Labor Law Pre-Week Lecture Areas 2014 Prof.

Samson Alcantara
Section 3, Article III, 1987 Constitution
State Policy on full protection of labor
Preferential use of voluntary modes of settling labor disputes.
Note that compulsory arbitration of disputes is still done. Example, when the President or
Secretary of Labor assumes jurisdiction over a labor dispute in an industry vital to national
interest, the dispute may be referred for compulsory arbitration to the LA.
Principle of shared responsibility between workers and employers, to actively participate in the
settling of disputes.
Right to profits by enterprises reasonable return of capital and for purposes of expansion and
growth)
Principle of social justice for the employer : No work, no pay.
Exception to said principle:
1. Payment of benefits as provided for in the CBA
2. Dismissal was without just or authorized cause, reinstatement with backwages shall be
awarded
3. Those benefits provided by law
Characteristics of Employer-Employee Relations
1. Master-servant relationship
2. Control test control of means and methods of accomplishing the work
3. In-personam nature of employment contract does not bind 3rd parties
4. No requirement of compulsory rendering service as it amounts to involuntary servitude.
Exemption to in-personam nature of employment:
Selling the shares of the company does not sever the employment of the employees with the
company, as it was only the majority of the shares of the company goes to the buyer of the
shares. The assets of the company still belong to the company.
Look out for questions involving employee-employer relations that will involve 3 parties: Job
contractor, principal and the employees. Determine who exercises control.
Do labor laws apply to those agreements already existing? Is there retroactive effect?
Yes, labor laws are applicable to agreements already existing. There is retroactive effect due to
Article 4 of the Labor Code where the liberality of the law applies and construction is made in
favor of labor. Also, labor laws are police power measures that cannot be barred by a defense of
impairment of contracts. Police power measures are for promoting the general welfare, over
which the rights of contracting parties must be superseded.
Management prerogatives not absolute
Restrictions:
1. Must be in good faith

2. Non-oppressive
3. Not in contravention of contracted stipulations entered into by the employee and employer.
Closed shop agreement a limitation to the hiring and dismissal of workers
Refusal of promotion not a valid ground for dismissal, promotion is a reward, the refusal of
which is not a ground for dismissal
Exception: If there was a stipulation in the employment contract that refusal to be promoted shall
be a valid ground for dismissal.
Recruitment and placement
Liability of employment agency in case of illegal dismissal of OFW by the principal is solidary
with the said principal.
Article 18. Ban on Direct Hiring
General Rule: Hiring through an agency in the Philippines is required. This is in conjunction with
the requirement of OFWs to mandatorily remit part of their earnings back to family members in
the Philippines.
Exceptions: DION
1. Diplomatic corp members
2. International organizations
3. Other employers as may be allowed by DOLE
4. Name hires
Prohibited acts of licensee and non-licensee
Amendment or alteration of contractual stipulations of employment contracts
If favorable to the employee, it is binding, even if it was not approved by the Secretary of Labor.
If not favorable, such as reduction of benefits, if done unilaterally by the employer, it is not
binding.
Employment of non-resident aliens general rule, prohibited under Article 40 LC
Exceptions:
1. There are no qualified Filipino workers
2. There are no Filipino workers willing and available to do the work
3. Employment with the understanding that alien shall train Filipinos in doing the same job
Jobs where aliens are disqualified to have under the law/Constitution
Learnership vs. Apprenticeship
Overtime
Service Incentive Leave
Service Charge
Vacation Leave
Holiday Pay (regular and special holiday)

Employees who are not covered by labor standards in the Labor Code:
1. Government employees
2. Manager, managerial officers, staff and supervisors
3. Field personnel
4. Domestic helper
Note: Due to the Kasambahay Law, a family driver is now to be considered as covered by the
Labor Code.
Employment of minors in relation to the Kasambahay Law:
1. Not below 15 years old
2. Work only during the daytime
3. Have an opportunity to study (elementary and highschool)
4. Not to work in hazardous conditions or situations
5. 40 hours of work in one week
Debt bondage service as a domestic helper in lieu of payment of money.
Who are not covered by holiday pay? Retail/service establishment with less than 10 workers.
SIL - 5 days leave, convertible to cash if not utilized; employee is qualified for such leave if he
has rendered at least one year of service.
The employer may provide other benefits not provided under the Labor Code which cannot be
eliminated anymore due to the following:
1. Contractual stipulation
2. Long practice or tradition
3. Provided by law or the Constitution
Service Charges vs. Tips
Overtime Work general rule, voluntary only
Exceptions: emergency overtime work
1. In times of war or national emergency
2. Necessary to avail of favorable work conditions, weather or environmental conditions
3. Work is necessary to preserve perishable goods
4. Urgent work done on machines and equipment
5. Prevent loss/damage to the life or property due to emergency or force majeure
6. Prevent serious obstruction or prejudice to the business or operations of the employer.
Wage vs. Salary
Bonus either contractual (part of the wage, paid for work done) or gratuitous (not part of wage,
essentially a donation or reward)
Facilities items intended to meet the essential needs of workers and their families; part of the
employees wages; not inclusive of the tools of the trade, articles or services primarily for the
benefit of the employer or necessary to the conduct of the employers business.

Supplements additional benefits provided by the employer over and above ordinary wages or
earnings; provided for by the employer for the enhancement or promotion of the business; not
chargeable against the wage of the employees.
Wage distortion
Non-diminution of benefits (Article 100 LC)
- Not applicable to non-monetary benefits
- Replacement of benefit withdrawn must be commensurate in vale
- Employer cannot unilaterally remove or withdraw the benefits already given.
Article 128. Visitorial and Enforcement Power of the Secretary of Labor
- No need for an arrest warrant
- Exercised on behalf of those works who are still employed
Those whose employment had ceased and with money claims
With a claim for reinstatement, regardless of amount of money claims Labor Arbiter
Without Claim for reinstatement with money claims PhP5,000.00 and below Regional Director
Deductions by the Employer that are allowed by law even without employees consent:
1. SSS contributions
2. Insurance premiums of the employee
3. Union dues/check off as provided in the CBA
4. Special assessments for mandatory union activities
5. Taxes withheld by employer
Special assessment for non-mandatory union activities needs written consent of the employee.
Agency Fee amount imposed on non-members of the exclusive bargaining unit who receive
benefits from the CBA.
Break compensable, short duration
Meal period at least 1 hour, not compensable as a rule.
When shortened meal period is allowed:
1. When the operations of employer lasts for 16 hours a day.
2. Duration of the meal period is not less than 20 minutes.
Kinds of Employment
Regular Employment
When does a project employee become a regular worker?
1. Constant rehiring
2. Transferring of assignment to other projects
3. Non-compliance with the reporting requirement to the DOLE at the termination of the project
and termination of workers
Seasonal Employment

Casual Employment engaged in performance of activities not necessary or desirable to the

trade or business of the employer; becomes a regular worker after serving at least one year, and
is retained so long as the activity which he is engaged in is still required by the employer.
Probationary employment employment for a period to enable the employer to determine if the
employee is qualified for regularization; a managerial prerogative; dismissal shall be only for
cause; standards of regularization must be made known at the time of hiring, otherwise,
employee is deemed to be a regular worker.
Promotions as a rule, cannot be the basis of discipline, except if stipulated in the employment
contract.
Employment for a fixed period
Employment of Women Workers
Stipulation against marriage generally void
Except: Bona fide occupational qualifications
Pregnancy-induced absences should be allowed by employer
Employment of minors
- Relate with Kasambahay law
- Non-hazardous jobs
- Up to 9 pm only
- No interruption in the childs development and education
- Not more than 20 hours a week
Home worker vs. House helper
Retrenchment vs. Redundancy
Retrenchment
Due to losses
Separation pay of month pay/year served
Resorted to after other prior measures failed to arrest losses
Redundancy
Due to over-hiring of workers
Separation pay of 1 month pay/year served
Valid authorized cause, use of labor saving device
Serious business losses/reverses no payment of separation pay required
SSS
- For the private sector
- The worker and his family are given protection form disability, retirement, maternity or death
- As a rule, compulsory, as it is imposed as a form of police power of the state
- Self-employed individual depends upon his own efforts to earn, no employee-employer
relationship

- Employer generally must contribute to SSS

- Once a member, always a member, even if the worker has stopped working in the meantime
- If worker is dismissed for cause, no forfeiture of benefits is had (In GSIS, dismissal for cause
shall result to forfeiture of benefits and return of the premiums.)
SSS Maternity Leave Benefits
1. First four childbirth, abortion or miscarriages of the woman employee
2. Employee had paid at least 3 monthly contributions in the 12-month period immediately
preceding the semester of her childbirth or miscarriage
3. Benefit of 100% of her average daily salary credit for 60 days (normal delivery) or 78 days
(caesarian delivery)
Retirement Pension
Disability Benefits
Sickness Benefits
Dependents means the workers relatives; the worker is still alive
Beneficiaries persons specifically designated to benefit from the SSS pensions after workers
death; need not be a relative.
The designated dependent or beneficiary shall benefit from the SSS.
Jeepney drivers are covered by SSS.
Limited Portability Rule
GSIS Law
- Includes GOCCs with original charter
- All those in government service receiving regular remuneration are covered
Disability benefits from the GSIS will be disallowed if the accident was due to:
1. Grave misconduct
2. Notorious negligence
3. Habitual intoxication
4. Willful intention to kill himself or another
Voluntary Separation Benefits given to an employee who had accepted optional retirement but
has not yet served the minimum 15 years of service.
Involuntary Separation Benefits a lump sum payment of a worker who undergoes involuntary
retirement due the abolition of the office; minimum 3 years of service.
Retirement Lump Sum Benefits:
1. SSS 5 years lump sum 5 years lump sum
2. GSIS 18 months lump sum.
Employees Compensation Program
- Covers both government and private employees

- Not contributory, employers contribute to the state insurance fund

- Only for work-related injuries and occupational diseases.
Injury sudden harmful change in the human body, occurred in the workplace, in performance
of his duties or other circumstance.
Proximity Rule accident occurred so near the work place, so it can be considered as an injury
that occurred in relation to his work.
Occupational disease
1. A disease recognized by the government as occupational
2. A disease established by substantial evidence that the risk of contracting it was increased
due to the prevailing working conditions or functions (increased risk theory)
Persons with disability (PWDs)
- Public ridicule of a PWD during hiring process shall be subject to sanction.
Qualified Disabled vs. Handicapped
Qualified disabled is entitled to 100% wage rate; his disability has nothing to do with doing the
job at hand.
Handicapped people are entitled to 75% wage rate; his disability affects how work is done.
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