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The Lectures of Fr. Agustin Nazareno

2 – MANRESA 2018-2019

JUNE 22, 2018: FIRST LECTURE Now, the changes in the implementing rules are more of them
are in LabRel, but there are in LabStan. I thought the term
We begin our discussion this afternoon on social justice. Social ‘househelpers’ has been amended away by the new law,
justice is present, and is woven throughout our Constitution. because it is supposed to be called kasambahay. But in the
last bar exams, there’s a question using the term
SOCIAL JUSTICE – it is an admission that our society is ‘househelpers’. The Kasambahay Law has been in effect for 3
basically flawed. That it is radically defective. It is not just years. So when you pick a Labor Code, make sure that it is the
imperfect, it is sick and the sickness could be terminal but with latest so that you will not have any difficulty.
social justice, it is hope that our sick society will be remedied.
BTW, one of the laws that use native terminologies of our
What is the remedy proposed by social justice? To provide language is the Labor Code. The terminologies that are not
more in law to those who have less in life. That is the English used in the Labor Code, you have to use their spelling.
abbreviated definition of social justice. The Labor Code has ‘pakyaw’ workers, but you have to use
their spelling in the bar exam.
The thrust of our Constitution is admitting that our society is
sick. Why is it sick? Because too many have too little and a few (chikka about Azucena having Alzheimer’s and Chan’s book
have so much more than what native talent or industry have a being expensive)
right to claim. To correct this imbalance, you give more in law
to those who have less in life. If you don’t do that, then the I’ll share to you a problem. Article 5 of the Labor Code. It says
nation might explode like a volcano because there is this
radical imbalance. It’s manifested by insurgency, rebellion. We Article 5. Rules and regulations. The Department of Labor and
have our own brand of rebellion in Mindanao, which is not just other government agencies charged with the administration
economic, but also cultural and it could explode beyond our and enforcement of this Code or any of its parts shall
capability of containing it. To prevent that, there is this social promulgate the necessary implementing rules and regulations.
justice. Such rules and regulations shall become effective fifteen (15)
days after announcement of their adoption in newspapers of
Now, what kinds of inequality is addressed by social justice? general circulation.

The basic kind of inequality is economic inequality. What’s the problem with this provision? The problem is the
“Department of Labor”. Who in the department is it referring to?
ARTICLE BY PAUL KRUGMAN The old version, PD 442 came out. It is the Secretary of Labor
…..economics is not a morality play. It’s not a happy story in that issues the IRR and he/she was responsible. But if you put
which virtue is rewarded and vice punished. The market down there, “Department of Labor”, who authenticates it that it
economy is a system for organizing activity — a pretty good is the Department of Labor? Just because it is signed, it is the
system most of the time, though not always — with no special DOLE? That’s problematic. Executive branch of government,
moral significance. The rich don’t necessarily deserve their under the President – the Secretary of Labor, is the alter ego of
wealth, and the poor certainly don’t deserve their poverty; the President, who focuses on the implementation of labor
nonetheless, we accept a system with considerable inequality legislation.
because systems without any inequality don’t work. And before
the trolls jump in to say aha, Krugman concedes the truth of Now, who do you go to when it comes to the rules and
supply-side economics, that’s not an argument against regulations? What version is the determinative version in case
progressive taxation and the welfare state; it’s just an there is a conflict of different versions? Is it the one with the
argument that says that there are limits. Cuba doesn’t work; signature of the Undersecretary? This is a problem. It
Sweden works pretty well. should’ve been the Secretary of Labor.

He says if people were born equal then there would be Have you ever noticed that the President hardly signs anything
equality. If everybody had the same mental capacity, if except when he is required by law to officially sign? Executive
everybody had the same physical abilities, if everybody had orders aren’t signed by the President. Who signs? The
the same emotional drive – then there would be equality. But Executive Secretary. Is the Executive Secretary by authority of
because we have different mental capacities, physical abilities the President? The President does not sign – but there’s
and capacities, the end result is unequal. Common sense ra somebody to blame.
noh? Can you change that? He says, to a certain degree, you
can, but you cannot. Here, when you say “Department”, who signs? Remember in
your Political Law, there’s the President, then there are all
So, social justice may be able to alleviate economic inequality. these alter egos, acting for and in behalf of the President. Their
But there is serious doubt that it can be eradicated. There will act, unless countermanded by the President is the President’s
always be some form of inequality simply because the starting sign, because the President executes and implements the law.
point is already greatly unequal. Gi tao ta sa kalibutan, di man
ta equal tanan. So, he says, this is worth taking into When you say that it is the DOLE that implements the law, it
consideration. does not jive with the executive nature of the President and his
alter egos. It has to be a person, because in the end, it must be
By the way, there had already been recent changes in the traceable to the President. Remember that principle in Political
implementing rules of the Labor Code. The Labor Code has Law – you do not call the President, “The Chief Executive”, you
been renumbered. 3 years ago, they had put a law which had call him “Chief Executive”. Why? Because there is no other
renumbered the Labor Code. The Labor Code is the most executive, except the President. All the others are alter egos.
amended law, I think. Can you imagine, before this even took It’s only the President that is Chief Executive.
effect in 1974, it had already 1 or 2 amendments. Wala pa gani
mu-effect, gi-amend na. So I thought for awhile that it was the They say there was a Chief Justice who wanted to be called
renumbering version of Azucena that was the only official “Chief Justice”, not “The Chief Justice”. The Chief Justice of
Labor Code, as renumbered, that is used by the SC. But, the SC is called THE Chief Justice – because there are other
lately, there has been another case that used Rex Bookstore’s justices. He is just first among equals. You’re talking about a
renumbered Labor Code. There’s a difference between the collegiate body. The President is only one. That is why our
Azucena renumbered. One of these days, the SC will settle government is Presidential. It might be equal branches –
that. So know that right now, it is more or less, Azucena. But separate and distinct – but the President is prominent. That is
there is a decision – en banc – that used the Rex Bookstore the difference.
renumbered version.

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

Now, that’s the PRINCIPLE OF ECONOMIC EQUALITY – it major change in the whole world of work. What is the major
can be mitigated, but it cannot be eradicated. It is a serious change? This (referring to book) might be out of date, this
problem, and it is not a monolithic problem, it is several might be thrown out of the window, this might have to go. So
problems. Income inequality – that is because of education, because the talk now is not just about frictional unemployment,
etc. So many forms of inequality that leads to economic it is now about structural unemployment.
inequality. And there are various solutions open to the state
and it is all in the name of social justice. Concept of Parens Patriae in the Civil Code
Parens Patriae is built on a proposition that there is no basic
One of the principles adopted by our Constitution and also inequality in society. Every single individual in society stands
implemented by the Labor Code is the policy of FULL on equal footing with other individuals. So if there at all
EMPLOYMENT – that the state should strive for full instances where inequality occurs such as children are left
employment. Is that achievable? Most of you who have studied parentless, or the person looses this mental capacity and
economics, have been taught about FRICTIONAL becomes insane or is born with deficiencies, that is when the
UNEMPLOYMENT. It is the result of an economy moving by state is mandated to act. It is the fundamental parenthood of
reason of changes in technology. Because the economy the state that is the basic principle that is activated to answer
moves, what happens is that there is always somebody whose for this disadvantage individuals. That is why these individuals
skills will become obsolete. And the example given in the notes like widowers, orphans, the insane, mentally retarded, these
is the receptacle for cooking rice. are the traditional people that require help. They are not
mention in the constitution because they are already
Originally, before Magellan came they were already using an addressed by the parens patriae.
old, indigenous, receptacle for cooking rice – the earthen pot.
Now here comes the kaldero, the pig iron pot. So those who Who are addressed by the Constitution? The structural
were making earthen pots, their skills became obsolete. Now, inequalities like the workingmen, the daily wage earners. Now,
when the rice cooker came in, the makers of the pig iron pot you say how can this sector of society be defined as
lost their relevance. They are unemployed. Now, you have this disadvantaged? Then you have to go back to history. The end
Pyrex – combination where you can just cook your rice and of the middle ages and the beginning of the modern age, when
you can also put it on the table without apologies, because it’s the … by technology. You take a look at England, when the
good enough for the table. That’s the end also of the ordinary spinning jenny was created this was the machine that made
rice cooker. It’s always moving, and because it moves, there thread not the usual thread that you see with his bicycle going
are people who have no work. So if all work, and there’s nowhere that you see in the Disney movies. When that was
nobody who is not out of work, is the economy moving? This mechanized then, there was a huge demand for wool because
implies that because the economy moves, there are segments they can make coats. “Ang unang gihimu nila katung mga
of society that are unemployed. And that’s just frictional necessity para sa tugnaw na coat. Dugay2 na himuon kay
unemployment. munbuhat ka thread pinagsa ra. Karun makabuhat naka ana”.

What happens when employment becomes STRUCTURAL? So with the demand for wool, then the royalty, the royal class,
When does that happen? They say it’s happening already in started with enclosure movement. They started fencing of this
the post-industrial development. There is a change in the very huge of land which used to be work over by tenants. Before
nature of work. Because digitalization is introduced, then work you were a tenant you were under a lord of a castle. The lord
has become paradigmatically different. of the castle has the obligation to give you a tract of land where
you can live in and he did not get a share of that.
Just an example, niadto 10 years ago, 15 years ago, when you
said you said you’re studying computers, okay na na – “Mao na naa sa tenant natu hatgan syag sakop, naa man syay
sigurado ka na maka trabaho. Karon, if you are not in the ABC homelot dha. Nagtanum syag camote dha di ka mangayug
of the digital education world, you can be just like everybody bahin ana, may nagka na nakatubo di man ka makakuha kay
else – out of work. What is ABC? iya mana. Kanang mga baboy, mga manok nga nagadagan2
sa ilalum sa iyang balay, iya na, di ka makapangayug bahin
A – artificial intelligence dha sa iyang yuta na iyang gisakupan. But when the enclosure
B – big data movement began, gikural na nila kay buhian nila og sheep kay
C – cloud computing dako silag kwarta sa wool sa sheep kay magbuhat naman nila
makinarya, coats baligya naman.
If you are not somehow connected with these fields in
computers, your skill in computers is deemed to be obsolete. Then the people were driven off the land. Where did they go?
They went to the cities. Pagabot nila cities, naa nay mga
bagong makinarya, ddto sila mangitag trabaho. These were
Take a look at driverless vehicles. It is no longer just a theory.
the dispossessed people, no longer connected to the land and
They are already testing it in some of the most crowded cities.
they were just selling their strength of their arms, and that what
And you can put the technology in existing parts of the world.
Karl Marx said. He was so scandalized with what he saw and
Can you imagine? It is classified as a semi-skill job – driving.
says they were no different from prostitutes, selling their honor
Kadaghang mawad-an ug trabaho ana.
for money. Kanang magpahire sa iyang kaugalingun
magpatrabaho, prostitute na sya! Because that is not for sale.
Robotics assembly line – niadto ana sila na cars are so The work that you applied on a raw material, gives the raw
complicated, you cannot replace the human being that is there material its added value. Nya bayran ka lang, fraction of the
in the assembly line. That is why their per hour rate was higher cost of the resulting work. So suko si Karl Marx ana to the
than the rate of nurses in the United States. You work other ideology other than capitalism. Same time that Karl Marx
unionized, your rate was higher than a registered nurse who was developing his idea. Adam Smith said there was an
went through college and a board exam. Mas taas pa silag invisible hand that also develop. Now, it’s a settled issue, pildi
rate. Karon, naunsa naman? Napulihan na man silag robot. man ni niya, Karl Marx, pildi man. Ikaw hunahuna kaayu kang
dako pati castro, Kim Jong Un”……
So many changes now, and here we are still talking about
contractualization. BTW, that is a misnomer. All labor is So, for the first time in history that has no land, no wealth, no
contractual labor because it is based on a contract. So you resources at all, except the strength of the arms and they sold
cannot say you are against contractualization. Kung di na nimo it and that what it called work. This class of people is the first
contract, unsa na man na? Affiliation? occurrence in history and this is the birth of the industrial
working class. Then you can be able to understand that the
When labor is chopped up, jobs are chopped up. And certain real revolutionary class was the industrial worker. It is never
segments of the job, which used to be just one, are spliced off the agricultural worker because if the agricultural worker, one
to different places, and it can be done in different jurisdictions, day gets a small plot of lot it becomes a pettable j???. naa na
without losing any effectivity and you can see that there is a
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

syay property but the industrial worker will always remain just a Philippines its the same as United Kingdom, the state is the
seller of labor, it will never have something an asset of that can insurer. That is the reason of legislation that tries to remedy the
be made to generate more wealth. enforcement are the system that has created problem. The
industrial revolution by increasing productivity, raising standard
What did industrial revolution bring about? Felix said it take for living has created so many problems.
granted, in the middle ages if you are not royalty the only
settled clothes you have was the one you were wearing. Can you imagine, the first working hours, 12 hours kung
Maligu gani ka which was rare because there was no running trabahante ka, as soon as there was light, sugod ka na
water, that was also the same time that you wash your clothes. trabahao. Nganu maundang man ka trabahao? Wa namay light
There was a point na maligo gani ka magtikungkung ka sa Di naman ka makakita, muuli ka na sa inyo. So the working
corner, waiting for your clothes to dry because you have no hours was 12. Nganu man nang nahimu man ng 8? Kay
other settled clothes. You have only enough time to make one nagunionized na man ang mga workers, nag tipon naman sila.
set, the rest you have to devote for earning a living to eat. With Di mi mutrabaho sobra ning mga hours. And can you imagine if
the industrial revolution mass production to meet. Karun you were the employer of the company that were the subject of
makapalit na ka. But then because its new there were so many a strike, and the working are asking for 8 hours, you see you
accuses. For instance, coal was no available in huge cannot grant it mahapay ka, ang imung tanang competitor
quantities. Nganu man? First, naa nay explosives, naa nay dose oras ang trabaho nya ikaw muhatag kag otso. Unsaon
rails. When the locomotive, internal combustion engine could mana? That is why in the supreme court decision, the great
pull up this heavy rigs having coal from below. So kay naa JBL reyes who is civilist, who is not a labor expert, he says that
namay coal, mamalit na tung mga tao coal to alleviate the cold affordability of the demand of the workers is not the litmous
in winter. Tungod naa nay sigeg burn og coal naa say test whether there demand is valid or not. Why? Because all
chimneys. Kinahanglan nag limpyuhan ng chimneys, kanang these other features in labor laws now where once impossible
dakong tao di man kasulod kung maglimpyo. Knsa man ang demands.
mulimpyu? Bata. When should you work? Isulod ang bata dha.
Is that being unkind? When they are in agiculture, the child So if you make affordability, the measure, you will never get
helped in harvesting why he should have to climb up the improvement. At one point, reducing 12 to 8 hours work met
chimney? Even children were working in the underground economic death for the employer. And yet, those demands
mines. Ang problema sa underground mines kanang carbon were made and gradually it became the benchmark and the
monoxide, odorless, colorless, its just like the air you breathe standard. So, this is the rights of labor began to grow up in the
but very deadly toxic gas. What was there barometer? Butang system of industrial revolution. The system of industrial
silag langgam, mutinkangkang na magunahay silag dagan kay revolution, there are extremes and there are middle of the way
naa nay carbon monoxide. Kanang mga bata mao pa nay unay ..... The extremes had many consequences, they say, world
mamatay. All these different causes. war II is one of the consequences. They were so afriad of
Russia after its revolution in 1940 it take over europe but they
You are met with work related injury at the workplace. What were ready to embrace hitler who was against the communists.
was your relief? There’s an old case smith bell a 1902 case. That is how Hitler gained so much power, he led the entire
Underground mine in the Philippines. Kanang kargahan nilag europe into a very costly war which can trade loss the most
coal that is called bagoon same terminology for the carrier number of lives civilian and military during the second world
of??? Kanang truck na dagku kanang case na itungtung sa war. Its ironic it is russia who lost the most number of lives
truck mao nay ginatawag na bagun. Its on rails. Tuklod na. this because hitler was very ruthless. He put a city of 3 million
particular bagun, have to go over rails where that ties 2 or 3 under siege. Isa katuig gisiege walay pagkaun, mukaun silag
ties were broken. A tie is the number on which the rails are ilaga o cannibalism tung mga mamatay pang kaun. Di man ka
rest. Nabali gani ng us aka tie mutakilid na na. bugat kaayu madunot kay tugnaw man kaayu di gikarne ka na.
ilang bagun, pagtulod ana delikado matikwang, punggan na
ninyo. Ayaw tag kapatas. Walay magpabilin sa right side para So, if you look at the historical origin of social justice, that is the
di ta matikwang, guinitun natun ning left arun ma balance. origin chronologically. Parens patriae, the origin was the
Kining trabahante nakalimut siguro ni siya or naa syay lahing middle ages when it was the duty of the crown to protect the
gihuna2, nagpabilin sya ddto sa luyo, nagdali man sila tulod subjects against brigans. The assumptions in parnes patriae in
kay katikuon man, di na pisat sya kay natumba man ang every society, stand on equal footing with every one else. In
bagun. Work related injury, it occurs during working hours at social justice is the society is fatally flawed because of the
the workplace. Is there negligence on the part of the employer? tremendous imbalance. The state action, if the state acts in
Buak man ang tie, gipulihan unta to, pero pulihan nimu stop parens patriae, it is by way of exception because most children
man ang production. Di gusto ipostpone kay Naa may mga have parents who will take care of them. In case of social
quota mga manager. So, is the employer liable and his liability justice, the state assumes a permanent posture, legislation
whole and entire? Because his defense is we are not the there is this minimum wage, you cannot pay lower than this
proximate cause of the death. Who was the proximate cause? minimum wage. You, employer employee you agree of 300
Ang kadanghag sa empleyado. Sige manag sulti everybody pesos a day minimum wage for working 8 hours. All of a
knows ayaw dha sa right basta maabot ta dha na section, ha. sudden, the government comes in and says no, that is no
Magtingug man gani ng bagun approaching na ta dagan mo ali longer the wage for the days work, its should be 350. Can the
mo sa pikas. Sya nagpabilin ddto nagpahero man, nagpabilin government do that? Is the flag impairing the obligation of
man sa pagkadanghag niya, di napisat sya. the argument of contracts? And the answer is the government can impair the
the employer in the very least, the employee has committed obligation of contracts when it acts based on police power.
contributory negligence which diminishes our liability. Karun, di Social justice is police power. Just like the power to tax and
na man na problema, its answered by the employees also impair obligations of contracts.
compensation a nofault system. Naa nay mahitabo na
aksidente, bayran ka sa system. All employees paid Now, the government comes in and says when is there
employees compensation. employer employee relationship? Sometimes, the law says it
does not follow the elements of contracts. In nfa vs nlrc. This
There’s no contribution from the employees unlike SSS naay the case of security guards that are supplied by a security
contribution and when death occurs, bayad dayun. All you agency that entered into contract with nfa th at is gocc with
have to do is to prove that the death occurs at the working original charter. There’s a wage order comes in and it says that
place, during working hours and you do not argue anymore. minimum wage has been raised to 50 pesos a day. So, the
About, Who is at fault? Who committed contributory seucrity agency tells the nfa you have to raise the money that
negligence? Wala na na. Diadto ka na. That is a civil case. you give to us. Because according to the wage order any
Dugay kaayu sa tanan. The remedy applied by social justice is increase in the mandatory minimum wage law, you are
a no fault system and it is insurance and the state is the responsible, its the indirect employer. Nfa says we are not
insurer. In the states, it is different, you are obliged to buy covered by the labor code, we are government. The labor code
insurance from private insurers and they answer for your covers private employment. Pag abot sa SC, no, you are
liabilities for work related sickness during working. In the covered, there is er ee relationship between you as the
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

employer and the security guards and you are responsible for person who drew up the contract. Individual contract of
underpayment of wages. Government is mad an employer employmnent, it is the employer that sets the terms. Any
despite what is said in the contract. Protection of the worker. doubts arising from that it is resolved in favor of the employee,
not the employer.
Exception from general rules of contract, you agree here is the
subject matter here is consideration but the state can come in Other principles in contracts, principle of consensuality. Unless
and say that is not your agreement, i can add to the the law requires a specific fomr, contracts are perfected by
compensation. Suppose you say, isa ka buwan na ko nangitag mere consent. If there is no requirement of a specific form,
trabaho wa koy makitan trabaho pakauna na lang ko ayaw ko here, it even brings it further even if there is no consent there is
sweldohi kay wa na gyud, naglisud na jud ko. Bisag unsa pa an employer employee contract. Even if by nature the party
may pahimu nimu nako, pakan a ra ko ayaw na ko sweldohi. cannot enter into an employer employee contract because it is
Ikaw; sige dre ka nako, ikaw bantay dre sa kuan, factory nako government there is emp[loyer employee contract because the
sa talyer nako ikaw bantay dri tulog ka dre, pag 9am trankahe law says so. The indirect employer is responsible for the
na. Kung gusto ka mukaun suloid dre kusina, kaun na. Bantay underpayment or non-payment of wages by the contractor of
bantay ka lang. The next thing employer know, unsa naman ni his employees. The indirect employer is government. He
nawal naman ning mga butang, di man ni mawala sa wala pa should not be covered but since the law says that the indirect
ni sya, naa naman nawala na tung mga martilyo, sge namag employer is liable for the sake of the workers. Protection of
kawala. Iya ra giingnan; bai tingali magsugod naka mangita labor from the government he is liable. what is mutuality?
trabaho. Kay gipahawa naman, sugod nag pangita trabaho Parties to the contract are equally bound to what has been
lain. Lakaw sad siya pero wla sya nangitag trabaho kay niadtu agreed upon in the contract. You cannot say ikaw ra ha. Ako,
sya sa labor arbiter nifile sya illegal dismissal. Nangsugod nipirma man ko pero wla koy labot. Both of you are bound in
narun ane employer ingun pa di man nako sya empleyado the contract. Here, there is a presumption that the employer
wala man na syay timecard. Ako ra na sya gipaistar kanako, unless it is stated in the inception in the employment that your
bantay ra ug panilhig dha ginagmay kay gipakaun nako sya. work is probationary, suwayan raka testing, or that your work is
Wla na nako sya sweldohi kay ako man sya gipakaun. Is that a for a term there is a definite time or period, if there is none of
valid defense? Too bad you do not know the law, he becomes that from the inception, then, indefinite unless there is just or
an employee the moment he is suffered and permitted to work, authorized cause that supervenes. Just cause, nakasala ka.
that is the language of the labor code. Authorized cause a cause neutral to the responsibility of the
employer like there is a new labor saving device that will take
Distinguish it from Contracts your place, so your employment is ended you are paid a
When you studied obligations and contracts, what is the separation pay. But absent that, the employer is mandated to
presumption if things are doubtful is there a contract or there is keep you in his employ indefinitely.
no contract? Are most contracts express or implied? Sakay
kag jeepney, is that express or implied? Kanang karatula dra Now, how about the employee? Is he equally bound to work for
bankerohan offer man na, pag ingun nimu ana mu stop man the employer indefinitely? No, why? Because there is such
na, basta mupara sya dnha. Muhinay gani sya wa na na, that thing as provision against involuntary servitude. He can just
is implied consent, dagan ka ana pagtikang nimu di na give up. Muingon ang company na we loss so much because
perfection, execution of the contract na kay pagtikwang ka ana. you abandon your job, can he be held liable? That is a debt.
The case that is filed is not culpa acquiliana but is already He owes that to the company, nobody get imprisoned by
negligence in failing to bring you to your destination. Is there or reason of debt. So, he can leave. If an employer is sued for
is there no contract? Rules of interpretation of contracts, if illegal dismissal and there is a finding that there has been
there is consideration for a contract and there is doubt how illegal dismissal, can the employer be forced to accept the
should the doubt be resolved? Maximum exchange. If there is employee? Yes, his forced to accept. The employer can be
no consideration involved how is the doubt resolved? The least forced by the law to accept but the employee cannot be forced
transmission of rights. That is why? Mahibulong ka, nganung to exert work for the particular employer. Is that mutuality of
kaning mga contract, mga ingana ang board of directors, ikaw contract? Tanawa ang deperensya ha. Tanawa. (story si father
membro ka sa board muretire ka na manager, kanang kotse na katung 30 years ago as a lawyer)
imung gigamit imuha man na ipadala na nimu. What contract
will the corporation enter into. Will it give it to you by way of
donation? Ikaw manager ka kahibaw kag law. Ayaw sugot og
donation kay maquestion na karun least transmission of rights
birahun gid na nimu kay wa kay sakyanan sa sigdunan natu di
man ka tag iya, di bawiun na? Put a consideration bisag
gamay lang kaayu, 100 pesos oh. So if there is doubt, if there
is controversy arising from the contract is maximum
transmission of rights. Labor there is no consideration.
Pagkaun lang. There is controversy that arises, is that
followed? No, that is not followed. Suffered or permitted to
work. Doubts are resolved in favor of labor. Lahi ni. You have
to make anadjustment. The nice thing about this is it makes
you remember....... It makes you understand the principles of

Remember, when you are talking about obligations and

contracts you are talking about two parties that are equal.
What is your talking here, is the parties are not equal. What is
the principle of contracts? Principle of autonomy, parties are
free to enter or not to enter into contracts, parties are free to
stipulate such terms and conditions as is agreeable to the
parties provided they are not contrary to law, customs, morals.
Principle of autonomy. It is assumed, by the labor code that the
working class are not free whether to enter or not to enter into
contract. They have to enter into contract, otherwise they will
have no earnings. There is no freedom on their part. It is
assumed right away that an individual contract of employment
is a contract of adhesion. Mao ng naay termino sa civil code. It
means that if the contract is just drawn up by one of the parties
and the other party is left with the take it or leave it choice that
is a contract of adhesion. Any doubts is resolved against the
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

JULY 06, 2018: SECOND LECTURE put an end to ER-EE relationship. That is why there is no
requisite of rendition of service.
a relationship that is contractual, it is a contract. It is important Now, LVN VS PHIL. MUSICIANS GUILD, it says one of the
for us to realize that it is a contract because there are other four is a DOMINANT requisite. So dominant that if there is a
engagements that outwardly are like er- ee relationship but failure of the first three, this last element “Power to control” the
it is not a contract, like government employment, it is not a means and methods, not just the goal to be achieved but the
contract. Who says so that it is not a contract? It is the means and method of achieving the goal, that is paramount
Constitution itself. It says public office is a public trust. test, it can establish er-ee relationship. And this is highlighted
by the facts of the case.
In EE-ER RELATIONSHIP, normally there are only 2 parties in
the contract, the employee and the employer. Normally ha, I LVN is just one of 2 of the appellants, the other one is Premier
say normally. Why? because there is also: Productions.
1. Contracting
2. Sub - contracting The issue here is a group of musicians that provide music for a
(I guess this refers to Sub - contracting). Employer - indirect movie that created by LVN, they want to form a union vis-à-vis
employer who contracts with another entity to provide it with a LVN, and LVN opposes the petition for them to be a union, by
service and so this contractor hires people, and these people denying the existence of an ER-EE relationship.
are seconded to the indirect employer. There are 3 parties
there. We will see later on that if there is a failure on the part of The putative employer, LVN says, “we have no musician
the contractor, in the payment of wages, if there is non- employee because we do not make music we make movies”.
payment or underpayment, then the indirect employer that is their argument. “we did not hire you” LVN, when it
becomes liable. Temporarily, they become the employer. But if decides to make a movie, it engages the services of a musical
it is labor-only contracting, the contractor is cancelled by law director, and then it asks the musical director “read the script,
and by only two parties—legally speaking. take a look at it. what do you think? Are you creating new
music for our movie?” so mag compose ka? Mas mahal na
General rule: There are only two parties: EMPLOYER AND diba? “or are you going to use existing music?” then the
EMPLOYEE. musical director will say “we have to create new music”. What
will LVN do? They will go back to the financier, and say “are
COMPARED TO GOVERNMENT SERVICE: we going for blockbuster here? New music? We have to
In government service, there are always 3 parties because borrow money from the bank.” (sidetrack si father). (Jokes
public office is a trust. When you’re talking about that trust, about CHINA as the only country where the big screens are
you are always talking about three parties because there is a: the dominant screen.)
1. Trustor
2. Trustee LVN’s argument: LVN says that the musical directors is the
3. Beneficiary one who hires the musicians. String instruments etc. it is his
music and he hires the musicians that he needs. The musical
 Who is the trustor in a government service? It is the
director is the contractor of LVN, so it is the musical director’s
one who appoints you or the office of which you are
 Who is the trustee? The government employee, Who
is either appointed or elected. HELD:
 Who is the Beneficiary? The public in general. There
are supposed to benefit from your engagement to the Who pays them? It’s the musical director who pays the
government. musicians. He gets a lump sum money from LVN, then he
So you answer to the people. You are urged to live simple budgets the salary. So the second requirement was not
lives. What happens if you are not simple? That’s when you met.
become corrupt.
Who dismisses them? The musical director. But why did the
Cases: SC said there is a er-ee relationship? The power of control
test was met.
1 SCRA 132/ 110 PHIL. 725 (1961)
How was it met? It might be the musical director who selected
you but LVN controls you. How?
This is the most important case in the whole labor. 1. Call slips. You were informed where you have to
report so that the LVN bus can pic you up with your
4 requisites: instrument. It doesn’t say musical director, it says
1. Selection on hiring; LVN “for this movie..”. why are they picked up?
2. Payment of wages; Because they are carrying their instrument. (jeep
3. Power to dismiss; and joke).
4. Power of control. concept: but of you meet an accident, that is
considered work-related accident, injury or death, and
What did you notice about the 4 requisites? There is no the employee’s compensation is already responsible
requisite that says “there is a rendition of service”. Ee-er man for that, if your employer’s driver was negligent, then
ni, syempre nitrabaho man kaha ni? Mu adto kag bubaron (?) the employer is secondarily liable. The employer
sa atong pinulungan.. nay pag pili, nay bayad saa sweldo, nay actually assumes obligation by picking you up,
gahum sa pag pahawa, nay gahum sap ag. control sa imong because of that possible liability.
pag buhat. Naunsa may? Why is there no requisite of service? 2. LVN provides food for them.
If it is supposed to be service? Why is that? Not even CHAN 3. When it is finally pieced together (music), it is no
answers that questions.. sa kabaga sa iyang libro, wala jud longer the musical directors who directs, it is now, the
niya gi explain. I will tell you why: Because if there is a movie director who is the representative of the LVN.
rendition of service (that is essential for er-ee relationship
to exist), then when an employee goes on leave, and he That is how the SC says “control is shown” So, the goal of
does not render service, he ceases to be an employee. the music is to enhance the experience of the movie.. The
sound is secondary but necessary.
There is no more er- ee relationship, kay wan a may
SERVICE. If he is on sick leave, or strike, the strike does not

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

Take a look at the discussion there of SC between VDA DE DY KEH BENG VS INTERNATIONAL LABOR
CRUZ VS MANILA HOTEL, and the case of LVN, because 90 SCRA 162 (1979)
here the SC describes, Vda De Cruz is the wife of Tirso Cruz I.
He was a band leader, and he was commissioned by Manila
Kaings, large baskets, were the products. Two people here
Hotel to play at the lobby the whole day for like 5 to something
in the evening, to amuse or entertain or satisfy the customers wanted to join the union vis-a-vis Dy Keh Beng denies the EE-
that stay around the lobby. Now, how he is to play or what he ER relationship. DKB says that there could be no union by this
is to play; he decides; it is his own repertoire of music that he people against them. DKB says that he do not know them, how
picks out from. It’s not manila hotel who dictates his music, and can DKB know them when they just sent to DKB the kaings.
then he plays it of his way of playing it. Now what happened? They are paid in a piece-rate basis. According to DKB, if you
Tirso had a heart attack. he died. are paid in a piece-rate basis there is no EE-ER relationship.
They do not have to make the kaings in the premises of DKB,
they just bring it and DKB pays them. Thus, how can you say
Is he entitled to workmen’s compensation (now it is employee’s that there is control in the means and method of their work.
compensation)? The holding of the court is there is no ER-EE DKB said that they do not even see them work. they just bring
relationship. Why? Because the element of control is not the products.
present, Tirso was free to play the music. but the goal was to
entertain the people, and it is up to him hoe to do that.
Back to LVN
1. Does the payment on a piece-rate system cannot rise the
The movie director intervenes in the final take of the music,
legal relationship; WON there is an EE-ER relationship or not.
according to his vision of the film, and how he wants the film to
come across the audience who watches it. What is the role of A: It does not. It only characterizes payment, it does
not characterize whether there is EE-ER relationship.
the musical director? He just sets up the basic tenor of the
music. Neutral.

So, what is the doctrine? There maybe a deficiency in the first 2. Must an ER, to be an ER, must there proof of evidence
three requirements, but if the control test is met, and it is submitted that in fact the ER exercises control?
overwhelmingly dominant, then you have ER-EE A: In STERLING PRODUCTS VS SOL, there is
relationship. control because there is a form to be followed, while you are
away, the radio given is still in control because you can only
listen to particular radio stations. Here, there is no evidence
that is presented that DKB in fact exercised control. The SC
7 SCRA 446 , February 28, 1963 says that what is necessary is you must present evidence
that there is at least reservation for the exercise of the
Decided two years after LVN.Here, you have what is called a power of control. The fact that he can control is the evidence
radio monitor. Sol was a radio monitor. He was tasked by the in the minimum that is required not that he in fact exercised.
company to determine whether or not the airtime that the And how is that shown? Because the Kaings have a specific
company has bought for its advertisements over the radio is in dimension, if those people who wanted to join the union
fact complied with. That is her job. She is given a radio, she brought to DKB a small basket (e.g. souvenir in weddings)
does not have to report to the office. She can stay at home. DKB would reject it because that is not what they need. So,
Provided that she fills out the times when the advertisement of what is important is the evidence of the reservation of the
Sterling Products comes out in her monitoring reports. She is power of control.
given an ID that she is an Employee so that she could go into
the premises and collect her salary, to submit her reports. But RJL MARTINEZ VS NLRC
then there is a controversy and she is asking for benefits given 127 SCRA 455 (1984)
only to regular employees. Sterling products denies EE-ER
relationship. The reason why Sterling Products can deny is that
"we cannot exercise control over her. How can we if she lives Issue: WON the power of control test, in order to be met, must
in her own home and we are on our office? Is she really doing be exercised in a continuous and unbroken fashion.
her job? What if she breastfeeds her baby and listening to the
radio? What is that, is she working or is she breastfeeding her Recall that RJL Martinez is a corporation that is engaged in
baby? If she cooks, is she hearing the radio advertisements of deep sea fishing. It has about 60 vessels. And the workers we
Sterling Products or isn't it aired yet?". That is the argument of are talking about here are those who load and unload these
the Sterling Products is that it is impossible to exercise control vessels. In a situation where there is no fish port, they just
if you are physically separated from each other - the EE and (wave anchor?) up to your waist. And if you are not above 5 ft.
the ER. it might be over your neck. So these people, they are asking
13 month pay, holiday pay, etc. And RJL Martinez’s defense
ISSUE: For the control test to be met, must be the EE and ER is that there is no ER-EE relationship. Why? Because every
be physically in the same place? engagement is ended, begun and ended and so on… So, if
these people are made unload every two ship that come in,
RULING: NOT NECESSARILY. You can still be controlled after they do the work, they normally go to others fishing
even if you are not in juxtaposition with each other. How were vessels that come in. You know, you have to imagine this huh,
you controlled? There are forms [in this case]: kanang fish ports, the ships come-in up to the point where they
cannot longer go in. So the way is anchor. And the kargadors
1. The radio itself. Sol could not listen to any other radio
come in and they unload Pakyaw by Pakyaw to the waiting
station except those radio stations from which Sterling
refrigerated box. And there are who are doing the inventory of
Products bought airtime.
the “catch”. This vessel has this catch. And the bidders are
2. Sol was told what hours to listen to. waiting at the shore. Pano sila mag-bid? Mu hung-hung sila sa
tag-iya sa catch. Asa mana nila idala? Dalhun nila sa quezon
So she is still controlled. Remember: You need not be in the city, etc. And then the one who owns it would announce who
same place in order to be the subject of control required for won the bid. So these are the one who loads and unloads. So,
the existence of EE-ER relationship. not all the 60 ships of RJL come in because you are based at
sea. Sometimes you go even beyond territorial waters. And the
1 or 2 or 3 come today and they unload and they still have
time. So they also unload for other ships who come in.

That is the argument of RJL Martinez. If they are in our control,

how come they can unload other vessels? So they have many
employers. But the unloaders say that we are employees of
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

RJL Martinez because the ships have priority. Biyaan na namo juris. It is one of a kind. Why? It is borne out of a radical,
ng uban. Unya wa naman mi trabaho, di gihapon mi traditional development – Industrial revolution.
mabayaran sa tibuok adlawa. So, muadto mi sa lain unya
makumpleto namo among isa ka adlaw. So there are three kinds of ER-EE relationship. 1) Bona fide
contracting and sub-contracting. In other words, you are
And the Supreme Court (SC) said, for the control test to be allowed to contract-out. The pertinent provisions are 106, 107
met, it does not have to be continuous. It can be broken. and 108. Now, the measurement in 106 is, if the service that is
Why? Why do you find fault to these people looking for other contracted out is not directly related to the usual business of
boats to unload when their 8 hour work day is not fully filled by the employer, you may contract it out. Ex. We make soap, we
work? So you only pay them with only a partial salary. So no are Proctor and Gamble. You hire people to work on your
requirement of “one and the same place” for an ER and EE for garden to impress your Vice-president who is coming over and
the control test to be met. No evidence actually be presented to impress him. So, they work for 6 months. And 6 months is
that there was exercise of control. But you have to prove that usually the probationary period. Did they become regular? Are
there was reservation of the power of control. Next, piece- they permanent employees? That is the issue. SC says these
rate basis does not deny power of control. It is only are the activities which are not directly related to the usual
evidence of payment. And finally, power of control is met even business of the employer. So you can contract it out. But you
if, power of control is not exercised in a continuous and have Coca-cola. Christmas season and we need to hire to
unbroken fashion. meet the demands. So, August, September, October, you add
another shift. You hire an agency to provide you workers.
--- Where do you put them? In the assembly line because it’s a
Now, power of control is the ultimate, the final and dominant new shift. And 3 months na. We are now regular and our work
test but it is not the only test. For instance, I tell you “5 is directly related to the usual business of the employer. Are
minute break”. Everybody takes break. And when I say “let’s they doing bona fide contracting? No. You are now regular
resume”, you also resume. Looks like I have a power of employees. That is one of the badges of a labor-only
control. Is that ER-EE with you and me? The truth is you are contracting. The other badge is if you do not have a substantial
my employers and I am your employee because you pay your capital as a contractor or sufficient investment in the form of
tuition fees. No ER-EE Why? Because there are other factors. equipment or work premises. Now, if you are labor-only
Now, I bring you to the heart of issue. There are line of cases contractor, you are cancelled out by Article 106. The only
that says power of control in an ER-EE relationship is a employer remains is the Indirect employer which is not only
question of fact. Each case must be examined by its unique liable for non-payment or underpayment of wages but also
factual features. Another line of decisions, the SC says ER-EE those provided by social legislation, the SSS, Pag-Ibig etc…
relationship is a question of law. How do you reconcile this? The law says the Indirect Employer is jointly and solidarily
liable for underpayment or nonpayment of wages.
If it involves only one ER it is a question of fact. The features
of that relationship establishes the requisites and proves
whether or not the requisites are met especially control test. So pangutan-on ka, here the contractor he fails to pay his
But when it is contracting or sub-contracting (multiple ER). employees and he just disappears. The employees when they
Nahh tulo na ka parties. It is no longer just a question of fact. It file a complaint who can they implead? Who can make as
is a question of law. respondent on the case? Mutabag gani kag, if the contractor
cannot pay then the indirect employer. Sayop. Wa diay ka
kasabot sa joint and solidary. The moment it is solidary, once
The example of this is NFA v. NLRC – NFA engages security
the obligation is ripe then you can go straight to the indirect
agency to provide them security guards. So the security
employer and the contractor kay joint and solidary man. The
agency provides security guards to NFA. They sign a contract.
moment it is demanded. Joint obligation, two of you have put in
Now, minimum wage rates but here comes the wage order of
a reservation to the hotel room. And they say you are joint.
RTWPB raising the minimum wage. And the wage order says
What is your obnligation? Wala kay joint man mo. If it becomes
that the wage is the liability of indirect employer. So NFA. But
due, either of you may pay basta ang maximum kay ½.
NFA says, I am not covered by Labor Code. I am a GOCC with
original charter. SC says, you are liable. Why? Because the
law says so. And the SC says ER-EE relationship is a question If you say you are the guarantor. You guarantee the payment
of law. of these hotel rooms. What happens? The hotel looks at the
form and says here theres the guarantor. Can he make the him
pay? Not yet. You have to prove the original debtor is bankrupt
In fact there is this very particular provision, 136 noh,
before you can go to the guarantor. How about surety. You are
Hospitality girls. 136 say classification of certain women
the surety. The original debtor his obligation has ripen but he
workers. (It should be Art. 138 of labor code) –
cannot pay. So the creditor can run after the surety. He must
Article 138. Classification of certain women workers. Any first go to the original debtor and if he cannot pay, then he can
woman who is permitted or suffered to work, with or without go to the surety. But he cannot go to the surety just because
compensation, in any night club, cocktail lounge, massage the obligation has become due. If he can do that, then he is not
clinic, bar or similar establishments under the effective control a surety but a solidary debtor.
or supervision of the employer for a substantial period of time
as determined by the Secretary of Labor and Employment,
You are an indirect employer, because there can be contractor
shall be considered as an employee of such establishment for
and subcontracting and then sub sub contracting. Let say a
purposes of labor and social legislation.
building project let say Marco Polo. He contracts with EEI to
construct this building to be the Marco Polo. It is the general
With or without compensation – kasi sa mga night clubs, you contractor. The EEI contracts with structural engineering
are paid by commission. Base on your order and your incorporation. And then EEI further contracts with Interiors
customer’s order. So mas dugay ka, mas daghan kay Incorporated. They fill up the place with walls. These interior
commission. Is she really a worker then given maka-gawas- contracts with doors and windows. Then it contracts with glass
gawas man siya? And yet the law says, shall be considered as incorporated. They have there own employees. What if these
an employee of such establishment for purposes of labor and employees have not been paid their salaries. 106 says the
social legislation. That the bar owner has obligation to register indirect employer is jointly and solidarily liable. When you file
to SSS, Pag-big, PhilHealth, Employees compensation... And your complaint. You sue Glass as your employer. You named
her earnings per night must not be less than minimum. in the complaint. Can you name doors and windows? Yes. On
the part of the employees of glass he is an indirect employer
So, we go back to the basic concept. ER-EE relationship is a because he is the one who contracted Glass. Can you sue
contract and yet there are times when the law itself says “that’s interiors as respondent? Yes because he contracted Doors
a contract” even if the basic of the contracts are not met. No and windows who contracted Glass. He is an indirect
offer, no acceptance and no meeting of the minds as to the employer. Can you sue include structural engineering
subject matter. That is why we say an ER-EE relationship is sui Incorporated? No there is no subcontracting here. You can
include EEI because he is the final indirect employer. You can
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

go as far up as you can. Ibutang nimo tanan. When in doubt

just put it there. In practice, when you are in doubt implead
him. And he will get out of it by himself. In bar examination, you
must know whom to implead. Between structural engineering
and interiors, there is no privity in contract. Contract,
subcontract, employees of the contractor. If it is broken, then
you cannot sue. If there is a continuous line, all the way you
can sue.

So I just like to bring to your attention that there have been en

banc rulings of the Supreme Court in Kimberly Clark
Independent Labor Union v. Drilon 326 SCRA 299 (2000),
Neri v, NLRC 224 SCRA 717 (1993) where the Supreme
Court says, these court takes judicial notice of the widespread
practice in the public as well as the private sector of
contracting out security services, janitorial services and other
specialized services. In other words, there no need for it to be
proven. Pag Janitor gani you can contract it through Janitorial
service and that is bona fide contracting. That is not a labor-
only contracting. In other words the indirect employer is only
liable for non-payment or underpayment of wages and cannot
be liable for social legislation like SSS etc. Because it is a bona
fide contracting.

Why does the Supreme Court made that pronouncement? This

court takes judicial notice. You do not have to prove it
anymore. Because if you go the Supreme Court website, you
will see a page there where the SC handles its contracting
needs. There is a bid and you must comply with the
requirements. Then the SC contracts out security services.
Janitorial Services. The Supreme Court does not hire any more
employees for janitorial services. Suppose these employees
are not paid their minimum wages? What happens? Who is the
indirect employer? The Supreme Court. The contractor is the
Direct employer and the Supreme Court is the indirect
employer. One of these days it’s going to happen. So when the
workers file their claims for underpayment of wages, can they
implead the Supreme Court? By pronouncement of the
Supreme Court, yes they can. Because the employer-
employee relationship is created by law. It is not an act in a
tripartite setting.

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019


Field Personnels - they work outside the principal office and
Last time we met, we were taking up those that have their hours of work cannot be determined with reasonable
employer-employee relationship but are exempted from the certainty.
labor standards laws on hours of work, rates of pay, holidays
etc. The emphasis is that the nature of their work cannot be
determined with reasonable certainty. It is not that they cannot
Art. 82. Coverage. The provisions of this Title shall apply to be supervised, it is the very nature of their work.
employees in all establishments and undertakings whether for
profit or not, but not to government employees, managerial The Supreme Court says that true the field personnel is the
employees, field personnel, members of the family of the sales person.
employer who are dependent on him for support, domestic
helpers, persons in the personal service of another, and
-If you are a salesman and you want to get someone to
workers who are paid by results as determined by the consider your products, then you invite him/her for lunch so
Secretary of Labor in appropriate regulations. you can sell your product. My question is, are you eating your
As used herein, "managerial employees" refer to those whose lunch or are you working? You also eat what is ordered. So if
primary duty consists of the management of the establishment you count all that, it is unfair for the employer. Their hours of
in which they are employed or of a department or subdivision work cannot be determined with reasonable certainty.
thereof, and to other officers or members of the managerial
Salespersons, normally, they have a small basic and most of
"Field personnel" shall refer to non-agricultural employees who
their compensation comes from commission. Its a percentage
regularly perform their duties away from the principal place of of your sales. Now, when you talk about retirement, the
business or branch office of the employer and whose actual statutory benefit of retirement is 15 days work plus 5 days
hours of work in the field cannot be determined with
leave every year. 22.5 days even if the law says its 15 days. Its
reasonable certainty. supposed to be just basic salary. But the basic salary is so
small. The Supreme Court says, the commissions earned on
1. GOVERNMENT EMPLOYEES the average is added on top of the basic because the basic of
We began with government employees, that's really an a salesman is not enough. There are decision like that,
exclusion since government employees do not have employer- because they end up on the losing side if you just follow strictly
employee relationship. the retirement statute.


Managerial employees are excluded/exempted because they Members of the family dependent on the employer for
are engaged not for the...(inaudible) that they were in but for support – We just take a look at Uyanguren. All those
results that would diffuse on their specific qualifications. hardware stores. Who opens those hardware stores? Anak na
sa tag-iya, mao nang mu-abri. Who closes down those stores
at 7 o'clock in the evening, mao gihapon tung nag-abri. And
The preliminary description of Managerial Employees is found
then you ask him how much he is paid by way of salary. They
in Article 82 also. This is further elaborated in the Implementing
don't know how much their salary is. Anak man sila sa tag-
Rules, Book III, Rule 1, Section 2:
iya. Can they complain that they're working more than 8 hours
and therefore they should get overtime? Wala man silay fixed
SECTION 2. Exemption. — The provisions of this Rule shall na sweldo, unya murag maluoy ka. Pero pag tan-awon nimo
not apply to the following persons if they qualify for exemption gwapo man kaayo silag sakyanan. Honda Accord man iyang
under the conditions set forth herein: sakyanan. Kung wa kay sweldo unya ngano Honda Accord
xxx man ka ha. Ingon siya, naa man credit card. Credit man ibayad
(b) Managerial employees, if they meet all of the following sa gasolina sa pa service. Wala kay tinuod na sweldo, aha
conditions: man ka nagpuyo? Tua sa ubos na floor, ang iyang parents tua
(1) Their primary duty consists of the management of the sa 3rdflr kay 4-floors manang ila unya ang ubos ana bodega
establishment in which they are employed or of a man.
department or sub-division thereof.
(2) They customarily and regularly direct the work of two Dependent on the employer for support. Ang iyang asawa
or more employees therein. tagaan pud ug credit card para pag mangompra og grocery.
(3) They have the authority to hire or fire employees of Aha man nagskwela imong anak, Ateneo, credit card
lower rank; or their suggestions and gihapon. So, it ends up that employer-employee relationship is
recommendations as to hiring and firing and as to the merely decorative of a fundamental relationship governed by
promotion or any other change of status of other the Civil Code, which you studied in first year, Family
employees, are given particular weight. Relations. Filiation is a more fundamental relation covered by
(c) Officers or members of a managerial staff if they perform law so the Labor Code will step back and not impose itself
the following duties and responsibilities because for all we know, this particular employee might be
(1) The primary duty consists of the performance of work receiving more than what the Labor Code dictates. That's why
directly related to management policies of their they are exempted.
(2) Customarily and regularly exercise discretion and 5. DOMESTICS
independent judgment; and and
(3) (i) Regularly and directly assist a proprietor or a 6. PERSONS IN THE SERVICE OF ANOTHER
managerial employee whose primary duty consists of Domestics. – Article 82 says Domestics, now it is
the management of the establishment in which he is called Kasambahay. Why are Domestics excluded? Because
employed or subdivision thereof; or (ii) execute under Domestics antedate the Industrial Revolution, long before
general supervision work along specialized or Magellan landed in this archipelago.
technical lines requiring special training, experience,
or knowledge; or (iii) execute, under general
supervision, special assignments and tasks; and The law says that Domestics are supposed to be in a
household because the serve the personal comfort and
(4) Who do not devote more than 20 percent of their hours
convenience of the members of the household. You have to be
worked in a work week to activities which are not
a household. What happens if you are in single(inaudible) and
directly and closely related to the performance of the
you have domestics?
work described in paragraphs (1), (2) and (3) above.
The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

Persons in the personal service of another – its almost the Case:

same as Domestics because the category in Article 82 is APEX MINING V. NLRC
Domestics and persons in the personal service of another, they 119 SCRA 278, 1991
are exempted from minimum wage, hours of work etc. Why is
that? Again, persons in the personal service of another
antedate the Industrial Revolution and there are certain Expatriate Japanese Engineers live in a separated house to
protocols already in place. the principal office of the Apex Mines. They stayed there, the
Apex Mines hired people who do the laundry, they make their
beds, clean the house, cook for them. In other words they were
When Price Harry and Megan were married in London.
doing Domestic chores. At a certain point, they thought they
Members of the Royal family, immediate family are seated in
were not receiving their 13th-month pay. The answer of Apex
front. Right behind, who are seated? Still members of the
is, you are domestics, you are not entitled to 13th-month pay.
family and they are considered as members of the family. This
You are exempted. But then they appealed and it reached all
nurse-teacher from Bacolod, who used to be the Nanny of
the way to the Supreme Court.
Harry, was flown over to London to attend the wedding. While
our own President cannot even an invitation to the wedding.
They are considered members of the family. Second row to the Issue: W/N they should be considered as Domestics.
wedding, ang mga heads of state naa na sa likod. Ang uban
gani di makakita didto ra sila sa second part of the cathedral. Held: NO.
The Supreme Court said, they are not Domestics, they are
Im sure Imelda would have wanted to get an invitation because not Kasambahays. What makes you a kasambahay? All of a
she loves this company. Because she has a feeling of royalty sudden the Supreme Court shifts.
but she was never raised as royal. Mahibal-an kuno nimo, pag
di gani ka royalty, ig linkod nimo mutan-aw jud ka ana. Pag What makes you managerial employees is not your title, its
royal gani ka dili ka mutan-aw kay sigurado jud ka na naay not your position, its your work, your activity. If your activity is
linkuranan kay naa jud kay person in the personal service of characterized by the use of independent judgment that lays
another, naa man kay maid-in-waiting. Naa kay imong down policy that hires, fires, disciplines, demotes, promotes,
personal assistant. dismissed employees, then you are managerial, if that is your
work, regardless of your title.
The Pope also has a personal assistant. Person in the
personal service of another, he's not a household. There's What makes you a kasambahay or a domestic? Is it what you
somebody who's supposed to dress him. do? The fact that you sweep the floor, mop the floor, clean the
toilets, make up the bed, cook, is that what make you
What is the tradition? when a Royal member dies, he's domestic?
supposed to reward all the persons in the personal service to
him with bequests. He has to recognize, that is the The Supreme Court says No. It is your employer. If you are
protocol. Mamatay ka na, i-apil sa imong will tung Nanny nimo hired by the Company to do these domestic chores for
that used to wipe your butt when you were still unable to take Japanese expatriates, you are an industrial worker and you are
care of yourself. And you give them a legacy, a gift. "Unto my entitled not to the minimum wage of kasambahays but to the
butler James, i hereby decree my 1936 Bentley" So you end up minimum wage of industrial and commercial workers. Nikalit ug
getting practically more than what the Labor Code insists. shift ang Supreme Court.

There are different protocols, it depends on a country, like the ---

middle-east they have closed-in assistants who even stand
outside your door while you are sleeping because it’s a violent I already gave you the Manual of Employee's Labor
country. Your personal bodyguard will even take a bullet for Standards Benefits by the DOLE, 2016 edition. Every 2 or 3
you. years they have a new edition. That's what you have to look at.
Because Labor Standards is not very broad, it is just very
The Secret Service in the US, in the Philippines also, they are minute.
supposed to take a bullet for their President. Gamay lang na
paka-paka, dive-an dayon nila ang Presidente. But that is Just a word of caution, in that manual, the DOLE includes not
because they are public servants. only Labor Benefits like for example VAWC. If you are a
woman, and you are working and you have to go to court
Persons in the personal service to another, specially in the because of domestic violence or legal separation etc. so you
Middle East, if you are the Sultan of the House of Saudi, Saudi have to appear in court. You are entitled to a leave and the
Arabia, they have a food-taster. If somebody want to poison employer must grant you that leave. That is not Labor
you, it will be they who will be killed first because they taste Legislation, it is Penal, it is Criminal Law.
your food before the Prince eats it. They are removed from the
regular employer-employee relationship. It’s very important because if you notice, Art.4 of the Labor
Code, says that construction in favor of Labor, all doubts in the
You might be given a problem, here is a CEO, Mr. Pangilinan, implementation and interpretation of the provisions of this
who is never without bodyguards. He has close-in and he has Code, including its implementing rules and regulations shall be
support personnel. He does not travel with less than 3 cars. He resolved in favor of Labor.
has an advance car and he has a back-up car. You dont know
where he is because they are identical cars. Are they persons Labor Legislations – in cases of doubt, are interpreted in
in the personal service of another? If he hired them personally, favor of the employee.
yes. But if they are hired by the Company, they are not
persons in the personal service of another. Their job might be Penal Provisions/Criminal Law – in cases of doubt, in favor
similar but their employer is the corporation. So therefore they of whom is the interpretation of Criminal statutes? The
are not in the personal service of another. accused.

That is why if there is doubt, as to the implementation of

VAWC law, it’s not in favor of the woman who is an employee.
Even if it is in the Labor Standards Manual, put out by the
DOLE. It is in favor of the accused.

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

You will find so many laws there, granting benefits but they are b) Workers paid on a task basis
not actually Labor Benefits, that's why you have to pay This is the situation where a person hires you to perform a
attention. This is a general principle. Again, in favor of labor. task, and asks you how much do you want to be paid.
Doubts may arise from the text of the law, that's textual doubt.  Example: Someone wants to hire you for a flooring job,
That textual doubt is also interpreted in favor of labor. Doubts and asks you how much you want to be paid. You then
may arise as to the facts upon which the law should be compute the costs of flooring, cement, manpower, and
applied, the doubts then, have to be resolved in favor of Labor. then the time spent.

The doubts must be resolved in favor of labor, but before you Now you get paid at the end of the task (because again, it’s
can do that, you must make sure that the law in question is task basis). However, there are rules with respect to the
labor legislation. If not, you cannot interpret it in favor of labor, payment of wages. Such covers all employees, no matter what
in cases of doubt. regime they are paid. Wages are supposed to be paid twice a
th th
month, in intervals not longer than 16 days (15 and 30
I refer you to the 2016 DOLE Manual. There’s something days).
wrong here. They say that a kasambahay has the right to form  Same example: At the end of the 15 day, the flooring job
unions and enter into collective bargaining. You will find out was still not done. You are still to be paid, in pursuant to
later in the Kasambahay Law that there is no provision granting the basis of completion. The person who hired you has to
them the right to self-organization. Thus, that’s ultra vires on know how much you completed (EX. ½ or ¾), then he
the part of DOLE when they said, in their implementing rules, pays you accordingly.
that domestics or kasambahays can form labor organizations
for purposes of collective bargaining. You cannot do that. Part However, he has to be careful, because there is a tendency
of the right to self-organization is the right to concerted activity. when the project is mostly done (ex. ¾), you might not show up
One of the activities that the workers can do is conduct a for work after you get paid. So what people who hire usually do
strike. Can you imagine a kasambahay going on strike and is to keep retentions.
carrying placards around the subdivision? As a homeowner,  Example: You are a subcontractor of the main contractor
you’d be angry. However under the law, you’re obligated to for a construction job. You are assigned for doors and
give them board and lodging. That’s one of the rights of a windows. The main contractor tells you he will retain 15%
kasambahay. So after a day of strike, they go back to your of your compensation for 3 months, in case of complaints
house, and you have to give them a place for food and sleep. on the doors or windows.
That’s so impractical, but DOLE says that kasambahay has
such rights. Thus, kasambahays are not persons in the Pakiao is a tricky mark, because you can’t require pre-
personal service of another. employment requirements from them. If you want regular
workers, you ask for such (ex. NBI clearances).
 Example: Ayala constructions in Davao. The core
7. WORKERS PAID BY RESULT / PAKIAO WORKERS employees are usually small in numbers, but the
workforce necessary to be hired are 500 workers in one
week. Paano mo mabasa ang tao pag ganyan?
Note that “pakiao workers” is a Labor Code terminology, so
anyone can use that.
Let’s get back to workers paid by results. An example for such
are those truck drivers who drive across the provinces.
Kinds of Pakiao Workers (based on the Fair Labor Standards
Generally, they’re given meal allowances. But some only give
Act of the US):
them sacks of rice. Why? Because if you pay them on a daily
basis time-wise, they would get flagged in areas for violation of
a) Piece Rate Workers
truck bans. So that’s why they are paid by basis, so the
Produces uniform single units, and their compensation is per
employee could plan the time it takes to complete the task.
piece. Thus, the more they make, the more they earn.
There are companies, such as a dried mango factory, where a
Pakiao workers do not have definite hours. You cannot say to
lot of dried mangoes are harvested, but the workers aren’t
such worker that they have to work on a 8-5PM shift while
being paid by piece rate, because there’s a lot of dried
being paid in a piece rate basis. He is not being paid for the
mangoes. Instead, they’re being paid on a stock rate basis.
time he is putting it, so he is not covered by minimum wage.
However, you cannot use the pakiao system with payment by
Kanang dinha sa toril, kanang naga panit unya hiwahiwaon,
piece rate in order to circumvent the minimum wage. If you do,
dried man na unya lutuon, unya ibutang sa pocket. And they
then you run afoul of the minimum wage law.
are being exported. The people from, Canada, US, Australia,
and Europe they are crazy about they are crazy with this dried
How does a pakiao worker find out that he is being paid less
than the minimum wage?
 The piece rate must be based on the speed of the average
worker, not the fastest worker. So if the worker is being Kanang mga beginner pa, you end up with less mango kay
paid less than the minimum wage, he must go to the lawom man kaayo mag slice, ang pag panit ba. Daghan
Regional Director of Labor, and petition to have a time and mangga ang masayang. Lawom man ilang pag panit. Kanang
motion study. That’s where an industrial engineer comes mga expert na tag-as na silag rate ngadto mn nimo tan-awon
in and determines the optimum way of production (pila sa peelings naa na silay mga supervisor mutan-aw ana.
imong mahuman). The average speed shall then be
determined, and that shall be the rate. Ayaw na kumedyaha ha kay Sa cebu 5000 na sila kabouk
 If the Regional Director finds out that this is the proper mamanit. Daghan na sila pero puro rana sila mamanit. Kutob
rate, and the employer is applying a rate lower than that, sa mu-sustenir no, kay wala man na silay working hours kay by
then the latter is given an order to adjust its wage. If he batch man tag-upat mo kabouk unya bahin bahinun nlng na
refuses, then he will be brought before the Labor Arbiter, ninyu devided by four. So kadaghanan ana members of the
and the Regional Director will present evidence that his same family tinudlo-ay na silag unsaon. Ikaw sad, you take
rate is inequitious.Thus, he would have to pay whatever is care of your own tools. Kahibaw ka na pila na ka mangga
the difference between what is supposed to be paid and imung napanit, ipadalplin nimo ang isa ug kato napud bag-o
what was actually paid, because what he did is imung gamiton.
underpayment of wages.
Murag kag si Roger Herrera kay ilis ilis ug racket luag na tong
kuan ilisdan nimo. Habol napud imung pang panit
That is the piece rate and the task basis. Employer must know
the process of his product.

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

MORE THAN 5 EMPLOYEES Now, Health personnel as to the working week. The working
Now, retail and service establishments employing not more week is 6 consecutive working days. Why is working week
than 5, they are exempt as to the night shift deferential. Retail important? Because it determines the rest day. At the end of
and service establishments. the working week you are entitled to 24 consecutive hours of
no work so that you can rest.
ART. 86. Night shift differential. - Every employee shall be
paid a night shift differential of not less than ten percent (10%) Now, if you are a health personnel in a city with population of
of his regular wage for each hour of work performed between at least 1 million or if the city is less than 1 million but your
ten o’clock in the evening and six o’clock in the morning. health employer or institution whether be it a diagnostic service
or therapeutic service is the equivalent of a 100 bed hospital
then you fall in to this exception: Your work week is only 5
Retail Establishment
consecutive days.
A retail establishment is one that sells goods, commodities, to
one user(??). wholesale establishment is one that sells to
people of entities that will resell to consumers. Now if you are Industrial and commercial workers your work week is 6
an establishment, both retail and wholesale, how are you consecutive days.
classified? You are classified as Retail.
So if you are a nurse here in Davao, your work week is only 5
Remember if you have just 5 employees you are not covered working days. If you are made to work a 6 day working days
by night shift deferential. Ang target ini ka yang mga sari sari you must be paid premium pay of at least 30% of your salary
stores so they will not have an additional burden by additional for a day. Additional compensation.
cost of night deferential. Once they operate, sometimes they
operate. 10. FISHERMEN CREW
The next and last group of workers that is supposed to be
Service establishment exempted are so called fishermen crew. Because of
What is a service establishment? For example of a service Presidential Decree 705 fisheries act of the Philippines. You
establishment is a barbershop or a beauty salon or a hair know fishing crew they are still covered by 8 hour work day if
salon. They sell a service. If you only have 5 employees, then they are made to work in excess of 8 hours that’s supposed to
you are exempt from nigt deferential. be overtime pay. But because of PD 705 there rate is still the
same as .… time rate. They will be paid but it will not be under
Now, there is this story that they usually tell about senator Jose overtime rates, higher rates. That is by special provision of the
Wright Diokno. He was the hero of martial law. He was fisherman act of 1975.
confined in a solitary confinement together with Ninoy Aquino,
in lawud Nueva Ecija. They knew each other. Mga year to sila So these are the groups of people who are exempted from
sa solitary confinement. labor standards benefits.
Jose Wright Diokno was the same person in the land mark
case. He was once became an examiner in civil law and one of Tagaan gani ka ug problem. First you decide, is this
the question he asked is this: government or dili? Government gani dili na labor code. If you
“there is a restaurant and one of the customer who entered have decided it is private employment. So you now have to
the restaurant ordered oyster soup. When the oyster soup identify if there is employer employee relationship. The next
was delivered and the customer is already stirring the soup question you ask is, are they not exempted? Do they belong to
he suddenly realized that there is a sphere there that is any 10 categories mentioned. Later on if you become very
bright and unusual. He picked it up and lo and behold it was familiar with it, mubagting na sa imung huna huna na “pakyaw”
a pearl. Then he was about to pick the pearl and put it in his ni or field personnel. But you have to know the law so well.
pocket and then the waiter tapped his shoulders and said
“that is not yours, that belongs to the restaurant”. The Alright, next time we will discuss about compensable working
customer said “but I paid for this” then the waiter replied “No, hours under article 83.
you are not going to eat that”. So the issue is who has the
better right to the pearl. Is it the customer who ordered the Article 83. Normal hours of work. The normal hours of work of
oyster soup? Or is it the restaurant?”
any employee shall not exceed eight (8) hours a day.
Health personnel in cities and municipalities with a population
Kuyaw kaayong problemaha. Who has the better right to the of at least one million (1,000,000) or in hospitals and clinics
pearl? And Diokno’s suggested answer is it depends whether with a bed capacity of at least one hundred (100) shall hold
or not the restaurant is a retail or a service establishment. regular office hours for eight (8) hours a day, for five (5) days a
week, exclusive of time for meals, except where the exigencies
If the restaurant is a service establishment then it only serves of the service require that such personnel work for six (6) days
food to its customers, what it is selling is nutritional satisfaction. or forty-eight (48) hours, in which case, they shall be entitled to
It is retail if it allows take out. Muorder ka ug pagkaon unya d an additional compensation of at least thirty percent (30%) of
naka mukaon ddto ug mutake-out ka, that is a retail their regular wage for work on the sixth day. For purposes of
establishment. If it is a retail establishment, the owner of the this Article, "health personnel" shall include resident
pearl is the customer because he will take both the edible and physicians, nurses, nutritionists, dietitians, pharmacists, social
non-edibles but if it is a service establishment you will the non- workers, laboratory technicians, paramedical technicians,
edibles behind. Although, some people will bring with them the psychologists, midwives, attendants and all other hospital or
bones kay para daw sa ilang iro. clinic personnel.

So that is the answer of Diokno, retail and service 2 basic rules under Article 84 to determine compensability of
establishment. the working hours:
Article 84. Hours worked. Hours worked shall include
(a) all time during which an employee is required to be on duty
or to be at a prescribed workplace; and
(b) all time during which an employee is suffered or permitted
to work.
Rest periods of short duration during working hours shall be
counted as hours worked.

The Lectures of Fr. Agustin Nazareno
2 – MANRESA 2018-2019

Then they are further broken down in the implementing rules

But the first rule is used when the employee is not productive.
Is that compensable?

If it comprise with A, the employee, is required to be on duty or

to be at a prescribed workplace he must be compensated.

Now, if the employee is productive, apply the second one: all

time during which an employee is suffered or permitted to

How many of you here knows of the FOREMOST farms.

Foremost farms is in…. They have 1000 SAWS. Anay ba,
mother pigs. Anybody here with experience in piggery will
multiply it by 10 that is tha standing herd of 1 sow. So 1 million
standing herd. Now if you are hired there as a pig house
tender. You must report at 5:30 in the morning, pag abot nimo
ddto take off your street cloythes before you enter the piggery
itself, then you take a shower, then you put on your over alls.
Kanag over alls dial nag gyud na diha rapud na labhan. They
are very strict kay kung matakdan na ug sakit matakdan na

So, ligo ka unya pag sul-ob na nimo sa imung over alls

andamun na nimo feed cart. Ibutang nimo unsa imung una
pakan.on ang mga anay ba or mga baktin. Lain lain mn na ug
formula. Pero ang time nimo na mag sugod ug trabaho is 6am.
Human nakag shower human na kag andam.

Question: is the first 30 minutes compensable working hour?

Shower shower paka, kape kape, kanta kanta ka, is that


The case did never went to NLRC it only reached Bureau of

labor relations it was TARJANO who laid down the ruling and
he said, that is compendsable because it is integrally related to
the actual work activity. Without that you cannot do this work
activity. You cannot feed the pigs with your street clothes. So
all the time you are required to be at the place of work or at the
prescribed place is compensable that is what is used to
determine whether or not you are compensable for this
additional working hours.

Kinsay tag-iya anang FOREMOST farm? Mr. Lucio Tan.

If you think that is big, there is this island 5 km from signagpore

it is in Indonesia. It has 250k saws. Supplies 20% pork
requirement in Singapore. You see Indonesia it is a muslim
country where do they get their workers? In bali because bali is
Hindu. Who is the owner? Mr. Sudono Salim. Same majority
owner of first pacific and majority owner of PLDT and SMART
and channels 5 and Meralco