T H E L A B O R CO D E
WITH ANNOTATIONS
1
LABOR RELATIONS
2
BOOK FIVE
LABOR RELATIONS
3
LABOR RELATIONS
Franklin M. Drilon
(ECOP: 1987 Constitution: Its Implications
on Employment and Labor Relations)
4
CAN THE LABOR UNION SURVIVE?
Peter F. Drucker
The New Realities, 1989, pp. 185-189
5
LABOR RELATIONS
The Welga ng Bayan which was in fact a Welga Laban sa Bayan is off-
spring of a misreading of the constitutional provisions. The Constitution
authorizes only strikes that are peaceful and in accordance with law.
But strikes, whether peaceful or in accordance with law,
unfortunately are not the instrument to secure better salaries or benefits
for the workers. This has been the world’s plainest experience in the
last two decades that also saw the dismantling of the most cherished
doctrines of socialism. We don’t have to go very far to bring home our
point. What has debunked the dogma that strike is labor’s most necessary
and rewarding right is the history of labor in the past two decades in our
part of the globe, the area of economic miracle, the model Pacific Rim
where we are.
The records show that in countries here where there are no strikes,
or where strikes are few and far between, the workers enjoy the highest
wages and handsomest fringe benefits. By the same token, in countries
where strikes abound, the workingman gets very poor pay and small
benefits.
It was ILO, International Labor Organization of the United
Nations, that documented a comparative study of the number of strikes
in our area and came up with the conclusion that “industrial peace is
essential to the prosperity in Asean countries.”
The central folly is to try to divide wealth before creating it. It ought
to be clear to the labor leaders and the bleeding-hearts in the Left and in
Congress that there exists a law superior to the laws made by Congress
or by wage regulatory boards. This is the economic law of supply and
demand. Labor benefits are limited by the economic condition of the
business enterprises and of the nation. The key to better deal for labor
is better business. In Japan and Taiwan, workers get fantastic salaries
because there are more jobs than applicants.
Smarter labor leaders negotiate for higher salaries in exchange
for higher productivity. The deal benefits both parties.
All told, the world’s experience in the last decades is that a country’s
economic prosperity is what raises the workingman’s wages and condition;
and that staging strikes is what subverts and stunts economic progress.
Thus, strikes work against the interest of the workers. One day not far off
someone will rewrite the law books, even the Constitution, to moderate
the doctrine that the right to strike is labor’s most vital and rewarding
right.
Napoleon G. Rama
Philippine Panorama, Nov. 4, 1990
6
GENESIS OF INDUSTRIAL PEACE
7
LABOR RELATIONS
DISMISSAL FROWNED UPON
Except for the most serious causes affecting the business of
the employer, our labor laws frown upon the penalty of dismissal.
Where a penalty less punitive would suffice, an employee should
not be sanctioned with a consequence so severe.
EQUALIZING FORCE
8
BOOK FIVE
LABOR RELATIONS
Title I
POLICY AND DEFINITION
Chapter I
POLICY
9
ART. 211 LABOR RELATIONS
10
i
ii
iii
iv
v
vi
vii
Books by the Author
THE LABOR CODE WITH COMMENTS AND CASES (VOLUMES I and II)
The textbooks: A comprehensive instructional study of the whole Labor
Code, richly amplified with comments and court rulings; intended for
law students, lawyers, and other practitioners; recipient of the Supreme
Court “Centenary Book Award”; a “popular labor law textbook” (the
Supreme Court in Cainta Catholic School case, May 4, 2006); now on its
nineteenth year, seventh edition
viii
THE
LABOR CODE
WITH COMMENTS
AND CASES
Part of the Labor Law-Labor Relations Series
by
C. A. AZUCENA, JR.
VOLUME II
Seventh Edition
2010
US Library of Congress
Call No. KPM1214.31974.A6
A956 1991
PCPM Certificate of
Registration No. SP 594
ISBN 978-971-23-5740-4
Printed by
rex printing company, inc.
typography & creative lithography
84 P. Florentino St., Quezon City
Tel. Nos. 712-41-01 • 712-41-08 x
PREFACE
Keeping Faith with Tradition
A book has to build and keep its own tradition. This seventh
edition is an effort to do that.
Republic Act No. 9481 of 2007 amends a number of Labor Code
articles to strengthen the self-organizational right of employees.
Because of this law the Department of Labor and Employment had
to make numerous changes to the rules implementing the law on
labor relations, through Department Order No. 40-F-03 released in
October 2008.
Aside from these legislative and administrative changes, sig-
nificant rulings were also issued by the Supreme Court, affecting
some statutory provisions and previous decisions. Among these are
those declaring as unconstitutional Section 10 of R.A. No. 8042; the
precedent-setting rulings on labor contracting and cooperatives; the
debatable ruling on jurisdiction to determine employer-employee
relationship; and again, the reversal of the ruling on the effect of
employee’s defeat in an illegal dismissal case.
These developments—and many more—are all reflected in this
new edition.
Unchanged, however, are the underlying objective and the fea-
tures and methodology of the book. The objective is to analyze and
explain, as clearly and authoritatively as possible, the country’s labor
law anchored to the Labor Code. The aim, in other words, is to build
knowledge—at least to form cohesive and retainable understanding
of concepts comprising a defined subject. This being the aim I have
resisted (in this and the past editions) the easier work of merely rattling
off court rulings without integrating or synthesizing them. The harder
and more meaningful task is determining what materials to include,
what to exclude, and how to tie them together, correctly and clearly,
so as to create compact, graspable concepts. Those tasks this edition
does. This book therefore continues to feature annotations consisting
of authoritative explanations and court rulings, including the most
significant and recent ones. The codal articles and the annotations
xi
are linked, analyzed and synthesized objectively and academically.*
Figuratively, my aim is not to scatter seedlings in a forest but to build
a well-designed landscape with pathways and plants neatly lined up.
The features and the methods of explanations, I hope, enhance the
objective of offering accessible knowledge of Philippine labor law.
Because this has been the book’s mission since its birth some
twenty years ago and because the book has been generously accepted
in that light by generations of students, lawyers, and nonlawyers, this
edition has to keep faith with that tradition.
All these twenty years, of course, I have always acknowledged
my boundless debt of gratitude to my readers inside and outside the
universities.
CAA
Mandaluyong City and
San Pablo City
Labor Day, 2010
*It should be the business of teachers to stand outside the strife of parties
and endeavor to instill into the young the habit of impartial inquiry, leading them
to judge issues on their merits and to be on their guard against accepting ex parte
statements at their face value. The teacher should not be expected to flatter the
prejudices either of the mob or of officials. His professional virtue should consist in
a readiness to do justice to all sides, and in an endeavour to rise above controversy
into a region of dispassionate scientific investigation. If there are people to whom
the results of his investigation are inconvenient, he should be protected against their
resentment, unless it can be shown that he has lent himself to dishonest propaganda
by the dissemination of demonstrable untruths.
BERTRAND RUSSELL
Unpopular Essays
Routledge, 1950
(p. 129)
xii
To
Father and Mother,
my Lolita, Noel, Mylene, Carmen, and Bennet,
my brothers and sisters,
and
those of my clients and students
who have inspired me,
this work is
gratefully dedicated.
Lawyer’s Formation
A lawyer’s professional life begins the day that he or she
starts law school. This has not always been the case, of course, but
today the first place of almost every lawyer’s career consists of a
period of time spent studying law in a formal academic program
under the supervision of university professors. However diverse
their professional experiences may be in other respects, there-
fore, lawyers still share at least one thing in common: they have
all been law students at one time or another, and it is as students
that their professional habits first take shape.
Anthony T. Kronman
The Lost Lawyer (1993)
p. 109
xiii
ABBREVIATIONS
Without meaning to be informal but only for ease and brevity, this text
occasionally uses abbreviations, commonly known in labor relations practice,
such as the following:
BLR Bureau of Labor Relations
BU Bargaining Unit
BWC Bureau of Working Conditions
C.A. Commonwealth Act/Court of Appeals
CBA Collective Bargaining Agreement
CBL Constitution and By-laws
C.E. Certification Election
CNA Collective Negotiation Agreement
CSC Civil Service Commission
D.O. Department Order
DOLE Department of Labor and Employment
EBR Exclusive Bargaining Representative
E-E Employer-employee (Relationship)
E.O. Executive Order
JC Job Contracting
LA Labor Arbiter
LLO Legitimate Labor Organization
LMC Labor-Management Council/Committee
LoC Labor-only Contracting
M.O. Memorandum Order
MR Motion for Reconsideration
NCMB National Conciliation and Mediation Board
NLRB National Labor Relations Board (in U.S.)
NLRC National Labor Relations Commission
NWPC National Wages and Productivity Commission
OSEC Office of the Secretary
OWWA Overseas Workers’ Welfare Administration
PD Presidential Decree
POEA Philippine Overseas Employment Authority
R.A. Republic Act
RD Regional Director
RO Regional Office
RTWPB Regional Tripartite Wages and Productivity Board
TESDA Technical Education and Skills Development Authority
TRO Temporary Restraining Order
VA Voluntary Arbitration
VR Voluntary Recognition
WA Workers’ Association
WO Wage Order
xiv
THE
LABOR CODE
OF THE
PHILIPPINES
As Amended
By Presidential Decree
Nos. 570-A, 626, 643, 823, 819, 849, 850, 865-A
891, 1367, 1368, 1391, 1412, 1641, 1691, 1692
1693, 1920, 1921
Batas Pambansa
Blg. 32, 70, 130 and 227
Executive Order
Nos. 47, 111, 126, 179, 180, 203, 247, 251, 252, 307,
797
and
Republic Act
Nos. 6640, 6657, 6715, 6725, 6727, 7641, 7655, 7700,
7730, 7796, 8042, 8188, 8558, 9177, 9256, 9347, 9481
WITH
COMMENTS AND CASES
IMPLEMENTING RULES
APPENDICES
xv
STRUCTURE
xvi
TABLE OF CONTENTS
Volume II
Preface, xi
Abbreviations, xiv
Structure, xvi
Part One
THE LABOR CODE WITH ANNOTATIONS
Chapter I — POLICY
Art. 211. Declaration of Policy, 9
Comments and Cases
1. Overview and Viewpoint, 10
2. Workers’ Organization, 13
3. Why Workers Organize, 13
4. ILO Convention No. 87, 14
5. Workers’ Participation in Policy-Making, 15
Chapter II — DEFINITIONS
Art. 212. Definitions, 16
Comments and Cases
1. Employer-Employee Relationship Essential, 18
2. Who are Employees, 19
2.1 “One Whose Work Has Ceased...”, 20
3. Labor Organization As Employer, 20
4. Labor Dispute, 21
5. Labor Disputes and Remedies: A Summary, 22
xvii
5.1 Definition, 22
5.2 Tests or Criteria of “Labor Dispute”, 23
5.3 Kinds of Labor Disputes, 23
5.4 Remedies in Labor Disputes, 24
xviii
7.1 Termination of Corporate Officer; Jurisdiction Over
Intra-Corporate Disputes Transferred from SEC to RTC, 43
7.2 Effect of Claim for Backwages, Benefits, or Damages, 45
7.3 Mainland vs. Movilla: The “Better Policy” in
Determining SEC Jurisdiction, 46
7.4 Tabang vs. NLRC: SEC Jurisdiction Reaffirmed; Corporate
Officer and Intra-Corporate Controversy Defined, 47
7.5 When Bank Officer May be a Regular Employee, 50
8. Labor Arbiter’s Jurisdiction: Money Claims, 50
8.1 Only Money Claims Not Arising from CBA, 51
8.2 Money Claims Must Have Arisen from Employment, 51
8.3 Money Claims of Coop Employees, 53
8.4 Jurisdiction Over Claims for Damages, 54
8.5 Splitting of Actions Not Allowed, 54
8.6 Employer’s Complaint for Damages, 55
9. Labor Arbiter’s Jurisdiction: Strikes and Lockouts, 55
10. Labor Arbiter’s Jurisdiction: OFW’s Money Claims or Dismissal, 56
11. Labor Arbiter’s Jurisdiction: Wage Distortion, 57
12. Labor Arbiter’s Jurisdiction: Disputes over Compromise
Settlements, 57
13. Submission to Jurisdiction, 58
14. Immunity of Foreign Governments, 59
14.1 Immunity of the UN and Its Specialized Agencies, 59
15. Executing Money Claims Against the Government, 60
16. Local Water District, 61
16.1 Exception: Where NLRC Jurisdiction is Invoked, 62
17. Republic Act No. 6715 – Retroactive?, 63
[Part 2. POWERS]
xix
2.4 No Adequate Remedy, 74
2.5 Cash Bond, 74
2.6 Scope, 75
2.7 Reception of Evidence, 75
2.8 Twenty-day Life of TRO, 76
2.9 Illustrative Case: Issuance of TRO, 76
2.10 Injunction from NLRC Not the Proper Remedy Against
Employee’s Dismissal, 77
[Part 3. PROCEDURE]
xx
7.2 Proof and Completeness of Service, 98
8. Resolution of Doubt in Law or Evidence, 99
9. Decision of Labor Arbiter, 101
9.1 Contents of Decisions, 101
9.2 No Motions for Reconsideration and Petitions for
Relief from Judgment, 101
“Not Automatically in Favor of Labor”, 102
Art. 222. Appearances and Fees, 102
Comments and Cases
1. Appearance of Non-lawyers, 102
2. Change of Lawyer, 103
3. Authority to Bind Party, 104
4. Attorney’s Fee, 105
4.1 Negotiation Fee, 105
4.2 For Services Rendered by Union Officers, 106
4.3 Attorney’s Fee Collectible Only from Union Funds, 106
xxi
8.5 Is Property Bond Acceptable, 120
8.6 Bond Accepted Conditionally, 121
8.7 Supersedeas Bond, 121
9. Records and Transmittal, 121
10. Effect of Appeal of Arbiter’s Decision, 122
10.1 Execution or Reinstatement Pending Appeal, 122
10.2 Effect of Perfection of Appeal on Execution, 122
11. Frivolous or Dilatory Appeals, 122
12. Appeals from Decisions of other Agencies, 122
13. Proceedings Before the Commission, 123
13.1 Issues on Appeal, 124
13.2 Technical Rules Not Binding, 124
13.2a Evidence Submitted on Appeal to NLRC, 124
13.3 Conciliation/Mediation, 125
13.4 Consultation, 125
13.5 Dissenting Opinion, 125
13.6 Inhibition, 126
14. Form of Decision, Resolution and Order, 126
14.1 Reasoned Reversal, 126
14.2 Extended Meaning of “Appeal” under Article 223;
NLRC May Issue Writ of Certiorari, 127
15. Finality of Decision of the Commission and Entry of
Judgment, 128
16. Motions for Reconsideration, 128
16.1 Party who Failed to Appeal on Time From
Decision of Labor Arbiter may Still File Motion
for Reconsideration of NLRC Decision, 128
17. Certified Cases, 129
18. Appeal from the National Labor Relations Commission, 129
18.1 Review by Certiorari by the Court of Appeals; the
St. Martin case, 129
18.2 When and Where to File Petition, 131
18.2a One Day Late, 132
18.2b Certified True Copy of NLRC Decision, 132
18.3 Effect on NLRC’s Decision, 132
18.4 Appeal to Labor Secretary Abolished, 132
18.5 Grounds for Certiorari, 132
18.6 “Grave Abuse of Discretion”, 133
18.7 Sole Office of Certiorari, 133
18.8 Not a Slave to Technical Rules, 134
18.9 Appeal from OSEC to CA; St. Martin Ruling Applies, 135
18.10 Exhaustion of Administrative Remedies; Motion for
Reconsideration Required, 136
18.10a Exceptions, 136
19. Certificate of Non-Forum Shopping, 138
19.1 Certification of Nonforum Shopping Must be Made by
Petitioner, 139
20. Disposition by the Court of Appeals, 140
xxii
20.1 Remand, 140
20.2 Dismissal of Appeal, 140
20.3 Findings of Facts Generally Final, 141
20.4 Exceptions, 141
20.5 Examples: Some Findings of Facts Reversed, 142
21. From CA to SC; Only Question of Law, Rule 45, 143
“Faster Disposition of Appealed Cases”, 144
Art. 224. Execution of Decisions, Orders, or Awards, 145
Comments and Cases
1. Execution, 145
1.1 Both Party and Counsel Should Be Notified, 146
1.2 Article 244 is Execution, Not Appeal, Procedure, 146
2. Execution upon Finality of Decision or Order, 146
3. Appeal on the Execution of Decision; Supervening Events, 148
4. General Rule: Regional Trial Court Cannot Issue Injunction
Against NLRC, 150
4.1 Execution Over Property Owned Only by Judgment
Debtor; Remedies of Third-Party Claimant; the
Yupangco Case, 151
4.2 RTC Injunction Against Labor Arbiter or NLRC, When
Allowed, 154
4.3 Third Party Claim, 156
4.4 Simulated Sale, Void Ab Initio, 156
Art. 225. Contempt Powers of the Secretary of Labor, 157
xxiii
6.1 The definitive Ruling: Magbanua vs. Uy, 170
6.2 Absence of Counsel Remedied, 172
6.3 Reiteration, 172
7. Options When Compromise Agreement is Violated, 173
Art. 228. Indorsement of Cases to Labor Arbiters (Repealed
by Batas Pambansa Blg. 230), 173
Art. 229. Issuance of Subpoenas, 173
Art. 230. Appointment of Bureau Personnel, 174
Art. 231. Registry of Unions and File of Collective Agreements, 174
Comments and Cases
Registry of Unions and CBAs, 174
Art. 232. Prohibition on Certification Election, 175
Comments
The Contract-Bar Rule, 175
Art. 233. Privileged Communication, 176
xxiv
5.2 Independent Labor Union, 187
5.3 Worker’s Association, 188
5.4 Chartered Local, 188
5.4a Chartered Local has to be Registered;
Requirements, 188
5.4b Legal Personality only to File a PCE, 189
5.4c Submission of Confirming Documents, 189
5.4d A Trade Union Center cannot Create
a Chapter, 189
5.4e When does a Chapter Become an LLO?, 190
5.4f Recognition by BLR not a Ministerial Duty, 190
5.4g Requirements Relaxed, 192
5.5 Union’s Legitimacy not Subject to Collateral Attack, 192
6. Collective Bargaining Unit (CBU), 192
7. Constitution, By-Laws, and Regulations, 193
“Some Reasons For Joining A Union”, 195
7.1 Limitation to By-laws, 196
7.2 Amendments, 196
8. Provisions Common to the Registration of Labor Organizations
and Workers’ Association, 196
8.1 Attestation, Fee, Copies of Documents, 196
8.2 Action on the Application/Notices, 196
8.3 Denial of Application/Return of Notice, 197
8.4 Appeal, 197
9. Affiliation, 197
9.1 Report of Affiliation; Requirements, 198
10. Disaffiliation, 199
10.1 Local Union is the Principal; Federation, the Agent, 201
10.2 When to Disaffiliate, 201
10.3 Disaffiliation Must be by Majority Decision, 202
10.4 Disaffiliation: Effect on Legal Status, 203
10.5 Disaffiliation: Effect on Union Dues, 203
10.6 Disaffiliation; Effect on Existing CBA; the “Substitutionary”
Doctrine, 204
11. Revocation of Charter, 204
11.1 Effect of Cancellation of Registration of Federation or
National Union on Locals/Chapters, 204
12. Merger or Consolidation, 205
12.1 Notice of Merger/Consolidation of Labor Organizations;
Where to File, 206
12.2 Requirements of Notice of Merger/Consolidation, 206
12.3 Certificate of Registration, 207
13. Change of Name, 207
13.1 Effect of Change of Name, 207
Art. 238. Cancellation of Registration, 207
Art. 238-A. Effect of Petition for Cancellation of Registration, 207
Art. 239. Grounds for Cancellation of Union Registration, 208
xxv
Art. 239-A. Voluntary Cancellation of Registration, 209
Comments and Cases
1. Cancellation of Registration; Grounds, 209
1.1 Invalid Grounds, 209
1.2 “Cabo” and other Grounds Deleted, 210
1.3 Administrative Cancellation; the “reportorial
requirements”, 210
2. Who Files Petition for Cancellation, 211
3. Where to File Petition, 212
4. Procedure, 212
Art. 240. Equity of the Incumbent, 212
xxvi
11.3 Check-Off of Agency Fee, 233
11.4 Illegal Check-Off Ground for Cancellation, 233
11.5 Employer’s Liability in Check-Off Arrangement, 233
11.6 Jurisdiction Over Check-Off Disputes, 234
Title V — COVERAGE
xxvii
2. Registration, 254
3. Certification Election in Government Corporation, 255
3.1 Election of Officers in Government Unions, 255
4. When PSLMC May Rule on Legality of Dismissal, 256
5. Union-busting in a Government Agency, U.L.P., 256
5.1 Even Temporary Employees May Organize, 257
Art. 245. Ineligibility of Managerial Employees to Join any Labor
Organization; Right of Supervisory Employees, 257
Art. 245-A. Effect of Inclusion as Members of Employees Outside
the Bargaining Unit, 257
Comments and Cases
1. Categories of Employees, 258
2. Ineligibility of Managers, 258
2.1 Types of Managerial Employees, 258
2.2 Constitutionality of the Prohibition, 260
2.2a Other Opinions, 261
3. Evolution of Supervisors’ Right to Organize, 262
3.1 First Period: Under the Industrial Peace Act, 262
3.2 Second Period: Under the Labor Code Before
Amendment by R.A. No. 6715, 263
3.3 Third Period: Under the Labor Code as Amended
by R.A. 6715, 263
4. Definitions of Manager and Supervisor, 264
5. Test of Supervisory Status, 265
5.1 The Power to Recommend, 266
5.2 Examples of Ineffective or Clerical Recommendation, 267
5.3 Managers or Supervisors: Under the ILO Convention, 267
6. Segregation of Rank-and-File and Supervisors, 267
6.1 Effects of Having Mixed Membership, 268
6.2 Affiliation of Supervisors and Rank-and-File Unions, 269
7. Confidential Employees, 269
7.1 First Swing: Inclusion Among Rank-and-File, 269
7.2 Second Swing: Exclusion from Rank-and-File, 270
7.3 Third Swing: Inclusion Among Supervisors, 270
7.4 Fourth Swing: Inclusion Among Monthly Paid Rank-
and-File, 271
7.4a Limited Exclusion; Doctrine of Necessary
Implication, 272
7.4b The Metrolab and Meralco Summations:
Exclusion from bargaining unit and Closed-shop
Clause, 273
7.4c Who are Confidential Employees?, 275
7.4d The Labor Nexus, 276
7.4e New CBA may Include Employees Excluded
from old CBA; Expired CBA may be Modified,
not just Renewed, 277
xxviii
8. Security Guards, May Join Rank-and-File on Supervisor Union, 278
9. Workers in Export Processing Zones, 278
Art. 246. Nonabridgment of Right to Self-Organization, 279
Comments
1. Concept of the Right to Self-Organization, 279
Chapter I — CONCEPT
Art. 247. Concept of Unfair Labor Practice and Procedure
for Prosecution Thereof, 281
Comments and Cases
1. Concept of Unfair Labor Practice, 282
1.1 Elements, 283
1.2 Prejudice to Public Interest not an Element of U.L.P, 284
2. Prosecution of U.L.P., 284
“Right Culture — Instead of Anti-Unionism”, 285
xxix
5.9b Assumption of Obligation by New Company, 305
5.10 Successor Employer; Piercing the Corporate Veil, 305
6. Second U.L.P.: “Yellow Dog” Condition (Art. 248[b]), 307
7. Third U.L.P.: Contracting Out (Art. 248[c]), 307
7.1 Contracting Out Restricted by CBA, 309
7.2 Runaway Shop, 310
8. Fourth U.L.P.: Company-domination of Union (Art. 248[d]), 312
9. Fifth U.L.P.: Discrimination (Art. 248[e]), 314
9.1 Discrimination in Work Quota, 315
9.2 Discrimination in Bonus Allocation or Salary Adjustments, 315
9.3 Discrimination in Layoff or Dismissal, 316
9.4 Discrimination in Regularization, 316
9.5 Discrimination by Blacklisting, 317
9.6 Indirect Discrimination, 318
9.7 Test of Discrimination, 318
9.8 Constructive Discharge, 320
9.9 Discharge Due to Union Activity, A Question of Fact, 320
9.10 Valid Discrimination: Union Security Clause, 320
9.10a Kinds of Union Security Agreements, 321
9.10b Validity of Closed-Shop Agreement, 322
9.10c Advantages and Disadvantages of Closed-Shop
Agreement, 323
9.10d Valid Dismissal Because of Application of Union
Security Clause, 324
9.10e Dismissal Pursuant to Closed-Shop Clause
Must Clearly Appear in Contract, 326
9.10f Due Process Required in Enforcing Union Security
Clause; Intra-union Matter becomes Termination
Dispute with Employer, 327
9.10g Liability of Union to Pay Wages and Fringe Benefits
of Illegally Dismissed Employee, 328
9.10h Employer in Good Faith Not Liable, 329
9.10i Closed-Shop, To Whom Not Applicable, 329
9.10j Agency Fee Instead of Union Membership, 330
10. Sixth U.L.P.: Discrimination Because of Testimony
(Art. 248[f]), 330
10.1 Refusal to Testify, 331
10.2 Labor Standards Violation May Lead to a Strike, 332
11. Seventh U.L.P.: Violation of the Duty to Bargain
(Art. 248[g]), 332
12. Eighth U.L.P.: Paid Negotiation (Art. 248[h]), 333
13. Ninth U.L.P.: Violation of the CBA (Art. 248[i]), 333
14. Relief in U.L.P. Cases, 333
14.1 Cease and Desist Order, 333
14.2 Affirmative Order, 334
14.3 Order to Bargain; Mandated CBA, 334
14.4 Disestablishment, 334
15. U.L.P. Not Subject to Compromise, 335
xxx
16. U.L.P. in a Given Period Should Be Included in
Single Charge, 335
17. Employer’s Responsibility for U.L.P. Acts by Subordinate
Officials, 335
xxxi
Art. 252. Meaning of Duty to Bargain Collectively, 359
Art. 253. Duty to Bargain Collectively When There Exists a Collective
Bargaining Agreement, 359
Comments and Cases
1. Duty to Bargain Defined, 360
1.1 Four Forms of ULP in Bargaining, 360
2. First ULP in Bargaining: Failure or Refusal to Meet
and Convene, 361
2.1 Unresolved Petition for Union Cancellation, 361
2.2 Selling the Company, 362
2.3 Successor Employer: Continuity and Identity, 363
2.4 Conversion to Independent Franchise or Operation, 364
2.5 Do Economic Exigencies Justify Refusal to Bargain?, 364
2.6 Acts not Deemed Refusal to Bargain, 365
2.7 Alleged Interference in the Selection of the Union’s
Negotiating Panel, 367
2.8 Non-reply to Proposal; CBA Imposed on Employer, 367
2.8a Repetition in Divine Word University, 368
3. Second U.L.P. in Bargaining: Evading the Mandatory Subjects, 369
3.1 Wages and Employment Conditions, 369
3.1a Wage Factors; “Solomonic” Approach, 371
3.2 Workloads and Work Rules, 372
3.2a Code of Conduct, 372
3.3 Management Prerogatives Clause, 372
3.4 Union Discipline Clause, 373
3.5 Arbitration, Strike-Vote, or No-Strike Clauses, 373
3.6 No-Lockout Clause; Clause Fixing Contractual Term, 373
3.7 Signing Bonus, 373
3.8 Voluntary Benefits, 374
3.9 No Duty to Agree Even on Mandatory Subjects, 374
3.10 Non-mandatory Subjects, 375
3.11 Bargaining to the Point of Impasse: Not Necessarily
Bad Faith, 375
3.12 When Is There Deadlock or Impasse?, 377
3.12a Duty to Bargain When There is Deadlock or
Impasse, 377
3.12b Strike or Lockout in Case of Deadlock, 378
4. Third ULP in Bargaining: Bad Faith, 379
4.1 Determination of Good Faith, 379
4.2 When Can Bargaining in Bad Faith Occur?, 380
4.3 Instances of Bad Faith: Delay of, or Imposing Time
Limit on, Negotiations, 381
4.3a Bad Faitth: Surface Bargaining; Shifting Bargaining
Positions; Blue Sky Bargaining, 384
4.3b Bad Faith: Inflexible Demands; Strike Amid
Negotiation, 386
4.3c Bad Faith: Bloulwarism; Take-It-or-Leave-It
Bargaining, 387
xxxii
4.4 Not Bad Faith to Propose Modifications to the Expiring
CBA, 388
4.5 Giving of Information, 388
5. Fourth ULP in Bargaining: Gross Violation of the Contract, 390
6. Ratification by the CBU; Mandatory Requirements, 390
6.1 Invalid Ratification, 390
6.2 When Ratification Not Needed, 391
6.3 Ratified but Unsigned, 392
6.4 Unratified but Implemented, 392
7. Execution of Contract, 392
7.1 Unwritten or Unsigned Agreement, 393
7.2 Effect of Signing on Other Disputes, 393
8. Registration of CBA, 393
“Management’s Negotiation Strategy”, 394
8.1 Registration Requirements, 395
9. Implementation, then Renegotiation, 395
10. Automatic Renewal of CBA, 396
Art. 253-A. Terms of a Collective Bargaining Agreement, 399
Comments and Cases
1. Effectivity and Retroactivity, 399
1.1 Effectivity of CBA Concluded After Six Months from
Expiration of Old CBA, 400
2. Duration of a C.B.A., 401
3. Extension of Effectivity of CBA, When Valid, 405
3.1 Ten-year Suspension of CBA, 405
Art. 254. Injunction Prohibited, 407
Comments and Cases
1. No Injunction Policy, 407
1.1 Reason of the No-Injunction Policy, 408
1.2 Injunction Issued by Regular Court, When Proper, 409
“Social Dumping/Concession Bargaining”, 410
xxxiii
3. Individual Grievance, 419
4. Collective Bargaining Unit (CBU) Defined, 419
5. Appropriateness of Bargaining Unit; Factors Considered, 420
5.1 Bargaining History Not Decisive Factor, 422
5.2 Exclusion of Confidential Employees, 423
5.3 Temporary or Part-Time Employees, 423
5.4 Seasonal Employees, 424
5.5 Probationary Employees, 424
6. Referendum Where Interests Are Dissimilar, 424
6.1 Desire of the Employees; The Globe Doctrine, 425
7. Single or “Employer Unit” is Preferred, 426
7.1 Exceptions to One-unit Policy, 426
8. Two Companies with Related Businesses, 427
8.1 Subsidiaries and Spun-off Corporations, 429
9. Summation of Significance, 430
Art. 256. Representation Issue in Organized Establishments, 431
Art. 257. Petitions in Unorganized Establishments, 431
Art. 258. When an Employer May File Petition, 432
Art. 258-A. Employer as Bystander, 432
Art. 259. Appeal From Certification Election Orders, 432
Comments and Cases
1. Determining the Bargaining Union: Overview of the Methods, 432
2. First Method: Voluntary Recognition (V.R.), 434
2.1 V.R. Under D.O. No. 40-03, 434
3. Second Method: Certification Election (C.E.), 436
3.1 Fact-Finding, 436
3.1a Certification Election Differentiated from
Union Election, 437
3.2 Direct Certification No Longer Allowed, 438
3.3 Who Files Petition for Certification Election (PCE), 438
3.3a Intervention, 439
3.4 Where to File the PCE, 440
3.5 When to File the PCE, 440
3.6 Form and Contents of Petition, 441
3.7 Action on the Petition; Preminary Conference, 442
3.8 Action on the Petition; Hearings and Pleadings, 442
3.9 Action on the Petition: Denial; Eight Grounds, 443
3.9a First Ground: Non-appearance, 444
3.9b Second Ground: Illegitimacy: Unregistered
Union, 445
3.9c Third Ground: Illegitimacy: No Charter, 447
3.9d Fourth Ground: Absence of Employment
Relationship, 447
3.9e Fifth Ground: The 12-month Bar, 447
3.9f Sixth Ground: Negotiation or Deadlock Bar, 449
xxxiv
3.9g Seventh Ground: Election Bar: Existing CBA, 451
3.9h Eight Ground: Election Bar: Lack of Support, 458
3.10 Prohibited Ground for the Denial/Suspension of
the Petition, 461
3.10a Commingling, 461
3.10b Validity of Registration, 461
3.10c Authority to Decide Existence of Employer-
Employee Relationship; Med-Arbiter’ Order
Appealable to Secretary, 461
3.11 Employer a Bystander; Cannot Oppose PCE, 462
3.12 Action on the Petition; Approval, 463
3.13 Appeal of Order Granting or Denying Petition, 464
3.14 Conducting the C.E., 465
3.14a Pre-election Conference, 465
3.14b Conducting the C.E.; the Voters, 467
3.14c Conducting the C.E.: The Voting, 470
3.14d Conducting the C.E.: Canvassing of Votes, 472
3.14e Who Wins in the C.E.; Proclamation and
Certification, 472
3.14f Failure of Election; Motion for a Remedial
Election, 473
3.14g Run-off Election, 473
3.15 Appeal to Secretary as to Election Result, 475
3.16 Election Irregularities, Protest by Employer, 476
4. Third Method: Consent Election, 476
4.1 Effect of Consent Election, 477
5. The Winner as Sole and Exclusive Representative, 478
5.1 Exclusive Bargaining Agent Represents Even the Minority
Union, 478
5.2 Protection and Capacity of the Loser; the Duty of Fair
Representation, 478
5.3 Is the Bargaining Union a Majority Union?, 479
5.4 May the Bargaining Agent Represent Retired Employees?, 480
xxxv
4.3 Effect of Collective Agreement on the Individual Contracts
of Employment, 490
5. Enforceability Against Transferee of Enterprise, 490
5.1 Purchase of Assets, 490
5.2 Exceptions, 492
5.3 Merger and Consolidation, 493
5.4 Wiley Doctrine, 493
6. Change of Bargaining Agent; Substitutionary Doctrine, 494
7. Grievances, 496
7.1 By-passing the Grievance Machinery: ULP, 496
7.2 Waiver of Grievance Machinery Procedure and Submission
To VA, 498
7.3 Structure and Procedure, 498
8. Voluntary Arbitration, 499
“Settling Grievances”, 500
“Grievance Handling Tips For T.U.C.P. Shop Stewards”, 501
8.1 Voluntary Arbitration: A Private Judicial System, 503
8.2 Voluntary Arbitration, a Master Procedure, 503
9. Who May Be Accredited as Voluntary Arbitrator, 504
10. How Voluntary Arbitrator Is Chosen, 505
11. Distinguished from a Court of Law, 505
Art. 261. Jurisdiction of Voluntary Arbitrators or Panel of Voluntary
Arbitrators, 506
Art. 262. Jurisdiction Over Other Labor Disputes, 506
Comments and Cases
1. Arbitrable Disputes, 506
2. Jurisdiction of L.A. and V.A., 507
2.1 Jurisdiction Over Termination Disputes, 509
2.1a “Policies,” “Rules,” “Procedures”, 510
2.2 Jurisdiction Over CBA Violations, 511
2.3 Other Cases, 512
2.4 Dispute over Company’s Drug Abuse Policy, 513
3. How Voluntary Arbitration Is Initiated, 513
3.1 The Submission Agreement; Extent of Arbitrator’s
Authority, 513
4. Powers of the Arbitrator, 515
4.1 Power to Arbitrate Any Dispute, 515
4.2 No Power to Add to or Subtract from the Contract, 516
5. Functions of Arbitrator, 517
5.1 Arbitrator’s Interpretation of CBA, 517
Art. 262-A. Procedures, 518
Comments and Cases
1. Compliance with Duty to Arbitrate, 519
2. Who Determines the Arbitration Procedures, 519
3. Ethical Standards of Arbitrators, 519
xxxvi
4. Voluntary Arbitration Award, Generally Final; Exceptions, 520
4.1 Motion for Reconsideration, 521
4.2 Review of Award by Certiorari, 522
4.2a From VA to CA: Mode of Appeal is Rule 43,
not 65, 523
4.3 Findings of Facts of a Voluntary Arbitrator, 524
Art. 262-B. Cost of Voluntary Arbitration and Voluntary Arbitrator’s Fee, 524
“Principles of Union Management Relations”, 524
xxxvii
9. Legality of Strike: The Six Factors Affecting Legality, 549
10. First Factor in Legality of Strike: Statutory Prohibition, 550
11. Second Factor in Legality of Strike: Procedural
Requirements, 553
11.1 Declaration of Strike or Lockout, 557
11.2 Procedural Requirements, Mandatory; Non-observance
Makes Strike Illegal, 557
11.2a Strike on Installment: Work Slowdown and
Overtime Boycott, 561
11.3 In Case of Union Busting, 562
11.4 Strike During Arbitration, Illegal, 563
11.5 Strike Despite Preventive Mediation, 564
11.6 Violation of a Valid Order, 566
11.7 Grievance Procedure Bypassed, 566
11.8 Dismissal of Employees During Conciliation, When Legal
and Enforceable, 569
12. Third Factor in Legality of Strike: Purpose; Economic
and ULP Strike, 570
12.1 The Conversion Doctrine, 571
12.2 Lawful Purpose: Strike Incident to Collective
Bargaining, 572
12.2a Legality of Strike Nor Dependent Upon Ability
of Management to Grant Demands, 573
12.3 Lawful Purpose: Strike Against Employer’s Unfair
Labor Practice, 574
12.4 Lawful Purpose: ULP Strike in Good Faith, 575
12.4a The “Good-Faith Strike” Doctrine Retraced and
Reiterated, 577
12.4b “Good-Faith Strike” Doctrine Applied Even to
a Strike without Prior Notice and Despite
a No-Strike Clause, 579
12.4c Even “Good-Faith Strike” Requires Rational
Basis, 580
12.4d Do the Procedural Requirements Apply even to
a ULP Strike in Good Faith?, 582
12.5 Lawful Purpose: Strike to Compel Recognition of
and Bargaining with the Majority Union, 583
12.6 Unlawful Purpose: Strike for Union Recognition Without
Having Proven Majority Status, 584
12.6a May a Minority Union Strike?, 585
12.6b Strike Held to Compel Recognition while Case
is Unresolved, Illegal, 586
12.7 Unlawful Purpose: Trivial, Unjust, or Unreasonable, 587
12.8 Strike to Compel Removal of an Employee; Implied
Assertion of Union Infallibility, 588
12.9 Unlawful Purpose: Strike on Nonstrikeable Issue, 589
12.9a Nonstrikeable: Physical Rearrangement of
Office, 589
xxxviii
12.9b Nonstrikeable: Company’s Sales Evaluation
Policy, 590
12.9c Nonstrikeable: Salary Distortion Under the Wage
Rationalization Act, 591
12.9d Nonstrikeable: Inter-union or Intra-union Dispute, 593
13. Fourth Factor in Legality of Strike: Means and Methods, 593
13.1 Threats, Coercion or Violence, 593
13.1a Violence on Both Sides, 595
13.2 Responsibility for Use of Force: Individual
or Collective?, 595
“Causes of Violence”, 596
13.3 Minor Disorders, 597
13.4 Officials’ Inability to Leave Premises, Not Illegal Detention, 598
13.5 Blockade or Obstruction, 599
14. Fifth Factor in Legality of Strike: Injunction, 599
14.1 “National Interest” Cases; Automatic Injunction and
Return-to-Work Order, 599
“Don’t Pull Down the House”, 599
14.2 What are Considered “National Interest” Cases, 600
14.2a “National Interest” by Statutory Declaration, 601
14.3 Assumption of Jurisdiction: Prior Notice Not Required, 602
14.4 Power to Assume Jurisdiction, Constitutional, 602
14.5 Certification to NLRC, 603
14.6 Effects of Defiance, 603
14.7 Assumption or Certification Order Immediately Effective
Even without Return-to-Work Order; Strike Becomes an
Illegal Activity, 605
14.8 Refusing to Receive the RTWO, 606
14.9 Defying the RTWO, 608
14.10 Defiance of RTWO, an Illegal Act, 609
14.10a “Abandonment” has Varying Elements, 612
14.11 Restoration of Condition Upon Issuance of Return-
to-Work Order, 612
14.12 Actual, Not-Payroll, Readmission, 613
14.13 Voluntary Return to Work Is Not Waiver of Original
Demands, 614
14.14 All Issues to be Determined in the Certified
Industrial Dispute, 615
14.15 Submission of Incidental Issues; Rulings Reconciled, 617
14.16 Procedure in Certified Cases, 620
14.17 Assumption Order Regulates Management Prerogatives, 621
14.18 “Legal Discretion”; Judicial Review of Secretary’s Award
or Order, 622
14.19 Secretary’s Abuse of Discretion, Examples, 623
14.20 Withdrawal of Case to Submit to VA, 624
15. Sixth Factor in Legality of Strike: Agreement of the Parties, 624
15.1 Ruling in Master Iron Case, 626
15.2 No-Strike Clause Binding; Primacy of Voluntary Arbitration
Agreement, 627
xxxix
15.3 No-Strike Clause Not Binding Upon Newly Certified
Bargaining Agent, 629
15.4 If Members Disregard a No-Strike Clause, Union
May Become Liable, 630
15.5 No Violation If Work Stoppage Not Initiated
or Supported by the Union, 630
15.6 No-Strike Pledge Inferred from Other Provisions, 631
16. Improved-Offer Balloting, 631
xl
3. Who Declares “Loss of Employment Status”?, 651
3.1 Declaration of illegality of Strike Not a Prerequisite
to Dismissal of illegal Strikers, 652
3.1a Exception: Pending Case at the NLRC, 652
4. “Good-Faith Strike”, 653
5. Strike Which Is Illegal and Not Marked with Good Faith —
Strikers Forfeit their Employment, 654
6. Forfeiture of Reinstatement, 655
7. Discrimination in Readmission of Strikers, 656
8. Exaction of Promise or Clearances from Returning
Strikers, 657
9. Reinstatement may Render Moot the Question of Illegality
of Strike, 657
10. Generally, No Backwages in Strike, 658
10.1 Economic Strike, 658
10.1a Unfair Labor Practice Strike, 659
10.2 Exception: “Involuntary” Strikers Illegally Locked Out, 660
10.2a “Volunatry” Strikers in ULP Strike who Offered
to Return to Work Unconditionally, 661
11. Court’s Discretion on Backwages, 662
12. Employer’s Right to Hire Replacements During Strike; Discharge
of Replacements, 664
12.1 Where Reinstatement of Illegally Dismissed Strikers
Has Become Impossible, Backwages Should
be Paid, 665
13. Resignation of Strikers Does Not Prevent Signing of CBA, 666
14. Civil Liability of Labor Organizations, 667
14.1 Labor Organizations Not Liable for Unauthorized Acts
of Officers, 667
14.2 Liability of Officers of Labor Organizations, 667
14.3 Liability of Members of Labor Organizations, 667
14.4 Liability of Labor Unions for Damages Arising
from Boycott, 668
14.5 Liability of Labor Unions for Damages for Interfering with
Right of Laborers to Work, 668
14.6 Liability for Extorting Money from Employers, 669
14.7 Liability for Damages Arising Out of Publications
and Circulation of False Statements, 669
15. Damages, 669
xli
Chapter III — FOREIGN ACTIVITIES
Art. 269. Prohibition Against Aliens; Exceptions, 673
Art. 270. Regulation of Foreign Assistance, 673
Art. 271. Applicability to Farm Tenants and Rural Workers, 674
xlii
Comments and Cases
1. Constitutional Guaranty of Tenure, 691
1.1 Non-regular Employees, 692
2. Tenure of Managerial Personnel, 693
2.1 Even Managerial Employees Are Entitled to Security
of Tenure, 693
3. Right to Security of Tenure cannot be Contracted Away, 694
xliii
3.7c Computing the Backwages of Project Employee
who has become Regular; “No work, No Pay”
Rule Applicable, 721
4. Seasonal Employment; “Regular Seasonal” After One Season, 721
4.1 Employer-Employee Relationship Exists Between
Milling Company and Its Workers Even During
Off Season, 723
4.2 Seasonal “Pakiao” Employees, 723
4.3 The Mercado Ruling: Project Employees Do Not Become
Regular Although Service Exceeds One Year, 724
4.3a Mercado Reconciled with Earlier Rulings, 726
4.4 “Regular Contractuals” Entitled to Benefits of Regular
Employees, 726
5. Fixed-Period Employment, When Valid, 727
5.1 Brent Doctrine Summarized, 729
5.2 Pretermination of Fixed-Period Employment, Liability of
Employer, 730
5.3 Illegal “Fixed Period Employment”; Brent Ruling
Clarified, 730
5.3a Effect of Retention of Employee Beyond the Period
of Employment, 731
5.3b When “Five-Month Contractuals” considered Regular
Employees; the Purefoods Precedent, 733
5.3c Effect of Renewals of Fixed-Period Employment
in Regular Jobs, 734
5.3d Seafarers are Contractuals, 735
Art. 281. Probationary Employment, 736
Comments and Cases
1. Probationary Employment, 736
2. Employer’s Right to Select; the Need for Probation, 737
3. Rights of Probationary Employee; Termination Only
for Cause, 738
4. Limitations to Termination of Probation; Regular Status After
Probationary Period, 741
5. No Successive Probations, 741
5.1 Probation in Sister Company, 742
6. Period of Probation Not Necessarily Six Months, 742
7. Extension of Probation, 743
8. Last Day of Probation, 744
9. Probation of Teachers, 745
9.1 Reversion from Full-time to Part-time Teacher, 746
10. Employment Contracts Mostly Adhesion Contracts, 747
xliv
Comments and Cases
I. MANAGEMENT RIGHTS
1. Right to Manage People, in General, 749
2. The Right to Discipline, 750
3. The Right to Transfer Employees, 750
4. The Right to Demote, 751
5. The Right to Dismiss, 751
5.1 Power to Dismiss Not Absolute, 752
II. JUST CAUSES OF TERMINATION
1. Causes of Dismissal in General, 752
2. Just Cause: Serious Misconduct, 753
2.1 Examples of Misconduct, 753
2.1a Illustrative Case: Sexual Harassment, 754
2.2 Cause Found Inadequate, 755
2.2a Teacher in Love with Student: The Heart has
Reasons which Reason does not know, 756
2.3 Extra-marital Relationship as Immorality, 757
2.3a Immortal Conduct Defined, 757
2.4 Being the Spouse of a Co-employee, 758
3. Just Cause: Willful Disobedience, 758
3.1 Valid Termination: Employer’s Policy Enforceable
Despite Union’s Objection, 759
3.2 Elements of Disobedience, 760
3.3 Disobeying an Order to Transfer, 761
3.3a Valid Transfer, 761
3.3b Invalid Transfer, 762
3.3c May an Employee Disobey an Inconvenient
Transfer?, 763
3.3d Change of Position and Work, 767
3.3e Test of Validity of Transfer, 768
3.3f Invalid Change of Position, 769
3.3g Transfer with Promotion of a Manager, 770
3.3h Transfer Distinguished from Promotion, 772
4. Just Cause: Neglect of Duties, 773
4.1 Gross Negligence Defined; Examples, 774
4.2 Abandonment, 775
4.2a Elements of Abandonment; Immediate filing
of Dismissal Complaint, 775
4.2b Immediate Filing of Complaint Negates
Abandonment; Exception, 776
4.3 Tardiness and Absenteeism, 776
4.3a Illustrative Case: Valid Dismissal Due to
Unauthorized Absences of a Union Officer, 777
4.4 Is “Attitude Problem” a Just Cause to Dismiss on Employee?, 778
5. Just Cause: Dishonesty, Loss of Confidence, 778
5.1 Examples of Dishonesty: Falsification of Time Cards, 779
5.1a Theft of Company Property, 780
xlv
5.2 Loss of Confidence, 780
5.2a To Whom Applicable; “Position of Trust”
Explained, 781
5.2b Conflict of Interest; Employment with
Competitor, 782
5.3 Proof Required, 782
5.4 Guidelines Summarized, 783
6. Just Cause: Commission of a Crime or Offense, 784
6.1 Conviction or Prosecution Not Required, 784
7. Analogous Causes, 784
xlvi
5.2a Closure Contrasted to Downsizing, 814
5.3 Partial Closure, 814
5.4 Temporary Shutdown, 815
5.5 Should Separation Pay be Paid in Case of Closure
Because of Serious Business Losses?, 815
5.5a Contrary Jurisprudence, 816
5.5b The Final Word: Rulings in North Davao
and Reahs Corporation, 816
5.5c Does Previous Generosity Obligate the
Company?, 817
5.6 Justification for Closure Not Credible; Unfair Labor
Practice, 818
5.7 Closure by Operation of the Agrarian Reform Law, 820
5.7a Expiration of Lease, 820
6. Sale in Good Faith, 821
6.1 Sale of Business: Is it “Closure” or “Cessation
of Business”?, 822
“Global Competition in Labor Cost”, 824
6.2 Successor-in-Interest, Contractual Obligation
to Employ, 825
7. Merger, 825
8. Consolidation, 828
9. Ailment or Disease, 828
xlvii
2.10 Condonation, 843
3. Preventive Suspension, 843
3.1 Invalid Preventive Suspension, 843
3.2 Valid Preventive Suspension, 844
3.3 Period of Suspension, 845
3.4 Preventive Suspension Exceeding 30 Days; Constructive
Dismissal, 845
4. Appropriate Penalty, 845
4.1 Value of Property, 846
4.2 Past-Offenses, 847
5. Filing of Illegal Dismissal Complaint; Venue and Time, 848
6. Clearance No Longer Required, 848
xlviii
Backwages but with Deductions; Mercury Drug
Rule Abandoned, 868
2.5b Full Backwages without Deduction; Pines City
Ruling Abandoned in Bustamante, 869
2.6 Full Backwages Amendment Not Retroactive, 869
2.7 Backwages Up to Retirement Age Only, 870
2.8 Inflation, 870
2.9 Dismissal for Cause But Without Due Process; The
Wenphil Doctrine, 870
2.9a Amount of Penalty for not Observing Due
Process, 871
2.9b No Just Cause and No Due Process – The WenPhil
Doctrine does not apply; Dismissal Illegal, 872
2.10 Objections to Wenphil: Indemnity Only Too Niggardly?, 873
2.11 Illegal or Merely Defective?, 874
2.12 Serrano Modifies Wenphil: Where Due Process is Disregarded,
Full Backwages Must be Awarded, 875
2.13 From Wenphil to Serrano to Viernes: Not Only Full
Backwages but also Indemnity, 877
2.14 Agabon Discards Serrano and Partially Restores Wenphil, 878
2.14a JAKA Revises Agabon: Higher Indemnity in
the Authorized Causes, 881
2.14b JAKA Refined Further by Industrial Timber, 882
3. Reinstatement, 883
3.1 Reinstatement without Backwages, 884
3.2 Reinstatement Not Feasible Due to Changed
Circumstances, 884
3.2a Contrast: Reinstatement Enforced Despite
Closure of Original Employer, 885
3.3 Reinstatement Not Feasible Due to Strained Relations, 887
3.3a Qualifications to the “Strained Relations”
Principle, 888
3.4 When Reinstatement Not Feasible; Separation Pay
in Lieu of Reinstatement, 890
3.4a “Separation Pay in lieu of Reinstatement” Different
from Backwages, 891
3.4b “Separation Pay in lieu of Reinstatement” Different
from Separation Pay in Legal Terminations, 891
3.4c How much is the Separation Pay in lieu of
Reinstatement? 892
3.4d Separation Pay in lieu of Reinstatement of Seasonal
Worker, 892
3.5 Objection: Disproportionate Substitution, 893
4. Remedy if Reinstatement is Thwarted, 894
4.1 Backwages Continue to Accrue until Employer
Complies with Reinstatement Order, 897
5. Salary Rate Upon Reinstatement, 898
6. Reinstatement Immediately Executory; Employer’s Options, 899
xlix
6.1 May an Employee Lose the Right to Reinstatement?, 900
6.2 No Obligation to Reimburse, 902
6.2a Garcia Drops Genuino and Reaffirms Roquero, 903
6.3 Rationale of Payroll Reinstatement, 904
6.4 Rationale and Constitutionality of Reinstatement During
Appeal, 904
6.5 Exception to Immediate Reinstatement, 905
6.6 Reinstatement Pending Appeal is Enforceable Despite
Employer’s Denial of Employer-Employee Relationship, 905
6.7 Reinstatement Should have been Ordered by Labor
Arbiter, 906
6.8 Amendment by R.A. 6715 Not Retroactive, 906
7. Is Reinstatement Self-Executory?, 907
7.1 NLRC’s Reinstatement Order Not Self-Executory, 908
8. If Reinstatement is not Prayed For, 908
9. Damages, 909
9.1 Moral Damages, 909
9.2 Exemplary Damages, 911
10. Indemnity to Househelper, 912
11. Attorney’s Fees, 912
12. Persons Liable for Wrongful Dismissal: General Rule —
The Sunio Doctrine, 912
12.1 Government as Stockholder Not Directly Liable for
Corporate Indebtedness, 913
12.2 Exception: Piercing the Corporate Veil: Officers Become
Personally Liable, 913
12.3 Instances When Corporate Officers Become Solidarily
Liable, 916
12.4 Limited Liability of Indirect Employer, 917
13. Quitclaim; Public Policy Protects Labor, 919
13.1 Not All Waivers are Against Public Policy; Elements of
Validity of Waivers and Quitclaims, 920
13.1a “Dire Necessity” does not Nullify Quitclaim, 921
l
5.2 Not Constructive Dismissal: Resignation to Avoid
Dismissal, 929
6. Intention to Resign, 929
Art. 286. When Employment Not Deemed Terminated, 930
Comments and Cases
1. Suspension of Operations; “Floating Status”, 931
li
Comments and Cases
1. Prescriptive Period for Money Claims, 959
1.1 Reckoning of the Three-year Prescription; Accrual of Cause
of Action, 959
1.2 Money Claims Based on a Foreign Law, 961
1.3 Filing after Three Years: “Promissory Estoppel”, 962
1.4 Money Claim that Accrued Before the Labor Code, 963
2. Award for Monetary Benefits May Exceed Three Years, 963
3. Money Claims Include Incremental Proceeds Arising from Tuition
Fee Increases, 964
4. Action for Reinstatement Prescribes in Four Years, 964
4.1 When Does the Period Begin?, 965
4.2 Prescriptive Period Not Suspended by Criminal Case, 965
5. Laches, 966
Part Two
IMPLEMENTING RULES
lii
Rule IV. Provisions Common to the Registration of Labor
Organizations and Workers’ Association, 986
Rule V. Reporting Requirements of Labor Unions
and Workers’ Associations, 988
Rule VI. Determination of Representation Status, 988
Rule VII. Voluntary Recognition, 989
Rule VIII. Certification Election, 990
Rule IX. Conduct of Certification Election, 997
Rule X. Run-Off Elections, 1001
Rule XI. Inter/Intra Union Disputes and Other Related Labor
Relation Disputes, 1002
Rule XII. Election of Officers of Labor Unions and Workers’
Associations, 1007
Rule XIII. Administration of Trade Union Funds and Actions
Arising Therefrom, 1008
Rule XIV. Cancellation of Registration of Labor Organizations, 1011
Rule XV. Registry of Labor Organizations and Collective Bargaining
Agreements, 1012
Rule XVI. Collective Bargaining, 1013
Rule XVII. Registration of Collective Bargaining Agreements, 1015
Rule XVIII. Central Registry of Labor Organizations and Collective
Bargaining Agreements, 1017
Rule XIX. Grievance Machinery and Voluntary Arbitration, 1017
Rule XX. Labor Education and Research, 1020
Rule XXI. Labor-Management and Other Councils, 1021
Rule XXII. Conciliation, Strikes and Lockouts, 1021
Rule XXIII. Contempt, 1024
Rule XXIV. Execution of Decisions, Awards or Orders, 1025
Rule XXV. General Provisions, 1025
Rule XXVI. Transitory Provisions, 1026
liii
IMPLEMENTING RULES OF BOOK VII — PRESCRIPTION,
TRANSITORY AND FINAL PROVISIONS
Rule I. Venue of Actions, 1043
Rule II. Prescription of Actions, 1043
Rule III. Laws Repealed, 1044
Rule IV. Date of Effectivity, 1045
liv