LABOR LAW FUNDAMENTALS
REMINDERS 1. What are the kinds of illegal recruitment?
1. The following material does not predict bar
questions. It is meant to orient and prepare the
mind to approach questions in Labor Law, and to
thus “think labor law.”
2. Do not base your answers on logic, political
beliefs or sense of morality. All answers must be
based on a LEGAL PRINCIPLE. Cite a
constitutional provision (do not quote the
provision, just state the principle), a statutory
provision, a legal doctrine, or jurisprudence (no
need to cite the case title).
3. Do not use civil law, criminal law or remedial law
concepts in answering Labor Law questions.
Stick to the Labor Code, labor-related laws, and
principles enumerated in the Bar Syllabus.
4. Think long, write short. Please go straight to the
point and DO NOT use up an entire page for an
answer. TRY YOUR BEST TO LIMIT THE
ANSWER TO NO MORE THAN 3-4
SENTENCES.
5. Make sure the answer is COMPLETE. It is
complete if it has a LEGAL PRINCIPLE AND IT
IS APPLIED TO THE FACTS. To get full points,
the answer must be SHORT and COMPLETE.
6. Take time to choose the proper words to use in
your answer. In the suggested answers below,
the magic words are in bold. Remember that the
examiner is looking for certain words or phrases.
YOU WILL PASS THE BAR. TIWALA.
1
Explain.

Answer: Illegal recruitment is committed in one of two
ways. R.A. No. 8042 as amended by R.A. No. 10022
provides that illegal recruitment may be committed by a
person who commits any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring
workers and includes referring, contract services,
promising or advertising for employment abroad,
whether for profit or not, when undertaken by non-
licensee or non-holder of authority. Illegal recruitment is
also committed by a person who commits any of the
prohibited acts under Section 6 of R.A. No. 8042
whether such person is a non-licensee, non-holder,
licensee or holder of authority. (Section 6, RA No. 8042)
Illegal recruitment may also be committed by syndicate
or in large scale. Illegal recruitment is deemed
committed by a syndicate if carried out by a group of
three (3) or more persons conspiring or confederating
with one another. It is deemed committed in large scale
if committed against three (3) or more persons
individually or as a group. Illegal recruitment when
committed by a syndicate or in large scale shall be
considered an offense involving economic sabotage.
(Sections 2, RA No. 10022)
2. The Secretary of Labor and Employment may
assume jurisdiction over a labor dispute
causing or likely to cause a strike or lockout.
Explain the grounds for the exercise of this
power and its effects.

Answer: When, in his opinion, there exists a labor
dispute causing or likely to cause a strike or lockout in
an industry indispensable to the national interest, the
Secretary of Labor and Employment may assume
jurisdiction over the dispute and decide it or certify the
same to the Commission for compulsory arbitration.
Such assumption or certification shall have the effect of
automatically enjoining the intended or impending strike
or lockout as specified in the assumption or certification
order. If one has already taken place at the time of
assumption or certification, all striking or locked out
employees shall immediately return-to-work and the
employer shall immediately resume operations and
readmit all workers under the same terms and
conditions prevailing before the strike or lockout. (Art.
278 (g))
Under the present rules, the following are recognized as
industries indispensable to the national interest:
a. hospital sector
b. electric power industry
c. water supply services, excluding small water
supply services such as bottling and refilling
stations
d. air traffic control and

e. such other industries as maybe recommended
by the National Tripartite Industrial Peace
Council (TIPC) (D.O. No. 40-H-13).


3. Who are considered beneficiaries under the
SSS?
 on account of any threat, prohibited or unlawful
Answer: Under the SSS, the dependent spouse until he
or she remarries, the dependent legitimate, legitimated
or legally adopted, and illegitimate children, who shall
be the primary beneficiaries of the member. The
dependent illegitimate children shall be entitled to fifty
percent (50%) of the share of the legitimate, legitimated
or legally adopted children. In the absence of the
dependent legitimate, legitimated children of the
member, his/her dependent illegitimate children shall be
entitled to one hundred percent (100%) of the benefits.
In their absence, the dependent parents who shall be
the secondary beneficiaries of the member. In the
absence of all the foregoing, any other person
designated by the member as his/her secondary
beneficiary. (Sec. 8(k), R.A. No. 8282)
4. Current law requires all employers to pay their
rank and file employees a 13th month pay on or
before December 24 of every year. However,
employers already paying their employees a
13th month pay or its equivalent are not required
to pay 13th month pay. What does “its
equivalent” mean here?
 lockouts are provided in Article 274. These are the
Answer: Under applicable rules, the term "its
equivalent" shall include Christmas bonus, mid-year
bonus, cash bonuses and other payments amounting to
not less than 1/12 of the basic salary but shall not
include cash and stock dividends, cost of living
allowances and all other allowances regularly enjoyed
by the employee, as well as non-monetary benefits.
Where an employer pays less than required 1/12th of
the employees basic salary, the employer shall pay the
difference. (Revised Guidelines on the Implementation
of the 13th Month Pay Law)
5. C recalls reading that “(n)o temporary or
permanent injunction or restraining order in any
case involving or growing out of labor disputes
shall be issued by any court or other entity” but
forgets the exceptions. Help C recall the
exceptions.
 Any worker whose employment has been
Answer: Under Article 225 (e), the Commission level of
the NLRC has the power and authority to “enjoin or
restrain any actual or threatened commission of any or
all prohibited or unlawful acts or to require the
performance of a particular act in any labor dispute
which, if not restrained or performed forthwith, may
cause grave or irreparable damage to any party or
render ineffectual any decision in favor of such party.” A
temporary or permanent injunction in this case may be
issued only after hearing the testimony of witnesses,
with opportunity for cross-examination, in support of the
allegations of a complaint made under oath, and
testimony in opposition thereto, if offered, and only after
a finding of fact by the Commission, to the effect:
a. That prohibited or unlawful acts have been
threatened and will be committed and will be
2
continued unless restrained, but no injunction
or temporary restraining order shall be issued
act, except against the person or persons,
association or organization making the threat or
committing the prohibited or unlawful act or
actually authorizing or ratifying the same after
actual knowledge thereof;

b. That substantial and irreparable injury to
complainant’s property will follow;

c. That as to each item of relief to be granted,
greater injury will be inflicted upon complainant
by the denial of relief than will be inflicted upon
defendants by the granting of relief;
 

d. That complainant has no adequate remedy at
law; and
 

e. That the public officers charged with the duty to
protect complainant’s property are unable or
unwilling to furnish adequate protection.

The prohibited activities in relation to strikes and
following:
a. No labor organization or employer shall declare
a strike or lockout without first having bargained
collectively in accordance with Title VII of this
Book or without first having filed the notice
required in the preceding Article or without the
necessary strike or lockout vote first having
been obtained and reported to the Ministry.

No strike or lockout shall be declared after
assumption of jurisdiction by the President or
the Minister or after certification or submission
of the dispute to compulsory or voluntary
arbitration or during the pendency of cases
involving the same grounds for the strike or
lockout.
terminated as a consequence of any unlawful
lockout shall be entitled to reinstatement with
full backwages. Any union officer who
knowingly participates in an illegal strike and
any worker or union officer who knowingly
participates in the commission of illegal acts
during a strike may be declared to have lost his
employment status: Provided, That mere
participation of a worker in a lawful strike shall
not constitute sufficient ground for termination
of his employment, even if a replacement had
been hired by the employer during such lawful
strike.
b. No person shall obstruct, impede, or interfere
with, by force, violence, coercion, threats or
intimidation, any peaceful picketing by
employees during any labor controversy or in
 the exercise of the right to self-organization or
collective bargaining, or shall aid or abet such
obstruction or interference.
 is greater, a fraction of at least six (6) months being
c. No employer shall use or employ any strike-
breaker, nor shall any person be employed as
a strike-breaker.

d. No public official or employee, including officers
and personnel of the New Armed Forces of the
Philippines or the Integrated National Police, or
armed person, shall bring in, introduce or escort
in any manner, any individual who seeks to
replace strikers in entering or leaving the
premises of a strike area, or work in place of the
strikers. The police force shall keep out of the
picket lines unless actual violence or other
criminal acts occur therein: Provided, That
nothing herein shall be interpreted to prevent
any public officer from taking any measure
necessary to maintain peace and order, protect
life and property, and/or enforce the law and
legal order. 
 an establishment, the employer and the union shall
e. No person engaged in picketing shall commit
any act of violence, coercion or intimidation or
obstruct the free ingress to or egress from the
employer’s premises for lawful purposes, or
obstruct public thoroughfares. 
 voluntary arbitrators within ten (10) calendar days from
6. Under the Labor Code, is it possible for an
employer to suspend operations without
terminating its workers?
 In cases where there are no collective agreements or
Answer: Yes. The bona-fide suspension of the
operation of a business or undertaking for a period not
exceeding six (6) months, or the fulfillment by the
employee of a military or civic duty shall not terminate
employment. In all such cases, the employer shall
reinstate the employee to his former position without
loss of seniority rights if he indicates his desire to
resume his work not later than one (1) month from the
resumption of operations of his employer or from his
relief from the military or civic duty. (Article 301)
7. The Human Resources Manager asks you if
she can terminate the employment of an
employee due to illness and if so, what legal
requirements should she fulfill. How will you
respond?
 employer faces any liability.
Answer: Yes, the Labor Code allows disease to be a
ground for termination. An employer may terminate the
services of an employee who has been found to be
suffering from any disease and whose continued
employment is prohibited by law or is prejudicial to his
health as well as to the health of his co-employees. The
employer shall not terminate his employment unless
there is a certification by competent public health
authority that the disease is of such nature of at such a
stage that it cannot be cured within a period of six (6)
months even with proper medical treatment. The
employee to be terminated must be paid separation pay
3
equivalent to at least one (1) month salary or to one-half
(1/2) month salary for every year of service, whichever
considered as one (1) whole year. (Article 299 and
Section 8, Title I, Book 6 of the Rules Implementing the
Labor Code)
8. Under the Labor Code, what is “wage distortion”
and how should it be corrected?

Answer: A wage distortion shall mean a situation where
an increase in prescribed wage rates results in the
elimination or severe contraction of intentional
quantitative differences in wage or salary rates between
and among employee groups in an establishment as to
effectively obliterate the distinctions embodied in such
wage structure based on skills, length of service, or
other logical bases of differentiation.
Where the application of any prescribed wage increase
by virtue of a law or wage order issued by any Regional
Board results in distortions of the wage structure within
negotiate to correct the distortions. Any dispute arising
from wage distortions shall be resolved through the
grievance procedure under their collective bargaining
agreement and, if it remains unresolved, through
voluntary arbitration. Unless otherwise agreed by the
parties in writing, such dispute shall be decided by the
the time said dispute was referred to voluntary
arbitration.
recognized labor unions, the employers and workers
shall endeavor to correct such distortions. Any dispute
arising therefrom shall be settled through the National
Conciliation and Mediation Board and, if it remains
unresolved after ten (10) calendar days of conciliation,
shall be referred to the appropriate branch of the
National Labor Relations Commission (NLRC). It shall
be mandatory for the NLRC to conduct continuous
hearings and decide the dispute within twenty (20)
calendar days from the time said dispute is submitted
for compulsory arbitration. (Article 124)
9. F discovered that his employer, despite having
deducted amounts from his salaries purporting
to be SSS contributions, has not been remitting
any amount to the SSS. F asks you if his


Answer: Yes, under the law, should the employer fail to
remit any contribution due prior to the date of
contingency, resulting in a reduction of benefits, the
employer shall pay to the SSS damages equivalent to
the difference between the amount of benefit to which
the employee member or his beneficiary is entitled had
the proper contributions been remitted to the SSS and
the amount payable on the basis of contributions
actually remitted: Provided, That if the employee
member or his beneficiary is entitled to pension
benefits, damages shall be equivalent to the
accumulated pension due as of the date of settlement
of the claim or to the five (5) years' pension, whichever
is higher, including dependents' pension. In addition, the
employer shall also be liable for the corresponding
unremitted contributions and penalties thereon. (Sec.
24 R.A. No. 8282)
Any employer who, after deducting the monthly
contributions or loan amortizations from his employee's
compensation, fails to remit the said deduction to the
SSS within thirty (30) days from the date they became
due, shall be presumed to have misappropriated such
contributions or loan amortizations and shall suffer the
penalties provided in Article 315 of the Revised Penal
Code. (Sec. 28 (h) R.A. No. 8282).
10. B is a yaya and is considered a kasambahay,
being engaged in domestic work within an
employment relationship. She was terminated
unjustly and before the expiration of the term of
her contract. Where should her case be
resolved and what reliefs are available to her?
Answer: Under the law, all labor-related disputes shall
be elevated to the DOLE Regional Office having
jurisdiction over the workplace of the kasambahay
without prejudice to the filing of a civil or criminal action
in appropriate cases. The DOLE Regional Office shall
exhaust all conciliation and mediation efforts before a
decision shall be rendered. Ordinary crimes or offenses
committed under the Revised Penal Code and other
special penal laws by either party shall be filed with the
regular courts. (Sec. 37, R.A. No. 10361)
When the domestic worker is unjustly dismissed, the
domestic worker shall be paid the compensation
already earned plus the equivalent of fifteen (15) days
work by way of indemnity. (Sec. 32, R.A. No. 10361)
11. Under the law, the Voluntary Arbitrator or panel
of Voluntary Arbitrators shall have original and
exclusive jurisdiction to hear and decide all
unresolved grievances arising from the
interpretation or implementation of the
Collective Bargaining Agreement and those
arising from the interpretation or enforcement of
company personnel policies. They may also
hear and decide all other labor disputes
including unfair labor practices and bargaining
deadlocks if the parties agree. How is the
Voluntary Arbitrator or panel of Voluntary
Arbitrators chosen?

Answer: Parties to a Collective Bargaining Agreement
may name and designate in advance a Voluntary
Arbitrator or panel of Voluntary Arbitrators, or include in
the agreement a procedure for the selection of such
Voluntary Arbitrator or panel of Voluntary Arbitrators,
preferably from the listing of qualified Voluntary
Arbitrators duly accredited by the National Conciliation
and Mediation Board (NCMB). In case the parties fail to
select a Voluntary Arbitrator or panel of Voluntary
Arbitrators, the NCMB shall designate the Voluntary
Arbitrator or panel of Voluntary Arbitrators, as may be
necessary, pursuant to the selection procedure agreed
4
upon in the Collective Bargaining Agreement, which
shall act with the same force and effect as if the
Arbitrator or panel of Arbitrators has been selected by
the parties. (Article 273)
12. In organized establishments, when a petition for
certification election is filed within the 60 day
freedom period (the 60 day period before the
expiration of the CBA, the written consent of at
least 25% of all employees in the bargaining
unit authorizes the Med-Arbiter to automatically
order an election by secret ballot. What is
needed in case the establishment is
unorganized?

Answer: In any establishment where there is no
certified bargaining agent, a certification election shall
automatically be conducted by the Med-Arbiter upon the
filing of a petition by any legitimate labor organization.
This includes a national union or federation which has
already issued a charter certificate to its local/chapter
participating in the certification election or a
local/chapter which has been issued a charter certificate
by the national union or federation. In cases where the
petition was filed by a national union or federation, it
shall not be required to disclose the names of the local
chapter's officers and members.
13. Under Article 128 of the Labor Code, the duly
authorized representative of the Secretary of
Labor and Employment shall have the power to
issue compliance orders to give effect to the
labor standards provisions of the Labor Code
and other labor legislation based on the findings
of labor employment and enforcement officers
or industrial safety engineers made in the
course of inspection. Where may an appeal be
filed with respect to this order?

Answer: An order issued by the duly authorized
representative of the Secretary of Labor and
Employment under Article 128 of the Labor Code may
be appealed to the Secretary of Labor and Employment.
In case said order involves a monetary award, an
appeal by the employer may be perfected only upon the
posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Secretary of
Labor and Employment in the amount equivalent to the
monetary award in the order appealed from. (Article
128)
14. Under Article 129 of the Labor Code, the
Regional Director of the Department of Labor
and Employment or any duly authorized
hearing officer of the Department is
empowered, through summary proceeding and
after due notice, to hear and decide any matter
involving the recovery of wages and other
monetary claims and benefits, including legal
interest, owing to an employee, arising from
employer-employee relations for as long as (1)
the complaint does not include a claim for
reinstatement and (2) the aggregate money
claims of each employee does not exceed Five
 thousand pesos (P5,000.00). Where is an
appeal from the decision of the Regional
Director of the Department of Labor and
Employment or duly authorized hearing officer
filed? What grounds should the appeal be
based on?
 letter, and the third was a proposal as to how
Answer: Any decision or resolution of the Regional
Director or hearing officer under Article 129 of the Labor
Code may be appealed, within five (5) calendar days
from receipt of a copy of said decision or resolution, to
the National Labor Relations Commission. (Article 129)
The appeal may be based on any of the following
grounds:
a. If there is prima facie evidence of abuse of
discretion on the part of the Labor Arbiter;
 employee in lieu of reinstatement. In this case, P
b. If the decision, order or award was secured
through fraud or coercion, including graft and
corruption;
 whether he or she, in fact, intended to sever his or her
c. If made purely on questions of law; and

d. If serious errors in the findings of facts are
raised which would cause grave or irreparable
damage or injury to the appellant. (Article 129
and Article 229).
 resigning. Hence, since P was not illegally terminated,
15. Under Article 82 of the Labor Code, the Title on
Working Conditions and Rest Periods applies to
employees in all establishments and
undertakings whether for profit or not, but not to
(1) government employees, (2) managerial
employees, (3) field personnel, (4) members of
the family of the employer who are dependent
on him for support, (5) domestic helpers, (6)
persons in the personal service of another, and
(7) workers who are paid by results as
determined by the Secretary of Labor in
appropriate regulations. However, there are
benefits which the Implementing Rules have
made available only to retail and service
establishments with a certain number of
workers. What are these benefits and what is
the rule set by the Rules?
Answer: (a) Night shift differential is not available to
employees of retail and service establishments
regularly employing not more than 5 workers. (Section
1, Rule II, Book Three)
(b) Holiday pay and Service Incentive Leave are not
available to employees of retail and service
establishments regularly employing not more than 10
workers. (Section 1 (b), Rule IV, Book Three
and Section 1 (g), Rule V, Book Three)
16. P was an employee V Bank. A merger was
concluded between V Bank and S Bank.
Management of both banks informed P, who
earns 2 million pesos a year, that he should
resign and that his severance pay and other
5
benefits would be paid. They assured P that he
would eventually be rehired. In connection with
this, P wrote three letters to management: the
first letter requested an employment extension,
the second was an unconditional resignation
his benefits are to be paid. Thereafter, P
reluctantly resigned and issued an
unconditional resignation letter. Later on,
despite repeated attempts to claim his
severance pay, the banks did not heed the
requests.

Is P entitled to severance pay?
Answer: No, P is not entitled to severance pay.
Severance pay may be granted to an illegally dismissed
resigned voluntarily. In order to prove that resignation is
voluntary, "the acts of the employee before and after the
alleged resignation must be considered in determining
employment. P issued 3 letters and his second letter is
an unconditional resignation letter indicating that he was
fully aware of the consequences of his voluntary
resignation from the service. He is also no ordinary
employee given his annual salary. P should have made
sure that the verbal agreement regarding the severance
pay was embodied in a written instrument before
he is not entitled to severance pay. (Reference: Pascua
v. Bank Wise)
17. U and B Company formally executed a CBA
which was effective from Nov. 2007 to Oct.
2012. In 2009, B Company hired L and C and
were given higher salaries by Php 1,500.00
despite being probationary employees. Later,
U’s President sent a letter to B Company
expressing that the CBA was not being
implemented properly pursuant to the
guidelines and that, if not addressed, might
result in a salary distortion among union
members. Union alleges that as a
consequence, wages of said probationary
employees became equal with the wage rates
of the regular employees, thereby obliterating
the wage rates distinction based on merit, skills
and length of service. 

a. Did B Company violate the CBA when it granted
the wage increase to probationary employees?
Explain.

b. Is there a wage distortion? Explain.

Answer:
a. No. The B Company did not violate the CBA since
the increase in the wages of the probationary
employees was due to the increase in the hiring
rates at the time these employees were hired in
2009. The setting and implementation of such
various engagement rates were purely an exercise
of the B Company’s business prerogative in order
 to attract or lure the best possible applicants in the
market and which the Court will not interfere with,
absent any showing that it was exercised in bad
faith.
 already released to him by the Labor Arbiter
b. No, there is no wage distortion. In one case, the
Court held that the compulsory mandate under
Article 124 to correct "wage distortion" cannot be
applied to voluntary and unilateral increases by the
employer in fixing hiring rates which is inherently a
business judgment prerogative. The apparent
increase in L and C’s salaries as compared to the
other company workers who also have the same
salary/pay grade with them does not result in a
wage distortion because they were hired in 2009,
when the hiring rates were relatively higher as
compared to those of the previous years.
(Reference: Phil. Geothermal, Inc. Employees
Union V. Chevron Geothermal Phils. Holdings,
Inc.)
18. T was hired by PAL as a flight engineer. Union
members went on strike, and when T and other
striking pilots returned to work, PAL refused to
readmit them. They filed a complaint for illegal
lockout against PAL. Members and officers of
the Union who participated in the strike in
defiance of return-to-work order by the
Secretary of Labor were declared to have lost
their employment status by the court. Although
T was hired again by PAL, it was made clear to
him that he was rehired on the condition that his
employment would be as a new hire. He
resigned after less than a year. He informed
PAL of his intention of collecting his separation
and/or retirement benefits under the CBA. The
Retirement Plan requires at least five years of
continuous service with PAL to be entitled to the
resignation benefit. PAL refused to pay T
separation and/or retirement benefits as stated
in the CBA.
 upon the finality of the decision ordering the separation
Is T entitled to retirement benefits under the
CBA, and the equity in the retirement fund
under the PAL Pilot’s Retirement Benefit Plan?
Answer: No, T is not entitled to any retirement benefits.
Retirement is the result of a bilateral act of the parties,
a voluntary agreement between the employer and the
employee whereby the latter, after reaching a certain
age, agrees to sever his or her employment. In this
case, T forfeited his benefits when his employment was
terminated for just cause. An employee who knowingly
defies a return-to-work order issued by the Secretary of
Labor is deemed to have committed an illegal act which
is a just cause to dismiss the employee. As a new hire,
he did not complete the required number of years of
service in order to avail the benefits of the Retirement
Benefits Plan. (Reference: Tolentino v. PAL)
19. After winning a case for an illegal dismissal
case decided by the Supreme Court and finality
of the resolution on March 30, 2012, Z moved
for the issuance of an alias writ of execution
6
against CCC for his reinstatement, and the
payment of full back wages, accrued salaries
and allowances less the amount that were
pending appeal. CCC opposed the motion and
argued that its execution of the Asset Purchase
Agreement (APA) with TTT in 2007 was a
supervening event that made it impossible to
reinstate Z to his former position. In the
execution proceedings, the NLRC ruled that the
reinstatement was indeed rendered impossible
because of the APA, but the backwages should
be computed only until the finality of the SC
Resolution in the Illegal Dismissal case on Mar.
30, 2012. Z went to the Court of Appeals, which
modified the NLRC decision by stating that the
backwages should be computed from the date
of illegal dismissal until the finality of its
decision, and separation pay computed from
the date of employment until finality of its
decision. CCC argues that it should only be
liable for back wages and separation pay only
until time the supervening event and legal
impossibility to reinstate arose that made Z’s
position non-existent as of 2007.
How should Z’s backwages and separation pay
be computed?
Answer: As held by the Supreme Court, when there is
a supervening event that renders reinstatement
impossible, backwages is computed from the time of
dismissal until the finality of the decision ordering
separation pay. When separation pay is ordered after
the finality of the decision ordering the reinstatement by
reason of a supervening event that makes the award of
reinstatement no longer possible, as in the case,
backwages is computed from the time of dismissal until
the finality of the decision ordering separation pay.
Further, the employment relationship is terminated only
pay. The finality of the decision cuts-off the employment
relationship and represents the final settlement of the
rights and obligations of the parties against each other.
(Reference: Consolidated Distillers of the Far East, Inc.
v. Zaragoza)
20. A is the widow of D, a Filipino seafarer who
signed a contract of employment with Starcrest.
The deceased was employed as chief cook for
6 months on board a vessel. During work, he
experienced constipation and abdominal pains.
He was taken to a German hospital and was
found with blood in his stool, swollen intestinal
walls and lower abdomen. He was then
repatriated.

When he was admitted to St. Luke’s hospital,
he was diagnosed with stage 4 colon cancer.
He was discharged from the hospital but
underwent chemotherapy one month later
under the care of the company designated
physician, who issued a Progress Report where
he reported that the illness was deemed not
 work related. On the basis of the foregoing
report, D's chemotherapy treatments were
discontinued. Further, Cancer of the Large
Bowel (Colon), is not among the occupational
diseases listed in the POEA-SEC.
D then filed a complaint with the Labor Arbiter
for disability benefits. The LA decided against
D. Pending appeal, D died and he was
substituted by his heirs.
Is the illness of D work-related?
Answer: No. Work-related illnesses are determined by
the following rules:
First, there is work relation if the illness leads to
disability or death as a result of an occupational disease
listed under Section 32-A of the POEA- SEC with the
conditions set therein satisfied;
Second, for illnesses not mentioned under Section 32,
the POEA-SEC creates a disputable presumption in
favor of the seafarer that these illnesses are work-
related, and the seafarer must still prove by substantial
evidence that his/her work conditions caused or, at
least, increased the risk of contracting the disease.
In this case, the afflicted illness of D is not among the
occupational diseases listed in the POEA-SEC, hence,
he or his heirs cannot be entitled to disability benefits.
Since there is failure on the part of D or his heirs to
present substantial evidence that would prove
reasonable causation, or at the very least, aggravation
of D’s work while aboard the vessel, the claim for
disability benefits must be denied (reference: Seacrest
Maritime Management Inc. v. Roderos).
21. DOLE declared a strike held by ALPAP as
illegal and declared the loss of employment of
its officers. The Court of Appeals affirmed the
Secretary of Labor resolution and the decision
reached finality.
 amounts allegedly due them.
Eight (8) months after, PAL filed with the Labor
Arbiter a complaint for damages against ALPAP
and its officers and members. It alleged that the
striking pilots abandoned three (3) PAL aircraft.
Because of the deliberate and malicious
abandonment of the said flights, its passengers
were stranded, and rendered PAL liable for
violation of its contract of carriage.
The Labor Arbiter, NLRC and CA all held that
PAL’s claim for damages lies with the regular
courts.
Can PAL claim for damages against ALPAP?
Answer: No, PAL can no longer claim for damages
against ALPAP.
Labor tribunals have jurisdiction over actions for
damages arising from a labor strike, since the loss and
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injury from which PAL seeks compensation have
“reasonable causal connection” with the alleged acts of
unfair labor practice, a claim provided for in Article 217
of the Labor Code.
However, the Labor Arbiter was already divested of its
jurisdiction to entertain PAL's claim for damages as
such issue was deemed included in the issue of legality
of strike of which the Secretary of Labor had assumed
jurisdiction, pursuant to the rule against splitting of
jurisdiction. Unfortunately, for PAL's failure to raise the
claim during the pendency of the illegal strike case
before the Secretary of Labor, the same is deemed
waived. (Reference: PAL v. Airline Pilots Association of
the Philippines).
22. This case involves 3 different illegal dismissal
complaints by A, B and C against Better Health
Co. The Labor Arbiter found that all 3 were
illegally dismissed. The National Labor
Relations Commission affirmed. The Court of
Appeals reversed holding that there is no
employer-employee relationship between A
and EEE Company, and that his complaint
should have been filed before the Regional Trial
Court and that EEE Company was justified in
dismissing B and C.

A, B and C allege that the Court of Appeals
should have dismissed outright the appeal of
EEE Company since the latter failed to post a
genuine appeal bond before the NLRC. The
Sheriff enforcing the judgement award against
the bond was informed that the appeal bond
procured by EEE Company did not appear in
the records of FFF Insurance and GGG
Insurance.
EEE Company, on the other hand, contend that
there was substantial compliance and that the
issue had already been considered moot since
the three were able to garnish and collect the
The NLRC certified that EEE Company filed a
security deposit in the amount of P6,512,524.84
under Security Bank check no. 0000045245,72
showing that the premium for the appeal bond
was duly paid and that there was willingness to
post it. Also, documents proving that Alpha
Insurance was a legitimate and accredited
bonding company was presented by EEE
Company.
Did EEE Company fail to perfect its appeal with
the CA when it was discovered that their appeal
bond was a forged bond? Explain.
Answer: Yes, EEE Company perfected its appeal.
Appeal is not a matter of right. The perfection of an
appeal is jurisdictional. In labor cases, an appeal by an
employer is perfected only by filing a bond equivalent to
the monetary award. The purpose of requiring an
appeal bond is "to guarantee the payment of valid and
legal claims against the employer." It is a measure of
financial security granted to an illegally dismissed
employee since the resolution of the employer's appeal
may take an indeterminable amount of time.
As decided in other cases, while the procedural rules
strictly require the employer to submit a genuine bond,
an appeal could still be perfected if there was
substantial compliance with the requirement. In this
instance, EEE Company posted a security deposit and
presented proof that GGG Insurance was legitimate.
In addition, despite their failure to collect on the appeal
bond, A, B and C were eventually able to garnish the
amount from respondents' bank deposits. This fulfills
the purpose of the bond, that is, "to guarantee the
payment of valid and legal claims against the employer."
Hence, EEE Company is considered to have
substantially complied with the requirements on the
posting of an appeal bond. (Reference: Malcaba et. al.
v. Prohealth Pharma Philippines, Inc.)
23. A and B were both hired as pre-school teachers
of DDD College. A filed a Leave-of-absence
(LOA) for the period May to June 2010 as she
was to undergo a fertility check-up in Canada.
When she returned to the Philippines, she
received a letter from the Directress of DDD
College requiring her to explain why she should
not be dismissed for taking a leave of absence
without approval. When she reported back to
the College, she was allegedly barred by from
teaching in her class, entering her classroom,
being introduced to her students, preparing
teaching aids and materials, and going to other
offices within the campus. Thus, A alleges that
all these acts constitute constructive
dismissal.
 complaints. The Labor Arbiter dismissed the
On the other hand, B took a LOA without pay
from April to June 2010 to undergo surgical
operation for scoliosis. She received a letter
from the College advising her to file a LOA (Sick
Leave) for the entire school year. Otherwise,
she will be reassigned to a higher-grade level
where the students are more independent
learners. The letter also required her to submit
a waiver absolving the College from any liability
in case of any untoward incident that may take
place while in the performance of her teaching
duties as well as notarized certification of her
physician as to her fitness to resume work. She,
thus, avers that she was constructively
dismissed when PET stripped her of her
teaching load and being forced to take a LOA.
Were A and B constructively dismissed?
Explain.
Answer: Yes, A and B were constructively dismissed by
the DDD College. Constructive dismissal arises when
continued employment is rendered impossible,
unreasonable or unlikely; when there is a demotion in
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rank and/or a diminution in pay; or when a clear
discrimination, insensibility or disdain by an employer
becomes unbearable to the employee. An employee is
considered to be constructively dismissed from service
if an act of clear discrimination, insensibility or disdain
by an employer has become so unbearable to the
employee as to leave him or her with no option but to
forego with his or her continued employment.
In this case, DDD College employed means whereby
the A and B were intentionally placed in situations that
resulted in their being coerced into severing their ties
with the College, thus, resulting in constructive
dismissal. Hence, there is constructive dismissal
committed against A and B.
24. A was hired by B on 8 February 2000 and was
assigned to the Alabang, Muntinlupa City
branch, while his wife was also hired and
assigned to another branch. A signed an
agreement that they are prohibited from setting
up or be involved in a similar business. Z, which
operates the salon, found out that A was
establishing a beauty salon near his place of
work. He then received a notice placing him
under preventive suspension and requiring him
to appear in an investigation. During the
hearing, A denied that he was establishing the
salon but admitted that it was owned by his
brother-in-law and he just gave funds to the
latter. He also received a second written notice
containing the justification of his termination. 

On the other hand, his wife was also notified to
explain her involvement and was placed under
preventive suspension. Both were eventually
terminated due to loss of confidence. Hence,
the filing of two separate illegal dismissal
complaints. The NLRC, on appeal, affirmed the
dismissal of A’s complaint and held that the
wife’s dismissal is illegal.
Is there basis for A’s illegal dismissal
complaint?
Answer: None. A’s illegal dismissal complaint must be
dismissed. Dismissals under the Labor Code have two
facets: substantive due process and procedural due
process. The requirement of procedural due process
was served with the service of first written notice
containing the specific grounds or causes for possible
termination, the conduct of an investigative hearing and
the service of the second written notice containing the
justification for his termination. The substantive due
process aspect was met due to the existence of a valid
cause for terminating his employment since he violated
their agreement against engaging in a similar business.
This constitutes serious misconduct or willful
disobedience of the company’s lawful orders, which is a
just cause for terminating an employee by the employer.
25. A was a receptionist at the Manila Bay Hotel
receiving P50,000 monthly as her salary. She
 worked overtime for three hours for fourteen
days in the month of October 2017. In
December 2017, she still had not received her
overtime pay totalling P despite demands upon
the hotel management. If A were to seek
remedy by filing a complaint, what would her
cause of action be?
 filing of the complaint before the NLRC in 2010
Where should A file her complaint?
Answer:
a. A’s cause of action is a monetary claim for the
recovery of overtime pay for the month of October.
b. She should file her complaint before the NLRC.
The NLRC would have jurisdiction over monetary
claims of employees; however, the Regional
Director of the DOLE or any of the duly authorized
hearing officers of the Department, is also
empowered, through summary proceeding and
after due notice, to hear and decide any matter
involving the recovery of wages and other
monetary claims and benefits, including legal
interest, owing to an employee or person
employed in domestic or household service or
househelper under the Labor Code, arising from
employer-employee relations, provided that a)
such complaint does not include a claim for
reinstatement, and that b) the aggregate money
claims of each employee or househelper does not
exceed five thousand pesos (P5,000), otherwise,
the NLRC would have jurisdiction over the
monetary complaint. In the scenario above, the
value of A’s monetary claim exceeds that of
P5,000, and therefore it should be filed before the
NLRC and not before the DOLE.
26. A and B allege that they are regular employees
of PPI assigned at the Marikina branch. When
their contracts expired, they were told that as a
precondition for continued employment, they
had to submit a resignation letter, pass through
CBMI and after 6 months go on vacation for one
month. After this, they were assigned at the
same branch and performed the same duties
and received the same salary. Their contracts
with CBMI shows that the latter wield and
exercise the following powers over them:
"selection and engagement, payment of wages,
dismissal, and control over the employees'
conduct."
After A was investigated for his involvement in
an attempted theft by CBMI, he was
preventively suspended and then dismissed. B,
on the other hand, claims that after the
investigation, she was no longer allowed to
report for work. Hence, they filed complaints for
illegal dismissal and argued that their transfer
from PPI to CBMI constituted labor-only
contracting and was a mere scheme by PPI to
prevent heir regularization; and second, that
they were illegally dismissed without cause and
due process of law.
9
CBMI is a corporation engaged in the business
of providing janitorial, kitchen, messengerial,
elevator maintenance and allied services to
various entities and has been in existence since
1967. The company's total assets at the time of
amounted to Php 84,351,349.00. Among
CBMI's clients is Philippine Pizza, Inc.-Pizza
Hut (PPI), De La Salle University (DLSU),
Philippine National Bank (PNB), Smart
Communications, Inc., SM Supermalls, and the
United States (US) Embassy.
Is CBMI labor-only contractor or independent
contractor?
Answer: CBMI is an independent contractor. Job
contracting is not absolutely prohibited. Job contracting
is deemed legitimate and permissible when the
contractor has substantial capital or investment and
runs a business that is independent and free from
control by the principal. In this case, CBMI runs a
business independent from the PPI. It has control over
the conduct of A and B based on their contracts, pays
their salaries, and maintain the power to discipline them
when they initiated an investigation over their
participation in the theft.
27. B was hired as a warehouse helper by CDE
Company, a domestic corporation engaged in
the business of distribution and sale of
pharmaceutical and consumer products, after
which he joined a labor union. CDE Company
bought another drug company, FGH Company,
wherein it was stated in the Memorandum that
the Management of CDE Company decided to
limit CDE Company’s functions to those of a
holding company and run FGH Company as the
main operating company. The Memorandum
also stated that the Union (to which B belonged)
acknowledges Management's decision to
transfer all employees of CDE Company to
FGH Company who would have the power to
select the employees. The Memorandum also
guaranteed the tenure of the employees, the
preservation of salaries and benefits, and the
enjoyment of the same terms and conditions of
employment by the affected employees.
FGH contracted its logistic services to JKL
Distributors. FGH and JKL agreed that FGH
would provide warehousemen to JKL’s tobacco
business which operated in JKL-Libis
Warehouse. B was one of those
warehousemen assigned and an ID with the
FGH logo was given to B. FGH saw to it that its
obligation to provide logistic services to its client
JKL Distributors is carried out with B working as
warehouseman. However, JKL Distributors
decided to operate the business by themselves,
thereby ending their logistic service agreement
with FGH. This left FGH with no other option but
to terminate the employment of those assigned
 to JKL-Libis Warehouse, including B, who
received a termination letter from FGH.
B filed a complaint against CDE Company.
CDE asserted that it was not B’s employer. Was
there an employer-employee relationship
between B and CDE Company?
Answer: No, there is no employer-employee
relationship between B and CDE Company, because B
failed to satisfy the four-fold test (i.e. the selection and
engagement of the employees, the payment of wages,
the power of dismissal, the power to control the
employee’s conduct). He did not submit any evidence to
show that CDE Company was still his employer. To
analyze each test one by one:
b. redundancy;
c. retrenchment to prevent losses;
d. closure and cessation of business; and
e. disease / illness.
30. What is the right to self-organization?
Answer: Workers and employees have the right to
form, join or assist unions, organizations or
associations, for purposes of collective bargaining and
negotiation, and for mutual aid and protection. The right
to self-organization also refers to the right to engage in
peaceful concerted activities or to participate in policy
and decision-making processes affecting their rights
and benefits.

a) The Memorandum shows FGH’s power to THE END

select employees and to decide when to
engage them. ACKNOWLEDGEMENTS:
b) There was no substantial evidence that CDE
was the one paying him wages. UP LAW BAR COMMITTEE Dean Fides Cordero-Tan
Assoc. Dean Concepcion L. Jardaleza
c) The termination letter given by FGH Company,
not CDE Company, shows that FGH Company SUBJECT EXPERTS Atty. Arnold F. De Vera
was the one who terminated B. Prof. Dante Gatmaytan
d) FGH Company, and not CDE Company, had
UP LAW CENTER Atty. Glenda T. Litong
control over B, as FGH saw to it that its TRAINING AND Atty. Renee A. Fopalan
obligation to provide logistic services to its client CONVENTION DIVISON Elisha Danne R. Ponio
is carried out with B working as warehouseman.
Furthermore, B’s new ID no longer had CDE’s LAYOUT Renee Louise M. Co
logo, but FGH’s logo. The court held that in a
business establishment, an ID is to identify the
holder as a bona fide employee of the firm that
issues it.

28. What are the just causes for an employer to

terminate an employee?

Answer: Under Art. 282 of the Labor Code, and

employer may terminate and employee for any of the
following causes:

a. Serious misconduct or willful disobedience by

the employee of the lawful orders of his
employer or representative in connection with
his work;
b. Gross and habitual neglect by the employee of
his duties;
c. Fraud or willful breach by the employee of the
trust reposed in him by his employer or duly
authorized representative;
d. Commission of a crime or offense by the
employee against the person of his employer or
any immediate member of his family or his duly
authorized representatives; and
e. Other causes analogous to the foregoing.

29. Enumerate the authorized causes for

terminating employment.

Answer: Under Art. 283 and 284 of the Labor Code, the
employer may also terminate employment due to the
following:
a. installation of labor-saving devices;

10