LABOR LAW REVIEW

Pointers for Midterms

1. Constitutional Provision Sec. 3, Art. 13 (1987 Constitution)
What are the rights that are in Sec. 3, Art.13 that are not found in Art.3 of the Labor
Code?

Specific provisions of full protection to labor whether local and overseas,
organized and unorganized;

Right to peaceful concerted activities, including the right to strike;

Right to a living wage;

Right to participate in policy and decision-making processes affecting their rights
and benefits;

Promote the principle of shared responsibility between workers and employers

Preferential use of voluntary modes in settling disputes;

Right of labor to its just share in the fruits of production;

Right of enterprises to reasonable returns on investments, expansion and growth
2. (Art. 4, Labor Code) Construction in favor of Labor Laws
Why is it not in violation of equal protection clause?
o Art. 4 of the Labor Code is not in violation of equal protection clause because a law which
promotes a constitutional mandate does not violate the equal protection clause. The
constitutional mandate is for the State to afford full protection to labor such that, when
conflicting interests of labor and capital are to be weighed on the scales of justice, the heavier
influence of the latter should be counterbalanced by the sympathy the law should accord the
underprivileged.
o

ALTERNATIVE ANSWER: Its not in violation of the equal protection laws because the State shall
afford full protection to labor. Furthermore, the State affirms labor as a primary economic force.
It shall protect the right of workers and promote their welfare.

3. (Art. 5) Rule making power the power of subordinate legislation

Wage Order (Art. 123)

Whether or not the employee will have to wait for the effectivity date before
filing an appeal?
No. The reckoning point in filing an appeal is the publication date (within 10 days, Art.
123)

Is filing of an appeal enough to stay a wage order?

Art. 123, Labor Code Filing an appeal DOES NOT STAY order unless appellant files an
undertaking with a surety, to guarantee payment of employees if the wage order is
affirmed (as emended by RA 6727)
Publication Requirement

CASE: Office of the National Administrative Register (ONAR) It failed to provide/ furnish ONAR, said
issuance is not legally enforceable.
SC: Under the doctrine of Tanada v. Tuvera, an issuance should be published before it becomes effective.
The issuance should also comply with the requirement stated under Section 3 of Chapter 2, Book VII of
the Administrative Code of 1987 filing with the ONAR in the University of the Philippines Law Center
for rules that are already in force at the time the Administrative Code of 1987 became effective. These
requirements of publication and filing were put in place as safeguards against abuses on the part of
lawmakers and as guarantees to the constitutional right to due process and to information on matters of
public concern and, therefore, require strict compliance.
4. (Art. 6) Applicability
Employment of government agencies are covered by the Civil Service laws
GOCCs with original charter are under Civil Service laws, otherwise, it will fall under the
Labor Code
CASE: Corporate officers of Matling Industrial vs Coros (Hes a corporate employee NOT a corporate
officer)
- For a position to be a corporate position, the by-laws should be amended
SC: (Sec. 25, Corporation Code) 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. Moreover, the power to elect corporate
officers was a discretionary power that the law exclusively vested in the BOD and could not be delegated
to subordinate officers or agents. The office of VP for Finance and Administration created by Matlings
President pursuant to By Law No. V was an ordinary, not a corporate office.
CASE: Nacpil vs. IBC 13 (SC: Matling Case not applicable)
- Position not in the by-laws since BOD of IBC 13 appoint Nacpil (Case falls under the jurisdiction
of the SEC (special commercial courts), not with the NLRC )
SC: Dismissal or non-appointment of a corporate officer is clearly an intra-corporate matter and
jurisdiction over the case properly belongs to the SEC, not to the NLRC (PD 902-A). Since complainants
appointment was approved unanimously by the BOD of the corporation, he is therefore considered a
corporate officer and his claim of illegal dismissal is a controversy that falls under the jurisdiction of the
SEC as contemplated by Sec.5 of PD 902-A. That the position of Comptroller is not expressly mentioned
among the officers of the IBC in the By-Laws is of no moment, because the IBCs Board of Directors is
empowered under Sec. 25 of the Corporation Code and under the corporations By-Laws to appoint
such other officers as it may deem necessary.

Labor Code provisions not applicable to employee of International organizations and

specialized agencies of international organizations.
o Remedy: avail of internal mechanism
Choice where to file money claims: Labor Arbiter or Regular Court

TEST: Reasonable Causal Connection Test

 Is the money claim by employee arising from Employer-Employee
relationship?
If YES money claim has reasonable causal connection Labor
Arbiter;
If NO appropriate regular court
In determining whether the employee is a regular/permanent employee:
o TEST: Reasonable connection between the function of the employee: is it
usually necessary in the usual trade/ business?
 If YES hes a regular employee
o

5. (Art.13 B) Overseas employment (definition of recruitment and placement)

CASE: People vs. Panis - application of recruitment
- Determination of the proper interpretation of Art 13(b) of the Labor Code (Recruitment)
SC: The specification of two or more persons is not to create a condition prior to filing but rather it states
a presumption that the individual is engaged in recruitment in consideration of a fee, however, the
number of persons is not an essential ingredient to the act of recruitment or placement and it will still
qualify even if only one person has been involved.

Differentiate direct hire from name hire

DIRECT HIRE General Rule: No employer may hire a Filipino worker for
overseas employment except through the Boards and entitles authorized by the
Secretary of Labor (Art. 18, Labor Code)
Exceptions: 1. Members of the diplomatic corps; 2. international
organizations; 3. Such other employees as may be allowed by the Secretary
of Labor; 4. Name hires

NAME HIRE one whos able to look for foreign employment contract without
assistance from placement agency. There must be authentication of contracts by
consul general on the existence of foreign job (when approved: documented
worker)
- Those individuals who are able to secure contracts for overseas as
employment on their own efforts and representation without the assistance
or participation of any agency. Their hiring, nonetheless, has to be processed
through the POEA.

Differentiate:
o license and authority

Art.13 (d) of the Labor Code defines License as a document issued
by the Department of Labor authorizing a person or entity to
operate a private employment agency. While authority as defined

in Art. 13 (f) 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.
o Simple and syndicated illegal recruitment (large scale/ economic sabotage)

Simple illegal recruitment has the following elements:
The person charged with the crime must have undertaken
recruitment activities, defined under Art. 13(b) or prohibited
activities defined under Art. 34; and
The said person does not have a license or authority to do so
(Art. 38, Labor Code)

Syndicated illegal recruitment (Large scale/ economic sabotage)
o Illegal recruitment is considered economic sabotage when
the commission thereof is attended by the ff. circumstances:
 By syndicate if carried out by a group of 3 or more
persons conspiring and confederating with one
another;
 In large scale if committed against 3 or more
persons individually or as a group [Art. 38 (b), LC]
ILLEGAL RECRUITMENT IN LARGE SCALE
o The accused engages in acts of recruitment and placement of workers
defined under Art. 13(b) of the Labor Code or in any prohibited activities
under Article 43 of the Labor Code;
o The accused has not complied with the guidelines issued by the Secretary of
Labor and Employment, particularly with respect to the securing of license or
an authority to recruit and deploy workers, either locally or overseas; and
o The accused commits the unlawful acts against three or more persons
individually or as a group.
ILLEGAL RECRUITMENT BY A SYNDICATE
o The offender undertakes either any activity within the meaning of
recruitment and placement defined under Art. 13(b) of the Labor Code;
o He has no valid license or authority required by law to enable one to lawfully
engage in recruitment and placement of workers; and
o The illegal recruitment is committed by a group of three or more persons
conspiring or confederating with one another (People vs. Gallo, 2010)
Liability of Foreign Employer (Local Licensed Agency) joint and severally or solidary
o Local Employment Agency is solidarily liable with foreign principal.
Severance of relations between local agent and foreign principal does not
affect the liability of local recruiter. Private employment agencies are held
jointly and severally liable with the foreign-based employer for any
violation of the recruitment agreement or contract of employment. This joint
and solidary liability imposed by law against recruitment agencies and

foreign employers is meant to ensure the aggrieved worker immediate and

sufficient payment of what is due him (Becmen Service Exporter and
Promotion, Inc. vs. Sps. Cuaresma, 2009)

Exception to Solidary Liability:

CASE: ILAS vs. NLRC & All Seasons Manpower International use of fake exit passes
SC: It is true that the rules and regulations of the POEA provide that the private employment of
recruitment agency is made to assume full and complete responsibility for all acts of its officials and
representatives done in connection with recruitment and placement. However, where the recruitment
was actually made by respondent agencys agent in behalf of CBT/Shiek International, not the private
respondent, and the name of the private respondent was only used as a means to enable petitioners
to be issued TEPS for travel purposes, obviously without the knowledge and consent of private
respondent, the latter cannot be held liable for the claims of petitioners.
CASE: Feagle Construction vs. Dorado
SC: When an overseas worker persuades the local representative of the principal or recruiter to send him
abroad to work despite the refusal of said local representative or recruiter to accede to the request due
to the unstable condition in the area of work desired so much so that the regular payment of the
remuneration of the employee or worker and his security of tenure cannot be assured and still such
employee or worker insists on taking a calculated risk by signing a waiver rendering the local
representative or recruiter free from any liability to said employee r laborer arising from such overseas
employment, thus, the local representative or recruiter cannot be jointly and severally held liable with
the foreign principal or employer for any claim of such employee or worker arising thereunder.
On Escrow Agreement
o
o
o

Signed by authorized agency of bank

Signed by applicant
Signed by representative of POEA

6. Sec.10 of Migrant Workers Act

Officers/ Directors are solidarily liable to the corporation
RA 8042 (Migrant Workers Act) as amended by RA 10022

When OFW enters compromise agreement, the agreed amount should be
payable in 120 days

From the date of approval, must be paid within 30 days
Par. 5 of Sec. 10 unexpired portion of the contract: less than 1 year OR 1 yr or
more
7. Sec. 6 and 7, Migrant Workers Act
Illegal recruitment and three (3) kinds of penalties

1. In illegal recruitment (economic sabotage), if the recruiter is a non-holder of

authority, then maximum penalty would be imposed.
Sec. 7 of the Migrant Workers Act of 1995, as amended by RA 10022 (Sec. 6)
SEC. 7. Penalties. (a) 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).
(b) 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 therein.
Provided, however, That the maximum penalty shall be imposed if the person illegally recruited is less
than eighteen (18) years of age or committed by a non-licensee or non-holder of authority.
(c) 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).
If the offender is an alien, he or she shall, in addition to the penalties herein prescribed, be deported
without further proceedings.
In every case, conviction shall cause and carry the automatic revocation of the license or registration of
the recruitment/manning agency, lending institutions, training school or medical clinic.
Less than 1 year contract
9 months
8 mos.

30 days
-

Prove illegal dismissal first before

the unexpired portion will be
granted;
So if proven, he will awarded
with the remaining 8 months

1 year or more contract

24 months
12 mos
3mos

3 mos

months

CASE: Serrano vs. Gallant Maritime and

Marlow Navigation
SC: Theres no valid classification of a less
than 1 yr contract and 1 yr or more
contract, therefore, its in violation of the
equal protection laws
-

It restored Par. 5 of Sec. 10 the

unexpired portion of 3 mos
whichever is less

August 05, 2014 In the case of SAMEER, the SC declared Par. 5 of Sec. 10 Unconstitutional:
- Any breach of contract, the whole unexpired portion will be granted.
CASE: Sameer Overseas Placement Agency, Inc. vs. Cabiles
Respondent Joy Cabiles, having been illegally dismissed, is entitled to her salary for the unexpired
portion of the employment contract that was violated together with attorneys fees and reimbursement
of amounts withheld from her salary.
Section 10 of Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos
Act of 1995, states that overseas workers who were terminated without just, valid, or authorized cause
shall be entitled to the full reimbursement of his placement fee with interest of twelve (12%) per annum,
plus his salaries for the unexpired portion of his employment contract or for three (3) months for every
year of the unexpired term, whichever is less.
SC: We uphold the finding that respondent is entitled to all of these awards. The award of the threemonth equivalent of respondents salary should, however, be increased to the amount equivalent to
the unexpired term of the employment contract.
In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., this court ruled that
the clause or for three (3) months for every year of the unexpired term, whichever is less is
unconstitutional for violating the equal protection clause and substantive due process. A statute or
provision which was declared unconstitutional is not a law. It confers no rights; it imposes no duties; it
affords no protection; it creates no office; it is inoperative as if it has not been passed at all.
al

8. Employees Compensation Cases award of damages

Art. 229, Labor Code: Two (2) kinds of bonds: Cash and Surety
Art. 229: xxx...In case of a judgment involving a monetary award, an appeal by the employer may be
perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly
accredited by the Commission in the amount equivalent to the monetary award in the judgment
appealed fromxxx

Property bond was accepted in the following cases:

Issue: whether or not in perfecting an appeal to the National Labor Relations Commission (NLRC) a
property bond is excluded by the two forms of appeal bond cash or surety as enumerated in Article
223 of the Labor Code
UERM Medical Center vs. Carino
SC: We reiterate this policy which stresses the importance of deciding cases on the basis of their
substantive merit and not on strict technical rules. In the case at bar, the judgment involved is more than
P17 million and its precipitate execution can adversely affect the existence of petitioner medical center.
Likewise, the issues involved are not insignificant and they deserve a full discourse by our quasi-judicial
and judicial authorities. We are also confident that the real property bond posted by the petitioners
sufficiently protects the interests of private respondents should they finally prevail.
YBL (Your Bus Line) Transit vs NLRC
SC: The Court finds that while Article 223 of the Labor Code, as amended by Republic Act No. 6715,
requiring a cash or surety bond in the amount equivalent to the monetary award in the judgment
appealed from for the appeal to be perfected, may be considered a jurisdictional requirement,
nevertheless, adhering to the principle that substantial justice is better served by allowing the appeal
on the merits threshed out by the NLRC, the Court finds and so holds that the foregoing requirement of
the law should be given a liberal interpretation.
Oriental Mindoro Electric Cooperative vs. NLRC
SC: The intention of the lawmakers to make the bond an indispensable requisite for the perfection of an
appeal by the employer is underscored by the provision that an appeal by the employer may be perfected
"only upon the posting of a cash or surety bond." The word "only" makes it perfectly clear, that the
lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive means
by which an employer's appeal may be perfected. The requirement is intended to discourage
employers from using an appeal to delay, or even evade, their obligation to satisfy their employees'
just and lawful claims.
9. Illegal Recruitment
Venue of illegal recruitment cases (local or overseas)
A criminal action arising from illegal recruitment shall be filed with the RTC of the
province or city:
1. Where the offense was committed; or
2. Where the offended party actually resided 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 the aforestated provisions shall
also apply to those criminal actions that have already been filed in court at the time of
the effectivity of this Act(Sec. 9, RA 8042)

Prohibited in engaging (relatives in 4th degree of consanguinity or affinity)

(MWA) SEC. 8. PROHIBITION ON OFFICIALS AND EMPLOYEES. - It shall be unlawful for
any official or employee of the Department of Labor and Employment, the Philippine
Overseas Employment Administration, or the Overseas Workers Welfare Administration,
or the Department of Foreign Affairs, or other government agencies involved in the
implementation of this Act, or their relatives within the fourth civil degree of
consanguinity or affinity, to engage, directly or indirectly, in the business of recruiting
migrant workers as defined in this Act. The penalties shall be imposed upon them.

Period to file illegal recruitment

SEC. 11. MANADATORY PERIODS FOR RESOLUTION OF ILLEGAL RECRUITMENT
CASES. - The preliminary investigations of cases under this Act shall be terminated within
a period of thirty (30) calendar days from the date of their filing. Where the preliminary
investigation is conducted by a prosecution officer and a prima facie case is established,
the corresponding information shall be filed in court within twenty-four (24) hours
from the termination of the investigation. If the preliminary investigation is conducted
by a judge and a prima facie case is found to exist, prosecution officer within fortyeight (48) hours from the date of receipt of the records of the case.

Presumptive period:

5 yrs from commission - simple illegal recruitment

20 yrs from commission - illegal recruitment with economic sabotage

10. Country Team Approach (Sec. 28, Migrant Workers Act)

All organic employees of the government on a country basis will be under the leadership
of Philippine ambassador assigned in that country
Sec. 28 (MWA) - Under the country-team approach, all officers, representatives and personnel of the
Philippine government posted abroad regardless of their mother agencies shall, on a per country
basis, act as one country-team with a mission under the leadership of the ambassador. In this regard,
the ambassador may recommend to the Secretary of the Department of Foreign Affairs the recall of
officers, representatives and personnel of the Philippine government posted abroad for acts inimical
to the national interest such as, but not limited to, failure to provide the necessary services to protect
the rights of overseas Filipinos.
Upon receipt of the recommendation of the ambassador, the Secretary of the Department of
Foreign Affairs shall, in the case of officers, representatives and personnel of other departments, endorse
such recommendation to the department secretary concerned for appropriate action. Pending
investigation by an appropriate body in the Philippines, the person recommended for recall may be
placed under preventive suspension by the ambassador.

In host countries where there are Philippine consulates, such consulates shall also constitute part
of the country-team under the leadership of the ambassador.
In the implementation of the country-team approach, visiting Philippine delegations shall be
provided full support and information.
Whos a migrant worker?
Sec. 3 (a), MWA - "Migrant worker" refers to a person who is to be engaged, is engaged or has been
engaged in a renumerated activity in a state of which he or she is not a legal resident to be used
interchangeably with overseas Filipino worker.
Gender sensitivity (Art. 19 (f), MWA)
Art. 3 (b), MWA - "Gender-sensitivity" shall mean cognizance of the inequalities and inequities prevalent
in society between women and men and a commitment to address issues with concern for the respective
interests of the sexes.
Art. 19 (f), MWA - Gender sensitive programs and activities to assist particular needs of women migrant
workers
May non-resident aliens be allowed to work in the Philippines?
CASE: General Milling Corp. vs. Torres

SC: Petitioner GMC's claim that hiring of a foreign coach is an employer's prerogative has no legal
basis at all. Under Article 40 of the Labor Code, an employer seeking employment of an alien must first
obtain an employment permit from the Department of Labor. Petitioner GMC's right to choose whom
to employ is, of course, limited by the statutory requirement of an alien employment permit.
Petitioners will not find solace in the equal protection clause of the Constitution. As pointed out by
the Solicitor-General, no comparison can be made between petitioner Cone and Mr. Norman Black as the
latter is "a long time resident of the country," and thus, not subject to the provisions of Article 40 of the
Labor Code which apply only to "non-resident aliens." In any case, the term "non-resident alien" and its
obverse "resident alien," here must be given their technical connotation under our law on immigration.
11. Apprentices, Learners and Disabled Workers
Venue TESDA apprentices
1. Only employers in highly technical industries may employ apprentices (TESDA);
2. Only in apprenticeable occupations approved by the Secretary of Labor (Art. 60)
Art. 71 (Labor Code) Deductions by employers
ART. 71. Deductibility of training costs. - An additional deduction from taxable income of onehalf (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency
of apprentices shall be granted to the person or enterprise organizing an apprenticeship program:
Provided, That such program is duly recognized by the Department of Labor and Employment: Provided,
further, That such deduction shall not exceed ten (10%) percent of direct labor wage: and Provided,
finally, That the person or enterprise who wishes to avail himself or itself of this incentive should pay his
apprentices the minimum wage

 RULE ON LEARNERS
Learners may be employed when no experienced workers are available, the employment of learners is
necessary to prevent curtailment of employment opportunities and the employment does not create
unfair competition in terms of labor costs or impair or lower working standards (Art. 74, Labor Code)
Summary of Rules
1. The duration of learnership shall not exceed 3 months (Art. 73);
2. If the learnership of 3 months is completed, the employer may be compelled to continue with the
services of the learner as a regular employee [Art. 75 (d)];
3. There is a commitment from the employer to employ the learners if they so desire, as regular
employees upon completion of the learnership [Art. 75 (d)];
4. If the learner is dismissed from service without just and valid cause and without due process
after 2 months of service, he will be deemed as regular employee; and
5. The wages or salary rates of the learners which shall begin at not less than 75% of the applicable
minimum wage
Rule on disabled workers and handicapped RA 7277
No disabled person shall be denied access to opportunities for suitable employment. A qualified
disabled EE shall be subject to the same terms and conditions of employment and the same
compensation, privileges, benefits, fringe benefits, incentives or allowances as a qualified able-bodies
person (Sec.5, RA 7277)
Rule on working scholars
There is no employer-employee relationship between students on one hand and schools, colleges or
universities on the other, where there is written agreement between them under which the former agree
to work for the latter in exchange for the privilege to study free of charge, provided, the students are
given real opportunities, including such facilities as mat be reasonable and necessary to finish their
chosen courses under such agreement. (Sec. 14, Rule X, IRR)
12. BOOK III:
Coverage: Art. 82 and Art. 83 (Hours of Work)
ART. 82. Coverage. - The provisions of this Title shall apply to employees in all establishments and
undertakings whether for profit or not, but not to government employees, managerial employees, field
personnel, members of the family of the employer who are dependent on him for support, domestic
helpers, persons in the personal service of another, and workers who are paid by results as determined
by the Secretary of Labor in appropriate regulations.
As used herein, "managerial employees" refer to those whose primary duty consists of the management
of the establishment in which they are employed or of a department or subdivision thereof, and to other
officers or members of the managerial staff.

"Field personnel" shall refer to non-agricultural employees who regularly perform their 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.
ART. 83. Normal hours of work. - The normal hours of work of any employee shall not exceed eight (8)
hours a day.
Health personnel in cities and municipalities with a population of at least one million (1,000,000) or in
hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours for
eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where the exigencies of
the service require that such personnel work for six (6) days or forty-eight (48) hours, in which case, they
shall be entitled to an additional compensation of at least thirty percent (30%) of their regular wage for
work on the sixth day. For purposes of this Article, "health personnel" shall include resident physicians,
nurses, nutritionists, dietitians, pharmacists, social workers, laboratory technicians, paramedical
technicians, psychologists, midwives, attendants and all other hospital or clinic personnel

Policy Instruction No. 54: Ultra Vires Act

Policy Instruction No. 54:
This issuance clarifies the enforcement policy of this Department on the working hours and
compensation of personnel employed by hospital/clinics with a bed capacity of 100 or more and those
located in cities and municipalities with a population of one million or more. Republic Act 5901 took
effect on 21 June 1969 prescribes a 40-hour/5 day work week for hospital/clinic personnel. At the same
time, the Act prohibits the diminution of the compensation of these workers who would suffer a
reduction in their weekly wage by reason of the shortened workweek prescribed by the Act. In effect, RA
5901 requires that the covered hospital workers who used to work seven (7) days a week should be paid
for such number of days for working only 5 days or 40 hours a week. The evident intention of RA 5901 is
to reduce the number of hospital personnel, considering the nature of their work, and at the same time
guarantee the payment to them of a full weekly wage for seven (7) days. This is quite clear in the
Exemplary Note of RA 5901 which states: As compared with the other employees and laborers, these
hospital and health clinic personnel are over-worked despite the fact that their duties are more delicate
in nature. If we offer them better working conditions, it is believed that the brain drain that our
country suffers nowadays as far as these personnel are concerned will be considerably lessened. The fact
that these hospitals and health clinics personnel perform duties which are directly concerned with the
health and lives of our people does not mean that they should work for a longer period than most
employees and laborers. They are also entitled to as much rest as other workers. Making them work
longer than is necessary may endanger, rather than protect the health of their patients. Besides, they
are not receiving better pay than the other workers. Therefore, it is just and fair that they may be made
to enjoy the privileges of equal working hours with other workers except those excepted by law. (Sixth
Congress of the Republic of the Philippines, Third Session, House of Representatives, H. No. 16630).The
Labor Code in its Article 83 adopts and incorporates the basic provisions of RA 5901 and retains its spirit
and intent which is to shorten the workweek of covered hospital personnel and at the same time assure
them of a full weekly wage. Consistent with such spirit and intent, it is the position of the Department

that personnel in subject hospital and clinics are entitled to a full weekly wage for seven (7) days it they
have completed the 40-hours/5-day workweek in any given workweek.
CASE: San Juan De Dios Hospital vs. NLRC
SC: We note that Policy Instruction No. 54 relies and purports to implement Republic Act No. 5901,
otherwise known as An Act Prescribing Forty Hours a Week of Labor for Government and Private
Hospitals or Clinic Personnel, enacted on June 21, 1969. Reliance on Republic Act No. 5901, however, is
misplaced for the said statute, as correctly ruled by respondent NLRC, has long been repealed with the
passage of the Labor Code on May 1, 1974, Article 302 of which explicitly provides: All labor laws not
adopted as part of this Code either directly or by reference are hereby repealed. All provisions of existing
laws, orders, decrees, rules and regulations inconsistent herewith are likewise repealed. Accordingly,
only Article 83 of the Labor Code which appears to have substantially incorporated or reproduced the
basic provisions of Republic Act No. 5901 may support Policy Instructions No. 54 on which the latters
validity may be gauged
Art. 84: benefits, service, incentive leave.
- Basis for 15-day VL and SL: There is no law for this. This is based on employers practice. If this
practice is being extended by the employer for 3 yrs, this has already ripened into an employer
practice. Therefore, it cannot be assailed without violating the non-diminution benefit rule.
Rule: 5 days incentive leave if employee works for at least a year
13. On Supervisors and Managerial employees
Are supervisors covered by Art. 83 to 96?

SC: Supervisors are part of managerial staff and are NOT covered by Art. 83 to
96.

Supervisors and managerial employees are one, they are both NOT entitled to
benefits in Book III of the Labor Code. However, in case of the right to selforganization, they are distinct.

Managerial employees are prohibited in forming unions

Supervisory employees can form union distinct and apart from Rank and File
employees. If theres mixture of union, its not invalid but these supervisors
should withdraw OR the rank and file employees should withdraw.
CASE: Atlas Lithographic Services, Inc. vs. Laguesma (DOLE) read Art. 245
Issue: Whether or not, under Article 245 of the Labor Code, a local union of supervisory employees may
be allowed to affiliate with a national federation of labor organizations of rank-and-file employees and
which national federation actively represents its affiliates in collective bargaining negotiations with the
same employer of the supervisors and in the implementation of resulting collective bargaining
agreements

SC: The prohibition against a supervisors' union joining a local union of rank-and-file is replete with
jurisprudence. The Court emphasizes that the limitation is not confined to a case of supervisors wanting
to join a rank-and-file local union. The prohibition extends to a supervisors' local union applying for
membership in a national federation the members of which include local unions of rank-and-file
employees. The intent of the law is clear especially where, as in the case at bar, the supervisors will be
co-mingling with those employees whom they directly supervise in their own bargaining unit.
RA 9481 (June 2007) Rank and File can now affiliate with one and the same federation (the doctrine
of separate union is not that accurate)
14. Art. 101, Labor Code: workers paid by result
ART. 101. Payment by results. - (a) The Secretary of Labor and Employment shall regulate the payment of
wages by results, including pakyao, piecework, and other non-time work, in order to ensure the payment
of fair and reasonable wage rates, preferably through time and motion studies or in consultation with
representatives of workers and employers organizations.
15. Art. 102 to 105, Labor Code: What form, where, when, to whom should wages be paid?
Legal tender (ATM arrangement, checks, postal money order)

For checks and postal money order with one (1) additional requirement: it
must be customary at the time of the adoption of the code; all other
requirements are the same.
When employees status changed can demand _______ adjustment.
Place of undertaking
Directly to the employee. If dies with unpaid salary, the spouse may hire a lawyer to prepare
for an affidavit re: her relationship with her minor children.
ART. 102. Forms of payment. - No employer shall pay the wages of an employee by means of promissory
notes, vouchers, coupons, tokens, tickets, chits, or any object other than legal tender, even when
expressly requested by the employee.
Payment of wages by check or money order shall be allowed when such manner of payment is
customary on the date of effectivity of this Code, or is necessary because of special circumstances as
specified in appropriate regulations to be issued by the Secretary of Labor and Employment or as
stipulated in a collective bargaining agreement.
ART. 103. Time of payment. - Wages shall be paid at least once every two (2) weeks or twice a month at
intervals not exceeding sixteen (16) days. If on account of force majeure or circumstances beyond the
employers control, payment of wages on or within the time herein provided cannot be made, the
employer shall pay the wages immediately after such force majeure or circumstances have ceased. No
employer shall make payment with less frequency than once a month.
The payment of wages of employees engaged to perform a task which cannot be completed in
two (2) weeks shall be subject to the following conditions, in the absence of a collective bargaining
agreement or arbitration award:

(1) That payments are made at intervals not exceeding sixteen (16) days, in proportion to the amount of
work completed;
(2) That final settlement is made upon completion of the work.
ART. 104. Place of payment. - Payment of wages shall be made at or near the place of undertaking,
except as otherwise provided by such regulations as the Secretary of Labor and Employment may
prescribe under conditions to ensure greater protection of wages.
ART. 105. Direct payment of wages. - Wages shall be paid directly to the workers to whom they are due,
except:
(a) In cases of force majeure rendering such payment impossible or under other special circumstances to
be determined by the Secretary of Labor and Employment in appropriate regulations, in which case, the
worker may be paid through another person under written authority given by the worker for the
purpose; or
(b) Where the worker has died, in which case, the employer may pay the wages of the deceased worker
to the heirs of the latter without the necessity of intestate proceedings. The claimants, if they are all of
age, shall execute an affidavit attesting to their relationship to the deceased and the fact that they are
his heirs, to the exclusion of all other persons. If any of the heirs is a minor, the affidavit shall be executed
on his behalf by his natural guardian or next-of-kin. The affidavit shall be presented to the employer who
shall make payment through the Secretary of Labor and Employment or his representative. The
representative of the Secretary of Labor and Employment shall act as referee in dividing the amount paid
among the heirs. The payment of wages under this Article shall absolve the employer of any further
liability with respect to the amount paid
16. Labor-only contracting prohibited by DOLE; Independent contracting permitted by DOLE.
Labor only contracting is prohibited. There is labor-only contracting where:
a. The contractor does not have substantial capital or investments in the form of tools,
equipment, machineries, work premises, among others, and the employees recruited and places are
performing activities which are usually necessary or desirable to the operation of the company, or
directly related to the main business of the principal within a definite or predetermined period,
regardless of whether such job, work or service is to be performed or completed within or outside the
premises of the principal; or
b. The contractor does not exercise the right to control the performance of the work of the employee.
On Independent Contracting
CASE: Aliviado vs. Procter & Gamble Philippines, Inc.
The SC conceded that the law and its implementing rules allow contracting arrangements for the
performance of specific jobs, works, or services. Indeed, it is management prerogative to farm out any of
its activities, regardless of whether such activity is peripheral or core in nature. However, in order for

such outsourcing to be valid, it must be made to an independent contractor because the current labor
rules expressly prohibit labor-only contracting.
Factors to determine existence of Independent Contractor relationship
1. Whether the contractor is carrying on an independent business;
2. Whether the work is part of the employers general business;
3. The nature and extend of the work;
4. The skill required;
5. The terms and duration of the relationship;
6. The right to assign the performance of the work to another;
7. The control and supervision of the work and the employers powers with respect to the hiring,
firing and payment of salaries;
8. The duty to supply premises, tools and appliances.
17. DOLE Department Order No. 18 A define bilateral agreement
Are outsource providers covered by the Labor Code or New Civil Code?
DO 18-A, Series of 2011, clearly speaks of a trilateral relationship that characterizes the covered
contracting/subcontracting arrangement. Thus, vendor-vendee relationship for entire business processes
covered by the applicable provisions of the Civil Code on contracts is excluded.
18. Art.110 Workers Preference
What is the order of preference?

Ordinary order of preference is subject to condition that none of the property
should be mortgaged (specifically attached) the moment the State will assert his
right (Note: There should be a judicial declaration of bankruptcy before
workers can avail of this right)
ART. 110. Worker preference in case of bankruptcy. - In the event of bankruptcy or liquidation of an
employers business, his workers shall enjoy first preference as regards their wages and other
monetary claims, any provisions of law to the contrary notwithstanding. Such unpaid wages and
monetary claims shall be paid in full before claims of the government and other creditors may be paid

March 21, 1989 On Judicial Declaration

Herrera- Veloso Law (RA 6715) (deleted the requirement of a judicial order of
declaration)

CASE: DBP vs NLRC (There MUST always be a judicial order of declaration before the employer can
avail of preference)
SC: The right of preference given to workers under Article 110 of the Labor Code cannot exist in any
effective way prior to the time of its presentation in distribution proceedings. It will find application
when, in proceedings such as insolvency, such unpaid wages shall be paid in full before the "claims of the
Government and other creditors" may be paid. But, for an orderly settlement of a debtor's assets, all

creditors must be convened, their claims ascertained and inventoried, and thereafter the preferences
determined in the course of judicial proceedings which have for their object the subjection of the
property of the debtor of the payment of his debts and other lawful obligations.
CASE: Rubberworld (Phils) Inc. vs NLRC (May workers assert in an extrajudicial proceeding?)
- NO. Judicial proceeding first before they can enforce their rights in Art. 110.
SC: The preferential right of workers and employees under Article 110 of the Labor Code may be
invoked only upon the institution of insolvency or judicial liquidation proceeding. Indeed, it is wellsettled that "a declaration of bankruptcy or a judicial liquidation must be present before preferences
over various money claims may be enforced. But debtors resort to preference of credit -- giving
preferred creditors the right to have their claims paid ahead of those of other claimants -- only when
their assets are insufficient to pay their debts fully. The purpose of rehabilitation proceedings is
precisely to enable the company to gain a new lease on life and thereby allow creditors to be paid
their claims from its earnings. In insolvency proceedings, on the other hand, the company stops
operating, and the claims of creditors are satisfied from the assets of the insolvent corporation. The
present case involves the rehabilitation, not the liquidation, of petitioner-corporation. Hence, the
preference of credit granted to workers or employees under Article 110 of the Labor Code is not
applicable.
CASE: Peralta vs. Republic
Did Art. 110 do away with provisions of the Civil Code?
Art. 110 of the Labor Code must always be read together with the provisions of the Civil Code.
SC: Article 110 of the Labor Code and its implementing rule cannot be invoked by the respondents in this
case absent a formal declaration of bankruptcy or a liquidation order. To hold that Article 110 is also
applicable in extra-judicial proceedings would be putting the worker in a better position than the State
which could only assert its own prior preference in case of a judicial proceeding. Therefore, Article 110
must not be viewed in isolation and must always be reckoned with the provisions of the Civil Code.
o

CONDITIONS before workers can avail of Art. 110:

 Judicial declaration
 No mortgaged properties or encumbrances

Which is superior, mortgage credit or mortgage preference under Art. 110?

o MORTGAGE CREDIT is superior. This involves real rights. It is a specially
preferred credit. (superior since June 1989 based on the case of DBP vs Ariel
Santos)
o Mortgage Preference is only an ordinary preferred credit.

CASE: DBP vs. Ariel Santos

SC: A recorded mortgage credit is a special preferred credit under Article 2242 (5) of the Civil Code on
classification of credits. The preference given by Article 110, when not falling within Article 2241 (6) and

Article 2242 (3) of the Civil Code and not attached to any specific property, is an ordinary preferred
credit although its impact is to move it from second priority to first priority in the order of preference
established by Article 2244 of the Civil Code (Republic vs. Peralta, supra).

19. Attorneys Fees

Limited to recovery of unpaid wages. This is NOT true today because the lawyer is awarded with 10%
attorneys fees based on Art. 111 of the Labor Code.
ART. 111. Attorneys fees. - (a) In cases of unlawful withholding of wages, the culpable party may
be assessed attorneys fees equivalent to ten percent of the amount of wages recovered.
(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative
proceedings for the recovery of wages, attorneys fees which exceed ten percent of the amount of wages
recovered.
CASE: Traders Royal Bank vs. NLRC
- The attorneys fee was reduced by the Labor Arbiter to below 10% to union lawyer. It depends on the
professional standing of the lawyer.
SC: Article 111 of the Labor Code regulates the amount recoverable as attorney's fees in the nature of
damages sustained by and awarded to the prevailing party. It may not be used therefore, as the lone
standard in fixing the exact amount payable to the lawyer by his client for the legal services he rendered.
Also, while it limits the maximum allowable amount of attorney's fees, it does not direct the
instantaneous and automatic award of attorney's fees in such maximum limit.
xxxThis Court has laid down guidelines in ascertaining the real worth of a lawyer's services. These
factors are now codified in Rule 20.01, Canon 20 of the Code of Professional Responsibility and should be
considered in fixing a reasonable compensation for services rendered by a lawyer on the basis of
quantum meruit. These are: (a) the time spent and the extent of services rendered or required; (b) the
novelty and difficulty of the questions involved; (c) the importance of the subject matter; (d) the skill
demanded; (e) the probability of losing other employment as a result of acceptance of the proffered
case; (f) the customary charges for similar services and the schedule of fees of the IBP chapter to which
the lawyer belongs; (g) the amount involved in the controversy and the benefits resulting to the client
from the services; (h) the contingency or certainty of compensation; (i) the character of the employment,
whether occasional or established; and (j) the professional standing of the lawyer.
CASE: UP Office of Legal Aid: whether or not a student member is entitled to attorneys fees
SC: In an ordinary sense, attorneys fees are awarded to lawyers. In an extraordinary sense, attorneys
fees are awarded to litigants.
Connect to: Art. 228 of the Labor Code, may non-lawyers appear to the Labor Arbiter?

YES, if: 1) authorized representative of the union; 2) _______; 3) Those
accredited members of the Legal Aid.

Article 228. Appearances and Fees.

(a) Non-lawyers 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.
(b) No attorneys fees, negotiation fees or similar charges of any kind arising from any collective
bargaining agreement shall be imposed on any individual member of the contracting union: Provided,
However, that attorneys fees may be charged against union funds in an amount to be agreed upon by
the parties. Any contract, agreement or arrangement of any sort to the contrary shall be null and void.
CASE: Pacific Banking Corp. vs. Clave:
Whether or not a lawyer may assess directly his attorneys fees from union members?
NO. (3 requisites)  NOT SURE
This case is about the legality of deducting from the monetary benefits awarded in a collective
bargaining agreement the attorneys fees of the lawyer who assisted the union president in negotiating
the agreement. It also involves the jurisdiction of the Office of the President of the Philippines to order
such deduction.
SC: the Office of the President had no jurisdiction to make adjudication on Saavedras attorneys fees.
The case was appealed with respect to the CBA terms and conditions, not with respect to attorneys fees.
Although the fees were a mere incident, nevertheless, the jurisdiction to fix the same and to order the
payment thereof was outside the pale of Claves appellate jurisdiction. He was right in adopting a handsoff attitude in his first resolution and holding that the payment of the fees was a question between the
lawyer and the union.

STRIKE: declare/ not: voting should be secret?

Art. 247 (a) Additional compensation; (b) majority authority based on total union membership
(I honestly do not know why I wrote these words, hindi ko marelate, haha)

20. READ: Art. 112 to 119

RA 6727: National Wages and Productivity Commission (NWPC) and regional board
Wage Rationalization Act (RA 6727) fix minimum wage

SIGNIFICANCE:

Creation of NWPC

Creation of regional board to fix minimum wage in regional level

Last minute minimum wage passed
21. Art. 123 Wage Distortion

CASE: Cagayan Sugar Milling Corp. vs. Sec. of Labor & Employment Whether or not Wage Order R0202 is null and void
SC: Passing RO2-02-A without going through the process of public consultation and hearings, the
Regional Board deprived petitioner and other employers of due process as they were not given the
opportunity to ventilate their positions regarding the proposed wage increase. In wage-fixing, factors
such as fair return of capital invested, the need to induce industries to invest in the countryside and the
capacity of employers to pay are, among others, taken into consideration. Xxx. For the same reason,
Article 123 of the Labor Code also provides that in the performance of their wage-determining functions,
the Regional Board shall conduct public hearings and consultations, giving notices to interested parties.
Moreover, it mandates that the Wage Order shall take effect only after publication in a newspaper of
general circulation in the region. In the case at bar, it is indisputable that there was no public
consultation or hearing conducted prior to the passage of RO2-02-A. Neither was it published in a
newspaper of general circulation.
Wage Order: Salary Floor method and salary ceiling/ cut method

Bankers Cases: Teller cannot compare salary because of inter-regional ____.

Jurisdiction: wage distortion is NOT a strikeable issue. When a union file a wage
distortion case in the regional office of NCMB, notice of strike as a preventive mediation
case and notice of strike deemed withdrawn. If union continues, strike will be declared
illegal and will lose payment of _______.
Intra and inter-union disputes are non-strikeable

22. STUDY: Labor Standards, Kasambahay Law, Night Workers Act, Stipulation against marriage,
prohibited activities.