBA or company personnel policies.

19. Who has the jurisdiction over termination of employment on the ground of union
security clause?

The Supreme Court ruled that in a situation where termination of employment is

effected on the ground of violation of the union security clause, the jurisdiction belongs to
the Labor Arbiter and not to the Voluntary Arbitrator. The reason is that only issues or
disputes were the parties involve the union and management are cognizable by the
grievance machinery and Voluntary Arbitrator.

20. Does the phrase “all other labor disputes” in article 275(262) automatically confer
jurisdiction on Voluntary Arbitrators?

No, the phrase “all other labor disputes” in article 275(262) does not automatically
confer jurisdiction on Voluntary Arbitrators. There is a need for express stipulation in the
CBA that illegal termination disputes should be resolved by a Voluntary Arbitrator or Panel
of Voluntary Arbitrators since the same fall within a special class of disputes that are
generally within the exclusive original jurisdiction of Labor Arbiters by express provision
of law. Absent such express stipulation, the phrase “all disputes” should be construed as
limited to the areas of conflict traditionally within the jurisdiction of Voluntary arbitrators,
i.e., disputes relating to contract-interpretation, contract-implementation, or interpretation
or enforcement of company personnel policies.

21. What are the classification of money claims falling under the exclusive and original
jurisdiction of the Labor Arbiter?

The classification of money claims falling under the exclusive and original
jurisdiction of the Labor Arbiter are the following:
a) Any money claim, regardless of amount, accompanied with a claim for
reinstatement; or

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 b) Any money claim, regardless of whether accompanied with a claim for
reinstatement, exceeding the amount of five thousand pesos (5,000.00 php) per
claimant.

22. What is the power to assume jurisdiction or certify “national interest” labor disputes
to NLRC?
When, in his opinion, there exists a labor dispute causing or likely to cause a strike
or lockout in an industry indispensable to the national interest, the Secretary of Labor and
Employment may assume jurisdiction over the dispute and decide it or certify the same to
the Commission for compulsory arbitration. (Article 263 [g], Labor Code).

23. What are the principles that affect the exercise of jurisdiction of DOLE Secretary?

There are certain principles that are well-recognized in relation to the exercise by
the DOLE Secretary of his assumption and certification powers under Article 278(g)
[263(g)]. They are:
• Principle of subsumation or absorption; and
• Principle of territoriality.

24. . What is the present rule under RA 7730, which abandons the ruling in Servando
case?

The DOLE Secretary or his duly authorized representatives (“Duly authorized

representatives” refer to “Regional Directors”) may exercise such powers regardless of the
amount of the monetary claims involved. Consequently, while it is true that under said
articles, the Labor Arbiter has jurisdiction to hear and decide cases where the aggregate
money claims of each employee exceeds P5,000.00, these provisions of law do not
contemplate or cover the visitorial and enforcement powers of the DOLE Secretary or his
duly authorized representatives.

25. Ex-Bataan Veterans Security Agency, Inc. (EBVSAI), private respondents, is in the
business of providing security services while private complainants, TUBIG BAYANI,
NOGNOG, ALEXANDER and JABAR, are EBVSAI's employees assigned to the
National Power Corporation at Ambuklao Hydro Electric Plant, Bokod, Benguet
(Ambuklao Plant). On 20 February 1996, TUBIG BAYANI, NOGNOG,
ALEXANDER and JABAR, instituted a complaint for underpayment of wages
against EBVSAI before the Regional Office of the Department of Labor and
Employment (DOLE).

On 7 March 1996, the Regional Office conducted a complaint inspection at the

Ambuklao Plant where the following violations were noted: (1) non-presentation of
records; (2) non-payment of holiday pay; (3) non-payment of rest day premium; (4)
underpayment of night shift differential pay; (5) non-payment of service incentive
leave; (6) underpayment of 13th month pay; (7) no registration; (8) no annual medical
report; (9) no annual work accidental report; (10) no safety committee; and (11) no
trained first aider.

On the same date, the Regional Office issued a notice of hearing requiring EBVSAI
(respondents) and TUBIG, NOGNO, ALEXANDER and JABAR, to attend the
hearing on 22 March 1996. EBVSAI filed a motion for reconsideration and alleged
that the Regional Director does not have jurisdiction over the subject matter of the
case because the money claim of each private respondent exceeded P5, 000. EBVSAI
pointed out that the Regional Director should have endorsed the case to the Labor
Arbiter.

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 Does the Regional director have jurisdiction over the case, notwithstanding the fact
that the money claims sought exceeds Php 5,000.00?

Yes. The visitorial and enforcement powers of the DOLE Regional Director to
order and enforce compliance with labor standard laws can be exercised even where the
individual claim exceeds P5, 000.”

In the case of Ex Bataan Veterans Security Agency Inc v. The Secretary of Labor
Laguesma it was held that the DOLE regional director validly assumed jurisdiction over
the money claims of private respondents even if the claims exceeded Php 5,000.00 because
such jurisdiction was exercised in accordance with Article 128(b) and the case does not fall
under the exception clause.

26. Sometime in 1997, KINAS filed a complaint for underpayment of wages, regular
holiday pay, overtime pay, nonpayment of 13th month pay and service incentive leave
pay against its employer ABUSADO before the Regional Office, NCR of the
Department of Labor and Employment (DOLE). Acting on the complaint, Regional
Director PAASA issued an inspection authority to Senior Labor Enforcement Officer
ALAWI.

On 22 August 1997, an inspection was conducted on the premises of ABUSADO’s

offices wherein the following violations of labor standards law were discovered, to
wit: non presentation of employment records (payrolls and daily time records);
underpayment of wages, regular holiday pay, and overtime pay; and nonpayment of
13th month pay and service incentive leave pay. On the same day, the Notice of
Inspection Result was received by and explained to ABUSADO, with the
corresponding directive that necessary restitution be effected within five days from
said receipt.

As no restitution was made, the Regional Office thereafter conducted summary

investigations. However, despite due notice, ABUSADO failed to appear for two
consecutive scheduled hearings. Furthermore, ABUSADO failed to question the
findings of the Labor Inspector received by and explained to the corporation’s
manager.

Thus, on 6 November 1997, Regional Director PAASA issued the assailed Order, the
decretal portion of which reads:

WHEREFORE, premises considered, respondent ABUSADO is hereby

ordered to pay KINAS the total amount of ONE MILLION THREE
HUNDRED EIGHTY-TWO THOUSAND THREE HUNDRED
THIRTY-TWO PESOS and 80/100 (P1,382,332.80) corresponding to their
claims within ten (10) days from receipt hereof, otherwise, a WRIT OF
EXECUTION shall be issued.

ABUSADO questions the decision of the Regional Director, arguing that the Regional
director had no jurisdiction over the case, and that the same should have been
forwarded to the LABOR ARBITER.

Does Regional Director PAASA have jurisdiction over this case?

Yes. The Regional Director had jurisdiction to try this case.

In the case of EJR Crafts Corp v. CA, It held that if there still exists an e-e
relationship between petitioner and private respondents at the time of the filing of the case,
and that the case involves violations of the Labor standard provisions of the Labor code,
the DOLE-RD has jurisdiction to hear and decide the instant case in conformity with

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 Article 128(b). On the contrary, where the e-e relations have been severed, complaints or
claims for payment of monetary benefits fall within the exclusive and original jurisdiction
of the Labor Arbiters.

In this case, since there still existed an e-e relationship between KINAS and
ABUSADO, at the time of the filing of the complaint, it is but proper that REGIONAL
DIRECTOR PAASA, validly assumed jurisdiction over the case. (Page 77)

27. What are the 3 requisites in order to divest the DOLE secretary or his duly authorized
representatives from issuing writs of execution to the appropriate authority?

The following are the requisites to divest the Secretary of Labor form issuing a writ
of execution:
a. That the employer contests the findings of the labor regulations officer and raises
issues thereon;
b. That in order to resolve such issues, there is a need to examine evidentiary matters;
and
c. That such matters are not verifiable in the normal course of inspection.

28. What are the two classes of corporations recognized under the 1987 Constitution?

The following are the two corporations recognized under the 1987 Constitution:
a. Private Corporations- created under the general law; and
b. Government-Owned or Controlled Corporation created by special charters.

29. What is “ecclesiastical Affair”?

An “ecclesiastical affair” is one that concerns doctrine, creed, or form of worship

of the church, or the adoption and enforcement within a religious association of needful
laws and regulations for the government of its membership, and the power of excluding
from such association those deemed unworthy of membership.

30. What are the rights of a Member-employee of a Cooperative?

The right of a member-employee of a cooperative:

1. to collective bargaining; and
2. to assert compliance by the cooperative with the law and to file illegal
dismissal and monetary claims cases in appropriate situations.

31. Enumerate 3 issues or cases that do not fall under the jurisdiction of the Labor
arbiters.

The following are the cases that do not fall under the jurisdiction of the labor
arbiters:
a) Claims for damages arising from breach of non-compete clause and other
postemployment prohibitions;
b) Claims for payment of cash advances, c~, appliance and other loans of
Employees;
• Dismissal of corporate officers and their monetary, claims;
• Issues involving suspension of payment of debts (rehabilitation
receivership);
• Cases involving entities immune from suit;
• Cases falling under the doctrine of forum non conveniens;
• Quasi-delict or tort cases;

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 • Criminal and civil liabilities arising from violations of certain
provisions of the Labor Code; and
• Constitutionality of CBA provisions.

32. Distinguish a corporate officer from an employee.

An 'office' is created by the charter of the corporation and the officer is elected by
the directors or stockholders. On the other hand, an 'employee' occupies no office and
generally is employed not by the action of the directors or stockholders but by the managing
officer of the corporation who also determines the compensation to be paid to such
employee.

33. Who has the jurisdiction over the case of illegal dismissal of corporate officers?

Where the complaint for illegal dismissal concerns a corporate officer, the
controversy falls under the jurisdiction of the RTC because the controversy arises out of
intra-corporate or partnership relations: (1) between and among stockholders, members, or
associates; or (2) between any or all of them and the corporation, partnership, or association
of which they are stockholders, members, or associates, respectively; and (3) between such
corporation, partnership, or association and the State insofar as the controversy concerns
their individual franchise or right to exist as such entity or because the controversy involves
the election or appointment of a director, trustee, officer, or manager of such corporation,
partnership, or association.

34. AA was appointed as Vice President for nationwide expansion by BB, the general
manager of DBD Corp. After sometime AA was dismissed by the DBD Corp. AA then
filed a complaint for illegal dismissal against DBD Corp. and some of its corporate
officers before the Labor Arbiter. DBD Corp. moved to dismiss the complaint on the
ground of lack of jurisdiction because the issue was intra-corporate inasmuch as AA
was a member of DBD’s Board of Directors aside from being its Vice-President for
Finance and Administration prior to his termination.

AA, in opposing the motion filed by DBD Corp., alleged that his status as a member
of the Board was doubtful since he was not formally elected and he did not own a
single share of stock. Even assuming that he had been a Director of DBD Corp., he
had been removed as the Vice President for Finance and Administration, not as a
Director, a fact that the notice of his termination dated April 10, 2000 showed

Is AA a corporate officer of DBD Corp.? Is the case cognizable by the RTC?

AA is not a corporate officer because a position must be expressly mentioned in the

By-Laws in order to be considered as a corporate office. Thus, the creation of an office
pursuant to or under a By-Law enabling provision is not enough to make a position a
corporate office.

An "office" is created by the charter of the corporation and the officer is elected by
the directors or stockholders. On the other hand, an employee occupies no office and
generally is employed not by the action of the directors or stockholders but by the managing
officer of the corporation who also determines the compensation to be paid to such
employee.

In this case, AA was appointed as the vice president for nationwide expansion by
BB, DBD’s general manager, not by the board of directors of DBD Corp. It was also BB

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 who determined the compensation package of AA. Thus, AA was an employee and not a
"corporate officer." Hence, the case is cognizable by the Labor Arbiter and not by the RTC.

35. What are the two tests that can be used to determine whether a dispute is intra-
corporate or not?

The two tests that should be considered in order to determine whether a dispute
constitutes an intra-corporate controversy or not, namely:
a) The status or relationship of the parties or Relationship test;
b) The nature of the question that is subject of their controversy or Nature of the
Controversy Test.

36. On January 1, 1992, Happy was elected Executive Vice President and Treasurer
(EVP/Treasurer) of SandBox Corporation. As EVP/Treasurer, his duties and
responsibilities included: (1) the management of the finances of the company; (2)
carrying out the directions of the President and/or the Board of Directors regarding
financial management; and (3) the preparation of financial reports to advise the
officers and directors of the financial condition of SandBox Corporation. Happy held
this position for 13 years, having been re-elected every year since 1992, until January
21, 2005, when he was nominated and elected Chairman of SandBox’s Board of
Directors.

On August 5, 2005, a little over seven (7) months after his election as Chairman of the
Board, the SandBox Board held a special meeting at the Manila Polo Club. One of the
items of the agenda was the election of a new set of officers. Unfortunately, Happy
was neither re-elected Chairman nor reinstated to his previous position as
EVP/Treasurer.

Aggrieved, on June 19, 2007, Happy filed a complaint for illegal dismissal with prayer
for reinstatement, payment of backwages, damages and attorney’s fees before the
Labor Arbiter against SandBox Corporation and Jolly, who was then the President
of SandBox Corporation.

Is the case cognizable by the Labor Arbiter?

No, the case is not within the jurisdiction of the Labor Arbiter because the issue of
his removal is an intra-corporate dispute which is cognizable by the RTC. Happy is
considered as a corporate officer and not an employee of SandBox Corporation.

Corporate officers are officers of a corporation who are given that character either
by the Corporation Code or by the corporation’s by-laws.

In this case, Happy was a corporate officer who held the position of Executive Vice-
President/Treasurer as provided in the by-laws of Sandbox Corporation and that he held
such position by virtue of election by the Board of Directors.

37. Who is an emigrant? Is the term “emigrant” still being used now?

An emigrant means any person, worker or otherwise, who emigrates to a foreign

country by virtue of an immigrant visa or resident permit or its equivalent in the country
of destination.

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 This term, however, is no longer found in recent enactments nor in their
Implementing Rules. Apparently, emigrant is now referred to as “legal resident” and is
defined in the 1996 Omnibus Rules and Regulation as a “person who has obtained
permanent residency status in accordance with the law of the host country.”

38. What are the differences between Migrant workers (MWs) and overseas Filipino
workers (OFWs)?

There are no differences. R.A. No. 8042 points out that the terms “migrant worker”
and “overseas Filipino worker” may be used interchangeably, thus: “Migrant worker”
refers to e person who is to be engaged, is engaged or has been engaged in a remunerated
activity in a state of which he or she is not a legal resident to be used interchangeably with
overseas Filipino worker.

39. What is the effect on the jurisdiction of the labor arbiters and NLRC if the former
employer’s assets are placed under rehabilitation receivership or liquidation?

The jurisdiction conferred by law upon Labor Arbiters and the NLRC would not be
lost simply because the assets of a former employer have been placed under rehabilitation
receivership or liquidation. It is merely suspended.

40. What is the exception to the rule that immune entities may be sued for labor law
violations?

When the function of the entity otherwise immune from suit partakes of the nature
of a proprietary activity, such entity may be sued for labor law violations relating to the
discharge of such function.

41. What are the requisites of a forum non conveniens?

The following are the requisites for a forum non conveniens:

a) That the Philippine court is one to which the parties may conveniently resort;
b) That the Philippine court is in a position to make an intelligent decision as to
the law and the facts; and
c) That the Philippine court has or is likely to have power to enforce its decision.

42. What is visitorial power?

The Secretary of Labor or his duly authorized representatives may, at any time.
Inspect the premises, books of accounts and records of any person or entity covered by this
title, require it to submit reports regularly on prescribed forms, and act on violation of any
provisions of this Title. (Referring to Title I (Recruitment and placement of workers), Book
I, Labor Code).

43. What is the Halaguena doctrine?

It held that it is not the Labor Arbiter but the regular court which has jurisdiction to
rule on the constitutionality of Collective Bargaining Agreement (CBA) provisions.

44. State the periods in which the Labor Arbiters should decide cases.

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

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 for decision without extension, even in the absence of stenographic notes, the following
cases involving all workers, whether agricultural or non-agricultural. Note the periods is
mandatory.

45. Is a motion for reconsideration to the DOLE Secretary’s decision a prerequisite to

the filing of Petition for Certiorari under Rule 65 to the Court of Appeals?

Yes. The 2014 case of Philtranco Service Enterprises (G.R. No. 180962, February
26, 2014), reiterated the rule on the mandatory filing of a motion for reconsideration prior
to the institution of a Rule 65 petition for certiorari from the decision of quasi-judicial
administrative agencies which, in this case, refers to the DOLE Secretary. Most notably,
the decision herein rendered has clarified that while a government office may prohibit
altogether the filing of a motion for reconsideration with respect to its decisions or orders,
the fact remains that certiorari inherently requires the filing of a motion for reconsideration
which is the tangible representation of the opportunity given to the office to correct itself.
Unless it is filed, there could be no occasion to rectify. Worse, the remedy of certiorari
would be unavailing. Simply put, regardless of the proscription against the filing of a
motion for reconsideration, the same should be filed on the assumption that rectification of
the decision or order must first be obtained and before a petition for certiorari should be
instituted.

46. What is the only mode of elevating decisions of the Court of Appeals to the Supreme
Court in cases originating from the DOLE Secretary?

The only mode of elevating decisions of the Court of Appeals to the Supreme Court
in cases originating from the DOLE Secretary a Petition for Review on Certiorari under
Rule 45. Since the CA has jurisdiction over Rule 65 petitions for certiorari that may be
filed before it from the decisions of the DOLE Secretary. any alleged errors committed by
it in the exercise of its jurisdiction would be errors of judgment which are reviewable by
means of a timely appeal to the Supreme Court through a Rule 54 petition for review on
certiorari and not by way of a Rule 65 special civil action of certiorari. Rule 45 is clear that
the decisions, final orders or resolutions of the CA in any case, i.e., regardless of the nature
of the action or proceeding involved, may be appealed to the Supreme Court by filing a
petition for review, which would be but a continuation of the appellate process over the
original case. Under Rule 45, the reglementary period to appeal is 15 days from notice of
judgment or denial of the motion for reconsideration (Asian Transmission Corporation v.
CA, GR No. 144664, March 15. 2004).

47. Does the POEA have jurisdiction to hear money claims cases of OFWs?

No, the POEA . The POEA ceased to have any jurisdiction over money claims of
OFWs, or those arising out of an employer-employee 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 jurisdiction over these claims was
transferred to the Labor Arbiters of the NLRC by virtue of Section I 0 of RA. No. 8042, as
amended.1 Consequently, appeals from decisions of the Labor Arbiter may be instituted to
the Commission (NLRC).

48. What are the additional powers of the Commission?

The following are the additional powers of the commission:

a) Power to grant extraordinary remedies;
b) Power to conduct ocular inspection; and

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 c) Power to conciliate and mediate.

49. Can the Labor Arbiter administer oath in cases pending before the Commission?

No, the power to administer oath is expressly granted to the Commission under
paragraph (b) of Article 225 [218] of the Labor Code.

50. Does the NLRC or the Labor Arbiter have jurisdiction to rule on indirect contempt?

Yes, Rule 71 of the Rules of Court does not require the Labor Arbiter or the NLRC
to initiate indirect contempt proceedings before the trial court. This mode is to be observed
only when there is no law granting them contempt powers. Since Article 225(d) [218(d)]
expressly grants both direct and indirect contempt power to the Labor Arbiter and the
NLRC, they do not need to cite persons for indirect contempt by initiating it to the Regional
Trial Court (RTC).

49. Explain the extent of the workers right to participate in policy and decision making
process as provided under Article XIII, Section 3 of the Philippine Constitution. Does
it include membership in the Board of Directors of a corporation?

Under Art. XIII, Sec. 3 of the Constitution, the workers shall participate in policy
and decision making affecting their rights, duties, welfare and benefits, through labor
management councils (See, Art. 211[g] and 255 of the Labor Code). The worker’s rights
do not include membership in the Board of Directors of a Corporation.

50. What is the principle of codetermination?

The principle of codetermination is one which grants to the workers the right to
participate in policy and decision making processes affecting their rights and benefits. (Art.
255, Labor Code).

51. Explain the impact of the union security clause to the employees’ right to security of
tenure.

A valid union security clause when enforced or implemented for cause, after
according the worker his substantive and procedural due process rights not violate the
employee’s right to security of tenure. Art. 248(e) of the labor Code allows union security
clauses and a failure to comply with the same is a valid ground to terminate employment.
Union security clauses designed to strengthen unions and valid law policy.

52. What is the requirement to be considered a pauper litigant?

In order to qualify as a pauper litigant, the person need not be so poor that he must
be supported at public expense. It is sufficient that the complainant is indigent, a person
who has property or sources of income sufficient for his support aside from his own labor
though self-supporting when able to work and in employment. (Acarv. Rosal, G.R. No. L-
21707, March 18, 1967.)

53. What is company-level due process as opposed to the labor court due process?

Company-level due process refers to the due process that should be afforded by the
employer to an employee prior to the latter's termination. Labor court due process, on the

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 other hand, refers to the due process required to be afforded to the parties in termination
cases filed before such labor authorities as the Labor Arbiter and the NLRC.

54. What are the requirements in order for a labor complaint or petition to be valid?

The 2011 NLRC Rules of Procedure imposes two (2) important requirements in
order for a labor complaint or petition to be valid. It shall be:
a. signed under oath by the complainant or petitioner; and
b. accompanied with a declaration of non-forum shopping.

55. What is the effect of an Attorney signing the Certificate against Forum Shopping?

A petition is dismissible outright for being accompanied by a defective certification

of non-forum shopping signed by the lawyer instead of the complainants as the principal
parties. It has been repeatedly emphasized that in the case of natural persons, the
certification against forum shopping must be signed by the principal parties themselves
and not by the attorney.
56. What is the Venue for Cases which the Labor Arbiters have Authority to hear and
decide?

All cases which Labor Arbiters have authority to hear and decide may be filed in
the Regional Arbitration Branch (RAB) of the NLRC having jurisdiction over the
workplace of the complainant or petitioner. (1st paragraph of Section 1[a], Rule IV, 2011
NLRC Rules of Procedure) For purposes of venue, the workplace shall be understood as
the place or locality where the employee is regularly assigned at the time the cause of action
arose, it shall include the place where the employee is supposed to report back after a
temporary detail, assignment, or travel. In the case of field employees as well as ambulant
or itinerant workers, their workplace is where they are regularly assigned, or where they
are supposed to regularly receive their salaries or wages or work instructions from, and
report the results of their assignment to, their employers.

57. What is the rule in case there is a Conflict in Venue?

Where two (2) or more RABs of the NLRC have jurisdiction over the workplace of
the complainant or petitioner, the Branch that first acquired jurisdiction over the case shall
exclude the others. (Page 178)

58. Rod Digs is (was?) employed as a regular sugar farm worker of Hacienda Go in
Talisay, Negros Occidental. He filed a complaint for illegal dismissal, reinstatement,
payment of backwages, and attorney’s fees against Hacienda Go/Harry Roque. Harry
Roque claimed that he was merely the administrator of Hacienda Go which was
owned by Go Agricultural and Development Corporation (GADC).

The NLRC ruled in favor of Rod Digs, and ordered GADC liable to pay jointly and
severally, with Harry Roque the claims of Rod Digs. GADC claims that the NLRC
acted without or in excess of jurisdiction or with grave abuse of discretion when it
included motu proprio GADC as a party respondent. Is GADC’s claim tenable?

No. A corporate employer is deemed to have had its day in court even if it was only
its unregistered trade name and its administrator/manager which/who were impleaded in a
case before a labor tribunal. The non-inclusion of the corporate name of such corporation
is a mere procedural error which does not affect the jurisdiction of the labor tribunal. This

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 is so because a corporation may be sued under the name by which it makes itself known to
its workers.

59. Duturtle Construction Corp. (DCC) dismissed its Project Manager Engr. Jose Reyes,
allegedly for his gross negligence on the job which resulted to the tilting and falling of
a crane along the Skyway Extension in Muntinlupa. Engr. Reyes filed an illegal
dismissal case against DCC. During the pendency of the proceedings, Engr. Reyes
died because of a stroke. What is the effect of his death?
Engr. Reyes’s death does not affect the ongoing case. The case may still proceed
provided that he is substituted by his heirs.

Under New Section 20, Rule V, 2011 NLRC Rules of Procedure, as added by
NLRC En Banc Resolution No. 11-12, Series of 2012 [November 16, 2012, effective
January 11, 2013), in case a complainant dies during the pendency of the proceedings,
he/she may be substituted by his/her heirs.

60. How can the Labor Arbiter acquire jurisdiction over the parties?

The Labor Arbiter acquires jurisdiction over the parties in cases before him either:

1. by summons served on them; or

2. by their voluntary appearance before the Labor Arbiter.

61. What are the instances when a motion for intervention is proper? When is it improper?

When Proper: Motion for intervention in labor cases may be allowed based on
Section 1, Rule 19 of the 1997 Rules of Civil Procedure.

When not proper: Individual intervenors cannot be allowed to intervene if they are
already represented in the suit by a party authorized by law to represent them, say, a labor
union. While said rule allows such intervention, they, however, failed to consider, in
addition to the rule on intervention, the rule on representation under Section 3, Rule 3 of the
Rules of Court. A labor union is one such party authorized to represent its members under
Article 251(a) [242(a)] of the Labor Code which provides that a union may act as the
representative of its members for the purpose of collective bargaining. This authority
includes the power to represent its members for the purpose of enforcing the provisions of
the CBA (Acedera v. International Container Terminal Services, Inc., G.R, No. 146073, Jan.
13, 2003.) Moreover, motions for intervention cannot be allowed if the party's own
appeal/petition for review has already been denied with finality. Intervenors cannot re-open
their case or recover their lost appeal by intervention (Suarez, Jr. v. National Steel
Corporation, SR No. 150180, Oct 17, 2008).

62. What is the rule on filing of pleadings by ordinary mail or private messengerial
service?
The rule is that when a pleading is filed by ordinary mail or by private messengerial
service, it is deemed filed only on the day it is actually received by the court, not the day it
was mailed or delivered to the messengerial service.

63. What is the rule on service of decision and final awards in labor cases?

The 2011 NLRC Rules of Procedure, provide that in case of decisions and final
awards, copies thereof should be served on both parties and their respective counsels or
representatives through any of the following modes:
a. By personal service;

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 b. By Registered mail;
c. By private courier service.

Exceptions.
The exceptions to this rule are as follows:
a. In cases where a party to a case or his/her counsel on record personally seeks service
of the decision upon inquiry thereon, in which case, service to said party is deemed
effected; and
b. Where parties are numerous, service shall be made on counsel and upon such number
of complainants as may be practicable and shall be considered substantial
compliance with Article 230(a) [224(a)] of the Labor Code.

64. What are the roles of the Labor Arbiter, Labor Arbitration Associate and authorized
personnel in Mandatory Conciliation and Mediation Conference?

The Labor Arbiter is required to personally preside over and take full control of the
proceedings. However, he may be assisted by the Labor Arbitration Associate in the
conduct thereof.

In areas where there is no Labor Arbiter assigned, conciliation and mediation may
be conducted by a Labor Arbitration Associate, any other NLRC personnel with sufficient
training and knowledge on conciliation and mediation, authorized by the Chairman or a
duly authorized personnel of the Department of Labor and Employment, pursuant to any
Memorandum of Agreement executed for this purpose.

65. What is the effect of having a compromise agreement?

A compromise agreement is deemed final and binding upon the parties and shall
have the force and effect of a judgment rendered by the Labor Arbiter.

66. Is an amendment of position paper allowed?

An amendment of the pleadings, such as position papers, may be made to conform

to an authorized presentation of evidence. When issues not raised by the pleadings are tried
by express or implied consent of the parties, they shall be treated in all respects as if they
have been raised in the pleadings. Such amendment of the pleadings as may be necessary
to cause them to conform to the evidence and to raise these issues may be made upon
motion of any party at any time, even after judgment; but failure to amend does not affect
the result of the trial on the issues.

67. What is the effect of non-appearance of parties during hearing?

In case of non-appearance of any of the parties during the hearing or clarificatory

conference despite due notice, the proceedings shall be conducted ex-parte. Thereafter, the
case shall be deemed submitted for decision.

68. Is hearing or trial before the Labor Arbiter a matter of right of parties? (page 211)

No. The parties may ask for a hearing but such hearing is not a matter of right on
their part that they can demand. In a catena of cases, it has been consistently declared that
the Labor Arbiter, in the exercise of his discretion, may deny such request and proceed to

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 decide the case on the basis of the position papers and other documents brought before him
without resorting to technical rules of evidence as observed in regular courts of justice.

69. What is Admission by Silence?

Admission by silence is an act or declaration made in the presence and within the
hearing or observation of a party who does or says nothing when the act or declaration is
such as naturally to call for action or comment if not true, and when proper and possible
for him to do so, may be given in evidence against him.

70. Is the concept of conspiracy in criminal cases applicable to labor cases?

Yes, the concept of conspiracy in criminal cases is applicable to labor cases. It

is elementary that “when there is a conspiracy, the act of one is the act of all the
conspirators, and a conspirator may be held as a principal even if he did not participate in
the actual commission of every act constituting the offense. In conspiracy, all those who in
one way or another helped and cooperated in the consummation of the crime are considered
co-principals

71. What is the required period for the Labor Arbiter to render a decision?

The Labor Arbiter is required to render his decision within 30 calendar

days, without extension, after the submission of the case by the parties for decision, even
in the absence of stenographic notes; provided however, that cases involving OFWs should
be decided within 90 calendar days after the filing of the complaint.

72. What must be stated in a decision or order of the Labor Arbiter?

The decisions and orders of the Labor Arbiter should be clear and concise and
must include a brief statement of the following:
a. Facts of the case;
b. Issue/s involved;
c. Applicable laws or rules;
d. Conclusions and the reasons therefor; and
e. Specific remedy or relief granted.

73. Is a Motion for Reconsideration or a Petition for Relief from Judgment from the
Judgment of a Labor Arbiter allowed?

No it is not allowed under Section 5d and Rule V of the 2011 NLRC Rules of
Procedure. To entertain such motion for reconsideration will permit the movant to violate
the statutory 10-calendar day period requirement for appeals

74. X received the decision and order of the Labor arbiter on November 11, 2015. X filed
an appeal with the Regional Arbitration Branch on November 25, 2015. Will the
appeal prosper?

No the appeal will not prosper because under Article 229 [223] of the Labor Code
and the 2011 NLRC Rules of Procedure,' the decision or order of the Labor Arbiter shall
become final and executory after ten (10) calendar days from receipt thereof by the counsel
or authorized representative or the parties, if not assisted by counsel or representative.

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75. Suppose X prosecuted his appeal to the NLRC by himself and forgot to attach a
verification in his appeal of the decision of the Labor Arbiter, will the appeal prosper?

Yes, it will still prosper. In a case where the employee prosecuted his appeal by
himself; the lack of verification or oath in the appeal memorandum is not fatal. A pleading
which is required under the Rules of Court to be verified may be given due course even
without a certification, if the circumstances warrant the suspension of the rules in the
interest of justice

76. A non-lawyer may appear before the Commission or any Labor Arbiter only:

A non-lawyer may appear before the Commission or any Labor Arbiter only: 1) If
they represent themselves; or 2) If they represent their organization or members thereof.

77. Requirements on appearance of lawyers.

A lawyer appearing for a party is presumed to be authorized for that purpose. In

every case, he/she shall indicate in his/her pleadings and motions his/her Attorney's Roll
Number, as well as higher Professional Tax (PTR) and Integrated Bar of the Philippines
(IBP) numbers for the current year and Mandatory Continuing Legal Education (MCLE)
compliance. Sec. 6 (a), Rule 3, 2011 NLRC rules of procedure.

78. Meaning of appearance of non-lawyers before Labor Arbiters/Commission.

It shall mean appearance during the mandatory conciliation and mediation
conferences and scheduled hearings and signing of pleadings. Attendance for the sole
purpose of simultaneous filing of position papers and other pleadings shall not be
considered as appearance. (Sec. 6 (b) of Rule III, NLRC RoC)

79. X comes to you for advice regarding the decision of the Labor Arbiter in relation to
his case where the latter declared that there was no illegal dismissal and denied his
claims for separation pay. What remedy can he avail of if only two days had passed
after he was served with the decision of the Labor Arbiter?

X may still appeal the decision if any of the following grounds exist:

a) If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter;

b) If the decision, order or award was secured through fraud or coercion, including
graft and corruption;

c) If serious errors in the findings of facts are raised which would cause grave or
irreparable damage or injury to the appellant.

80. The rule is that a party who does not appeal from a decision of a court cannot obtain
affirmative relief other than that granted in the appealed decision. Is this an absolute
rule?

No. Jurisprudence instructs that affirmative relief is still available to a party who
did not appeal:

a. where there are (1) errors affecting the lower court's jurisdiction over the subject
matter, (2) plain errors not specified, and (3) clerical errors; or

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 b. to serve the interest of justice or to avoid dispensing piecemeal justice.

81. In an illegal dismissal case, the monetary award for separation pay was reduced by
the NLRC. The employee did not appeal within the reglementary period.

What are the effects of failure of a party to appeal a decision that is favorable to him?

If the decision is favorable to the party who failed to appeal, his failure to appeal
does not preclude him from praying that he be awarded the monetary benefits as provided
in Article 294 [279] of the Labor Code. Besides, the NLRC had already declared that he
was illegally dismissed; thus, the NLRC is mandated to award him the monetary benefits
due under the law.

81. Grounds for Appeal to The NLRC

UNDER ARTICLE 229 [223]:

a. Four grounds only.

The appeal to the NLRC may be entertained only on any of the following grounds:

1. If there is a prima facie evidence of abuse of discretion on the part of the Labor
Arbiter or DOLE Regional Director;

2. If the decision, award or order was secured through fraud or coercion, including
graft and corruption;

3. If made purely on questions of law; and/or

4. If serious errors in the findings of facts are raised which, if not corrected, would
cause grave or irreparable damage or injury to the appellant. (Articles 229 [223j
and 129, Labor Code, Section 2, Rule VI, 2011 NLRC Rules of Procedure.)

82. Effect of miscomputation of the reglementary period.

Miscomputation of the reglementary period will not result in forestalling the finality
of the judgment. Any holding to the contrary will necessarily leave to the whim of the
losing party, the determination of the definite and executory nature of the judgment. It is
in the interest of everyone that the date when judgments become final and executory should
remain fixed and ascertainable (Volkschel Labor Union v. NLRC, GR. No. 39686, June
25, 1980, 98 SCRA 314).

83. What are requisites for perfection of an appeal to the NLRC are as follows:

The requisites for perfection of an appeal to the NLRC are as follows:

1) Reglementary period. — The appeal should be filed within the reglementary

period (As provided in Section 1, Rule VI, 2011 NLRC Rules of Procedure).

2) Form of appeal. — The appeal should be in the form of a Memorandum of

Appeal which shall state the grounds relied upon and the arguments in support
thereof, the relief prayed for, and with a statement of the date the appellant
received the appealed decision, award or order.

3) Verification. - The Memorandum of Appeal should be verified by the appellant

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 himself/herself in accordance with the Rules of Court (See Section 4, Rule 7
thereof)

4) Number of copies. - The Memorandum of Appeal should be written in three

(3) legibly typewritten or printed copies.

5) Accompanying proofs. —- The Memorandum of Appeal should be

accompanied by:

i. proof of payment of the required appeal fee and legal research fee;

ii. posting of a cash or surety bond (As provided in Section 6, Rule VI,
2011 NLRC Rules of Procedure); and

iii. proof of service upon the other parties (Section 4 [a],, Rule VI, Ibid; See
also Bristol Myers Squib [Phils.], Inc. v. Vitoria, G.R. No. 148156, Sept
27, 2004)

Substantially, the salient considerations of the above requisites are the following:

(1) Reglementary period;

(2) Appeal and legal research fee;
(3) Memorandum of appeal;
(4) Proof of service; and
(5) Posting of cash, property or surety bond, in case of monetary awards.

The discussion of the foregoing requisites will follow the above order of
presentation in seriatim.

84. In appeals under the NLRC Rules of Procedure, is a Certificate of Non-Forum

Shopping required to be attached?

No. Compared to the earlier 2005 NLRC Rules and established jurisprudence, the
certificate of non-forum shopping is no longer required in appeals under the 2011 NLRC
Rules of Procedure. Notably, the latter Rules no longer require the appendage of a
certificate of non-forum shopping to the Memorandum of Appeal for purposes of
perfecting the appeal. (Sutherland Global Services (Philippines), Inc. v. Labrador, G.R.
No. 193107, March 24, 2014) It is only required in the initiatory complaint or petition filed
with the Labor Arbiter.

85. A, the appellant, failed to allege a material date in his appeal memorandum. B, the
appellee, insists that the failure to state the material dates is fatal to A’s appeal to the
NLRC and to his present position in this case. Is B correct?

No. The failure of the appellant to allege a material date in the appeal memorandum
is an innocuous mistake which does not generally cause any prejudice to the parties. The
same constitutes, at most, a reversible error. (Del Mar Domestic Enterprises v. NLRC, G.R.
No. 108731, Dec. 10, 1997) In the same case of Sutherland, petitioner Sutherland insists
that the failure to state the material dates is fatal to Labrador's appeal to the NLRC and to
his present position in this case. The Court, however, found this argument of petitioner
Sutherland unmeritorious as technical rules are not necessarily fatal in labor cases; they
can be liberally applied if – all things being equal - any doubt or ambiguity would be
resolved in favor of labor. These technicalities and limitations can only be given their
fullest effect if the case is substantively unmeritorious; otherwise, and if the defect is

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 similar to the present one and can be verified from the records (as in this case), the Court
has the discretion not to consider them fatal.

86. Does the failure of the appellant to furnish a copy of the memorandum of appeal to
the other party (appellee) constitute a fatal defect which would warrant a dismissal
of his appeal?

No. While Article 229 [223] and the 2011 NLRC Rules of Procedure require the
party intending to appeal from the Labor Arbiter's ruling to show proof of service by
furnishing the other party a copy of his memorandum of appeal, the Supreme Court has
held that the mere failure to serve the same upon the opposing party does not bar the NLRC
from giving due course to an appeal. (Lei Sheryll Fernandez v. Botica Claudio, G.R. No.
205870, Aug. 13, 2014) Such failure is only treated as a formal lapse, an excusable neglect
and, hence, not a jurisdictional defect warranting the dismissal of an appeal. Instead, the
NLRC should require the appellant to provide the opposing party copies of the notice of
appeal and memorandum of appeal. (EDI-Staffbuilders International v. NLRC)

87. What is the remedy in the case the employee failed to post a bond to perfect the
appeal?

The remedy of the employee is to file a motion to the dismiss appeal and not a
petition for mandamus for the issuance of a writ of execution. Since the posting of a bond
for the perfection of an appeal is both mandatory and jurisdictional, the decision of the
Labor Arbiter sought to be appealed to the NLRC becomes final and executory upon the
failure of the employer to post the bond.

88. What are the seven (7) documents required to accompany the bond?

The surety bond should be accompanied by original or certified true copies of the
following documents:

(1) A joint declaration under oath by the employer, his/her counsel, and the bonding
company, attesting that the bond posted is genuine, and shall be in effect until
final disposition of the case.

(2) An indemnity agreement between the employer-appellant and bonding

company;

(3) Proof of security deposit or collateral securing the bond: provided, that a check
shall not be considered as an acceptable security;

(4) A certificate of authority from the Insurance Commission;

(5) Certificate of registration from the Securities and Exchange Commission;

(6) Certificate of accreditation and authority from the Supreme Court; and

(7) Notarized board resolution or secretary's certificate from the bonding company
showing its authorized signatories and their specimen signatures.

89. When is an appeal bond considered bogus?

An appeal bond is considered bogus if it was issued by an officer no longer

connected for a long time with the bonding company. The bond not being genuine, the

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 liberal interpretation of the rule on appeal bond cannot be applied. In effect, there is really
no bond posted since a fake or expired bond is, in legal contemplation, merely a scrap of
paper.

90. Suppose X Multi-Purpose Cooperative appealed a decision by the NLRC to the CA

but they noted that they are not required to post a bond because under the
Cooperative Code, Article 62, paragraph (7), it states that all cooperatives are exempt
from putting up a bond for bringing an appeal against the decision of an inferior
court. They believe that NLRC is within the purview of “inferior court.” Are they
correct in assailing such?

No, they are not. In Balagtas Multi-Purpose Cooperative, Inc. v. CA, the Supreme
Court said that “courts” refer to courts of law. It does not extend to quasi-judicial bodies
like the NLRC unless otherwise clearly and expressly indicated in the wording of the
statute. Simply because these tribunals or agencies exercise quasi-judicial functions does
not convert them into courts of law. Hence, NLRC not being the inferior courts referred to
in the provision of the Cooperative Code, X multi-purpose cooperative must still post a
bond to perfect its appeal.

91. ABC Broadcasting Corporation, which is a government-owned and/or controlled

corporation, performs proprietary and not governmental functions. It is involved in
a labor dispute and received an unfavorable decision from the NLRC. It then brought
the case before the Court of Appeals but did not file a bond. The corporation claimed
that because it is wholly owned by the government, the rule that the government does
not have to post bond to perfect its appeal because it was presumed to be always
solvent, extends to it. Is ABC Broadcasting Corporation correct?

No, ABC Broadcasting Corporation is not correct. The Supreme Court said in a
decided case that GOCCs have separate and distinct personalities from its shareholders.
Although the State is its majority stockholder, the corporation remains to be a separate
entity. Further, because ABC Broadcasting Corporation performs proprietary functions, it
cannot be exempt from the payment of bond during appeal.

92. Suppose YYY Inc. did not file a bond during appeal because the Labor Arbiter’s
decision did not state any amount, is YYY Inc. correct in stating that it is a valid
justification for the non-posting of bond?

Yes. It falls under the three justifications that may be cited for not posting any bond.
Under different decisions by the Supreme Court, the three justifications are:

(a) That the decision of the Labor Arbiter does not grant any monetary award;

(b) That the decision of the Labor Arbiter does not state the specific amounts of the
monetary awards; or

(c) When, instead of posting a bond in a new case, the bond posted in an earlier
separate case which has already been decided with finality in favor of the
employer is applied to the new case.

93. What are the conditions necessary for the NLRC to entertain a motion to reduce
bond?

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 The filing of a motion to reduce bond shall be entertained by the NLRC subject to
the following conditions: (1) there is meritorious ground; and (2) a bond in a reasonable
amount is posted.

94. What is “reasonable amount” in relation to the bond necessary for the NLRC to
entertain a motion to reduce bond?

A motion shall be accompanied by the posting of provisional cash or surety bond

equivalent to ten percent (10%) of the monetary award subject to appeal, exclusive of
damages and attorney’s fees; this shall be considered as the “reasonable amount.”

95. Should the full amount of monetary award still be posted?

No. The rule that the full amount of the monetary award should still be posted
within the reglementary period even if the appellant has filed a motion to reduce bond no
longer holds.

96. Distinguish reinstatement under Article 229[223] and Article 294[279].

The following distinctions may be cited between reinstatement under Article 229
[223] and Article 294 (279) of the Labor Code:

• Finality. The reinstatement under Article 229 [223] has not attained finality
as in fact it is the subject of an appeal; while that contemplated under Article
294 (279) has already become final and executory.
• Employer's option to reinstate. - The reinstatement in the former is subject
to the exercise of option by the employer, while that in the latter, no such
option is available to the employer except to reinstate the employee to his
former position or to a substantially equivalent position, if the former
position is no longer available or reinstatement thereto is not viable or
feasible.
• On nature of duty of Labor Arbiter to implement order. - In the former, it is
ministerial upon the Labor Arbiter to implement his order of reinstatement
which is self-executory in character, while in the latter, it is not ministerial
as it requires the filing of a motion for the issuance of writ of execution with
the Labor Arbiter of origin before he can implement the reinstatement
order.
• On necessity for issuance of writ of execution. - In the former, a writ of
execution is not necessary to enforce the reinstatement order, while in the
latter, a writ of execution is indispensable to effect reinstatement.

97. What are the 2 options of the employer, to implement the reinstatement of Labor
Arbiter’s Decision?

To implement the reinstatement aspect of a Labor Arbiter's decision, there are only
two (2) options available to the employer, to wit:

1. Actual reinstatement which means that the employee should be reinstated to

the position which he occupied prior to his illegal dismissal under the same
terms and conditions prevailing prior to his dismissal or separation or, if no
longer available, viable or feasible, to a substantially-equivalent position; or

2. Payroll reinstatement which means that the employee should be reinstated

merely in the payroll of the company without requiring him to report back to
his work.

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98. What is the effect of issuance of TRO by Higher court?

The issuance of a temporary restraining order (TRO) by the CA or by the Supreme

Court, as the case may be, merely suspends the implementation and enforcement of the
reinstatement order but it does not have the effect of nullifying the right of the employee
to his reinstatement and to be paid his reinstatement wages.

99. What is the Wenphil rule? The Bergonio rule?

In regard to the reckoning of backwages of an employee who was reinstated in the

payroll, the period for computing the backwages due to employee during the period of
appeal should end on the date that a higher court reversed the labor arbitration ruling of
illegal dismissal. Wenphil Corporation v. Abing, (G.R. No. 207983, April 7, 2014)

After the Labor Arbiter's decision is reversed by a higher tribunal, an employer is

no longer obliged to keep the reinstated employee in the actual service or in the payroll.
The employee, in turn, is not required to return the wages that he had received prior to the
reversal of the Labor Arbiter's decision." Bergonio, Jr. v. South East Asian Airlines, (G.R.
No.195227, April 21, 2014)

100. What is the Genuino doctrine?

The employee who is reinstated in the payroll, as distinguished from actual

reinstatement, should refund the reinstatement salaries she received if her dismissal is
finally found legal on appeal. Genuino v. NLRC (G.R. Nos. 142732-33, Dec. 4, 2007).

101. What is the two-fold test under the Garcia doctrine?

Under Garcia, the test to determine the liability of the employer (who did not
reinstate the employee pending appeal) to pay the "reinstatement wages" of the dismissed
employee is two-fold, to wit:

1. There must be actual delay or the fact that the order of reinstatement pending
appeal was not executed prior to its reversal; and

2. The delay must not be due to the employer's unjustified act or omission. If the
delay is due to its unjustified refusal, it may still be required to pay the salaries
notwithstanding the reversal of the Labor Arbiter's decision.

102. How is back wages computed when employee will no longer be reinstated but will
instead be paid separation pay in lieu of reinstatement?

In cases where the illegally dismissed employee will not be reinstated but will
instead be paid separation pay in lieu thereof because reinstatement is no longer viable, the
computation of back wages due him includes the period when he should have been
reinstated by virtue of the order of the Labor Arbiter until he is paid said separation pay.

103. Who determines whether an appeal is frivolous or dilatory?

Jurisprudence gives conflicting claims but it appears that both Labor Arbiter and
the Commission have the power to so determine.

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 If the appealed case is still with the Labor Arbiter and the records were not yet
transmitted to the NLRC, the Labor Arbiter may make a finding that the appeal is frivolous
and, there and then, terminate the appeal. (Bongay v. Martinez)

But in a subsequent case, it was ruled that it is only the NLRC which has authority
to impose penalties for filing frivolous or dilatory appeals, thereby implying that the Labor
Arbiter has been divested of the power and authority to rule on the propriety of the appeal
filed by a party. The NLRC, and not the Labor Arbiter, has the power to rule upon appeals.
(National Power Corporation v. NLRC)

104. What are the fundamental requisites for admission of new and additional evidence
for the first time on appeal?

The liberality of procedural rules (admission of new and additional evidence for the
first time on appeal) is qualified by two (2) requisites as follows:

1. A party should adequately explain any delay in the submission of evidence; and
2. A party should sufficiently prove the allegations sought to be proven

105. May issues not raised during the trial court be raised for the first time on appeal?

Well-settled is the rule, also applicable in labor cases, that issues not raised below
cannot be raised for the first time on appeal. To allow fresh issues on appeal is violative of
the rudiments of fair play, justice and due process. But in Plantation Bay Resort and Spa
v. Dubrico, the High Court allowed the raising of a new issue in the Motion for
Reconsideration. It was ruled that while it is a well-settled rule, also applicable in labor
cases, that issues not raised below cannot be raised for the first time on appeal, there are
exceptions thereto among which are for reasons of public policy or interest. Technical rules
of procedure are not strictly adhered to in labor cases. In the interest of substantial justice,
new or additional evidence may be introduced on appeal before the NLRC. Such move is
proper, provided due process is observed.

106. What are the instances when the belated filing of the motion for reconsideration is
excused?

1. When the last day of the filing fell on a Saturday, in which case, it can be filed on the
next working day.

2. When it was filed 1 day or 3 days late in order to subserve substantial justice.

3. When the issue of timeliness in filing of motion for reconsideration rendered moot and
academic.

107. Give 5 exceptions to the principle of exhaustion of administrative remedies.

1) When there is a violation of due process;

2) When the issue involved is purely a legal question;
3) When the administrative action is patently illegal amounting to lack or excess of
jurisdiction;
4) When there is estoppel on the part of the administrative agency concerned;
5) When there is irreparable injury;
6) When the respondent is a department secretary whose acts as an alter ego of the
President bear the implied and assumed approval of the latter;
7) When to require exhaustion of administrative remedies would be unreasonable;
8) When it would amount to a nullification of a claim;
9) When the subject matter is a private land in land case proceedings;

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 10) When the rule does not provide a plain, speedy and adequate remedy;
11) When there are circumstances indicating the urgency of judicial intervention;
12) When no administrative review is provided by law;
13) Where the rule of qualified political agency applies; or
14) When the issue of non-exhaustion of administrative remedies has been rendered moot.

108. What is the mandatory period within which labor cases should be decided by the
NLRC?

Article 229 (223) expressly mandates that:

"The Commission shall decide all cases within twenty (20) calendar days from
receipt of the answer of the appellee. The decision of the Commission shall be final and
executory after ten (10) calendar days from receipt thereof by the parties."

109. What is the purpose of the Fresh Period Rule?

This new rule aims to regiment or make the appeal period uniform, to be counted
from receipt of the order denying the motion for new trial, motion for reconsideration
(whether full or partial) or any final order or resolution.

110. Where can an aggrieved party elevate his case in case the decision of the NLRC is
rendered without or in excess of jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction?

In cases where the decision of the NLRC is rendered without or in excess of

jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction,
the aggrieved party may elevate the case to the CA not by way of ordinary appeal but by
and through the special civil action for certiorari provided under Rule 65 thereof, as
amended by the 1997 Rules of Civil Procedure.

111. What is the period to file a petition for certiorari?

Under the Rules, the period within which petitions for certiorari may be filed has
been fixed at 60 days from notice of judgment, order or resolution. The provision on this
fixed period is a new one. This period is inextendible to avoid any unreasonable delay that
would violate the constitutional rights of the parties to a speedy disposition of cases.
112. What is the rationale behind the timeliness requirement of the CA petition for
certiorari?

Time and again, it has stressed that procedural rules do not exist for the convenience
of the litigants; the rules were established primarily to provide order to, and enhance the
efficiency of the judicial system. While procedural rules are liberally construed, the
provisions on reglementary periods are strictly applied, indispensable as they are to the
prevention of needless delays, and are necessary to the orderly and speedy discharge of
judicial business. The timeliness of filing a pleading is a jurisdictional caveat that even the
Supreme Court cannot trifle with. Viewed in this light, procedural rules are not to be
belittled or dismissed simply because their non-observance may have prejudiced a party's
substantive rights; like all rules, they are required to followed (Labao v. Flores; G.R. no.
187894; 2010).

113. What is the Factual-Issue-Bar-Rule?

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 Under this rule, since the Supreme Court's jurisdiction in a Rule 45 for review on
certiorari is limited to resolving only questions of law, the findings of fact of the CA are
deemed conclusive and binding. The reason is that the Supreme Court does not entertain
factual issues. It is not its function to analyze or weigh evidence all over again as the
evaluation of facts is best left to the trial or administrative agencies/quasi-judicial bodies
and appellate court which are better for the task.

114. When can the factual findings of the CA, NLRC and Labor Arbiter subject to judicial
review by the Supreme Court?

If there are conflicting factual findings of the CA, NLRC and the Labor Arbiter, the
High Court is impelled to resolve the factual issues along with the legal ones (Southeastern
Shipping v. Navarra, GR No. 167678, June 22, 2010). This factual divergence necessitates
a review of the records of a case to ascertain which conclusion is supported by substantial
evidence (Co Say v. Baltasar, GR No. 188828, Mar. 5, 2014) and enough to remove the
conclusion away from the issue of grave abuse of discretion.

115. Who are the labor officials empowered to issue writs of execution of their final orders,
decisions, resolutions or awards?

The following labor officials are empowered under Article 230 [224] to issue writs
of execution of their final orders, decisions, resolutions or awards:

1. Secretary of Labor and Employment;

2. Director of the Bureau of Labor Relations;
3. Regional Directors of the Department of Labor and Employment;
4. National Labor Relations Commission;
5. Labor Arbiters;
6. Med-Arbiters; or
7. Voluntary Arbitrators

116. Can the Sheriff conciliate or take part in any settlement proceedings during
enforcement in a labor case?

Any settlement attempts or settlement entered into by the parties should be referred
by the Sheriff to the Commission or the Labor Arbiter who issued the writ. In no case shall
the Sheriff conciliate or take part in any settlement proceedings during enforcement.

The Sheriff of the Commission must at all times conduct himself in an upright
manner, with utmost dignity, integrity and professionalism. His first and primary duty is to
implement the writ of execution, processes and other orders strictly in accordance with the
terms thereof.

117. May an order granting or denying a motion for execution be subject of appeal?

Appeal from orders issued by the Labor Arbiter in the course of execution
proceedings shall not be allowed and acted upon nor elevated to the Commission. Such
appeal is a prohibited pleading. (Section 50. Rule V, Ibid.) Consequently, a pleading or
motion shall not be allowed and acted upon nor elevated to the Commission respecting the
denial of a motion for the issuance of a writ of execution. (Section 5(9) 3), Rule V, Ibid.)

118. What is a writ of execution? What is its effectivity period?

A writ of execution is an order directing the Sheriff to enforce, implement or satisfy

the final decisions, orders or awards of the Labor Arbiter or the Commission, It is effective

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 for a period of 5 years from its issuance. (Section 4(b), Rule 1, 2012 NLRC Sheriffs’
Manual on Execution of Judgment November 15, 2012)

119. Which has jurisdiction over actions for revival of judgment?

The NLRC has jurisdiction over actions for the revival of its judgment. This is
based on the principle that an action upon a judgment must be brought either in the same
court where said judgment was rendered or in the place where the plaintiff or defendant
resides, or in any other place designated by the statutes which treat of the venue of actions
in general. (Maricalum Mining Corporation v. NLRC, GR No. 124711, Nov. 3, 1998, 298
SCRA 378.) It is well established that regular courts are bereft of jurisdiction to entertain
disputes involving employer-employee relationship.

120. What is the effect of perfection of appeal on the execution of the Labor Arbiter’s
reinstatement order?

The perfection of appeal from the Labor Arbiter to the NLRC has the general effect
of staying the execution of the decision of the Labor Arbiter being appealed, with the
exception of the execution of the reinstatement aspect of his decision which is self-
executory under Article 229 [223] of the Labor Code.

121. What is the effect of the issuance of a stay or suspension order in the rehabilitation
proceedings on monetary claims of workers?

The issuance by the RTC of a stay or suspension order in the rehabilitation

proceedings has the following effects, insofar as execution is concerned:

(i) Suspend all actions or proceedings, in court or otherwise, for the enforcement
of claims against the debtor; and

(ii) Suspend all actions to enforce any judgment, attachment or other provisional
remedies against the debtor.

122. AA filed a complaint for illegal dismissal against CC, his employer, which was ruled
favorably by the Labor Arbiter. The decision ordered the employer to pay AA
backwages, separation pay in lieu of reinstatement, indemnity and attorney’s fees.
Upon appeal, NLRC also ruled in favor of AA. The Court of Appeals affirmed with
modification the NLRC decision. The CA decision became final. In the course of the
execution of the judgment, the Labor Arbiter submitted an updated computation of
the monetary awards to include additional backwages and separation pay. CC
contends that the recomputation of the award is improper because the computation
is already in the Labor Arbiter's decision which the CA had affirmed. Is CC correct?

CC is not correct. In the case of Session Delights Ice Cream and Fast Foods v. CA,
the Supreme Court held to be legally proper the recomputation in the course of execution
of the Labor Arbiter's original computation of the monetary awards which were fixed as of
the time the decision was rendered by him and subsequently confirmed with modification
by a final CA decision.

By the nature of an illegal dismissal case. the reliefs continue to add on until full
satisfaction, as expressed under Article 294 [279] of the Labor Code. The recomputation
of the consequences of illegal dismissal upon execution of the decision does not constitute
an alteration or amendment of the final decision being implemented. The illegal dismissal

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 ruling stands; only the computation of monetary consequences of this dismissal is affected
and this is not a violation of the principle of immutability of final judgments.

123. Whether or not the backwages and separation pay should be computed until the
finality of the decision ordering separation pay?

Yes. In Session Delights Ice Cream and Fast Foods v. Court of Appeals, the
Supreme Court explained that the finality of the decision becomes the reckoning point
because in allowing separation pay, the final decision effectively declares that the
employment relationship ended so that separation pay and back wages are to be computed
up to that point.

124. Whether a re-computation of back wages up to the date of the actual reinstatement
of an employee would violate the principle of immutability of judgments?

No. A computation of back wages until actual reinstatement is not a violation of the
principle of immutability of final judgments. The Supreme Court held in the case of Lim vs
HMR Philippines Inc., that the nature of an illegal dismissal case requires that back wages
continue to add on until full satisfaction. The computation required to reflect full satisfaction does
not constitute an alteration or amendment of the final decision being implemented as the
illegal dismissal ruling stands.

125. Nilda and Florentino, both professors at the University of Pinas were born on April 30,
1942 and December 11, 1942, respectively. In 2002, both had turned 60 and can opt to retire.
The University admin pointed out that Florentino and back wages and separation pay could
only be computed up to 2002 since under both petitioner UP’s retirement plan and Article 302
[2871 of the Labor Code, 60 is the optional retirement age. Florentino and Nilda filed separate
claims for retirement benefits, hence, effectively admitting that 60 and not 65 is the retirement age
for UP’s faculty members. Is the University Admin correct?

No. As held in the case of University of Pangasinan, Inc. v. Fernandez, the Court
cannot agree that this is the cut-off date for the computation of backwages and separation pay
due to them because:

1. 60 is merely an optional but not the mandatory retirement age.

2. The evidence submitted do not show at whose option it is to retire the faculty
members before the age of 65.
3. There is no proof whatsoever that the faculty members of UPI indeed retire at 60 years
of age.
4. Florentino and Nilda filed claims for retirement pay in 2005 when they were both 63,
hence, their acts did not necessarily constitute an admission that 60 is the retirement
age fix UPI's faculty members.

126. Is the intervening reversal of the Labor Arbiter's decision not included in the
computation of backwages and benefits?

Yes, (Reyes vs NLRC GR No. 180551 Feb. 10, 2009), the declared that: “One of
the natural consequences of the finding that an employee has been illegally dismissed is
the payment of backwages corresponding to the period from dismissal up to the actual
reinstatement. The statutory intent of this matter is clearly discernible. The payment of
backwages allows the employee to recover from the employer that which he has lost by
way of wages as a result of his dismissal. Logically, it must be computed from the date of
petitioner’s illegal dismissal up to the time of actual reinstatement. The can be no gap or
interruption, lest we defeat the very reason of law in granting the same.
127. Can a belated interest be awarded for the first after the finality of judgment, when,
however, such interest was not expressly granted in the decision before becoming final
and executory?

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 Yes, in the case of University of Pangasinan, Inc. v. Fernandez, legal interest is
deemed read into the decision; hence, the same should be awarded even if not expressly
mentioned therein. Consequently, it was held here that the CA properly imposed legal
interest upon the total monetary award even if none was explicitly included in the fine print
of the Labor Arbiter's final decision and order of execution because it is not to be
considered as an alteration thereof, the legal interest being deemed read into it.

128. Can a final and executory judgment pertain to the termination of the case?

No, it is the satisfaction of judgment that terminates the case as held in Spouses
Malolos vs Dy, the satisfaction of the judgment in full has placed the case beyond the
Court's review. Indeed, there are no more proceedings to speak of inasmuch as these were
terminated by the satisfaction of the judgment.

129. CAYCO Marine Service, a business of hauling oil is owned by Dan. A complaint for
illegal dismissal of wages, non-payment of holiday pay, and leave pay was filed against
his company by his former employee Marie. NLRC decided in favor of Marie so a
notice of levy/sale on execution of personal property over the motor tanker that Dan’s
company owned, was issued. However, Gina filed a third party claim alleging that she
is the owner of the motor tanker. The NLRC dismissed the third party claim and
ordered the sheriff to proceed with the sale on execution despite Gina’s third party
claim. Was NLRC correct?

Yes, NLRC is correct. As a general rule, the NLRC has the power to execute its
judgment which extends only to the properties belonging to the judgment debtor. A third
party claim of ownership on a levied property should not necessarily prevent execution.
Even upon a mere prima facie showing ownership by the third party claim, if the third party
claim does not grow out or involve a labor dispute, a separate action for injunctive relief
may be maintained in court. In this problem, the dismissal was correct and Marie may
petition for a separation action for injunction.

130. MUOG Controls Corporation was ordered by the Labor Arbiter to pay the
complainants a total of PHP 500,000.00 for underpayment, overtime pay, service
incentive leaves and legal holiday pays. A writ of execution was then issued subjecting
the computer units owned by MUOG for public sale. MUOG filed a motion to quash
or recall writ of execution on the ground that these are exempted from execution
being instruments that are used in their business and trade. Rule on the motion.

I will deny the motion. The properties exempted by law from execution pertain only
to the properties owned by natural persons and not to those owned by juridical entities. The
instruments used by MUOG in their business and trade are not owned by natural persons,
even if it be used by its employees in their business and trade. Hence, the motion to quash
the writ of execution should be denied.

131. A third party claim was filed by Juan before the Labor Arbiter where he alleged that
the sewing machines subject of a writ of execution issued against JCI Sewing Co.
belong to him. The Labor Arbiter dismissed his claim for lack of merit. Juan filed an
appeal to the NLRC arguing that the Labor Arbiter incorrectly dismissed his claim.
However, NLRC also dismissed his appeal on the ground that such decision of the
Labor Arbiter is no longer appealable and that he should instead file a petition for an
extraordinary remedy through the Commission. Is NLRC correct?

Yes, NLRC is correct. Decision of the labor arbiter on third party claims are not
appealable. It may be elevated by way of a petition to the Commission as amended in the
2011 NLRC Rules of Procedure. In this case, NLRC was correct in dismissing the appeal.
The remedy of Juan is to file a petition for an extraordinary remedy with the NLRC.

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132. What is the nature of the contempt powers of the Secretary of Labor?

It was held in the case of Rivera v. Florendo that contempt powers should be
exercised on the preservative and not on the vindictive principle. Such power is drastic and
extraordinary; thus it should not be resorted to unless necessary in the interest of justice.

133. What is the extent of the contempt powers of the DOLE Secretary?

The DOLE Secretary can cite persons in direct and indirect contempt. A person
could be cited in direct contempt when he or she is guilty of misbehavior in the presence
of or so near the DOLE Secretary as to obstruct or interrupt the proceedings before him,
including disrespect towards him, offensive personalities towards others, or refusal to be
sworn or to answer as a witness or to subscribe an affidavit or deposition when lawfully
required to do so.

On the other hand, a person could be cited in indirect contempt when he or she does
acts that tends to belittle, degrade, obstruct, interrupt, prevent, or embarrass the Secretary
in the administration of justice.

134. In relation to indirect contempt charges, is initiation before the RTC still required?

No. In the case of Robosa v. NLRC, Rule 71 of the Rules of Civil Procedure does
not require quasi-judicial authorities to initiate indirect contempt proceedings before the
trial court because this mode is to be observed only when there is no law granting them
contempt powers.

Because Article 231 expressly grants both direct and indirect contempt power to
the DOLE Secretary, he/she does not need to initiate any contempt proceeding before the
Regional Trial Court.

135. What cases fall under the jurisdiction of the Mediation Arbiter?

• Inter Union disputes, such as:

o Request for SEBA certification when made in an unorganized
establishment with only one or more than one (1) legitimate union
or in an organized establishment; or
o Petition for certification election, consent election, run-off election
or re-run election;
• Intra-union disputes;
• Other related labor relations disputes
• Injunction cases
• Contempt cases.

136. What cases fall under the exclusive jurisdiction of DOLE regional directors?

a. Visitorial cases under Article 289;

a. Union registration-related cases;
b. Denial of registration of single-enterprise; and
c. Request for SEBA certification when made in an unorganized establishment
with only one (1) legitimate union.

137. Where would you file the appeal of the decisions of the Med Arbiter?

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 1. Request for SEBA certification when made in an unorganized establishment
with only one or more than one (1) legitimate union or in an organized
establishment; or - DOLE Secretary
2. Petition for certification election, consent election, run-off election or re-run
election - DOLE Secretary
3. Intra-union disputes; - BLR Director
4. Other related labor relations disputes - BLR Director
5. Injunction cases - BLR Director
6. Contempt cases - BLR Director

138. Enumerate the cases that falling under the original and exclusive jurisdiction of the
BLR Director which are appealable to the DOLE Secretary?

Decisions in the cases falling under the original jurisdiction and exclusive
jurisdiction of the BLR Director are all appealable to the DOLE Secretary, to wit:

(a) Complaints and petitions involving the application for registration, revocation
or cancellation of registration of federations, national unions, industry unions,
trade union centers and their local chapters/chartered locals, affiliates and
member organizations;

(b) Request for examination of books of accounts of said labor organization

(referring to federations, national unions, industry unions and trade union
centers, as distinguished from independent unions, local chapters and workers’
associations.) under Article 289 [274] of the Labor Code;

(c) Intra-union disputes involving said labor organizations; (Id.)

(d) Notice of merger, consolidation, affiliation and change of name of said unions
and petition for denial thereof;

(e) Registration of multi-employer CBAs (Section 15, Rule XI, Book V, Rules to
Implement the Labor Code, as amended by Department Order No. 40-03, Series
of 2003, [Feb. 17,2003] and as renumbered by Department Order No. 40-F-03,
October 30,2008. See National Federation of Labor vs. Laguesma, G.R. No.
123426, March 10, 1999.) or petitions for deregistration thereof; and
(f)Contempt cases. (The person adjudged in direct contempt by the BLR
Director may appeal to the DOLE Secretary. (See Section 1, Rule XXIII, Book
V, Rules to Implement, the Labor Code, as amended by Department Order No.
40-03, Series of 2003, [Feb. 17, 2003])

139. What are the requisites UNIQUELY applicable to intra-union disputes?

The requisites are:

a. Exhaustion of union administrative remedies in intra-union actions.

As held in Diamonon v. Department of Labor and Employment, - that when the
constitution and by-laws dictates the remedy for intra-union dispute such as the
filing of the complaint by petitioner against private respondents for
unauthorized or illegal disbursement of union funds, this should be resorted to
before recourse can be made to the appropriate administrative or judicial body,
not only to give the grievance machinery or appeals body of the union the

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 opportunity to decide the matter by itself: but also to prevent unnecessary and
premature resort to administrative or judicial bodies. Thus, a party with an
administrative remedy must not merely initiate the prescribed administrative
procedure to obtain relief but also pursue it to its appropriate conclusion before
seeking judicial intervention;

b. Requirement of 30% union support in case of complaint affecting entire

membership.

Where the issue involves the entire membership of the labor organization, the
complaint or petition is required to be supported by at least 30% of its members.
(Section 3 [formerly Section 4), Rule XI, Book V,) However, this requirement,
as found in the penultimate paragraph of Article 250 [241] of the Labor Code,
need not be strictly observed; and

c. 30% not required if entire union membership is not involved.

If the entire union membership is not involved, there is no legal necessity to
comply with the 30% requirement.

140. A contempt case was filed before the BLR Director and thereafter rendered its
decision. Is the decision of the BLR Director appealable? If so where? May it be
further appealed up to the CA and to the Supreme Court?

Yes, BLR Director is exercising original and exclusive jurisdiction over contempt
cases and is appealable to the DOLE Secretary.

However, decisions rendered by either the BLR Director or DOLE secretary in their
appellate jurisdiction cannot be further appealed. The remedy of appeal is available only
up to the level of either the BLR Director or the DOLE Secretary, as the case may be.
Appeal to the CA from their decisions rendered in their respective appellate jurisdictions
is not available; the only remedy being the filing of an original special civil action for
certiorari under Rule 65 of the Rules of Court.(Section 23, Rule XI, Book V, Rules to
Implement the Labor Code, As amended by Department Order No. 40-03, Series of 2003,
[Feb.17, 2003]; National Federation of Labor [NFL] v. Laguesma G.R. No. 123426,March
10, 1999.)

141. Can the NLRC assume jurisdiction over issues involve in the compromise settlement?

The NLRC or any cannot assume jurisdiction over issues involved in the
compromise settlement except in the following:

1. In case of non-compliance with the terms and conditions of the compromise

agreement, or

2. If there is a prima facie evidence that the settlement was obtained through fraud
coercion or misrepresentation. (Art. 233) Article 233 [227] empowers the
NLRC to void a compromise agreement for fraud coercion or
misrepresentation.

142. Who has jurisdiction to enforce terms of compromise agreement?

In case of breach or non-compliance of any of the terms and conditions set forth in
the compromise agreement, the Labor Arbiter in the region where it was concluded, upon

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 motion of any interested party, may issue a writ of execution requiring a Sheriff of the
Commission or the courts to enforce it.

143. Is compromise agreement binding on a non-party thereto?

A compromise agreement cannot bind a party who neither voluntarily took part in
the settlement itself nor gave specific individual consent thereto. It must be remembered
that a compromise agreement is a contract; it requires the consent of the parties and it is
only when such consent is given that the agreement may be considered as having been
voluntarily entered into.’ Even the application of the principle of res judicata cannot bind
persons who were not parties to the compromise agreement because there is no identity of
parties (UP v. CA GR. 97827)

144. Is conformity of lawyer required for validity of compromise agreement?

No, the conformity of lawyer is not required. It is clear from the 2011 NLRC Rules
of Procedure, Section 8(b) that the signatures of counsels and authorized representatives
are not required if they are not present at the time the compromise agreements are made
and executed.

145. Does a quitclaim providing for lesser amount than what employee is legally entitled
to may be held valid?

Yes, the quitclaim may be held valid. In situations where, at the time of the
execution of the quitclaim, the employee's complaint has already been dismissed and is
pending appeal before the next higher tribunal, a settlement for a lesser amount than what
is actually being claimed in the complaint may be allowed. The reason is that it remains
uncertain at that point, whether the employee would prevail in his appeal. The possibility
is real that his appeal may not be successful. Since there has yet been no decision rendered
by the appellate tribunal when the quitclaim was executed, it could not be said that the
amount of the settlement is unconscionable as enunciated in the case of Planas Commercial
v. NLRC, G.R. No. 144619, November 11, 2005.

146. Does a Quitclaim bar an employee to pursue claims arising from ULP?

No, Quitclaim does not bar an employee to pursue claims arising from ULP. It is
well-established a rule in the case of Sari-Sari Group of Companies, Inc., v. Piglas Kamao,
G.R. No. 164624, August 11, 2008, that quitclaims and/or complete releases executed by
(ULP) of their employer. The basic reason for this is that such quitclaims and/or complete
releases are against public policy and therefore null and void. The acceptance of
termination pay does not divest a laborer of the right to prosecute his employer for ULP.

147. Who has the burden of proof on voluntariness of quitclaim?

It is the employer and not the employee who has the burden of proving that the
quitclaim was voluntarily entered into by him. It is error to rule that the burden of proof to
show that the Deed of Release and Quitclaim was signed and executed voluntarily was on
the employee. Thus, failure of the employer to discharge this burden would mean that the
quitclaim is invalid.

148. What are the requisites for valid Quitclaims of OFWs?

The following are the requisites:

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 (a) that there was no fraud or deceit on the part of any of the parties;
(b) that the consideration of the quitclaim is credible and reasonable; and
(c) that the contract is not contrary to law, public policy, public order, morals and
good customs or prejudicial to third person with a right recognized by law.

149. What is single entry approach or sena?

It refers to the administrative approach to provide an accessible, speedy, impartial,

and inexpensive settlement procedure of all labor and employment issues through a 30-day
mandatory conciliation-mediation. to prevent them from ripening into full blown disputes.
process is utilized as immediate intervention to effect amicable settlement among the
differing parties.

150. Union A filed its CBA with the DOLE Regional Office 40 days after its execution. The
company questions the validity of the CBA because it was belatedly filed and should
therefore not be honored. Is the contention of the company correct?

The non-compliance with the procedural requirements such as the non-filing of the
CBA within 30 days from its execution should not be adversely affect its substantive
validity. A CBA is more than a contract. it is highly impressed with public interest for it is
an essential instrument to promote industrial peace. Hence, it bears the blessings not only
of the employer and employees concerned but even of the DOLE. To set is aside on
technical grounds is not conductive to the public good. (Trade Unions of the Philippines
February Six Movement V. Laguesma, GR no. 95013, Sept. 21, 1994)

151. Can a collective bargaining agreement be deregistered? Assuming that a CBA can be
deregistered, what are the statutory requirement for such deregistration?

Deregistration of Agreement” refers to the legal process leading to the revocation

of the CBA registration.

The denial of the CBA registration should be in writing, stating in clear terms the
reasons thereof and copies thereof should be served upon the application union and
employer within 24 hours from its issuance.

152. Union X failed to file its Collective Bargaining Agreement to the Bureau of Labor
Relations. What are the implications of the non-filing of the CBA?

It bears stressing, however, that while registration and subsequent certification by

the BLR of the CBA are required under the law, such registration and certification are not
required to put a stamp of validity to such contract Once it is duly entered into and signed
by the parties, a CBA becomes effective as between them, irrespective of whether or not it
has been registered and certified by the BLR (Liberty Flour Mills Employees V. Liberty
Flour Mills, Inc., G.R. Nos. 58768-70, Dec. 29, 1989, 180 SCRA 668). Simply put, the
registration of the CBA is an essential requisite only for the contract bar rule to apply.
Resultantly, an unregistered CBA will not bar the conduct of a certification election.

153. What is the Certification year bar rule?

Certification year bar rule states that collective bargaining negotiations between the
employer and the SEBA should begin within twelve (12) months following the certification
of the union as SEBA. This rule thus prevents the holding of a new certification election

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 until the parties have had one year to bargain. The certified SEBA, for the entire duration
of the 1-year period reckoned from the date of certification of the SEBA, enjoys an
unchallenged representative status and is in fact conclusively presumed to represent the
majority of the employees.

154. When does Collective Bargaining Deadlock happen?

Collective Bargaining Deadlock happens when there is a failure in the collective

bargaining negotiations between the SEBA and the employer resulting in an impasse or
stalemate. Despite their efforts at bargaining in good faith, the parties have failed to resolve
the issues and it appears that there are no other definite options or plans in sight to break
the standoff.

155. After being certified as the SEBA of the rank-and-file employees of respondent XXX
Company, private respondent union, XXX Union submitted its CBA proposals but
XXX Company refused to negotiate a CBA, raising as an issue, the legitimacy of XXX
Union. Because of this, XXX Union staged a strike over which the DOLE Secretary
assumed jurisdiction and issued an order certifying the same to the NLRC for
compulsory arbitration.

After more than one year of not having any CBA negotiation because of the pendency
of the said certified case before the NLRC, another union, XXX Union II, filed a
petition for certification election among the regular rank-and-file employees of
respondent XXX, citing as one of the grounds, the fact that more than 12 months have
elapsed since the last certification election was held where XXX Union was voted as
the SEBA and yet, there has been no CBA negotiation or bargaining deadlock
between XXX Union and XXX Company that could effectively bar its filing of the
petition.

Rule on the petition of XXX Union II.

The petition should be dismissed. The circumstances in this case should be

considered as similar in nature to a "bargaining deadlock'' when no certification election
could be held. Collective Bargaining Deadlock includes a situation where a CBA could not
be concluded due to the failure of one party to willingly perform its duty to bargain
collectively.

XXX Company employed legal means to block the certification of XXX Union as
the bargaining agent of the rank and file employees. From this, it can be concluded that
XXX Company was unwilling to negotiate and reach an agreement with XXX Union.

Thus, the petition should be dismissed.

156. What is a legitimate labor organization?

A “legitimate labor organization” refers to any labor organization in the private

sector registered or reported with the DOLE, in accordance with the Labor Code and its
implementing rules. It includes any branch or local thereof.

157. What are the two (2) modes of creating a labor organization?

a. Independent Registration
b. Chartering of Local Chapter or Chartered Local

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158. Distinguish labor organization from a workers’ association.

Although broadly speaking, labor organization and workers’ association are alike
as they are both organizations of employees, however, in their technical sense, a labor
organization may be distinguished from workers’ association in that the former is
organized for the principal purpose of exercising collective bargaining rights, while the
latter is established for any lawful purpose other than collective bargaining.

For as long as an organization is established for the purpose of collective

bargaining, whether wholly or partly, it shall be considered as a labor organization.
Remove this purpose and the organization may merely be considered as a workers’
association or some other form of organization - established for mutual aid, interest,
cooperation, protection,

159. Distinguish the effect of Merger and consolidation in the legal existence of labor
organizations.

Where there is a merger of labor organizations, the legal existence of the absorbed
labor organization(s) ceases, while the legal existence of the absorbing labor organization
subsists. Consequently, all the rights, interests, and obligations of the absorbed labor
organizations are transferred to the absorbing organization. (Section 10, Rule Ill, Book V)

Where there is consolidation, the legal existence of the consolidating labor

organizations shall cease and a new labor organization shall acquire all the rights, interests
and obligations of the consolidating labor organizations. (Section 10, Rule Ill, Book V,
ibid.)

160. May Trade Union Centers create Local Chapters

No. Under Article 241 [234-A), it is clear that the authority to directly create a local
chapter/chartered local is vested only with the federation or national union, to the exclusion
of all others. It is only a federation or national union which is empowered to directly issue
a charter certificate indicating the establishment of the local chapter/chartered local.
(Section 2, Departmen1 Order No. 40-f--03, Series d 2008, [October 30, 2008) which
amended Section 2, paragraph E, Rule Ill of Book V of the implementing Rules of the
Labor Code, as earlier amended by Department Order No. 40-B-03 February 16, 2004).)

161. How does a local/ chapter acquire legal personality?

A local/ chapter may acquire legal personality in 2 ways:

First stage. Partial-legal personality which it acquires upon the issuance to it of a

Charter Certificate by a federation or national union. It is partial in the sense that the legal
personality so acquired is only meant for one purpose, that is, to enable it to file a petition
for certification election. At this stage, the local chapter/chartered local is not yet in full
possession of all the rights and privileges accorded by Jaw to a legitimate labor
organization.

Second stage. Full-legal personality which is accorded to a local chapter/chartered

local-only upon compliance with the all-too-important requirement of submission to the
DOLE of its Charter Certificate and the documents mentioned in Article 241 (234-A]. It is
this act of submission to the DOLE of the required documents that marks the grant of fall

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 legitimate status to a local chapter/chartered local which would entitle it to all the rights
and privileges of a legitimate labor organization. The local chapter/chartered local need not
wait for the issuance by the DOLE of a Certificate of Registration which is issued in case
of an independently registered union because there is no such certification ever
forthcoming. No such certificate is required to be issued to a local chapter/chartered local
before it can acquire full legal personality.

162. ABC Inc. filed with the Department of Labor and Employment (DOLE) a Petition for
cancellation of the union registration of ABC Union’s Association on the grounds that
the List of Officers and Constitution and By-laws which the ABC Union’s Association
attached to its application for union registration contain the union secretary's
certification but the same is not under oath, contrary to Section 1, Rule VI of the
Implementing Rules of Book V of the Labor Code, as amended by Department Order
No. 9, series of 1997; and that, as shown in a Sinumpaang Petisyon, 148 out of
approximately 200 employees-members have since denounced ABC Union’s
Association for employing deceit in obtaining signatures to support its registration
application. The petition of ABC Inc. was granted. ABC Union’s Association appealed
to the Bureau of Labor Relations to give due course to the appeal which granted the
same, it ordered that ABC Union’s Association, shall remain in the roster of legitimate
labor organizations. ABC Inc. filed a motion for reconsideration arguing that the
union’s registration is not valid for the reason that the application by the union is not
under oath. Is ABC Inc. correct?

ABC Union’s Association union's registration cannot be cancelled on the ground

that the List of Officers and Constitution and By-laws which the union attached to its
application for union registration contain the union secretary's certification which is not
under oath. All that Article 242 [235] requires is that the secretary's certification be under
oath. It does not prescribe a specific manner of its notarization. The BLR, in its October
14, 1998 Advisory, allows for the wholesale notarization of a union's application for
registration and recognizes the effects thereof even on the attachments, including the
secretary's certification. This is a reasonable interpretation considering that the form of
notarization contemplated in said Advisory adequately serves the purpose of Article 242
[235], which is to forestall fraud and misrepresentation. (Dong Seung, Inc.. BLR GR. No.
162356, April 14, 2008)

163. Is a Writ of certiorari a proper remedy in case of refusal to register a union?

Yes. Another remedy available to compel registration of a union is writ of certiorari.

In Vassar Industries Employees Union v. Hon. Estrella, respondent Francisco L. Estrella,
then the Acting Director of the BLR, refused to register petitioner Vassar Industries
Employees Union on the ground that there is already a registered collective bargaining
agent. In granting the writ of certiorari to compel the registration of petitioner union and
for the eventual conduct of a certification election, it was pronounced that "[a]s long as an
applicant union complies with all of the legal requirements for registration, it becomes the
BLR's ministerial duty to so register the union. It suffices then to order that petitioner union
be registered, there being no legal obstacle to such a step and the duty of the Bureau of
Labor Relations being clear.

164. Is a local chapter/chartered local considered an affiliate?

Technically, a local chapter/chartered local created through the mode of chartering

by a mother union (Federation or national union) under Article 241 [234-A) of the Labor
Code, cannot be properly called an "affiliate union" if it has not acquired any independent

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 registration of its own. However, in the previous provision of the Rules to Implement the
Labor Code, as amended, it is provided that the affiliate of a labor federation or national
union may be a local or chapter thereof or an independently registered union." But with the
latest amendment thereof, the distinction set forth above should be the prevailing view
thereon.

165. A court order was issued which held the National Labor Union liable by the Labor
Arbiter for (a) Actual damages in the form of loss of revenue during the duration of
the strike which lasted for 100 days amounting to Pl,000,000.00; (b) Damages to the
good business standing and commercial credit of the company in the amount of
P350,000.00; and (c) Exemplary damages to deter others similarly inclined from
committing similar acts and to serve as an example for the public good, in the amount
ofP250,000.00. Is the court correct?

No, the court is not correct. The direct and primary responsibility for damages
caused by an illegal strike falls on the local union, being the principal, and not on the
mother union, a mere agent of the former even if the latter had assisted the former in filing
the notice of strike.

166. Can a local union disaffiliate from its mother union?

A local union has the right to disaffiliate from its mother union. A local union, being
a separate and voluntary association, is free to serve the interests of all its members
including the freedom to disaffiliate or declare its autonomy from the federation which it
belongs when circumstances warrant, in accordance with the constitutional guarantee of
freedom of association.

167. Under the Constitution and By-laws of the union, the local union is strictly prohibited
from disaffiliating from the mother union. The local union contended that it has the
right to disaffiliate from the mother union and the prohibition is a violation of its right
to disaffiliate. Rule on the matter.

The local union is incorrect. The right of the local members to withdraw from the
federation and to form a new local union depends upon the provisions of the union's
constitution, by-laws and charter. The right to disaffiliate may thus be prohibited
thereunder. However, in the absence of enforceable provisions therein preventing
disaffiliation or the declaration of autonomy of a local union, the latter may sever its
relationship with its parent union at any time.

168. What is the effect of final judgment cancelling union registration?

Once the union registration is ordered cancelled with finality, the union loses its
legal personality and ceases to legally exist. It must be emphasized, however, that only a
final order for the cancellation of the registration could prevent the union form continuing
to enjoy all the rights conferred on it as a legitimate labor union, including the right to be
certified as bargaining agent through a petition for certification election. (The Heritage
Hotel Manila v. Secretary of Labor and Employment, supra, citing Itogon-Suyoc Mines,
INc., v. Sangilo-Itogon Workers’ Union, G.R. No. L-24189, Aug. 30, 1968, 24 SCRA 873,
881-882.)

Further, in case of cancellation, nothing in the law could restrict the right of the
union to seek just and equitable remedies in the appropriate courts. ( Article 246[238-A],
Labor Code, as inserted by Section 4, R.A. No. 9481, June 14, 2007.)

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169. What are the grounds of cancellation of union registration?

Article 247 [239]. Grounds for Cancellation of Union Registration. - The Following
may constitute grounds for cancellation of union registration:

(a) Misrepresentation, false statement or fraud in connection with the adoption or

ratification of the constitution and by-laws or amendments thereto, the constitution and by-
laws or amendments thereto, the minutes of ratification, and the list of members who took
part in the ratification;

(b) Misrepresentation, false statement or fraud in connection with the election of

officers, minutes of the election of officers, and the list of voters;

(c)Voluntary dissolution by the members. (As amended by Section 5, R.A. No.

9481, which lapsed into law on May 25, 2007 and became effective on June 14, 2007; As
renumbered pursuant to Section 5, R.A. No. 10151, June 21, 2011 and DOLE Department
Advisory No. 01, Series of 2015 (Renumbering of the Labor Code of the Philippines, as
Amended), issued on July 21, 2015.

170. May a petition for certification election be collaterally attacked?

As has been held in a long line of cases, the legal personality of at legitimate labor
organization cannot be subject to collateral attack. The law is very clear on the matter.
(San Miguel Corp. Employees Union-PTGWO vs. San Miguel Packaging Products
Employees Union-PDMP, G.R. 1711153, Sept. 12, 2007). In Tagaytay Highlands
(International Golf Club Inc., vs. Tagaytay Highland Employees Union-PGTWO, G.R.
142000, Jan. 22, 2003), it was ruled that after a certificate of registration is issued to a
union, its legal personality cannot be subject to a collateral attack in another proceeding
such as in a PCE. It may be questioned only in an independent petition for cancellation in
accordance with the Rules to implement the Labor Code. (Formerly, Section 5 of Rule IV,
Book V thereof, now Section 8, Rule IV, Book V, Rules to implement the Labor Code, (as
amended by Department Order No. 40-03, Series of 2003[February 17, 2003].)

The said holding in Tagaytay Highlands, was reiterated in Laguna Autoparts

(Laguna Autoparts Manufacturing Corporation vs. Office of the Secretary, DOLE G.R. No.
157146, April 29, 2005.) and Air Philippines (In Re:Petition for Cancellation of the Union
Registration of Air Philippines Flight Attendant Association, Air Philippines Corp. vs.
Bureau of Labor Relation, G.R. No. 155395, June 22, 2006). A similar ruling was likewise
made in Legend International Resorts. (Legend International Resorts Limited vs. Kilusang
Mangagawa ng Legarda(KML-Independent), G.R. 169754, Feb. 23, 2011.)

171. The members of Union ABC have called for a meeting, proposing for the dissolution
of the union. More than 2/3 of all its members had agreed to the dissolution of the
union, thus the Board had submitted its application for dissolution with the Regional
Director. The remaining members now questions the legality of such dissolution,
stating that there is no such ground upon which it is based upon. Rule on the merits
of the case.

The question has no merit. The dissolution was voluntary; the law does not require
that certain justifications be cited in support of the decision to voluntarily dissolve the
union. What is merely required is compliance with the requisites mentioned by the law.
For as long as such, decision complies with the requisites, the petition for voluntary
dissolution should be approved as a matter of course.

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172. The right to self-organization and collective bargaining is a duly guaranteed right by
the Constitution. May an employee invoke the same as a ground for an absolute right
to join a union?

An employee cannot invoke an absolute right to union membership. Although the

right to self-organization and collective bargaining is duly guaranteed under the
Constitution, it is subject, however, to regulation by the State. For instance, it is mandated
by law that no labor organization shall knowingly admit as member or continue in
membership any individual who belongs to a subversive organization or who is engaged
directly or indirectly in any subversive activity.

173. May a member who is not an employee, continue to be a member of the union?

No. If the union members are not employees, no right to organize for purposes of
collective bargaining nor to be certified as bargaining agent can be recognized. The
question of whether employer-employee relationship exists is a primordial consideration
before extending labor benefits under the workmen's compensation, social security,
PhilHealth, termination pay and labor relations law. It is important in the determination of
who shall be included in the proposed bargaining unit because it is the sine qua non, the
fundamental and essential condition that a bargaining unit be composed of employees.
Failure to establish this juridical relationship between the union members and the employer
affects the legality of the union itself. It means the ineligibility of the union members to
present a petition for certification election as well as to vote therein.

174. Must there be a written employment contract? If yes, what essential terms are
required to be evidenced in writing?

Generally, the law does not require an employment contract to be reduced into
writing, but specific laws may require the same. For example, the Domestic Workers Act
(Republic Act No. 10361) requires an employment contract to be executed between the
domestic worker and the employer in a language or dialect understood by both the domestic
worker and the employer. The contract must include the duties and responsibilities of the
domestic worker, the period of employment, the agreed compensation and authorized
deductions, among others. The Rules and Regulations Implementing the Act Providing for
the Elimination of the Worst Forms of Child Labor (DOLE Department Order No. 065-04)
also provides that, when the employer is in public entertainment or information, they shall
submit to the DOLE regional office a written employment contract concluded between the
employer and the child’s parents or guardian, and approved by the Department. Under
DOLE Department Order No. 174-17, the employment contracts of employees of a
contractor or subcontractor involved in job contracting are required to include the
following stipulations: the specific description of the job or work to be performed by the
employee; and the place of work and terms and conditions of employment, including a
statement of the wage rate applicable to the individual employee.

175. Can employees contractually waive the right to overtime pay?

Generally, overtime pay cannot be waived, and overtime work cannot be offset by
undertime work. However, both the DOLE and the Philippine Supreme Court have allowed
companies to employ a ‘compressed workweek scheme’, where the normal working week
is reduced to less than six days but the total number of work hours remains at 48 hours per
week (or 40 hours per week for firms whose normal working week is five days). Under a
compressed workweek scheme, work beyond eight hours will not be compensable by the
overtime premium provided the total number of hours worked per day shall not exceed 12

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 hours (in a 48-hour working week) or 10 hours (in a 40-hour working week). Employers
may implement a compressed workweek scheme only with the express and voluntary
agreement of a majority of the covered employees and prior notice to the DOLE of the
adoption of the scheme.

176. To what extent are post-termination covenants not to compete, solicit or deal valid
and enforceable?

The Philippine Supreme Court has ruled that post-termination covenants are valid
if they contain reasonable limitations as to time, trade or activity, and place. The restriction
must be reasonable and not greater than necessary to protect the employer’s legitimate
business interests. In determining the reasonableness of the restriction, courts consider the
following factors: whether the covenant protects a legitimate business interest of the
employer; whether the covenant creates an undue burden on the employee; whether the
covenant is injurious to public welfare; whether the time and territorial limitations
contained in the covenant are reasonable; and whether the restraint is reasonable from the
standpoint of public policy. Because these covenants are treated on a case-by-case basis,
there is no set maximum period for their duration. However, a two-year restriction has been
held to be valid. Is there any legislation protecting employee privacy or personnel data? If
so, what are an employer’s obligations under the legislation? The Data Privacy Act of 2012
restricts the processing of personal information and sensitive personal information and
requires compliance with the principles of transparency, legitimate purpose and
proportionality. It provides for the right of the data subject to be informed of the processing
of the personal information pertaining to the data subject and other relevant data.
Reasonable access must also be given to the contents of the personal information, sources
thereof, recipients, manner of processing, etc. In which circumstances may an employer
dismiss an employee without notice or payment in lieu of notice? Notice of termination is
not required in cases of: fixed-term employees in the case of the expiry of their term, since
the termination of employment had already been agreed upon at the time of the
engagement; and project employees, whose employment is automatically terminated at the
end of the duration of the project agreed upon.

177. Maria, who lives in Tuba, works for Makiling Corporation. There is a legitimate labor
organization in Makiling Corporation, however, Maria did not join it because she
didn’t want to have to pay union dues. The labor organization succeeded in
negotiating free shuttle service from far-flung areas where public transportation is
scarce. Maria just checked her recent payslip and was surprised when she saw that
union dues were actually deducted from her salary. She filed a complaint. Decide the
case.

I will decide in favor of Maria. The Labor Code and jurisprudence are clear in the
fact that no check-offs from any amounts due employees may be effected without
individual written authorizations duly signed by the employees specifically stating the
amount, purpose and beneficiary of the deduction. The cardinal principle should be borne
in mind that employees are protected by law from unwarranted practices that diminish their
compensation without their knowledge and consent. In the case at bar, Maria has not given
her consent for any deductions to be made from he salary. Therefore, the case must be
decided in favor of Maria.

178. What deductions from wages are valid even without the required individual written
authorization?

In the following cases, individual written authorization is not required:

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 1. Assessment from non-members of the bargaining agent of reasonable fees
equivalent to the dues and other fees paid by its members, if such non-members
accept the benefits flowing from the CBA. This is the so-called "agency fee"
provided under Article 259(e) (248(e)) of the Labor Code.

2. Deductions for fees for mandatory activities such as labor relations seminars and
labor education activities provided under Article 250(0) [24I(o)] of the Labor
Code.

3. Check-off for union service fees authorized by law. (RCPI vs. The Secretary of
Labor G.R.No. 77959, Jan. 9, 1989)

4. Deductions for withholding tax mandated under the National Internal Revenue
Code (NIRC).

5. Deductions for withholding of wages because of employee's debt to the employer

which is already due. (Article 1706, Civil Code)

6. Deductions made pursuant to a judgment against the worker under circumstances

where his wages may be the subject of attachment or execution but only for
debts incurred for food, clothing, shelter and medical attendance. (Article 1708,
Civil Code)

7. Deductions from wages ordered by the court.

8. Deductions authorized by law such as for premiums for PhilHealth, social

security, Pag-IBIG, employees' compensation and the like.

179. Makiling labor organization has 1000 members. 199 of its members filed a complaint
regarding an irregularity in the union's funds, but the union claimed that the number
of complainant's is too few. How many members of Makiling labor organization is
required for a valid filing of such a complaint?

30 %, or at least 300 members in this case is required. Under Article 250 of the
Labor Code, at least 30% of the members of a union or any member or members specially
concerned may report any violation of the rights and conditions of membership provided
therein, including the issue of the proper handling and disposition of the funds and
properties of the union.

180. What is the prescription period for actions involving union funds?

A complaint or petition for audit or examination of funds and books of accounts

prescribes within three (3) years from the date of submission of the annual financial report
to the DOLE or from the date the same should have been submitted as required by law,
whichever comes earlier.

181. What are the rights of legitimate organizations?

A legitimate labor organization shall have the right:

(a) To act as the representative of its members for the purpose of collective
bargaining;

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 (b) To be certified as the exclusive representative of all the employees in an
appropriate bargaining unit for purposes of collective bargaining;

(c) To be furnished by the employer, upon written request, with its annual audited
financial statements, including the balance sheet and the profit and loss
statement, within thirty (30) calendar days from the date of receipt of the
request, after the union has been duly recognized1 by the employer or certified
as the sole and exclusive bargaining representative of the employees in the
bargaining unit, or within sixty (60) calendar days before the expiration of the
existing collective bargaining agreement, or during the collective bargaining
negotiation;

(d) To own property, real or personal, for the use and benefit of the labor
organization and its members;

(e) To sue and be sued in its registered name; and

(f) To undertake all other activities designed to benefit the organization and its
members, including cooperative, housing, welfare and other projects not
contrary to law.

182. Does the union have the right to own property?

Under Article 25 l(d) [242(d)], a legitimate labor organization has the right to
acquire real and personal properties for its own or its members' use and benefit. Such
properties so acquired should be in the name of the labor organization which, by express
provision of the law, is granted such right of ownership as well as the exercise of all
attributes thereof.

183. What is a labor organization?

An “employees’ organization” refers to any organization or association of

employees in a government agency. (Section 1 [h], Rules and Regulations to Govern the
Exercise of the Right of Government Employees to Self-Organization.) In the private
sector, this is technically known as “labor organization” or simply “union”.

184. What is a bargaining will?

An “organizational unit” refers to the unit where the government employees’

organization seeks to operate and represent. It is the employer’s unit consisting of rank-
and-file employees unless circumstances otherwise require. (Section 9, Executive Order
No. 180, June 01, 1987.) In the private sector, this is technically known as “bargaining
will.”

185. Who are not eligible to join employees' organizations?

The following are not eligible to join, form or assist an employees’ organizations:
(1) High-level employees;
(2) Members of the Armed Forces of the Philippines;
(3) Police Officers;
(4) Policemen;
(5) Firemen; and
(6) Jail Guards.

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186. What are the modes or ways in determining the SEBA?

1) Voluntary recognition;
2) Certification election; or
3) Run-off election.

187. What are the Form and Contents of a Petition for Certification Election?

The PCE should be in writing and under oath and should contain, among others,
the following:

a. The name of the petitioner and its address;

b. The name and address of the employer; and
c. The total number of rank-and-file employees in the subject organizational unit.

188. What are the three categories of employees under the Labor Code?

Under Article 219 [212] of the Labor Code, as amended (as Amended by R.A. No.
6715, which took effect on March 21, 1989), the three (3) categories of employees for
purposes of applying labor relations law, are as follows: (a) Managerial employees; (b)
Supervisory employees; and (c) Rank-and-file employees.

189. What is First-Line Management?

This is the lowest level in an organization at which individuals are responsible for
the work of others. First-line managers direct operating employees only; they do not
supervise other managers. Examples of first-line managers are the “foreman” or production
supervisor in a manufacturing plant, the technical supervisor in a research department, and
the clerical supervisor in a large office. First-level managers are often called supervisors.

190. Are Supervisory Unions and Unions of Security Guards still allowed?

No. All existing supervisory unions and unions of security guards shall, upon the
effectivity of the Labor Code, cease to operate as such and their registration certificates
shall be deemed automatically cancelled. However, existing collective agreements with
such unions, the life of which extends beyond the date of effectivity of the Code, shall be
respected until their expiry date insofar as the economic benefits granted therein are
concerned.

191. What are the criteria to be considered confidential employee?

Within the context of labor relations, “confidential employees” are those who meet
the following criteria: (1). They assist or act in a confidential capacity; (2) To persons or
officers who formulate, determine, and effectuate management policies specifically in the
field of labor relations. These two (2) criteria are cumulative and both must be met if an
employee is to be considered a confidential employee, that is, the confidential relationship
must exist between the employee and his superior officer or supervisor and that the latter
must handle the prescribed responsibilities relating to labor relations.

192. Air Philippines Flight Attendants Association (APFLAA) was issued a Certificate of
Registration by the DOLE. APFLAA filed a petition for certification election as the
collective bargaining representative of the flight attendants of Air Philippines

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 Corporation (APC). After the Med-Arbiter rendered a ruling ordering the holding of
a certification election, such election was held, with majority of votes cast in favor of
AFPLAA.

Thereafter, APC filed a petition for De-Certification and Cancellation of Union

Registration against APFLAA with DOLE alleging that APFLAA could not be
registered as a labor organization, as its composition consisted of a mixture of
supervisory and rank-and-file flight attendants. Is the contention of APC correct?

No. APC’s contention is not correct.

Jurisprudence provides that the inclusion in a union of disqualified employees is

not among the grounds for cancellation, unless such inclusion is due to misrepresentation,
false statement or fraud under the circumstances enumerated in Sections (a) and (c) of
Article 247 [239] of the Labor Code.

193. What are the rights involved in the right to self-organization?

1. To form, join, or assist labor organizations for the purpose of collective

bargaining through representatives of their own choosing;

2. To engage in lawful concerted activities for the same purpose or for their mutual
aid and protection,

194. Art. 274 [261] of the Labor Code provides violations of a collective bargaining
agreement, except those which are gross in character, shall no longer be treated as
unfair labor practice and shall be resolved as grievances under the collective
bargaining agreement for purposes of this Article, gross violations of a collective
bargaining agreement shall mean flagrant and/or malicious refusal to comply with
the economic provisions of such agreement. What are examples of violations of the
CBA which are not considered ULPs, irrespective of whether they have been
committed by the employer or the union?

1. Ordinary violations of a CBA which involve its non-economic/political

provisions;

2. Violations of its non-economic provisions, even if gross in nature; and

3. Violations of its economic provisions which are not gross in character.

195. What is the totality of Conduct Doctrine?

The totality of conduct doctrine means that expressions of opinion by an employer,

though innocent n themselves, may be held to constitute ULP because of the circumstances
under which they were uttered, the circumstances under which they were uttered, the
history of the particular employer's labor relations or anti-union bias or because their
connection with an established collateral plan of coercion or interference. An expression
which may be permissibly uttered by one employer might, in the mouth of a more hostile
employer, be deemed improper and consequently actionable as a ULP. The past conduct
of the employer and like considerations, coupled with an intimate connection between the
employer's action and the union affiliation or activities of the employee or employees taken
as a whole, may raise a suspicion as to the motivation for the employer’s conduct. The
failure of the employer to ascribe a valid reason therefor may justify an inference that his

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 unexplained conduct in respect of the particular employee or employees was inspired by
the latter's union membership and activities.

196. What are the jjurisprudentially declared acts of the ULP involving Employer’s
Interference, Restraint or Coercion?

Certain specific acts have been jurisprudentially declared as ULP in a number of

cases which involves interference, restraint or coercion by the employer. These acts may
generally have classified as follows:

1. Dismissals;
2. Threats;
3. Questioning and interrogation;
4. Offers and Promises;
5. Espionage and surveillance;
6. Interference in intra-union affairs;
7. Other forms of interference, restraint or coercion.

197. What are threats that constitute ULP? Give examples.

The mere issuance of a threat by the employer, even if not actualized, may already
constitute ULP. Examples are as follows:

a. Threatening employees with loss of jobs or benefits or promotional

opportunities if they join or vote for a union or engage m protected concerted
activity.

b. Threatening to close the plant if employees select a union to represent them or

to discourage union activity or support.

c. Stating to employees that union bargaining is futile or a strike is inevitable.

d. Threatening the union recruiter with bodily harm when he refused to yield the
demand of the employer to surrender the union affiliation forms.

198. What is a yellow dog contract?

Paragraph [b] of Article 259 [248] describes what is commonly known as “yellow
dog contract” or a yellow-dog clause of a contract (also called an iron-clad document). It
is an employment agreement which requires from employees, as a condition of
employment, that they shall not join or belong to a labor organization, or attempt to
organize one during their period of employment or that they shall withdraw therefrom in
case they are already members thereof.

199. When is “contracting-out” becomes an unfair labor practice?

It is only when the contracting out of a job, work or service being performed by
union members will interfere with, restrain or coerce employees in the exercise of their
right to self-organization that it shall be unlawful and shall constitute Unfair Labor Practice
(Article 259 (c) [248 (c)], Labor Code; Section 6 [f], Department Order No. 18-02, Series
of 2002, [Feb. 21, 2002]; Philcom Employees Union vs. Philippine Global
Communication, G.R. No. 144315, July 17, 2006, 527 Phil. 540, 557).

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200. Is yellow union illegal?

Yes. Under Paragraph [d] of Article 259 [248] (d) of the Labor Code, Yellow Union
or Company Union is an Unfair Labor Practice of employer. Under this principle, an
employer is prohibited to initiate, sponsor, dominate, control, assist or otherwise interfere
with the formation or administration of any labor organization, including the giving of
financial or other support to it or its organizers or supporters or bringing pressure upon
employees to join a union.

201. MALULUPET UNION, the sole and exclusive bargaining agent of MALULUPET
GROUP, held a strike. While some union members were conducting the strike, some
reported for work. However, the union members were prevented by employer enter
the premises. Employees who were not union members were allowed to enter the
company. MALULUPET UNION now sues MALULUPET GROUP for unfair labor
practice due to discrimination. Decide.

I will rule in favor of MALULUPET GROUP. In the case of Rizal Cement Workers
Union v. Madrigal and Co., it was held that the refusal to allow the employees to work and
the requirement that they should stay out of the premises in the meantime while the strike
was still going on is not discrimination.

This is borne out of the company’s justified apprehension and fear that sabotage
might be committed inside the company premises.

Further, there is no showing that the act of the company was intended to induce the
employees to renounce their union membership or as a deterrent for non-members to
affiliate; nor was it shown that it is a retaliatory measure against the activities of the union.

202. After a valid strike, the employer required the strikers to undergo medical
examination before being admitted to work. Is this requirement valid? Why or why
not?

No, the requirement is invalid.

In Davao Free Workers Front v. CIR, it was held that requiring medical
examination as a condition precedent for reinstatement or return to work is not proper. This
is because the conduct of a strike does not severe the employer-employee relationship
between the employer and the strikers, even if there is a pending unfair labor practice case.

As a rule, the strikers may be subjected to periodic physical or medical examination,

but not as a precondition to their reinstatement or return to work.

203. Some union members of LABOR UNION disaffiliated with the union and joined
another union. They were then dismissed for violating the LABOR UNION’s closed-
shop union security provision in the CBA. Aggrieved, the dismissed union members
claim that they were not aware that such provision exists. Rule on their contention,

Their contention is without merit.

The rule is that ignorance of the existence of the union security provision in the
CBA is not an excuse. As held in Manalang v. Artex Development Company, Inc., the
ignorance of the terms and conditions of the CBA would not justify breach thereof.

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 This is because the CBA gives rise to valid enforceable contractual relations,
against the individual union members in matters that affect them peculiarly, and against
the union in matters that affect the entire membership or large classes of its members.

Further, a union member who is employed under an agreement between the union
and his employer is bound by the provisions thereof, since it is a joint and several contract
of the members of the union entered into by the union as their agent.

204. Enumerate the common grounds that are usually invoked by the SEBA to justify
termination of employment.

(1) Refusal to become members of the SEBA of:

a. employees who are neither member of the SEBA nor of any other union/s
at the time of the signing of the CBA; or

b. future, newly-hired employees upon their regularization;

(2) Resignation by its existing members;

(3) Expulsion on the following grounds:

a. Disloyalty to the SEBA;

b. Commission of any act's inimical to the interest of the SEBA;
c. Refusal to pay union dues and other assessments;
d. Commission or conviction of a felony, offense or crime as defined by the
Revised Penal Code or any special laws against any union officer or
member in relation to activities for and in behalf of the SEBA;
e. Organizing and/or joining another labor organization claiming jurisdiction
similar to that of the SEBA or affiliating with a labor federation without its
approval;
f. Involvement in any violation of the union security agreement or the SEBA's
Constitution and By-Laws; or
g. Participation in a ULP or any derogatory act against the SEBA or any of its
officers or members.

205. To whom should the union security clause apply?

In Freeman, a case decided prior to the advent of the Labor Code, under the regime
of R.A. No. 875,” from which the present provision in Article 259(e) [248(e)] traces its
roots, it was held that the union security clause should apply only to persons to be hired or
to employees who are not yet members of any labor organization at the time of the signing
of the CBA.

206. Is a closed shop agreement requiring all employees to join the SEBA valid?

As a general rule, a union security provision such as a closed shop agreement

requiring all employees to join the SEBA is not valid, Sta. Cecilia Sawmills v. CIR, G.R.
Nos. L-19273-74, Feb. 29, 1964, 10 SCRA 433. Hence, such a stipulation in a CBA cannot
be given effect as to cover and bind employees who are not members of any labor
organization at the time of the effectivity of the CBA.

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207. Can the employer dismiss an expelled union member without the union’s
recommendation?

No. An employee expelled by the union cannot be dismissed by the employer on

the ground of violation of the union security clause without the appropriate
recommendation of the union to that effect. The fact of union expulsion alone would not
be a sufficient justification for the employer to dismiss the expelled employee; the
employer should wait for the union recommendation before he could act thereon.

208. What is the meaning of "independent and separate hearing" in termination based on
union security clause?

The use of the phrase "independent and separate hearing” in connection with the
due process required in termination grounded on violation of the union security clause
means that the employer is not duty-bound to immediately implement the recommendation
to terminate made by the SEBA, it has to conduct its own hearing independent and separate
from any hearing as may have earlier been conducted by the SEBA.

209. Distinguish union due process from employer due process.

The due process required to be observed by the union prior to its member's
expulsion concerns the termination of his membership with the union; while the due
process that must be complied with by the employer pertains to the termination of his
employment with the employer.

210. Company XYZ hastily and summarily dismissed its five employees even without
conducting any hearing. The dismissal was recommended by the union’s mother
federation for “disloyalty in having instigated disaffiliation.” Under their CBA, it
provides free and harmless clause which states “... for disloyalty to the union shall be
dismissed from employment by the Company upon request in writing by the Union,
which shall hold the COMPANY free from any liability arising from or caused by
such dismissal.” Is the company liable for the dismissal of its employees despite the
provision of free and harmless clause in the CBA?

Yes, the company is liable jointly and severally with the federation for the
reinstatement and payment of full back wages to the dismissed workers despite the
provision of free and harmless clause in the CBA (Liberty Cotton Mills Workers Union v.
Liberty Cotton Mills, Inc.; Malayang Samahan ng mga Mangggagawa sa M. Greenfield
[MSMG-UWP] v. Ramos).

211. XYZ Company lodged an action of cross-claim for reimbursement with the Labor
Arbiter against XYZ Employees Union which was liable for ULP pursuant to the
CBA. After considering all the circumstances of the case, the Labor Arbiter passed a
judgment in favor of XYZ Company. Does the Labor Arbiter have jurisdiction over
the cross-claim for reimbursement?

No, the Labor Arbiter has no jurisdiction over the cross-claim for reimbursement.
The employer cannot assert his right of reimbursement by way of a cross-claim in the same
labor proceeding before the Labor Arbiter. He should lodge it through voluntary arbitration
in which Voluntary Arbitrator or Panel of Voluntary Arbitrators is/are vested with
jurisdiction pursuant to Article 274 [261] and not on the Labor Arbiter under Article 224
[217] of the Labor Code (Del Monte Philippines, Inc. v. Saldivar).

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212. What is Beck Rights doctrine?

Employees who are not members of the SEBA can object to paying any agency
fees to the SEBA other than for “representational or CBA-related purposes.” This means
that the SEBA, through the exercise by the employees of the Beck rights, cannot be allowed
to impose as part of the agency fee, any money that is used for politics or other
nonrepresentational activities. The most that non-SEBA members can be required to pay
is an agency fee that equals to their share of what the SEBA can prove is its “costs of
collective bargaining, contract administration, and grievance adjustment with their
employer.”

213. Samahan ng Manggagawa sa Ren Transport (SMART) is a registered union, which

had a five-year collective bargaining agreement (CBA) with Ren Transport Corp.
(Ren Transport) set to expire on December 31 2004. The 60-day freedom period of
the CBA passed without a challenge to SMART’s majority status as bargaining agent.
SMART thereafter conveyed its willingness to bargain with Ren Transport, to which
it sent bargaining proposals. Ren Transport, however, failed to reply to the
demand.Subsequently, two members of SMART wrote to the DOLE. The office was
informed that a majority of the members of SMART had decided to disaffiliate from
their mother federation to form another union, Ren Transport Employees
Association (RTEA). SMART contested the alleged disaffiliation through a letter
dated 4 April 2005. During the pendency of the disaffiliation dispute at the DOLE,
Ren Transport stopped the remittance to SMART of the union dues that had been
checked off from the salaries of union workers as provided under the CBA. Further,
on April 19, 2005, Ren Transport voluntarily recognized RTEA as the sole and
exclusive bargaining agent of the rank-and-file employees of their company. On 6
July 2005, SMART filed with the labor arbiter a complaint for unfair labor practice
against Ren Transport. Is Ren Transport violated its duty to bargain collectively?

Yes. Ren Transport violated its duty to bargain collectively with union SMART,
the incumbent bargaining agent, because of its refusal to submit to the latter its CBA
counter-proposals on the basis of its position that it has ceased to be the exclusive
bargaining agent of the rank and file employees by reason of the disaffiliation of the
majority of its members.

Under 264 in relation to Article 268 of the Labor Code, it is during the freedom
period, or at least 60 days before the expiration of the CBA, when another union may
challenge the majority status of the bargaining agent through the filing of a petition for
certification election. If there is no such petition filed during the freedom period, the
employer shall continue to recognize the majority status of the incumbent bargaining agent
where no petition for certification election is filed.

In the present case, the facts are not up for debate. No petition for certification
election challenging the majority status of SMART was filed during the freedom period,
which was from November 1 to December 31, 2004,a the 60 day period prior to the
expiration of the five year CBA. Therefore, SMART remained the exclusive bargaining
agent of the rank and file employees.

214. XYZ company through its president, sent 2 sets of letters to the individual strikers
during the strike. The first contained promises of benefits to the employees in order
to entice them to return to work; while the second contained threats to obtain
replacements for the striking employees in the event they do not report for work on
June 2, 2019. XYZ Company contends that the sending of the letters constituted a

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 legitimate exercise of their freedom of speech. The Supreme Court, however,
disagreed. The said letters were directed to the striking employees individually – by
registered special delivery mail at that – without being coursed through the unions
which were representing the employees in the collective bargaining. Moreover, the
sending of these letters is not protected by the free speech provisions of the
Constitution. The free speech protection under the Constitution is inapplicable where
the expression of opinion by the employer or his agent contains a promise of benefit
or threats or reprisal. Is the employer’s act, XYZ Comapany, of negotiating with
union members individually unfair labor practice?

Yes, it is ULP for an employer operating under a CBA to negotiate or to attempt to

negotiate with his employees individually in connection with changes therein. And the
basis of the prohibition regarding individual bargaining with the strikers is that although
the union is on strike, the employer is still under obligation to bargain with the union as the
employees’ bargaining representative. Such actions are illegal as constituting unwarranted
acts of interference. Thus, the act of a company president in writing letters to the strikers,
urging their return to work on terms inconsistent with their union membership, constitutes
interference with the exercise of his employees’ right to collective bargaining.

215. What is “surface bargaining” and “Blue-sky bargaining”?

Surface bargaining is defined as going through the motions of negotiating without

any legal intent to reach an agreement. It is a form of unfair labor practice that may only
be committed by the employer whereas, Blue-sky bargaining means making exaggerated
or unreasonable proposals. This is a kind of unfair labor practice which can only be
committed by a SEBA.

216. RGB Employees' Union (RGBEU), the SEBA of RGB Corporation, entered into a
CBA with their employer. In the CBA, there is a union security clause, wherein
RGBEU shall be a "closed-shop" for all the rank-and-file and non-managerial
employees of RGB Corporation. Yanis Antitokomport, a maintenance crew member
in charge of cleaning the bathrooms, did not want to join the union and continue to
pay union dues because of his low salary in the company. What is the legal effect on
RGBEU if Yanis is dismissed by the company by reason of the union-security clause
mentioned in the facts.

RGBEU may be liable for committing unfair labor practice of restraining or

coercing employees in the exercise of their right to self-organize.

As held in Confederate Sons of Labor v. Anakan Lumber, the mere existence of a

union-security clause in the CBA is no fool-proof assurance that termination is the
immediate consequence for its violation. A dismissal based on a union security clause
which does not expressly authorize it for its violation constitutes ULP.

Here, RGBEU may have a union security clause with RGB Corporation, but the
CBA does not expressly give RGBEU the authority to recommend for the dismissal of
employees that do not join or choose to leave the union. Thus, RGBEU may be liable under
Article 260 (a) of the Labor Code.

217. RGB Employees' Union (RGBEU), the SEBA of RGB Corporation, entered into a
CBA with their employer. In the CBA, there is a union security clause, wherein
RGBEU shall be a "closed-shop" for all the rank-and-file and non-managerial
employees of RGB Corporation, and the "voluntary disaffiliation from or removal

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 from the union shall be a just cause for termination of employment." Kael Cosma, a
rank-and-file employee, expressed his refusal to affiliate with the union because this
was against the teachings of his church, Simbahan ni Jordan. A recommendation by
the union for termination of Kael was submitted by RGBEU to the management of
RGB Corporation. The management, after two days, informed the union of their
denial of the request to dismiss Kael due to religious grounds. RGBEU now goes to
the Labor Arbiter to file an Unfair Labor Practice case against RGB Corporation. If
you were the Labor Arbiter, how will you decide the case?

I will dismiss the case against the employer.

In Lakas ng Manggagawang Makabayan v. Abiera, the Supreme Court stressed that

if the employee discharged on the basis of the recommendation of a union is a religious
objector, hence, exempted from the coverage of any form of union security clause, the
employee cannot be dismissed by the the employer on that ground. It may even be
considered ULP on the part of the labor organization which recommended the employee's
dismissal.

Thus, the employer, RGB Corporation, cannot be held liable for ULP by opting not
to dismiss Kael despite the recommendation of the SEBA because of Kael's religious
beliefs.

218. Dino Van Michel, seeing that there was no union in his work place, Ota Inc., decided
to gather up all the rank-and-file employees of the establishment to form such union.
Out of his endeavors with his co-worker, Kris Po-ol, they created the Samahan ng
Mga Manggagawa sa Ota. They have submitted all the necessary documents for their
registration as a legitimate labor organization, and on their way to request to be the
sole and exclusive bargaining agent of the establishment. While all of these are
pending, Dino Van and the union received a demand from Ota Inc. for collective
bargaining and negotiation. The union officers decided it is within their best interest
to decline, and so they rejected their employer's demand. So, Ota, Inc. filed a ULP
case against the union. Will the case against the union prosper?

No, the case filed by Ota, Inc. against the union will not prosper.

The Labor Code expressly provides that only that union certified as the sole and
exclusive bargaining agent (SEBA) of the establishment has the duty to bargain
collectively with their employer, and only the SEBA's refusal to collectively bargain shall
amount to an unfair labor practice under Article 260 (c) of the Labor Code.

In this case, the union has yet to become the SEBA of Ota, Inc., let alone, a
legitimate labor organization because it is still on its way from registering itself as a
legitimate labor organization with the Department of Labor and Employment. Hence, being
a non-SEBA, the union cannot be liable for ULP.

219. What are the conditions for a union or any of its agents or representatives to be liable
for ULP on the ground of asking or accepting negotiation fees or attorney’s fees?

Following are the requisites to hold a union liable for ULP based on this particular
ground:

1. The union or any of its officers, agents or representatives commit either of the
following acts:

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 a. to ask for negotiation fees or attorney's fees; or
b. to accept negotiation fees or attorney's fees;

2. The negotiation fees or attorney's fees are demanded from, or given by, the
employer as part of the settlement of any of the following issues:

a. in collective bargaining; or
b. in any other dispute.

220. When can the employer validly refuse to bargain collectively?

When the union demanding the right to bargain collectively is not the SEBA. The
employer has no such duty to bargain with the individual workers or with the minority
union (Lakas ng Manggagawang Makabayan v. Marcelo Enterprises).

221. In a collective bargaining negotiation, can the employer be liable for ULP when he
does not agree on the terms set by the SEBA?

The purpose of collective bargaining is to reach an agreement resulting in a contract

binding on the parties; but the failure to reach an agreement after negotiations continued
for a reasonable period does not establish lack of good faith. The statutes invite and
contemplate a collective bargaining contract, but they do not compel one. The duty to
bargain does not include the obligation to reach an agreement (Union of Filipino
Employees-Drug, Food and Allied Industries Unions-Kilusang Mayo Uno v. Nestle
Philippines, Inc.).

222. What is meant by the 60-day freedom period?

Article 264 [253] clearly states that “(w)hen there is an existing CBA, the parties
thereto are bound to observe the terms and conditions therein set forth until its expiration.
Neither party is allowed to terminate nor modify such agreement is within the period of at
least 60 days period to its expiration date by serving a notice to that effect.” This last 60-
day period of the 5-year lifetime of the CBA immediately preceding its expiration is called
the “freedom period.” It is denominated as such because it is the only time when the law
allows the parties to freely serve a notice to terminate, alter or modify the existing CBA. It
is also the time when the majority status of the SEBA (SEBA means Sole and Exclusive
Bargaining Agent) may be challenged by another union by filing the appropriate petition
for certification election.

223. If unchallenged during the 60-day freedom period, is the majority status of the
existing SEBA should continue to be recognized?

Yes. A petition for certification election challenging the majority status of the
existing SEBA should be filed within ̶ and not before or after – said 60 –day freedom
period. Upon the expiration of the said period and no petition for certification election is
filed by a challenging union, the employer is duty bound to continue to recognize the
majority status of the incumbent SEBA’s majority status is posed by another union.

224. Is the successor employer has the duty to bargain?

Yes. It is well-recognized principle that it is within the employer’s legitimate sphere

of management control of the business to adopt economic policies or make some changes

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 or adjustment in its organization or operations that would insure profit to itself or protect
the investment of its stockholders. As in the exercise of such management prerogative, the
employer may merge or consolidate its business with another, or sell or dispose all or
substantially all of its assets and properties.

The transfer of assets and employees from one employer to another leaves intact
the identity of the employing enterprise. The transferor’s duty to recognize and bargain
with the incumbent SEBA devolves upon the transferee as “successor employer.” This
mean that an acquiring employer becomes the successor to the bargaining obligations of
the predecessor if there is continuity in the business operation.

225. Who are the employees entitled to CBA benefits?

Based on jurisprudence, the following are entitled to the benefits stipulated in the
CBA:
(1) Members of the SEBA;
(2) Non-members of the SEBA but are members of the collective bargaining unit
as provided in New Pacific Timber & Supply Co., Inc. v. NLRC, G.R. NO.
124224;
(3) Members of the minority union's who paid agency fees to the SEBA [Article
259(e) [248(e), Labor Code]; and
(4) New employees hired after the conclusion of the CBA and during its effectivity
or even after its expiration.

226. What is the effect if the CBA stipulations are below the minimum legal standards?

As earlier emphasized, the parties to a CBA are not allowed to stipulate below the
minimum standards provided under the law. Entering into a CBA which contains terms
and conditions of employment below legally mandated minimum standards will not,
despite its registration, constitute a bar to the conduct of a certification election should
another union challenge the majority status of the SEBA which negotiated it. Previously,
entering into a CBA providing benefits below the minimum standards set by law is one of
the grounds for cancellation of union registration under paragraph (f) of Article 247 [239]
of the Labor Code. This ground, however, has been deleted by the amendatory provision
of R.A. No. 9481, which took effect on June 14, 2007.

227. Will the sufferance of extreme business losses by the employer exempt it from
complying with its commitment to grant benefits in the CBA?

The answer to this poser will depend on the stipulations attendant to and
surrounding such grant of benefits. The conditions under which the benefits are granted in
the CBA should be examined to determine whether despite the losses, they can still be
demanded and enforced. For instance, if their grant is conditioned on the profitability and
productivity of the employer, then they may not be demandable and enforceable during
times when the employer's operation is unprofitable and unproductive. But if no such
condition is attached to the grant of the benefits and contrarily, it appears that the employer
was fully aware of its distressed condition when it granted the same in the CBA, then, it
shall be demandable and enforceable despite the unprofitable and unproductive business
operation. This is stated in Benson Industries Employees Union ALU-TUCP v. Benson
Industries, Inc.

228. What are the kinds of collective bargaining? Define and briefly explain each.

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 The two kinds of collective bargaining are single-enterprise bargaining and multi-
employer bargaining.

Single-enterprise bargaining is one which involves a CBA negotiation between one

certified sole and exclusive bargaining agent (SEBA) and one employer. It is appropriate
when any certified SEBA demands negotiations with the employer regarding the terms and
conditions of employment of employees in the bargaining unit it represents.
Multi-employer bargaining is one involving a CBA negotiation between and among several
certified SEBAs and employers and may be initiated by the labor unions or employers.
Under this, any any legitimate labor unions and employers may agree in writing to come
together for the purpose of collective bargaining, provided, only legitimate labor unions
which are incumbent SEBAs, employers with counterpart legitimate labor unions which
are incumbent SEBAs and those legitimate labor unions that pertain to employer units
which consent to multi-employer bargaining may participate and negotiate in multi-
employer bargaining.

229. What are the essential requisites of collective bargaining?

Prior to any collective bargaining negotiations between the employer and the
SEBA, the following requisites must first be satisfied:

1. Employer-employee relationship must exist between the employer and the

members of the bargaining unit being represented by the SEBA.

2. The majority status of the SEBA must be duly established through any of the
modes sanctioned by law such as SEBA Certification (which replaced the mode
of "Voluntary Recognition") or certification, consent, run-off or re-run election.
Proof of the majority status of the union demanding negotiation should be
clearly established; otherwise, the employer has no obligation to engage in
collective bargaining negotiations with it and it has the right to refuse to
negotiate until such official proof is presented.

3. The bargaining unit being sought to be represented by the SEBA should be

validly constituted and established in accordance with law.

4. There should a lawful written demand to bargain and a clear statement of the
proposals by one party to negotiate an agreement and the equivalent
counterproposals thereto by the other party before the collective bargaining
negotiations process may validly commence.

230. May an arbitral award be the subject of renegotiation?

No. Arbitral award cannot be subject of re-negotiation.

Having freely agreed to submit the unresolved issues through the arbitration
process, the parties are duty-bound to adhere and comply with the arbitral award rendered
therein and subsequently execute a CBA completely reflecting and incorporating the
arbitrally awarded benefits and other terms and conditions without further need to discuss
again and re-negotiate them.

Consequently, an order to this effect may be issued by the arbitration authority

which issued the arbitral award.

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231. When is there a deadlock in collective bargaining?

There is a deadlock in collective bargaining whene there is a failure in the collective

bargaining negotiations between the collective bargaining agent and the employer resulting
in an impasse or stalemate on all or some of the issues subject of the negotiation.

232. What are the modes of resolving CBA issues?

The modes are:

a. Voluntary arbitration before a mutually chosen Voluntary Arbitrator or panel

of Voluntary Arbitrators; and

b. Compulsory arbitration in national interest cases under Article 278(g) of the

Labor Code before:

i. the DOLE Secretary, under his assumption of jurisdiction power; or

ii. the NLRC in similar cases certified to it by the DOLE Secretary.

233. What is the effect of refusal of the employer to negotiate the CBA?

The refusal indicates bad faith and constitutes unfair labor practice, as it violates
the duty to bargain collectively as prescribed by the Labor Code.

234. What are the kinds of collective bargaining? Define and briefly explain each.

The two kinds of collective bargaining are single-enterprise bargaining and multi-
employer bargaining:

Single-enterprise bargaining is one which involves a CBA negotiation between one

certified sole and exclusive bargaining agent (SEBA) and one employer. It is appropriate
when any certified SEBA demands negotiations with the employer regarding the terms and
conditions of employment of employees in the bargaining unit it represents.
Multi-employer bargaining is one involving a CBA negotiation between and among several
certified SEBAs and employers and may be initiated by the labor unions or employers.
Under this, any any legitimate labor unions and employers may agree in writing to come
together for the purpose of collective bargaining, provided, only legitimate labor unions
which are incumbent SEBAs, employers with counterpart legitimate labor unions which
are incumbent SEBAs and those legitimate labor unions that pertain to employer units
which consent to multi-employer bargaining may participate and negotiate in multi-
employer bargaining.

235. What are the essential requisites of collective bargaining?

Prior to any collective bargaining negotiations between the employer and the
SEBA, the following requisites must first be satisfied:

1. Employer-employee relationship must exist between the employer and the

members of the bargaining unit being represented by the SEBA.

2. The majority status of the SEBA must be duly established through any of the
modes sanctioned by law such as SEBA Certification (which replaced the mode
of "Voluntary Recognition") or certification, consent, run-off or re-run election.

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 Proof of the majority status of the union demanding negotiation should be
clearly established; otherwise, the employer has no obligation to engage in
collective bargaining negotiations with it and it has the right to refuse to
negotiate until such official proof is presented.

3. The bargaining unit being sought to be represented by the SEBA should be

validly constituted and established in accordance with law.

4. There should a lawful written demand to bargain and a clear statement of the
proposals by one party to negotiate an agreement and the equivalent
counterproposals thereto by the other party before the collective bargaining
negotiations process may validly commence.

236. May an arbitral award be the subject of renegotiation?

No. Arbitral award cannot be subject of re-negotiation.

Having freely agreed to submit the unresolved issues through the arbitration
process, the parties are duty-bound to adhere and comply with the arbitral award rendered
therein and subsequently execute a CBA completely reflecting and incorporating the
arbitrally awarded benefits and other terms and conditions without further need to discuss
again and re-negotiate them.

Consequently, an order to this effect may be issued by the arbitration authority

which issued the arbitral award.

237. According to SMTFM-UWP, the CBA provision on the removal of the additional
5days special leave were attendant with bad faith when the employer coerced them to
agree on such terms in exchange of additional 3 days in their paid vacation leaves. Can
bad faith bargaining affect the validity of the CBA and imputed to one of the parties?
If in case the employer committed a grave violation of the terms and conditions of the
CBA, will the union be precluded in claiming unfair labor practice?

Jurisprudence provides that as a general rule, bad faith can no longer be imputed
upon any of the parties and the CBA provisions are supposed to have been jointly and
voluntarily incorporated therein by the parties and the CBA is enough proof that the
company exerted reasonable effort at good faith bargaining. The signing of the CBA rules
out the presence of bad faith bargaining, however, this does not estopped the parties to
claim charges of unfair labor practice against each other.

238. Due to continuing operational losses of San Lazaro Hospital, the management decided
to close the business permanently the following year during the 5th anniversary of the
5-year term CBA. Six months prior to the expiration date of the CBA, the Samahan
ng Manggagawa ng San Lazaro Hospital is compelling the management to renew the
CBA. Is the claim of the Samahan tenable?

No. Jurisprudence provided that an employer which has already decided to close
shop cannot be compelled to enter into a new CBA with the union for the very simple
reason that to do so would be to compel the employer to continue its business when it had
already decided to close shop and that would be judicial tyranny on its part. Thus, in this
case, the Samahan ng Manggagawa ng San Lazaro cannot compel the management of the
San Lazaro Hospital to renew the CBA for another 5 years due to it decision to close the
hospital.

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239. In August 2019, Digong Corporation and Samahan ng mga Manggawang
Busypresidente ni Digong entered into a CBA but was only ratified by 181 out of 370
employees. In April 2020, the employees received their second quarterly bonus of
P10,000.00. Later that year, Bongga, the President of the union is claiming that the
CBA is not effective because the CBA was not ratified by majority of the employees
composing the bargaining unit. This is with the intention of proposing to increase the
quarterly bonus to P30,000.00 to be paid semi-annually. Are the provisions of the first
CBA indeed ineffective? If yes, why? If no, why not?

The provisions of the first CBA are effective. As a general rule, in order for the
CBA and its provisions to become effective it must be expressly ratified by majority of the
members of the bargaining unit. However, jurisprudence provided that the CBA can be
impliedly ratified despite the non-compliance to the express ratification of the members of
the bargaining unit specially when the employees availed and enjoyed the benefits
therefrom. They cannot receive benefits under the provisions favorable to them and later
insist that the CBA is void simply because other provisions turn out not to the liking of
certain employees.

In this case, the CBA was expressly ratified by 181 employees only out of the total
370 employees of the bargaining unit but the employees already received and enjoyed the
quarterly bonus of P10,000.00, hence, there was an implied ratification of the CBA. It is
grossly unfair to receive benefits from a CBA and later on disclaim its validity.

240. What are the standard stipulations in a CBA?

The stipulations in a CBA may be classified into two (2), namely:

a. Non-economic or political; and

b. Economic or non-political.

241. Can the existing stipulations in the CBA be changed unilaterally?

No. Being the law between the parties, unilaterally changes or suspensions in the
implementation of the provision of the CBA cannot be allowed without the consent of both
parties.

242. What are three (3) categories of CBA subjects?

The subjects of CBA are classified into three (3) categories, namely:

a. Mandatory;
b. Permissive or voluntary; and
c. Illegal.

243. Is it possible to renegotiate the Collective Bargaining Provisions before the end of its
5th year term?

Yes, there may be a renegotiation of the Collective Bargaining Provisions before

the end of its 5th year term.

Considering that the 5-year period is quite long during which the economic
situations of the parties may have already substantially changed, Article 265 [253-A]
recognizes the need for the parties to re-assess and re-negotiate all the provisions of the
CBA, except its representation aspect, after the lapse of the first three (3) years of its 5-
year term. Such re-negotiation, however, should only pertain to the terms and conditions
of the parties; relationship for the last remaining two (2) years of the CBA; 5-year lifetime.

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244. What is the Defunct Doctrine?

Under the Defunct Doctrine a union is considered defunct if it is unable or unwilling

to represent the employees. However, mere temporary inability to function does not
constitute defunctness; nor is the loss of all members in the unit equivalent of defunctness
if the representative otherwise continues in existence and is willing and able to represent
the employees.

245. When does a Collective Bargaining Agreement become effective?

As a general rule, a CBA becomes effective on the date mutually agreed upon by
the parties as its effectivity date. They may thus freely set it on any of the following:

1. on the date of its signing and execution; or

2. prospectively, at a future date from the date of its signing and execution; or
3. retrospectively, from the date of its signing and execution to such date in the
past as may be mutually fixed by them.

246. What is the rule on retroactivity incase a renewed CBA is concluded after 6 months
from expiry of the 3rd year of the current 5-year CBA?

In case the renewed CBA is concluded beyond 6 months after the expiry of the 3rd
year of the CBA, the rule is there is no automatic retroaction of its effectivity to the day
immediately following the expiry/ date but the parties should agree on the duration of
retroactivity thereof.

247. May prospectively Rule be stipulated when there is no agreement as to retroactivity

of the CBA?

Yes, if no agreement is reached within 6 months from the expiry date of the 3 years
that follow the CBA execution, the law expressly gives the parties – not anybody else – the
discretion to fix the effectivity of the agreement. Significantly, the law does not specifically
cover the situation where 6 months have elapsed but no agreement has been reached with
respect to effectivity. In this eventuality, prospectivity may be ordered instead of
retroactivity.

248. What is the “Hold Over” Principle?

Under Article 264 [253] and 265 [253-A] mandate the parties to keep the status quo
and to continue in full force and effect the terms and conditions of the existing agreement
during the 60-day period prior to the expiration of the old CBA and/or until a new
agreement is reached by the parties. Consequently, there being no new agreement reached,
the automatic renewal clause provided for by the law which is deemed incorporated in all
CBAs, provides the reason why the new CRA can only be given a prospective effect. In
Meralco case the Supreme Court labeled this concept as the “Hold Over Principle”.

249. What is the rationale behind prohibiting issuance of a temporary or permanent

injunction or temporary restraining order (TRO) in any case involving labor disputes?

The reason for prohibiting the issuance of a temporary or permanent injunction or

temporary restraining order (TRO) in any case involving or growing out of labor disputes,
except in the specified cases mentioned in the law, is to afford more or less equal bargaining
power to labor in dealing with the employer. The prohibition must be liberally construed
in favor of the workingman as the same involves not merely procedural but substantive
rights. [Caltex Filipino Managers and Supervisors Association v. CIR, G.R. Nos. L-30632-
33, April 11, 1972]

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250. What is the “Innocent Bystander Rule”?

Under the “Innocent Bystander Rule,” the third party employers or “innocent
bystanders” who have no employer-employee relationship with the picketing strikers, may
apply for injunction with the regular courts to enjoin the conduct of the picket. Because of
the absence of such employer-employee relationship, the NLRC cannot entertain such
application for injunction from “innocent bystanders.”

251. As a general rule, injunction cannot be issued against the conduct of picketing by the
workers for it is considered part of the freedom of speech duly guaranteed by the
Constitution. What are the situations excepted from this legal proscription?

a. Where picketing is carried out through the use of illegal means;

b. Where picketing involves the use of violence and other illegal acts
c. Where picketing affects the rights of third parties and injunction becomes
necessary to protect such rights.

252. What is a SEBA?

SEBA refers to a legitimate labor union duly certified as the sole and exclusive
bargaining representative or agent of all the employees in a CBU. A labor union certified
as SEBA means that it shall remain as such during the existence of the CBA, to the
exclusion of all other labor organizations existing and operating in the same CBU, and no
petition for certification election (PCE) questioning its majority status shall be entertained
nor shall certification election be conducted outside of the 60-day freedom period
immediately before the expiry date of the 5-year term of the CBA. Once certified, what is
represented by the SEBA are not only its members but also those who are members of other
unions, called minority; unions, who are included in the CBU.

253. May a non-certified union collectively bargain with the employer?

No. Under Article 267 of the Labor Code, it is clear that only the labor organization
selected by the majority of the employees in an appropriate CBU through any of the proper
certification processes can act as the exclusive representative or SEBA of all the employees
in such unit for purposes of collective bargaining with the employer. Hence, if the union is
admittedly not the exclusive representative of the majority of the employees in a CBU, it
could not demand from the employer the right to bargain collectively in their behalf.

254. May the SEBA refused to represent the non-SEBA members?

No. Indeed, it is well settled in law and jurisprudence that the constituency that a
SEBA is duty-bound to represent includes not only its members but also its non-members
that are covered by the CBU. It, therefore, has no right to refuse any request for fair
representation by such non-SEBA members in their dealings with the employer. Any such
unfair and unreasonable refusal may amount to a ULP of the SEBA under and by virtue of
paragraph (c) of Article 260 [249], which provides that it is ULP for a duly certified SEBA,
its officers, agents or representatives to violate the duty, or refuse to bargain collectively
with the employer.

255. Zoomanen Corporation is an unorganized establishment with two legitimate labor

organizations, Samahang Manggagawa sa Zoomanen (SMZ) and Zoomanen Union
(SU). SMZ filed a Request for SEBA Certification with the DOLE Regional Office
which issued its certificate of registration. May the Regional Director grant the
Request? Explain.

No. The Request for SEBA Certification will only be granted if what is involved is
an unorganized establishment with only one (1) legitimate union. It will not be granted and

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 instead, a certification election will be conducted in case the Request is made in an
unorganized establishment with more than one legitimate labor organization.

256. Explain the Certification year bar rule.

The issuance of the SEBA Certification bars the filing of a petition for certification
election by any labor organization for a period of one (1) year from the date of its issuance.

257. United Oppa Workers Union (UOWU) is a labor organization composed of the rank-
and-file employees of Oppa Corporation (OPPA). UOWU requested OPPA to bargain
collectively for better terms and conditions of employment of all the rank-in-file
employees of OPPA. Consequently, Juan Paksu, President of OPPA filed a petition
with the Bureau of Labor Relations (BLR) for the direct certification of UOWU as the
sole bargaining representative of the rank-and-file employees. May the certification be
granted? Explain.

No. Direct certification as a method of selecting the exclusive bargaining agent of

the employees is no longer allowed by virtue of President Corazon Aquino’s Executive
Order No. 111. This is because the conduct of certification election is still necessary in
order to arrive in a manner definitive and certain concerning the choice of the labor
organization to represent the workers in a collective bargaining unit.

258. Distinguish organize from unorganized establishment?

An “organized establishment” refers to an enterprise where there exists a SEBA,

regardless of whether a CBA has been concluded or not by such SEBA with the employer.
An “unorganized establishment” on the other hand is a firm or company where there is one
CBU and no certified SEBA or it is a firm or company where there are several CBUs and
one of the CBU existing therein have no certified SEBA.

259. What is the significance of the 60-day freedom period when filing a petition for
certification election in organized establishment?

The significance of the 60-day freedom period is that it is strictly observed in

determining the validity of the filing of the petition. It is only during this period that a PCE
may be filed by a challenging union. It cannot be a day before or after this period. If it is
filed a day earlier or longer, then it is considered prematurely filed; if it is a day after or
longer, then it is considered belatedly filed.

260. Is the employer a party to the certification election? If so what is the role of the
employer in the certification election?

No the employer shall not be considered a party to the certification election. The
employer’s participation in such proceedings shall be limited to:

(1) being notified or informed of petitions of such nature; and

(2) submitting the list of employees during the pre-election conference should the
Mediator Arbiter act favorably on the petition.

261. What is certification election?

“Certification election” refers to the process, voluntarily and mutually agreed upon
by the contending unions, of determining through secret allot of the SEBA of the
employees in an appropriate CBU for purposes of collective bargaining or negotiation. It
is conducted with or without the intervention of the DOLE [Section 1(h), Rule I, Book V,
Rules to Implement the Labor Code, as amended by Department Order No. 40-03, Series
of 2003].

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262. Give at least three (3) distinctions between consent election and certification election.

(1) The former is held upon the mutual agreement of the contending unions, while
the latter does not require the mutual consent of the parties as it is conducted
upon the order of the Mediator-Arbiter;

(2) The former may be conducted with or without the control and supervision of
the DOLE, while the latter is always conducted under the control and
supervision of the DOLE;

(3) The former is being conducted as a voluntary mode of resolving labor dispute,
while the latter, although non-adversarial, is a compulsory method of
adjudicating a labor dispute; OR

(4) The former is given the highest priority, while the latter is resorted to only when
the contending unions fail or refuse to submit their representation dispute
through the former. This is so because under the Implementing Rules, as
amended, even in cases where a PCE is filed, the Mediator-Arbiter, during the
preliminary conference and bearing thereon, is tasked to determine the
possibility of a consent election. It is only when the contending unions fail to
agree to the conduct of a consent election during the preliminary conference
that the Mediator-Arbiter will proceed with the process of certification election
by conducting as many hearings as he may deem necessary up to its actual
holding. But in no case shall the conduct of the certification election exceed 15
days from the date of the scheduled preliminary conference/hearing after which
time, the PCE is considered submitted for decision;

(5) The former necessarily involves at least two (2) or more contending unions,
while the latter may only involve one (I) union; and,

(6) The former may be conducted in the course of the proceeding in the latter or
during its pendency.

263. Do employees performing academic functions need to comprise a bargaining unit

distinct from that of the non‐academic employees?

Yes. Employees performing academic functions do need to comprise a bargaining

unit distinct from that of the non‐academic employees.

The mutuality of interest test should be taken into consideration. There are two
classes of rank and file employees in the university that is, those who perform academic
functions such as the professors and instructors, and those whose function are non‐
academic who are the janitors, messengers, clerks etc. Thus, not much reflection is needed
to perceive that the mutuality of interest which justifies the formation of a single bargaining
unit is lacking between the two classes of employees. (U.P. v. Ferrer‐Calleja, G.R. No.
96189, July 14, 1992)

264. In a certification election involving four (4) unions, namely: Union A, Union B, Union
C, and Union D, where there are 100 eligible voters who validity cast their votes, and
the votes they each garnered are as follows: Union A – 35; Union B – 25; Union C –
10; Union D – 15; and No Union – 15, may a run-off election be conducted between
Union A and Union B? Why?

Yes. A run-off election may be conducted between Unions A and B because:

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 (1) Not one of the unions mustered the majority vote of 51 votes but Union A and
Union B got the first two highest number of votes;

(2) If all the votes for the contending unions are added up, it will result in at least
50% of the valid votes cast (Union A – 35; Union B – 25; Union C - 10; Union
D – 15 for a total of 85 or 85%); and

(3) There are no objections of challenges which, if sustained, can materially alter
the result of the election.

265. Among the 400 regular rank-and-file workers of MNO Company, a certification
election was ordered conducted by the Med-Arbiter of the Region. The contending
parties obtained the following votes: (1). Union A - 70 (2). Union B - 71 (3). Union C -
42 (4). Union D - 33 (5). No union - 180 (6). Spoiled votes - 4 There were no objections
or challenges raised by any party on the results of the election. If you were the duly
designated election officer in this case, what would you do to effectively achieve the
purpose of certification election proceedings?

I will conduct a run-off election between the labor union receiving the two highest
number of votes. To have a runoff election, all the contending unions (3 or more choices
required) must have garnered 50% of the number of votes cast. In the present case, there
are four (4) contending unions and they garnered 216 votes. There were 400 vote cast. The
votes garnered by the contending unions is even more than 50% of the number of vote cast.
Hence, a run-off election is in order.

266. When is conduct of run-off election not justified?

In the event that, in a multiple-union certification consisting of 3 or more

contending unions, not one of them has garnered the majority of the valid votes cast and
the resulting total of all their votes, if added, is less than the threshold of “50% of the
number of valid votes cast,” the conduct of a run-off election is not justified and therefore
not legally feasible. Consequently, no SEBA would be proclaimed and no new petition for
certification election would be entertained until after the lapse of one (1) year from and
after the date of the actual conduct of the certification election, pursuant to the so-called
statutory bar rule.

267. What is the effect of failure to appear during pre-election conference?

Section 3, Rule IX, Book V, Rules to Implement the Labor Code, as amended by
Department Order No. 40-F-03, Series of 2099 [Oct. 30, 2008] provides that “Failure of
any party to appear during the pre-election conference despite notice shall be considered
as a waiver of its right to be present and to question or object to any of the agreements
reached in the pre-election conference. However, this shall not deprive the non-appearing
party of the right be furnished notices of and to attend subsequent pre-election
conferences.”

268. When is the proper time to question the list of qualified voters?

In Acoje Workers’ Union v. NAMAWU, 7 SCRA 730 [1963], it was ruled by the
court that “The proper time question the list of qualified voters is during the pre-election
conference. It can no longer be contested during the actual conduct of the certification
election.”

269. May the election be held outside work premises?

Being a purely employee-activity, the election should, as a general rule, necessarily

be held in the place of employment of the employees. Holding the election off premises

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 controlled by the employer may be justified such as when the employer unreasonably
refuses to make its work premises available for that purpose or has shown extreme anti-
union bias. In this eventuality, the Election Officer may exercise his/her sound discretion
over the election site. The contending unions, for their part, may mutually agree on the
venue of the election.

270. Does the pendency of a petition for cancellation of union registration preclude
collective bargaining?

No. The pendency of a petition for cancellation of union registration does not
preclude collective bargaining. If a certification election may still be ordered despite the
pendency of a petition to cancel the union’s registration certificate, more so should the
collective bargaining process continue despite its pendency. The majority status of union
is not affected by the pendency of the Petition for Cancellation pending against it. Unless
its certificate of registration and its status as the certified bargaining agent are revoked, the
employer is, by way of express provision of the law, duty bound to collectively bargain
with the union.

271. May an employer collaterally attack the legitimacy of a labor organization by filing a
motion to dismiss the latter’s petition for certification election?

Under Section 12 of RA 9481, employers have no personality to interfere with or

thwart a petition for certification election filed by a legitimate labor organization, to wit:

SEC. 12. A new provision, Article 258-A is hereby inserted into the Labor Code to
read as follows:

"ART. 258-A. Employer as Bystander. - In all cases, whether the petition for
certification election is filed by an employer or a legitimate labor organization, the
employer shall not be considered a party thereto with a concomitant right to oppose
a petition for certification election. The employer's participation in such
proceedings shall be limited to: (1) being notified or informed of petitions of such
nature; and (2) submitting the list of employees during the pre-election conference
should the Med-Arbiter act favorably on the petition."

Except when it is requested to bargain collectively, an employer is a mere bystander

to any petition for certification election; such proceeding is non-adversarial and merely
investigative, for the purpose thereof id to determine which organization will represent the
employees in their collective bargaining with the employer. The employer’s only right in
the proceeding is to be notifies or informed thereof.

272. Is a certification for no-forum shopping required in a petition for certification

election?

No. The requirement for a certificate of no-forum shopping refers to complaints,

counter-claims, cross-claims, petitions or applications where contending parties litigate
their respective positions regarding the claim for relief of the complainant, claimant,
petitioner or applicant. A certification proceeding, even though initiated by a “petition”, is
not a litigation but an investigation of a non-adversarial and fact-finding character. Such
proceedings are not predicated upon an allegation of misconduct requiring relief but, rather,
are merely of an inquisitorial nature.

273. What is a difference between the concept of union/ legitimate labor organization and
the concept of a bargaining unit?

Under the labor code, the concept of a union is that, any union or association of
employees which exists in whole or in part for the purpose of collective bargaining or of

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 dealing with employers concerning the terms and conditions of employment. Upon
compliance with the documentary requirements, the DOLE Regional Office or the BLR
and the issuance of certificate or registration, the union acquires legal personality and
becomes entitled to the rights and privileges granted by law to legitimate labor
organizations. On the other hand, a bargaining unit has been defined as a “group of
employees of a given employer, comprises of all or less than all of the entire body of
employees, which the collective interest of all the employees, consistent with equity to the
employer, indicated to be best suited to serve reciprocal rights and duties of the parties
under the collective bargaining provisions of the law.

274. How is the appropriate CBU determined?

Labor laws do not provide the specific modes or criteria for determining the proper
CBU. However, based on jurisprudence, there are four doctrines which may be used to
determine the appropriate CBU, to wit:

(1) Community or mutuality of interest doctrine;

(2) Globe doctrine;
(3) Collective bargaining history doctrine; and
(4) Employment status doctrine.

275. What is the “Globe Doctrine”?

Globe doctrine is based on the will of the employees. In the case of Globe Machine
and Stamping Co., it was ruled that, in defining the appropriate CBU that in a case where
the company’s production workers can be considered either as a single bargaining unit
appropriate for purposes of collective bargaining or as three (3) separate and distinct
bargaining units, the determining factor is the desire of the workers themselves.
Consequently, a certification election should be held separately to choose which
representative union will be chosen by the workers.

276. What is the Doctrine of Accretion?

The doctrine of accretion applies when new employees are added by the employer
to an existing CBU by reason or as a result of any of the following:

(1) Creation of new jobs; or

(2) Acquisition of new facility or business.

277. What is the Doctrine of Co-Determination?

This is a constitutional and legal right where the employees are given the right to
co-determine or share the responsibility of formulating certain policies that affect three (3)
fundamental things, namely: their ( I ) rights, (2) benefits, and (3) welfare.

278. What is the main function of the Labor Management Council?

The LMC is meant to implement the declared policy of the State, as expressed in
the Constitution and in the laws to ensure the participation of workers in policy and
decision-making processes of the establishment where they are employed insofar as said
processes will directly affect their rights, benefits and welfare.

279. Enumerate at least 3 fundamental distinctions between Labor Management Council

and Grievance Machinery.

a. (1) Constitutional origin. -The creation of the LMC is based on the

constitutional grant to workers of the right to participate in policy and decision-

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 making processes under the1st paragraph of Section 3, Article XIII of the 1987
Constitution, thus:

“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 and
benefits as may be provided by law.”

The creation of a GM, on the other hand, is based on a different paragraph, the
2nd paragraph, of the same constitutional provision, which states as follows:

“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.”

b. Legal anchor. - The creation of LMC is provided under Article 266 [255] of the
Labor Code; while the formation of a GM is mandated under Article 272 [260]
of the same Code.

c. Compulsory provision in the CBA. - Both LMC and GM are compulsorily

required to be embodied in the CBA in order for it to be considered a valid
agreement.

d. Purpose for creation. - The LMC is created for the purpose of affording workers
the right to participate in policy and decision-making processes in matters
affecting their rights, benefits and welfare; while that of the GM is to resolve
disputes and grievances arising from the interpretation or enforcement of such
policies or decisions.

e. Nature of functions. - The LMC is in the nature of a preventive mechanism

meant to foil and avoid problems from developing into disputes or grievances
or from ripening into full-blown litigations; while a GM is an adjudicatory
mechanism which is set into motion when a dispute or grievance has actually
occurred.

280. If there is an existing CBA in the bargaining unit, can an employer file a Petition for
certification election. (PCE)? In unorganized establishments, what are the employer’s
following options once a union requests or demands to collectively bargain with it?

No. Under the law if there is an existing CBA in the bargaining unit, PCE is the
principal concern and domain of the workers. The only time and the only exception when
the employer may file such petition is when it is requested by a union to bargain
collectively.

The employer’s following options once a union requests or demands to collectively

bargain with it are as follows:

a. The employer will itself file a PCE with the BLR;

b. The employer will wait until the requesting union files the PCE itself; or
c. The employer will demand that the requesting union file the PCE itself.

281. Under Article 271 [258-A] was inserted by RA. No. 9481, what is the rule of the
employer in Certification Election cases whether the petition for certification election
is filed by an employer or a legitimate labor organization?

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 Under Article 271 [258-A] was inserted by RA. No. 9481, what is the rule of the
employer in Certification Election cases whether the petition for certification election is
filed by an employer or a legitimate labor organization is limited only to two (2) things,
namely:

(1) To be notified or informed of the filing of the petition for certification election;
and
(2) To submit the list of employees during the pre-election conference, in case the
Med-Arbiter acts favorably on the petition by giving due course to it.

After the filing of such petition, the role of the employer in the certification process
ceases. It becomes merely a bystander. It should not involve itself in the process.

282. When does the “employer as bystander” rule not applicable?

The Employer as Bystander rule does not apply when existence of employer-
employee relationship is put at issue.

If the entity alleged to be the employer claims that no such employer-employee

relationship exists, the Employer as Bystander rule has no application therein and
accordingly, such entity shall be entitled to avail of all the rights guaranteed to it under the
law, such as the right to oppose the PCE, to appeal from any adverse ruling of the Mediator-
Arbiter and to bring certiorari action from the DOLE Secretary’s decision to the CA and
ultimately to elevate it by way of appeal to the Supreme Court.

283. What are the remedies in case not all or, not majority, of the members of the
petitioning union are alleged to be non-employees?

If not all but only a few of the members of the petitioning union are alleged to be
non- employees, the Employer as Bystander rule certainly applies to the employer since
there are a number of its employees remaining as members thereof.

Consequently, the employer cannot oppose the petition but may avail of the
following remedies:

1. Submit, during the pre-election conference, a list of the qualified voters

specifically excluding therein the members of the bargaining unit who are not
its employees; and/or

2. Raise the ancillary issue of existence of employer-employee relationship before

the Mediator-Arbiter during the hearing(s) and in the pleadings; which shall he
resolved in the same order or decision granting or denying the petition for
certification election.

3. In case its position is not sustained, the employer can then elevate the case to a
higher tribunal or court through the means and remedies allowed by law (appeal
or certiorari).

284. What are the rules on appeal between organized and unorganized establishments?

Rule on appeal in organized establishments:

The order granting the conduct of a certification election in an organized

establishment and the decision dismissing or denying the petition may be appealed to the
Office of the DOLE Secretary within ten (10) days from receipt thereof.

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 Rule on appeal in unorganized establishments:

The order granting the conduct of a certification election in an unorganized

establishment is not subject to appeal. Any issue arising from its conduct or from its results
is proper subject of a protest. Appeal may only be made in case of denial of the petition
within ten (10) days from receipt of the decision of denial.

285. Could there be a grievance without a SEBA or a CBA?

To be sure, a “grievance” exists in both organized and unorganized establishments.

Any issue, controversy or problem that the employee or group of employees may wish to
take up or discuss with the employer respecting the terms and conditions of their
employment for the purpose of having it resolved or adjusted certainly constitutes a
grievance. Thus, even in unorganized or non-unionized establishments, a grievance
machinery may be created either:

(1) Unilaterally by the employer, or

(2) Bilaterally, by virtue of a mutual agreement between the employer and the
employees through their duly designated representative/s.

286. What is the effect if the CBA does not contain a provision on grievance
procedure/machinery?

A CBA will not be registered with the DOLE if it does not contain a provision on
grievance procedure/machinery which is a “must” provision required of all CBAs. In the
event that a CBA without such provision is submitted for registration, the registrar should
advise the parties to include a grievance procedure/machinery therein before it is
considered duly registered. (Nos. 12 and 14, NCMB Primer on Grievance Machinery and
Voluntary Arbitration.)

287. Does the filing of an appeal from the order of the Med-arbiter dismissing a petition
for certification election stops the holding of any certification election?

Once the order of the Med-Arbiter dismissing a PCE is seasonably appealed, such
appeal stops the holding of any certification election. (Samahan ng mga Manggagawa sa
Filsystems v. Secretary of Labor and Employment, G.R. No. 128067, June 5, 1998.)

288. What Is the Procedure in Submitting Unresolved Grievances To Voluntary

Arbitration?

When a grievance remains unresolved, either party may serve notice upon the other
of its decision to submit the issue to voluntary arbitration. The notice should state the issue
or issues to be arbitrated and a copy thereof should be furnished to the NCMB or the
Voluntary Arbitrator or Panel of Voluntary Arbitrators named or designated in the CBA.

If the party upon whom the notice is served fails or refuses to respond favorably
within seven (7) calendar days from receipt thereof, the Voluntary Arbitrator or Panel of
Voluntary Arbitrators designated in the CBA should commence voluntary arbitration
proceedings. Where the CBA does not so designate the particular Voluntary Arbitrator, the
NCMB is mandated to call the parties and appoint a Voluntary Arbitrator or Panel of
Voluntary Arbitrators who shall thereafter commence arbitration proceedings.

289. Are the parties allowed to go directly to court in disregard of the Voluntary
Arbitration after decision by Grievance Committee?

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 It is settled that when parties have validly agreed on a procedure for resolving
grievances and to submit a dispute to voluntary arbitration, then that procedure should be
strictly observed.

Moreover, before a party is allowed to seek the intervention of the court, it is a

precondition that he should have availed of all the means of administrative processes
afforded him.

290. What is the concept of labor arbitration?

Simply put, it is a third-party settlement of a labor dispute involving the mutual

consent by the representatives of the employer and the labor union involved in a labor
dispute to submit their case for arbitration

291. Is Alternative Dispute Resolution applicable to Labor cases?

No. R.A. No. 9285,4 otherwise known as Alternative Dispute Resolution Act of
2004, Section 6 [a] thereat, expressly provides as exception to the application of the
provisions thereof, resolution or settlement of labor disputes covered by the Labor Code as
well as its implementing rules and regulations.

292. Who is a Voluntary Arbitrator?

A Voluntary Arbitrator refers to any person who has been accredited by the NCMB
as such, or any person named or designated in the CBA by the parties as their Voluntary
Arbitrator, or one chosen by the parties with or without the assistance of the NCMB,
pursuant to a selection procedure agreed upon in the CBA or one appointed by the NCMB
in case either of the parties to the CBA refuses to submit to voluntary arbitration. This term
includes a Panel of Voluntary Arbitrators.

293. What is wage distortion?

Wage distortion came to be explicitly defined in the law as a situation where an

increase in prescribed wage rates results in the elimination or severe contraction of
intentional quantitative differences in wage or salary rates between and among employee
groups in an establishment as to effectively obliterate the distinctions embodied in such
wage structure based on skills, length of service, or other logical bases of differentiation.

294. State the jurisdiction of the Voluntary Arbitrator, or Panel of Voluntary Arbitrators
in labor disputes?

The voluntary arbitrator or panel of voluntary arbitrators shall have exclusive and
original jurisdiction to hear and decide all unresolved grievances arising from:

a. The implementation or interpretation of the collective bargaining agreements;

b. The interpretation or enforcement of company personnel policies which remain

unresolved after exhaustion of the grievance procedure;

c. Wage distortion issues arising from the application of any wage orders in
organized establishments;

d. The interpretation and implementation of the productivity incentive programs

under RA 6971.

e. Upon agreement of the parties, shall also hear and decide all other labor disputes
including unfair labor practices and bargaining deadlocks;

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 f. Violations of a Collective Bargaining Agreement, except those which are gross
in character, shall no longer be treated as unfair labor practice and shall be
resolved as grievances under the Collective Bargaining Agreement.

295. Can a dispute falling within the exclusive jurisdiction of the Labor Arbiter be
submitted to voluntary arbitration? Why or why not?

Yes. A dispute falling with the exclusive jurisdiction of the Labor Arbiter can be
submitted to voluntary arbitration, provided that the parties in such dispute state in
unequivocal language that they conform to the submission of said dispute to the voluntary
arbitration (Vivero v. CA, G.R. No. 138938, October 24, 2000).

296. Can a dispute falling within the jurisdiction of a voluntary arbitrator be submitted to
compulsory arbitration? Why or why not?

No. A dispute falling within the jurisdiction of a voluntary arbitrator cannot be

submitted to compulsory arbitration because jurisdiction in compulsory arbitration is
conferred by law and not by agreement of the parties. Moreover, the law mandates that all
grievances submitted to the grievance machinery which are not settled shall be referred to
voluntary arbitration provided in the CBA.

297. What is an “arbitration clause”?

Arbitration clause is a provision in the CBA requiring that grievances, if unsettled,

shall be finally resolved by a Voluntary Arbitrator (Section 1[k], Rule II, NCMB Revised
Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings [Oct 15, 2004].

298. How to initiate voluntary arbitration proceeding?

An arbitration may be initiated either by way of:

(1) A Submission Agreement; or

(2) A Demand or Notice to Arbitrate invoking the arbitration clause in the CBA; or
(3) An Appointment from the NCMB.

299. How does procedural rules governing voluntary arbitration proceedings construed?

Guidelines should be liberally construed to carry out the objectives of the Labor
Code, to promote voluntary arbitration as a preferred mode of labor or industrial dispute
settlement and as an integral component of the collective bargaining process.

300. Ding and Dong, an employee of Ding, entered into voluntary arbitration proceedings
to settle a minor conflict at work. Dong is represented by Atty. Dantes who is a
renowned counsel in settling labor disputes. Dong, trusting and relying on Atty.
Dantes’s wisdom, allowed Atty. Dantes to do whatever he thinks is for his best interest
and he was only interested to know the result of the arbitration proceedings. Atty.
Dantes eventually entered into a compromise agreement with Ding without prior
informing his client Dong. Is the compromise agreement valid and binding as to Dong?

No, the compromise agreement is not valid and binding. Attorneys and other
representatives of the parties cannot enter into a compromise agreement with the opposing
party in full or partial discharge of a client’s or principal’s claim without a special power
of attorney (SPA) or express consent. Article 1978 of the Civil Code, requires such SPA to
make the compromise agreement valid and binding on the principal.

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301. X Corp. is represented by Atty. Yu in a voluntary arbitration proceeding. The
decision of the Voluntary Arbitrator was personally sent to the Liaison Office of X
Corp. and, within the day, the Board of Directors of X Corp. was duly informed of such
decision during their meeting. Does the service of the Arbitrator’s Decision to the
Liaison Office of X Corp. constitute proper notice to the parties?

No, a notice sent through the company’s Liaison Office is not notice to its counsel.

If a party is represented by counsel or authorized representative, service should be

made to the latter. Service by registered mail is complete upon receipt by the addressee or
his agents (Sections 3 and 4, Rule III, Ibid.).

302. Ten minutes before the start of the arbitration proceeding, the counsel of X Corp.
informed the Voluntary Arbitrator that he was stuck in traffic and would not be able
to come on time. Upon knowing this, the opposing party moved to have an ex-parte
proceeding arguing that further delay is detrimental to his interest as a laborer. Should
the Voluntary Arbitrator conduct the proceeding ex-parte?

No, only an unexplained failure to appear of a party after due notice, not a delay in
appearance, can justify an ex-parte proceeding.

303. What are the grounds for a judicial review of a voluntary arbitrator’s decision or
award?

The Voluntary Arbitrator’s decisions or awards may be contested judicially on the

following grounds:

(1) Lack or want of jurisdiction;

(2) Grave abuse of discretion;
(3) Violation of due process;
(4) Denial of substantive justice; or
(5) Erroneous interpretation of the law.

304. Are the decisions of Voluntary Arbitrators appealable to the NLRC?

No. Being a quasi-judicial agency, the decisions and awards of a Voluntary

Arbitrator are appealable by way of a petition for review (Rule 43) to the Court of Appeals.

Jurisprudence equates the decisions or awards of a Voluntary Arbitrator to those of

a Regional Trial Court. Hence, in a petition for certiorari from the awards or decisions of
the Voluntary Arbitrator, the CA has concurrent jurisdiction with the Supreme Court.

305. If the petition for review under Rule 43 (appeal to CA) is the proper way of appealing
a decision of the voluntary arbitrator, does this mean that the 15-day reglementary
period stated under that rule also applies? Explain why or why not.

No. The Supreme Court has held that the proper reglementary period for appeals
from a Voluntary Arbitrator’s decision is not the 15-day period under Rule 43 but 10-
calendar day rule under the Labor Code.

This is because the Labor Code is a statute that provides substantive rights, while
the Rules of Civil Procedure are merely rules of procedure promulgated by the Supreme
Court. Rules are subordinate to statute. In case of conflict, the statute will prevail. Under
the Constitution, rules of procedure cannot diminish, increase, or modify substantive rights.
The 10-calendar-day period under the Labor Code is a substantive right. Thus, it cannot be
diminished, increased, or modified.

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 The Labor Code explicitly provides that the award or decision of the Voluntary
Arbitrator (VA) or Panel of Voluntary Arbitrators is final and executory after 10 calendar
days from receipt or the copy of the award or decision by the parties. Thus, the period for
appeal from VA decisions should be 10 calendar days, not 15 days.

306. In instances of non-compliance by either or both parties with the decision of the
Voluntary or Panel of Voluntary Arbitrators, execution should be issued, as a matter
of course, upon a decision that finally disposes of the action or proceeding. What Labor
Code provisions may be cited as basis for the issuance of the writ of execution to enforce
it?

Article 230, and Article 276

307. What are the recognized exceptions when certiorari may be granted despite the
availability of an appeal?

(a) When public welfare and the advancement of public policy dictates;
(b) When the broader interest of justice so requires;
(c) When the writs issued are null and void; or
(d) When the questioned order amounts to an oppressive exercise of judicial
authority.

308. What is the effect of filing of petition for certiorari on execution process? Explain
with legal basis?

The filing of a petition for certiorari with the CA or the Supreme Court does not
stay the execution of the assailed decision of the Voluntary Arbitrator or Panel of Voluntary
Arbitrators, unless a TRO or injunction is issued by the CA or the Supreme Court pending
resolution of such petition based on Section 6, Rule VIII of NCBM Revised Procedural
Guidelines in the Conduct of Voluntary Arbitration Proceedings.

309. What is the distinction between a strike and picketing?

To strike is to withhold or to stop work by the concerted action of the employees

as a result of an industrial or labor dispute while picket simply means to march to and from
the employer’s premises, usually accompanied by the display of placards and other signs
making known the facts involved in a labor dispute. While a strike focuses on stoppage of
work, picketing focuses on publicizing the labor dispute and its incidents to inform the
public of what is happening in the company struck against.

310. Is employment relationship between the employer and picketers a requisite for the
conduct of picketing?

No. Picketing, if peacefully carried out, cannot be prohibited even in the absence
of employer-employee relationship between the picketers and the employer being picketed.

311. What do you mean by the term industrial or labor dispute?

The term industrial or labor dispute includes any controversy concerning terms,
tenure or conditions of employment, or concerning the association or representation of
persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms and
conditions of employment, regardless of whether the disputants stand in the proximate
relation of employer and employee.

312. Air Lines Pilot Association of the Philippines (ALPAP) is a certified bargaining agent
of the pilots working under Philippine Airlines (PAL). ALPAP then staged a strike
against PAL to demand pay increases, better working conditions on the Manila-

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 Karachi and Rome-Amsterdam flights, and a better retirement plan which was
approved by the Court.

PAL management was ordered to admit the striking employees back to work under the
same terms and conditions of employment existing before the strikes and not to
suspend, dismiss or lay-off any employee as a result" of said strikes. The CIR
further stated that failure to comply with its order would constitute contempt of court
and the employee failing or refusing to return to work, without justifiable cause, shall
immediately be replaced by PAL, and may not be reinstated without prior Court order
and on justifiable grounds.

ALPAP filed for reconsideration, however, it was denied. After five days of returning
to work, PAL dismissed strike leader Captain Gaston. Due to the event, members of
the union filed an en mass “protest resignations” and “protest retirements” which PAL
has accepted, although it turned out later that their submission to PAL was meant only
as a bluff calculated to bring favorable results.

Is the action of the union a legitimate concerted activity?

The pilots’ “protest resignations” and “protest retirements” do not constitute a

legitimate concerted activity. As defined under the law, a “strike” is “any temporary
stoppage of work by the concerted action of employees as a result of an industrial dispute.”
It is thus clear that as the law defines it, a strike means only a “temporary stoppage of
work.” What the mentioned pilots did, however, cannot be considered as mere “temporary
stoppage of work”. What they contemplated was evidently a permanent cut-off of
employment relationship with their erstwhile employer, PAL.

The pilots’ mass action was not a strike because employees who go on strike do not
quit their employment. Ordinarily, the relationship of employer and employee continues
until one or the other of the parties acts to sever the relationship or they mutually act to
accomplish that purpose. As they did not assume the status of strikers, their “protest
resignations” and “protest retirements” were not a concerted activity which is protected by
law. (Enriquez v. Zamora, G.R. No. L-51382, Sept. 13, 2017)

313. What are the elements of a valid strike?

The following are the elements of a strike:

a. Temporary stoppage of work by the employees;

b. Through their concerted action; and
c. Occasioned by an industrial or labor dispute. (Article 219 (o) [212 (o), Labor
Code as amended by Section 4, R.A. No. 6715)

314. De Guzman, Pimentel, Bardaje, Cruz, Naranjo were employees of Biomedica Health
Care Inc. They, together with two (2) other employees, were all absent for various
personal reasons on November 7, 2006 which happened to be the birthday of Carina,
Biomedica’s President. De Guzman was allegedly absent due to loose bowel movement,
Pimentel for an ophthalmology check-up, Bardaje due to migraine, Cruz for not feeling
well, and Naranjo because he had to attend a meeting at his child’s school.

Notably, these are the same employees who filed a letter complaint to the DOLE against
Biomedica for lack of salary increases, failure to remit SSS and Pag-IBIG
contributions, and violation of the minimum wage law, among other grievances. Later
that day, petitioners reported for work after receiving text messages for them to
proceed to Biomedica. They were, however, refused entry and told to start looking for
another workplace. The next day, November 8, 2006, petitioners allegedly came in for
work but were not allowed to enter the premises. Carina purportedly informed

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 petitioners, using foul language, to just find other employment. They were all
subsequently dismissed for conducting a strike through mass leaves.

Was there a strike through mass leave? Is the dismissal of the employees valid?

There was no mass leave as to amount to a strike because only 5 employees are
absent. Moreover, the absence of petitioners cannot be considered a strike as this term is
understood in law. In no way can the absence of 5 employees be considered as “concerted”
which is defined as “mutually contrived or planned” or “performed in unison.” The 5
petitioners went on leave for various reasons and were in different places on November 7,
2006 to attend to their personal needs or affairs. They did not go to the company premises
to petition Biomedica for their grievance. To demonstrate their good faith in availing their
leaves, petitioners reported for work and were at the company premises in the afternoon
after they received text messages asking them to do so. This shows that there was NO intent
to go on strike. Moreover, Biomedica did not prove that the individual absences can be
considered as ‘temporary stoppage of work.’ Biomedica’s allegation that the mass leave
‘paralyzed the company operation on that day’ has remained unproved. It is erroneous
therefore to liken the alleged mass leave to an illegal strike much less to terminate
petitioners’ services for it.” (Naranjo v. Biomedica Health Care, Inc, GR No. 193789, Sep
19, 2012)

315. What are the procedural requisites for a valid strike by the workers? Should these
requisites be complied with substantially or strictly?

The procedural but mandatory requisites for a valid and legal strike are the
following:

a. It must be based on any or both of the following exclusive grounds:

i. Unfair Labor Practice of the Employer; and
ii. Collective Bargaining Deadlock;

b. A notice of strike must be filed with the NCMB-DOLE;

c. A service of a 24-hour prior notice to the NCMB-DOLE to inform of the

conduct of a strike by the secret balloting;

d. A strike vote must be taken where a majority of the members of the union
obtained by secret ballot in a meeting called for the purpose must approve it;

e. A strike vote report should be submitted to the NCMB-DOLE at least 7 days

before the intended date of the strike;

f. The observance of the cooling-off period of 15 days, in case of ULP of the

employer, or 30 days in case of bargaining deadlock; and

g. The 7-day waiting period of the strike ban reckoned after the submission of the
strike vote report to the NCMB-DOLE should be observed in all cases.

All the foregoing requisites are mandatory and failure of a union or employer to
comply therewith would render a strike or lockout illegal.

316. The observance of the cooling-off period is mandatory for a valid strike, when is it
not applicable?

Cooling-off period does apply in cases of union-busting where the existence of the
union is threatened. The law allows the complete disregard of the 15-day cooling-off period

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 but the requirement on the 7-day waiting period or strike ban, together with the other
requirements on the filing of a notice of strike, the conduct of a strike vote and the
submission of the results thereof to the NCMB-DOLE should be complied with.

317. Who are the parties who may declare a strike or lockout?

The employer or any certified SEBA may declare strikes in case of bargaining
Deadlock or Unfair Labor Practice (ULP). In the absence of a certified SEBA, any
Legitimate Labor Organization in the establishment may declare a strike but only on the
ground of ULP.

318. When is Extension of the strike ban period allowed?

The 7-day strike ban period is required to be strictly observed. It is only in certain
instances where there is a possibility of settlement between management and the union,
that such period may be extended beyond the strike ban period but only upon their mutual
agreement.

319. What are the elements of union-busting?

To constitute union-busting under Article 278(c) [263(6)], there must be:

(1) A dismissal from employment of union officers duly elected in accordance with
the union ‘s constitution and by-laws; and

(2) The existence of the union is threatened by such dismissal.

320. What is required for minimum operational service in case of labor dispute affecting
hospitals or medical institutions?

In labor disputes adversely affecting the continued operation of such hospitals,

clinics or medical institutions it shall be the duty of the striking union or locking-out
employer to provide and maintain an effective skeletal workforce of medical and other
health personnel whose movement and services shall be unhampered and unrestricted as
are necessary to insure the proper and adequate protection of the life and health of its
patients, most especially emergency cases, for the duration of the strike or lockout.

321. Philhealth is a government-owned and controlled corporation employing thousands

of Filipinos. Because of the desire of the employees of Philhealth to obtain better terms
and conditions of employment from the government, they formed the Philhealth
Employees Association (PEA) and demanded Philhealth to enter into negotiations with
PEA regarding terms and conditions of employment which are not fixed by law. Are
the employees of Philhealth allowed to self-organize and form PEA and thereafter
demand Philhealth to enter into negotiations with PEA for better terms and conditions
of employment?

Yes. Employees of Philhealth are allowed to self-organize under Sec. 8, Art. III and
Sec. 3, Art. XIII of the Constitution which recognize the rights of all workers to self-
organization. However, they cannot demand, however, for better terms and conditions of
employment for the same are fixed by law (Art. 244, Labor Code), besides, their salaries
are standardized by Congress (Art. 276, Labor Code).

322. In case of unresolved grievances, can PEA (situation in number) resort to strikes,
walkouts, and other temporary work stoppages to pressure the government to accede
to their demands?

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 No. Since the terms and conditions of government employment are fixed by law,
government workers cannot use the same weapons employed by workers in the private
sector to secure concessions from their employers.

323. What is the nature and limitation of the power granted to the President or the DOLE
secretary to issue assumption or certification orders in labor?

The power to issue assumption or certification orders is an extraordinary authority

granted to the President or the DOLE Secretary, the exercise of which should be strictly
limited to national interest cases.3 It is in the nature of a police power measure. This is
done for the promotion of the common good considering that a prolonged strike or lockout
can be inimical to the national economy. The DOLE Secretary is mandated to act to
maintain industrial peace. Thus, his assuming jurisdiction over a labor dispute or his
certification thereof to the NLRC for compulsory arbitration is not intended to impede the
workers’ right to strike but to obtain a speedy settlement of the dispute.

324. Phimco Industries Labor Association (PILA), the duly certified collective bargaining
representative of the daily paid workers of PHIMCO filed a notice of strike with the
NCMB against PHIMCO, a corporation engaged in the production of matches, after a
deadlock in the collective bargaining and negotiation. Parties failed to resolve their
differences, thus, PILA (during the conciliation conferences), composed of 352
members, staged a strike.

PHIMCO sent notice of termination to some 47 workers including several union

officers.

Labor Secretary Brillantes then assumed jurisdiction over the labor dispute and issued
a return-to-work order.

PILA is now questioning the Labor Secretary’s assumption of the case, contending that
it is not within the Labor Secretary’s jurisdiction to assume the case because the case
does not involve an industry indispensable to national interest.

Did the Labor Secretary acted with grave abuse of discretion amounting to lack or
excess of jurisdiction in assuming jurisdiction over subject labor dispute?

Yes.

Under Article 278 (g) [263(g)] of the Labor Code, the law vests in the Secretary of
Labor the discretion to determine what industries are indispensable to the national interest.
Accordingly, upon the determination by the Secretary of Labor that such industry is
indispensable to the national interest, he will assume jurisdiction over the labor dispute in
the said industry. This power, however, is not without any limitation.

A match factory, though of value, can scarcely be considered as an industry

“indispensable to the national interest” as it cannot be in the same category as “generation
and distribution of energy, or those undertaken by banks, hospitals, and export-oriented
industries.” Yet, the public respondent assumed jurisdiction thereover.

To uphold the action of the public respondent under the premises would be
stretching too far the power of the Secretary of Labor as every case of a strike or lockout
where there are inconveniences in the community, or work disruptions in an industry
though not indispensable to the national interest, would then come within the Secretary’s
power. It would be practically allowing the Secretary of Labor to intervene in any Labor
dispute at his pleasure.

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325. XYZ Association, the duly certified collective bargaining representative of the daily-
paid workers of XYZ Company, filed a notice of strike with the NCMB against XYZ
Co., an electric power industry, after a deadlock in the collective bargaining and
negotiation. The parties failed to resolve their differences, thus, XYZ Assoc. staged a
strike. The Labor Secretary then assumed jurisdiction over the labor dispute and
issued a return-to-work order.

XYZ Assoc. is questioning the assumption order of the Secretary of Labor, contending
that there should have been prior notice and hearing before an assumption order may
be issued by the Secretary of Labor. It maintains that the DOLE Secretary cannot
exercise his powers under Article 278(g) [263(g)] without observing the requirements
of due process.

Is notice and hearing prior to issuance of assumption/certification order required?

What about after the issuance of assumption/certification order?

No. Citing Magnolia Poultry Employees Union v. Sanchez, G. R. Nos. 76227-28

(1986), the Supreme Court held that the discretion to assume jurisdiction may be exercised
by the DOLE Secretary without the necessity of prior notice or hearing given to any of the
parties. The rationale for his primary assumption of jurisdiction can justifiably rest on his
own consideration of the exigency of the situation in relation to the national interest.

While no prior notice and hearing are required as afore-discussed, Department

Order No. 40-H-13, Series of 2013, now requires the conduct of a preliminary conference
or hearing within five (5) days from the issuance of the assumption or certification order.

The same shall be conducted by the DOLE Secretary, in case of assumed cases, or
by the NLRC, in case of certified cases, or by the Voluntary Arbitrator or Panel of
Voluntary Arbitrators, in case the labor dispute is, by mutual agreement, submitted for
voluntary arbitration.

326. XYZ Association, the duly certified collective bargaining representative of the daily
paid workers of XYZ Company, filed a notice of strike with the NCMB against XYZ
Co., an electric power industry, after a deadlock in the collective bargaining and
negotiation. The parties failed to resolve their differences, thus, XYZ Assoc. staged a
strike. The Labor Secretary then assumed jurisdiction over the labor dispute and
issued a return-to-work order.

What is the effect of the assumption order?

The assumption or certification shall have the effect of automatically enjoining an

impending strike or lockout. If an actual strike/lockout has already taken place at the time
of the assumption/certification, all striking or locked out employees and other employees
subject of the notice of strike/lockout shall immediately return to work and the employer
shall immediately resume operations and readmit all employees under the same terms and
conditions prevailing before the strike or lockout.

In the instant case, since the strike has already taken place, all striking and locked-
out workers shall, within twenty-four (24) hours from receipt of an Assumption or
Certification Order, immediately return to work and the employer shall immediately
resume operations and readmit all workers under the same terms and conditions prevailing
before the strike.

327. What is the nature of the return-to-work order?

The return-to-work order is Compulsory in character and not offensive to

involuntary servitude and a limitation on Employers exercise of management prerogatives.

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328. In return to work order can the employer determine who among the strikers could
be admitted to work?

No. It cannot be made upon the discretion of the employer, lest the certification or
assumption of jurisdiction orders will be stripped of the coercive power that is necessary
for attaining their laudable objective.

329. Who has the power to execute judgment in certified cases?

The NLRC which has the to cause the execution of the judgment rendered therein.

330. What is the meaning of “ALL STRIKING OR LOCKED-OUT EMPLOYEES” AND

“READMIT ALL WORKERS” in assumption or certification?

Under Article 278(g) [263(g)], once an assumption or certification order is issued,

the consequence thereof is clear, thus: “Such assumption or certification shall have the
effect of automatically enjoining the intended or impending strike or lockout as specified
in the assumption or certification order. If one has already taken place at the time of
assumption or certification, all striking or locked-out employees shall immediately return
to work and the employer shall immediately resume operation and readmit all workers
under the same terms and conditions prevailing before the strike or lockout”.

331. What is status quo ante litem?

It is the state of their relationship prior to the strike or lockout, as if there has been
no conflict between them. By so mandating that the parties should go back to the status
quo ante litem, the parties would then be under legal compulsion to assert their respective
claims and counter-claims in the appropriate proceedings before the DOLE Secretary (in
case of assumption) or the NLRC (in case of certification) sans the extreme antagonism
and intense animosity and fervor that may have been brought to bear upon the parties had
the strike or lockout been on-going alongside said proceedings.

332. Are retrenched or redundant employees whose termination triggered the labor
dispute included in return to work order?

Yes. Article 278(g) [263(g)] is clear and unequivocal in stating that ALL striking
or locked-out employees should immediately return to work and the employer should
immediately resume operations and readmit ALL workers under the same terms and
conditions prevailing before the strike or lockout.

333. A certification Election was conducted which certified Lakas Manggagawa ng Toyota
Union as the sole and exclusive bargaining agent of the Toyota rank-and-file
employees. Toyota, however, challenged the order certifying the union as the SEBA.
Meanwhile, the Union submitted its Collective Bargaining Agreement (CBA) proposal
to Toyota. Toyota refused to negotiate in view of its pending appeal and both parties
are required to appear before the Bureau of Labor Relations (BLR).

Instead of appearing before the BLR, more than 200 employees staged mass actions in
front of the BLR and the DOLE offices, to protest the partisan and anti-union stance
of Toyota. Due to the deliberate absence of a considerable number of employees, Toyota
experienced acute lack of manpower in its manufacturing and production lines and
was unable to meet its production goals resulting in huge losses.

Toyota filed a petition to declare the strike illegal with the NLRC arbitration branch,
and prayed that the erring Union officers, directors, and members be dismissed. On
the contrary, the Union contends that the protests or rallies conducted are not within

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 the ambit of strikes as defined in the Labor Code, since they were legitimate exercises
of their right to peaceably assemble and petition the government for redress of
grievances. Rule on the petition.

The petition will prosper. The protest actions undertaken by the Union officials and
members are not valid and proper exercises of their right to assemble and ask government
for redress of their complaints but are illegal strikes in breach of the Labor Code.

The Labor Code provides that no labor organization or employer shall declare a
strike or lockout without first having filed the required notice or without the strike or
lockout vote first having been obtained and reported to the Regional Branch of the NCMB
and most importantly, without complying with all the mandatory procedural requirements
mentioned in Article 278 [263]. Although procedural in character, the requisites mentioned
in this article are all mandatorily required in order that the strike or lockout may be deemed
valid and legal. Any strike or lockout, therefore, staged not in full compliance with the
requisites is illegal.

Since the Union failed to comply with strike notice and the strike-vote report as
required by the Labor Code, the strike staged are deemed illegal.

334. DPD Laban Labor Center was one of the legitimate labor organizations of the rank-
and-file employees of the Filcon Corporation, while Dilawan Workers Association was
the exclusive bargaining agent of such rank-and-file employees.

Within the freedom period, DPD Laban filed petitions for certification election before
the Bureau of Labor Relations (BLR) and because of the misunderstanding on the
payment of wages by Filcon upon certain employees, who are coincidentally, members
of that union, DPD Laban filed a Notice of Strike before the National Conciliation and
Mediation Board (NCMB) and a strike vote was conducted. The strike was questioned
by Filcon as illegal. Meanwhile, Dilawan Workers Association asserted that since it was
the exclusive bargaining agent of the rank-and-file employees of the Filcon, the DPD
Laban Labor Center did not have a personality to file a notice of strike before the
NCMB. Is the strike illegal?

Yes. The strike is illegal.

Well-settled is the rule that strikes may only be allowed on grounds of CBA
deadlock and unfair labor practices. Corollary, Article 278(b) [263(b)] specifically
provides that no labor union may strike, and no employer may stage a lockout on grounds
involving inter-union and intra- union disputes.

The case at bar does not concerned a CBA Deadlock nor unfair labor practice but
more on the ground of inter-union and intra-union conflict which is a non-strikeable. As a
matter of fact, DPD Laban falsely assumed the role of a SEBA when it filed a notice of
strike during the 60-day freedom period, and while a petition for certification election was
pending. A strike during the pendency of such petition is patently illegal.

335. May a violation of the CBA a ground for strike or lockout?

As a general rule, the law expressly cites any violation of a CBA as an unfair labor
practice (ULP) of the employer under Article 259(i) (248(i) and of the labor organization
under Article 260(1) (249(1), hence, it is a ground for strike or lockout.

However, under Article 274 (261] of the Labor Code, simple violation of the CBA
is no longer treated as ULP but as a mere grievance which should be processed through the
grievance machinery provided in the CBA. A violation of the CBA becomes ULP only
when it is gross in nature which means that there is flagrant and/or malicious refusal to

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 comply with the economic provisions thereof by either the employer or the labor
organization.

It is, thus, only when the violation is gross that it may be cited as a ground in support
of a strike or lockout.

336. Union X staged an economic strike, claiming that Employer Y must provide for
additional benefits above those provided by law. Employer Y claims that the strike is
illegal because of the existence of a “no strike-no lockout” clause in their CBA,
mandating a grievance procedure for resolving their disputes. Union X answers that
the “no strike-no lockout” clause is violative of their Constitutional right. Is Union X
correct?

No. Union X’s contention is misplaced. No less than the Constitution recognizes
the preferential use of voluntary means to settle disputes. A “no strike-no lockout” the
strike or lockout is economic in nature.

337. Union X agreed with Employer Y to submit their disputes for Voluntary Arbitration.
On the day of the scheduled arbitration, Union X staged a strike, claiming that they
strongly believe that the arbitration proceedings will never be in their favor. Is the
strike valid?

No. Under the law, as well as the implementing rules of the Labor Code, a strike
cannot be held if the issue in under arbitration, conciliation or mediation. This is violative
of the duty of the union to bargain collectively, to act in good faith, and to participate fully
and promptly and to avoid disrupting the proceedings.

More particularly, the union must first exhaust all remedies under the established
grievance procedures and voluntary arbitration before staging a strike.

338. A case for unfair labor practices was filed by Union X against employer Y before the
labor tribunal. Tired of waiting for a resolution, Union X stages a strike on the same
ground of unfair labor practices which was previously filed. Is the strike valid?

No. The law expressly prohibits the conduct of a strike if it is declared during the
pendency of cases involving the same grounds invoked for the strike. Once jurisdiction
over an issue is vested to a labor tribunal, a strike or lockout cannot be staged to pre-empt
or circumvent the adjudication and resolution thereof by the said tribunal.

339. Can good faith in staging the strike be invoked against the restrictive effect of an
assumption/ certification order? Why?

No, strikers cannot invoke good faith where assumption/ certification order of the
DOLE Secretary is disregarded. This is because such order imposes an absolute injunction
against the conduct of any prospective strike after its issuance.

Consequently, a strike that is undertaken despite of issuance of such order becomes

a prohibited activity and thus, illegal pursuant to Article 279 (a)[264 (a)]. Needlessly, upon
such issuance, strikes are enjoined or, if one has already taken place, all strikers must
immediately return to work.

340. Why does strike will not become illegal absent any notice to the Union of the issuance
of the assumption/ certification order?

Because basic is the rule that no order decision, or resolution- not even one that is
immediately executory- is binding and automatically executory unless and until the
properties are duly notified thereof.

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341. What is the effect of declaring and staging a strike by a minority union? Explain your
answer?

The strike conducted by a minority union is patently illegal, according to UNited

Restauror’s Employees and ALbor Union-PAFLU v. Torres. No labor dispute which will
justify the conduct of a strike can exist between the employer and a minority union. To
permit the unions’ picketing activities would be to flaunt at the will of the majority.

342. Can the members or employees of a union who participated in an illegal strike be
dismissed in their employment?

No. As a general rule, the penalty of dismissal could be imposed only on union officers
serving and acting as such during the period of illegal strike. As a necessary implication, if
the employees acted as union officers after the strike, they may not be held liable therefor
and, therefore, could not be terminated in their capacity as such.

343. Does declaration of the illegality of a strike automatically make the employee who is
a union officer liable?

No, the fact alone that an employee is a union officer will not make him liable by the mere
declaration of the illegality of a strike. Article 279(a) [264(a)] of the Labor Code requires
that there must be a showing that he “knowingly participated in the illegal strike.”

344. What is the employment status of an employee who participated in a legal strike?

As a general rule, the declaration or actual conduct of a strike does not result in the
severance of the employment relationship nor a renunciation thereof. The employment
relationship is merely suspended during the period of work stoppage. An employee who
participates in a lawful strike is not deemed to have abandoned his employment but is
merely exercising his right to self-organization precisely to protect his rights as an
employee and/or to obtain better working conditions. Such participation should not
constitute sufficient ground for the termination of his employment even if a replacement
has already been hired by the employer during such lawful strike.

345. May Union officers be dismissed despite the fact that the illegal strike was staged only
for 1 day or for even less than a day?

Yes. The shortest period of illegal strike which resulted in the termination of union
officers lasted only for less than (10) hours. This is the case of University of San Agustin.
The DOLE Secretary issued in this case an assumption of jurisdiction order (AJO) and it
was served by the sheriff at 8:45 a.m. of September 19, 2003 but receipt thereof was refused
by the union. It was officially received by the union president only at 5:25 p.m. of the same
day.

346. What happen if there is defiance of assumption/certification order or return-to-work

order among the strikers?

All defiant strikers, irrespective of whether they are union officers or ordinary
members, are deemed to have lost their employment status is well supported by existing
(1) law; (2) applicable rules; and (3) pertinent jurisprudence.

As far as the law is concerned, the respective liabilities of striking union officers
and members who failed to immediately comply with the assumption/certification order
and/or its accompanying return-to-work order are outlined in Article 279 (264] of the Labor
Code which provides that any declaration of a strike or lockout after the DOLE Secretary
has issued such order is considered an illegal act. Consequently, any worker or union

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 officer who knowingly participates in a strike defying any such order may "be declared to
have lost his employment status.”

347. When strike becomes a prohibited activity?

It is now jurisprudentially settled that a strike that is undertaken despite the issuance
by the DOLE Secretary of an assumption or certification order becomes a prohibited
activity and thus, illegal, pursuant to the second paragraph of Article 279 (264] of the Labor
Code, as amended. This means that even if the strike has started as a legal strike, it
automatically becomes an illegal strike the moment it is pursued and continued after the
issuance of the said order, in clear defiance thereof. Consequently, the strike would be
treated as a "prohibited activity," an "illegal act" that would justify the termination of
employment not only of the defiant union officers but of the defiant ordinary union
members as well.

348. In a strike, what is the effect when an employer did not comply with the issuance of a
return-to-work order from a labor dispute?

In case of non-compliance by the employer with the return-to-work order issued in

connection with the assumption/certification of the labor dispute, it may be held liable to
pay backwages, damages and/or other affirmative reliefs, including criminal prosecution.
Employers who refuse to readmit returning workers may be held liable upon filing of the
proper petition for the payment of wages and other benefits from the date of actual refusal
until the workers are readmitted.

349. What is the liability from commission of illegal acts during a strike?

The commission of illegal acts in the course of a strike would make it illegal and
the striker involved therein - irrespective of whether he is a union officer or an ordinary
member - will suffer the penalty of dismissal.

350. What is crossing the picket line?

“Crossing the picket line” is a term used to describe the act of working during a
strike, whether by strike-breakers, management personnel, non-unionized employees or
members of other unions not on strike. The use of this term is proper irrespective of whether
it involves actually physically crossing a line of picketing strikers.

351. Can the legality of a strike be determined only by compliance with the legal
formalities in conducting strike?

No, the legality of a strike is determined not only by its compliance with the legal
formalities but also by the means through which it was carried out.

As ruled in Biflex (Biflex Phils. Inc. Labor Union [NAFLU] v. Filflex Industrial
and Manufacturing Corp., G.R. No. 155679, December 19, 2006) even assuming arguendo
that in staging the strike, petitioners had complied with the legal formalities, the strike
would just the same be illegal for by blocking the free ingress to and egress from the
company premises, they violated Article 279(e) [264(e)].

352. May the Picketing strikers prevent employees of other companies from using the same
premises being picketed?

No. The Labor Code is emphatic against the use of violence, coercion, and
intimidation during a strike and to this end, it prohibits the obstruction of free passage to
and from the employer’s premises for lawful purposes. In the same vein, a picketing labor
union has no right to prevent employees of another company from getting in and out of its

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 rented premises, otherwise, it will be held liable for damages for its acts against an innocent
bystander. (Philcom Employees Union v. Philippine Global Communications, G.R. No.
144315, July 7, 2006).

353. Employees who may be dismissed by their employer for participating in a strike?

The employer has the right to dismiss the following employees who participated in
a strike, to wit:

1) Union officers on the basis of the illegality of the strike;

2) Ordinary union members on the basis of their commission of illegal acts in the
course of the strike; and

3) Strikers who defied the assumption/certification or return-to-work order.

354. What is the effect when ULP strike is declared illegal?

If ULP strike is declared illegal, the necessary and logical consequence would be
the declaration of loss of employment status of the union officers who knowingly
participated in its staging. And if such declaration is occasioned by the commission of
illegal acts of both union officers and ordinary union members, the same effect of loss of
employment status would apply to the both of them. In such an eventuality, they can be
replaced permanently without getting afoul of the law.

355. What is striker replacement doctrine?

During a strike, the employer has the right and prerogative to hire the services of
replacement workers under the “striker replacement doctrine.” Such hiring, however, does
not necessarily mean the termination of employment of the striker replaced. But the reality
is that there is a very thin line of distinction between the right to fire employees for striking
and the right to “permanently replace” them. This is so because once the employer makes
the replacements permanent, the striking employees have generally no right to return to
their jobs if they decide to end the strike.

356. What is economic strike?

An economic strike is one declared to demand higher wages, overtime pay, holiday
pay, vacation pay, etc., It is declared for the purpose of forcing wage or other concessions
from the employer which he is not required by law to grant. It is strike which arose out of
a barangay deadlock in the CBA negotiations.

357. AA’s dismissal was declared illegal by the Labor Arbiter and ordered AA’s employer
to reinstate him. After the order, AA went back to work but his employer claimed
that since the decision is on appeal, AA cannot go back to work, yet. Is the contention
of AA’s employer correct?

No, the contention of AA’s employer is not correct.

It is a well-settled rule enunciated in the Labor Code that when a dismissal is

declared illegal by the Labor Arbiter, the order of reinstatement issued by him is
immediately executory and the employer is duty-bound to abide by the same, even if it
appeals therefrom.

Hence, AA should be allowed to go back to work.

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358. AA and BB both participated in a strike. The strike was subsequently declared illegal.
Hence, AA and BB are not entitled to backwages or separation pay. Is this correct?

No, it is not correct.

In the case of Escario, union members who did not commit any illegal acts in the
course of the strike which is declared to be illegal may still be awarded backwages by virtue
of reinstatement or separation pay if reinstatement is not feasible.

Hence, provided AA and BB did not commit illegal acts during their participation
in the strike, they may still be entitled to backwages or separation pay.

359. The union and employer both are culpable for illegal strike. The court ordered the
reinstatement of the the union workers. The employer contends that since the union
members are culpable for illegal strike, reinstatement is not warranted. Is the
employer correct?

No, the employer is not correct.

If both parties have acted in pari delicto in that the employer is guilty of illegal
lockout and the union is culpable for illegal strike, the dismissal of the striking employees
is unwarranted and their reinstatement should be ordered as a matter of course.

Hence, the order of the court is valid.

360. What is the liability of persons committing any of the prohibited acts under Article
279 in connection with the conduct of strike or lockout?

Any person performing any of the prohibited activities mentioned in Article 279
[264] may be charged before the appropriate civil and criminal courts.

According to Article 287(a) [272(a)], any person violating any of the provisions of
Article 279 [264] shall be punished by a fine of not less than one thousand pesos
(P1,000.00) nor more than ten thousand pesos (P10,000.00) and/or imprisonment for not
less than three (3) months nor more than three (3) years, or both such fine and
imprisonment, at the discretion of the court.

361. What is an “Improved Offer Balloting” and a “Reduced Offer Balloting”?

In case of a strike, the Regional Branch of the NCMB should, at its own initiative
or upon the request of any affected party, conduct a referendum by secret balloting on the
improved offer of the employer on or before the 30th day of the strike. When at least a
majority of the union members vote to accept the improved offer, the striking workers
should immediately return to work and the employer should thereupon readmit them upon
the signing of the agreement.

In case of a lockout, the Regional Branch of the NCMB should conduct a

referendum by secret balloting on the reduced offer of the union on or before the 30th day
of the lockout. When at least a majority of the board of directors or trustees of the
corporation or the partners holding the controlling interest in the case of partnership, vote
to accept the reduced offer, the workers should immediately return to work and the
employer should thereupon readmit them upon the signing of the agreements.

362. In cases where the employer and the strikers were ‘in pari delicto’, what would be the
proper relief?

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 The Supreme Court distinguished the proper relief available to the strikers who
were in pari delicto with the employer and those that were not. It held that the former is
entitled to reinstatement but without back-wages; while the latter should be reinstated and
given their back-wages with interest at the rate of six percent (6%) per annum which shall
be increased to twelve percent (12%) after the finality of the judgment.

The strikers who were deemed in this case as having been in pare delicto with the
employer were the ones who were charged by the employer for conducting the illegal
strike. Technically, as no charges for illegal strike were filed by the employer against some
of the employees, they cannot be among those found guilty of illegal strike. Thus, they
cannot be considered in pare delicto. They should therefore be reinstated and given their
back-wages.

363. Are aliens allowed to engage, in trade union activities?

The general rule is that all aliens, natural or juridical, as well as foreign
organizations, are strictly prohibited from engaging, directly or indirectly, in all forms of
trade union activities. The prohibition against intervention in trade union activities applies
to all aliens and alien organizations, whether public or private, and their agents or
representatives. Except on the following:

a. Continuity of normal contacts with International Labor Centers; and

b. Right of aliens to self-organization on rule of reciprocity.

364. Are aliens allowed to transfer to another job or change employer?

After the issuance of an employment permit, the alien is not allowed to transfer to
another job or change his employer without prior approval of the DOLE Secretary. Any
non- resident alien who takes up employment in violation of the provision of Title II, Book
I4 of the Labor Code and its implementing rules and regulations, shall be punished in
accordance with the provisions of Articles 304 [289] and 305 [290] of the Labor Code.

365. In the event of any violations by aliens, under whose jurisdiction shall a report on that
matter be filed?

Report of any violations by aliens may be filed directly with the BLR or the DOLE
Regional Office having jurisdiction of the place where the violation is alleged to have been
committed.4 The DOLE Regional Director or the BLR Director may, motu proprio,
conduct an investigation of any such violation.

366. When can the DOLE Regional Director or BLR Director inquire into the financial
activities of the union?

Such examination should be made upon the filing of a request or complaint for the
conduct of an accounts examination by any member of the labor organization, supported
by the written consent of at least twenty percent (20%) of its total membership.

367. Distinguish visitorial power under Article 289 [274] and Article 128 of the Labor
Code?

Article 289 [274] treats of the visitorial power of the DOLE Secretary to inquire
into the financial activities of legitimate labor organizations.

On the other hand, Article 128 dwells on the visitorial and enforcement power of
the DOLE Secretary to inquire into the employer’s compliance with labor laws and social
legislations.

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368. Who conducts a tripartite conference?

The DOLE Secretary or his duly authorized representatives may, from time to time,
call a national, regional, or industrial tripartite conference of representatives of
government, workers and employers for the consideration and adoption of voluntary codes
of principles designed to promote industrial peace based on social justice or to align labor
movement relations with established priorities in economic and social development.

369. What are the reasonable impositions may be collected by all unions?

(a) Membership fees;

(b) Union dues;
(c) Assessments;
(d) Fines; and
(e) Other contributions for the following purposes:
(1) Labor education;
(2) Labor research;
(3) Mutual death benefits;
(4) Hospitalization benefits;
(5) Welfare fund;
(6) Strike fund; and
(7) Credit and cooperative undertakings

370. What is the requirement of the Labor code in the termination of employment by an
employer?

The minimum requirement as provided by law is their right to be protected against

dismissal except for a just or authorized cause and without prejudice to the requirement of
notice containing a statement of the causes for lamination and shall afford the latter ample
opportunity to be heard and to defend himself with the assistance of his representative, if
he so desires, in accordance with company rules and regulations promulgated pursuant to
guidelines set by the Ministry of Labor and Employment.

371. What is the constitute a regular employee for the purpose of membership in a labor
union?

The law provides that any employee, whether employed for a definite period or not,
with at least one year of service, whether such service is continuous or broken, shall be
considered a regular employee for purposes of membership in any labor union.

There is therefore no need for definite-period employees to render “at least one year
of service, whether continuous or broken” and be first “regular” in their employment before
they can be eligible to become members of a union and to vote for its officers.

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