Commission.
Does the act of furnishing the NWCP a copy of the Wage Order mean
seeking its approval?
-No, furnishing the NWCP a copy of the Wage Order issued by the
RTWPB does not mean that it needs its approval; it only means that such
order is subject to their review. An approval by the NWCP is only needed for
the IRR which the RTWPB has to prepare within 10 days from the issuance
of the wage order. This IRR is approved by the DOLE Secretary upon the
recommendation of the NWCP.
Why is the approval of NWCP necessary for the IRR of a Wage Order?
-NWCPs approval is necessary for the IRR of a Wage Order because
only NWCP is empowered by RA 6727 to prescribe rules and regulations for
the determination of appropriate wages in the country.
If the IRR laid out by the RTWPB is not approved by the NWCP, what is
the effect of such an IRR?
-Guidelines or IRR laid out by the RTWPB without the approval of the
NWCP are INEFFECTUAL, VOID, and CANNOT BE THE SOURCE
OF RIGHTS AND PRIVILEGES of the working men. The Supreme Court,
in a case, ruled that Art. 121 (c) and (d) and Art. 122 (b) clearly grant the
NWCP, not the RTWPB, the power to prescribe the rules and guidelines for
the determination of minimum wage and productivity measures. While the
RTWPB has the power to issue wage orders under Art. 122 (b) of the Labor
Code, such orders are subject to the guidelines prescribed by the NWPC.
Are public hearings and publication a mandatory requirement for a
Wage Order?
-Yes, In the case of Cagayan Sugar Milling Co. Vs Sec. Of Labor, et al.
(1998), the Court upheld the objection of Cagayan Sugar Milling Co. when it
assailed the validity of Wage Order R02-02-A on the ground that it was
passed without the required public consultation and newspaper publication.
Respondents said that there was no need to comply with these requirements
since Wage Order R02-02-A merely clarified the ambiguous provision of the
orginal wage order. However, the Court held that there was no ambiguity as
it provided in clear and categorical terms for an increase in statutory
minimum wage workers in the region. Hence, the subsequent passage of R0202-A, providing instead for an across-the-board increase in wages did not
clarify the earlier order, but amended the same and changed the essence of the
original order. Hence, it was struck down as a violation of Art. 123 of the
Labor Code.
Illustrative Case:
Facts: Metrobank and its employee union arrived at a wage increase of P900
per month as of January 1, 199. It was arrived at through a collective
bargaining process or CBA. As result the daily wage of an employee holding
a lower position increased making a difference of only P100 in salary from an
employee holding a higher position.
b. Ensure a decent standard of living for the workers and their families
c. Guarantee the rights of labor ot its just share in the fruits of
production
d. Enchance employment generation in the countryside through industry
dispersal
e. Allow business and industry reasonable returns on investment,
expansion, and growth.
What is wage structure or compensation plan?
-Wage structure or compensation plan is practiced by companies in
determining the pay grade of their employees. This requires classifying jobs
through Job Evaluation, where a point rating system is used. Jobs are given
quantitative ratings based on skill or education, degree of responsibility,
physical effort, work conditions, and complexity of duties. The job ratings
are clustered into job grades which correspond to salary grades. Each salary
grade progresses from hiring rate to maximum. Under the wage structure, the
salaries pertaining to positions are results of studied distinctions and relative
values of jobs. The higher the job grade, the higher the pay.
If a company revises its wage structure or compensation plan, thereby
effecting wage distortion, can it be held accountable under Art. 124 of the
Labor Code?
-No, Art. 124 of the Labor Code does not apply to a distortion arising
from a revision of a salary scale initiated by the employer, it only applies to a
wage distortion arising from a compliance of a wage order. If wage distortion
is effected through the employers initiation of a wage restructure, employees
can negotiate with its employers and lobby for a wage increase through
appropriate channels, such as through a collective bargaining agreement. In
the National Federation of Labor vs NLRC (1994), Court said that it cannot
interfere as this is a matter of management judgment and discretion, and
ultimately perhaps, a subject matter for bargaining negotiations.
If the same company, situated in different regions, decides to increase the
salary scale of one of its branches in one region, can it be considered
salary distortion by those branches in other regions which were not given
any increase by the company? Is this the distortion contemplated by Art.
124?
-No to both questions. Art. 124 talks only of wage distortion resulting
from a compliance of a wage order. Also, if a company with different
branches in different regions decides to give an increase in pay only to one
branch in one region, it cannot be considered was wage distortion because for
one, the wages being compared are located in different regions; two, wage
fixing has been regionalized by RA 6727. That said each region has a
corresponding RTWPB which considers standards or criteria existing in the
region to fix a wage increase. Since these criteria vary from one region to
another, the pay levels of comparable jobs also tend to vary among regions.
Wage distortion will only arise if it involves comparison of jobs located in the
same region.
How do you correct wage distortion contemplated by Art. 124 of the
Labor Code?
-Wage distortion arising from compliance of a wage order can be
corrected through a negotiated wage increase to correct wage distortions,
which is recognized by the law as a valid remedy. The intent is to encourage
parties to seek solutions to the problem of wage distortion through voluntary
negotiation rather than strikes, lockouts, or other concerted activities of the
employees or management. Recognition and validation of wage increases are
given by employers either unilaterally or as a result of collective bargaining
negotiations for the purpose of correcting wage distortion are in keeping with
the public policy of encouraging employers to grant wage and allowance
increases to their employees which are higher than the minimum rates of
increases prescribed by law or administrative regulation.
Note: Wage Distortion is nonstrikeable as provided by Sec. 16, Chapter I
of RA 6727s IRR which declares that any issue involving wage
distortion shall not be a ground for strike/lockout.
What is the wage distortion adjustment formula?
-RA 6727 does not particularly prescribe a formula to estimate the
amount that will rectify or minimize wage distortion. However, NLRC
Commissioner Bonto-Paez in the case involving Metropolitan Bank
suggested a wage distortion adjustment formula that was accepted by the
Court as the appropriate measure.
This is merely a suggested
formula. Employers,
unions or employee reps.
may devise an equitable
formula differing from the
one adopted here.
D.O No. 57-04 comprises 3 approaches, what are these approaches and how
are they effected?
-The 3 approaches of LSEF are: Self-Assessment, Inspection, and
Advisory Service.
1. Self-Assessment is voluntary compliance mode.
-applicable to and encouraged in establishments with at least 200
workers and, regardless of number of workers, to unionized firms with
CBAs.
-guided by a checklist provided by the DOLE regional offices in
the 1st quarter of every year
-within 1 month after receiving the checklist, a committee in the
employer company composed of employer and employee reps. shall
accomplish the checklist and submit it to DOLE within 5 days.
2. Inspection - undertaken by DOLE inspectors
-in work places with 10-199 workers
-inspection priority are workplaces that are subjects of
complaints or where accidents and illnesses are
imminent or work hazards exist.
-construction sites and places where women and children
work are also considered inspection priority.
-inspection for compliance of establishment of health
programs under Art. 165 of the Labor Code may be
delegated to local government units
3. Advisory Services - applicable to establishments w/less than 10
workers
-registered as BMBEs
-assistance is given to improve their productivity to
facilitate their eventual compliance with labor standards.
How are labor standard violations, unearthed through self-assessment or
inspection, or related cases, to be disposed of?
-It shall be disposed of in accordance with Articles 128, 129, 168, and
171 of the Labor Code.
Art. 128, visitorial and enforcement powers where the Labor Sec. or
his authorized representatives shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases where the
employers contest the findings of the labor inspectors with supporting
documents not considered in the course of the inspection.
Director from the jurisdictional limitations imposed by Art. 129 and 217
as embodied in the phrase notwithstanding the provision of Articles 129
and 217... The intention of RA 7730 is to broaden the extent and
heighten the effectiveness of the enforcement power of the Regional
Director being the governments regional representative to give effect to
the labor standards provision of the Labor Code and other labor
legislation...
Can the Dole Regional Director determine the existence of employeremployee relationship?
-Initially, As ruled in the Bombo Radyo Case (2009), the Court said that
determining the existence of employer-employee relationship should be
comprehensive and intensive and better left to the specialized quasi-judicial
body that is the NLRC. The intricacies and implications of an employeremployee relationship demand that the level of scrutiny should be far above
the cursory and the mechanical. The employer-employee relationship is a
matter fraught with questions of fact and law, which is best resolved by the
NLRC rather than an administrative official of the executive branch.
However, in 2012, it modified its decision through an En Banc
Resolution, conceding that DOLE has the authority to determine the existence
of an employer-employee relationship, subject to judicial review, NOT
REVIEW BY THE NLRC. Court said that DOLE must have the power to
determine the existence of an employer-employee relationship and from
there, decide whether or not to issue compliance orders in accordance with
Art. 128 (b) of the Labor Code as amended by RA 7730.