SUMMARY OF DOCTRINES

Table of Contents

3Heading 1

3Heading 2

3Heading 3

4Frequently Asked Questions

4General Provisions

6Labor Standards

6Book One: Pre-Employment

6Book Two: Human Resources Development

7Book Three: Conditions of Employment

15Labor Relations

16Book Five: Labor Relations

27Book Six: Post-Employment

34Book Seven: Transitory and Final Provisions

35Social Legislation

392007 Bar Questions and Answers

45Bar-Type Questions

57Questions and Answers

76Case Doctrines

76Preliminary Title

76Book One: Pre-Employment

76Book Two: Human Resources Development

77Book Three: Conditions of Employment

77Employer-Employee Relationship

78Wages

79Labor-Only Contracting and Job Contracting

79Worker Preference in Case of Bankruptcy

80Book Five: Labor Relations

80Jurisdiction of Labor Arbiters

80Technical Rules Not Binding and Prior Resort to Amicable Settlement

81Appeal

81Bureau of Labor Relations

82Registration and Cancellation

82Rights of Legitimate Labor Organizations

83Right to Self-Organization

83Certification Election

83Unfair Labor Practice

84Collective Bargaining

84Strikes and Lockouts

85Assumption of Jurisdiction by the Secretary of Labor

85Book Six: Post-Employment

85Reinstatement

85Regular Employment

86Casual Employment

86Project Employment

86Seasonal Employment

87Fixed-Term or Fixed-Period Employment

87Probationary Employment

87Termination by Employer

88Termination by Employee

88Employment Not Deemed Terminated

89Retirement From Service

89Management Prerogative

89Book Seven: Transitory and Final Provisions

90Social Legislation

90Social Security Act of 1997 (R.A. 8282)

90Government Service Insurance Act of 1997 (R.A. 8291)

9013th Month Pay (P.D. 851)

91Tally of Frequently Asked Questions (1990-2007)

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Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text Body Text (A vs. B, GR No. 1872832, September 29, 1982).Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent Body Text Indent.Frequently Asked QuestionsSource: U.P. Law Center and Philippine Association of Law SchoolsGeneral ProvisionsTOPIC: LABOR LAW AND SOCIAL LEGISLATION; DEFINITIONSDifferentiate labor standards law from labor relations law. Are the two mutually exclusive?SBC BAR OPERATIONS SUGGESTED ANSWER (BOA):Labor standards law is that which sets out the minimum requirements prescribed by existing laws, rules and regulations relating to wages, hours of work, cost-of-living allowance, and other monetary and welfare benefits, including occupational safety, and health standards (Batong Buhay Gold Mines, Inc. v. Dela Serna, G.R. No. 86963, August 6, 1999).On the other hand, labor relations law is that labor law which defines the status, rights, and duties and the institutional mechanisms that govern the individual and collective interactions of employers, employees or their representatives.Labor standards laws and labor relations laws are not mutually exclusive; they complement each other. For instance, the grievance machinery is a labor relations matter, but very often the subject of complaint is labor standards such as unpaid overtime work. Figuratively, one may think of labor standards as the substance to be processed while labor relations is the mechanism that processes the substance (Azucena, 2007).Is there any distinction between labor legislation and social legislation? Explain.BOA:YES. Labor legislation consists of statutes, regulations and jurisprudence governing the relations between capital and labor, by providing for certain employment standards and a legal framework for negotiating, adjusting and administering those standards and other incidents of employment. On the other hand, Social legislation composes of laws that provide particular kinds of protection or benefits to society or segments thereof in furtherance of social justice. In that sense, labor laws are necessarily social legislation. Examples of social legislation are the agrarian reform law, social security laws, and even the Labor Code provisions on State Insurance Fund to cover work-related injuries and occupational diseases (Azucena, 2007).TOPIC: SOCIAL JUSTICEMay social justice as a guiding principle in labor law be so used by the courts in sympathy with the working man if it collides with the equal protection clause of the Constitution? Explain.UP LAW CENTERS SUGGESTED ANSWER (SA):YES. The State is bound under the Constitution to afford full protection to labor; and when conflicting interests collide and they are to be weighed on the scales of social justice, the law should accord more sympathy and compassion to the less privileged working man. (Fuentes vs. NLRC, G.R. No. 110017, January 2, 1997) However, it should be borne in mind that social justice ceases to be an effective instrument for the equalization of the social and economic forces by the State when it is used to shield wrongdoing (Corazan Jamer vs. NLRC, G.R. No. 112630, September 5 1997).UP LAW CENTERS ALTERNATIVE ANSWER (AA):NO. Social justice as a guiding principle in law may not be used by the courts if it collides with the equal protection clause of the Constitution. Social justice is not a magic wand applicable in all circumstances. Not all labor cases may be automatically decided in favor of the worker. Management also has rights which are entitled to recognition and protection; justice must be dispensed according to facts and the law; and social justice is not designed to destroy nor oppress the employer.TOPIC: CONSTITUTIONAL RIGHTS AND MANDATESWhat are the salient features of the protection to labor provision of the Constitution?

SA:The Constitution in Article XIII, Section 3 provides:

The State shall afford protection to labor, local and overseas, organized unorganized. The State shall afford protection to labor by promoting full employment and equality of employment opportunities for all. Workers are entitled to security of tenure, humane conditions of work and a living wage. The State shall guarantee the right of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike, in accordance by law. Workers shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law. The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in setting labor disputes, including conciliation, and shall enforce mutual compliance therewith to foster industrial peace. The State shall regulate the relations between workers and employers recognizing the right to its just share in the fruits of production and the right of enterprises to reasonable returns on investments, and to expansion and growth.TOPIC: MANAGEMENT RIGHTSHarbor View Hotel has an existing Collective Bargaining Agreement (CBA) with the union of rank-and-file employees consisting, among others, of bartenders, waiters, roomboys, housemen and stewards. During the lifetime of the CBA, Harbor View Hotel, for reasons of economy and efficiency, decided to abolish the position of housemen and stewards who do the cleaning of the hotels public areas. Over the protest of the Union, the Hotel contracted out the aforementioned job to the City Service Janitorial Company, a bona fide independent contractor which has a substantial capital in the form of janitorial tools, equipments, machineries and competent manpower.Is the action of the Harbor View Hotel legal and valid?BOA:YES. An employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, discipline, dismissal and recall of workers. (San Miguel Brewery Sales v. Ople, G.R. No. L-53515, February 8, 1989) Management prerogatives, however, are subject to limitations provided by: (1) law; (2) contract or collective bargaining agreements; and (3) general principles of fair play and justice (Mendoza v. Rural Bank of Lucban, G.R. No. 155421, July 7, 2004).AA:The action of the Harbor View Hotel is legal and valid. Contracting out services or functions being performed by union members is not illegal per se. In fact, it is the prerogative of management to adopt cost-saving measures to ensure economy and efficiency. Contracting out services or functions being performed by union members becomes illegal only when it interferes with, restrains or coerces employees in the exercise of their right to self-organization under Art. 248(c).TOPIC: APPLICABILITYMr. Aristedes Epol was elected as President, Chief Executive Officer, and Board Chairman of Transnational Insurance Corp. on May 31, 1988. At that time, he owned 51% of the companys voting stock. Under the by-laws of the company he had a one year term of office from June 1, 1988 to June 1, 1989. On July 15, 1988, Mr. Ramos agreed with the other stockholders to re-organize the composition of officers by having the board declare all positions of officers vacant, elect a new set of officers, with himself as President and Chief Executive. Mr. Epol would be re-elected only to the ceremonial post of Board Chairman, Mr. Epol got a Notice of Special Meeting of the Board to elect a new set of corporate officers. He consults you as lawyer.He asks if he is covered by the Labor Code and Constitutional guarantees of security of tenure of workers. He theorizes that since he was elected for a fixed one-year term, he enjoys tenure for a term.1. What is your view? Reasons?2. Mr. Epol, despite your opinion, observes that the Constitutional issue was not raised in those cases. He is adamant that you seek recourse to prevent his removal as President and Chief Executive before his term expires. Where will you file the case?SA:1. Mr. Epol is not covered by the Labor Code and Constitutional guarantees of security of tenure or workers. He is not an employee. He is a corporate officer and his tenure is subject to the Constitution and by-laws of the corporation and the Corporate Code.2. I will file the case before the RTC which has jurisdiction over the case. Whether or not Mr. Ramos and the other stockholders legally re-organized out Mr. Epol is an intra-corporate dispute. Since it is an intra-corporate dispute which is involved, it is the RTC which has jurisdiction (Nacpil vs. IBC, G.R. No. 144767, March 21, 2002; New Securities Regulation Code amending PD 902-A).Labor StandardsBook One: Pre-EmploymentTOPIC: RECRUITMENT AND PLACEMENT OF WORKERSWonder Travel and Tours Agency (WTTA) is a well-known travel agency and an authorized sales agent of the Philippine Air Lines. Since majority of its passengers are overseas workers, WTTA applied for a license for recruitment and placement activities. It stated in its application that its purpose is not for profit but to help Filipinos find employment abroad. Should the application be approved?PHIL. ASSOC. OF LAW SCHOOLS ANSWER (PALS):The application should be disapproved, as it is prohibited by Article 26 of the Labor Code, to wit: Travel agencies and sales agencies of airline companies are prohibited from engaging in the business of recruitment and placement of workers for overseas employment whether for profit or not.Rule I, Part II, POEA Rules and Regulations Governing the Recruitment and Employment of Land-Based Workers (2002) disqualifies any entity having common director or owner of travel agencies and sales agencies of airlines, including any business entity from the recruitment and placement of Filipino workers overseas, whether they derive profit or not.PHIL. ASSOC. OF LAW SCHOOLS ALTERNATIVE ANSWER (PALSA):

Section 6 of R.A. No. 8042 considers the following act as illegal recruitment: (j) For an officer or agent of a recruitment agency to become an officer or member of the Board of any corporation engaged in travel agency or to engage directly or indirectly in the management of a travel agency.The law considers as the operation of travel agencies and recruitment agencies as incompatible activities.Book Two: Human Resources DevelopmentTOPIC: WORKING STUDENTSIs there any law providing employment assistance to poor but deserving students who want to pursue their education?BOA:YES. Republic Act No. 7323, approved on 1992, encourages their employment during summer and/or Christmas vacations, through incentives granted to employers, allowing them to pay only 60% of their salaries or wages and the 40% through education vouchers to be paid by the government. The education vouchers shall be applied in the payment for the students tuition fees and books in any educational institution for secondary, tertiary, vocational or technological education. Poor but deserving students refer to those whose parents combined incomes, together with their income, if any, do not exceed P36,000.00 per annum, and who are at least 15 years of age but not more than 25 years old.Book Three: Conditions of EmploymentTOPIC: EMPLOYER-EMPLOYEE RELATIONSHIPPablo was a farm-hand in a plantation owned by ABC & Co., working approximately 6 days a week for 15 years. Upon Pablos death, his widow filed a claim for burial grant and pension benefits with the SSS. The claim was denied on the ground that Pablo had not been a registered member-employee. Pablos widow filed a petition before the SSS asking that ABC & Co. be directed to pay the premium contributions of Pablo and that his name be reported for SSS coverage. ABC & Co. countered that Pablo was hired to plow, harrow and burrow, using his own carabao and other implements and following his own schedule of work hours, without any supervision from the company. If proven, would this factual setting advanced by ABC & Co. be a valid defense against the petition?BOA:

ABC & Co. has a valid defense. Under the control test, which is the most important test in distinguishing an employee from an independent contractor, the employer must have the power or right to control the employee not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished (Leonardo vs. Court of Appeals, G.R. No. 152459. June 15, 2006). Applying this test to the facts given, it can be concluded that Pablo is an independent contractor. Among others, he had his own schedule of work hours, without any supervision from the company. Hence, not being an employee of ABC & Co., he is not under the compulsory coverage of the SSS.Zapato Custom-made Shoes, Inc. (Zapato) made shoes to customer specification and repaired them. As a service to customers, a shoe shine stand was operated on its premises. There were 10 shoe shine boys at the stand. They owned their shoe shine boxes with cleaning agent polish, brushes, and rags. Walk-in customers willing to wait were led by the shoe shine boys to sit at the stand where they waited while the boys shined the shoes. After the shoes were cleaned, the boys asked the customer to pay the receptionist. Customers not willing to wait leave the shoes with the stands receptionist who gave a receipt with the price for the service and pick-up date and time indicated. The boys were free to get shoes to be shined from the receptionist when there were no waiting walk-ins. For each pair shined, the boys got markers corresponding to the price for their service. Zapatos staff did not interfere with nor supervise how the boys went about their tasks. At days end, the markers held by each boy were tallied and paid for. The boys signed a receipt to acknowledge full payment for work done.A labor federation was organized and filed a petition for a consent election. The boys, sympathizing with the workers, joined the union. At the pre-election conference, the lawyer for Zapato moved to exclude the boys as voters.1. As Med-Arbiter handling the case, rule on the objection.2. Would your ruling be different if in this case, Zapato provided the boys with the shoe shine boxes and their contents? Explain.BOA:1. As Med-Arbiter, I will rule that the shoe shine boys should be excluded as voters in the consent election. There is no employer-employee relationship between the company and the shoe shine boys (Besa v. Trajano, G.R. No. 72409, December 29, 1986). For such relationship to exist, the following four-fold test should be satisfied: (1) selection and and engagement of the employee; (2) payment of wages; (3) power of dismissal; and (4) power to control (Pacific Consultants International Asia, Inc. v. Schonfeld, G.R. No. 166920, Feb. 19, 2007). The element of control, which is the most important, is not present. The facts reveal that Zapatos staff did not supervise the boys work. Jurisprudence tells us that the greater the supervision and control the hirer exercises, the more likely the worker is deemed an employee. The converse holds true as wellthe less control the hirer exercises, the more likely the worker is considered an independent contractor (Sonza v. ABS-CBN Broadcasting Corp., G.R. No. 138051, June 10, 2004). Hence, the shoe shine boys are not employees of Zapato and thus could not be considered as employees belonging to bargaining unit who will designate or select a bargaining representative.2. My ruling would not be different. By providing the shoe shine boxes and their contents, Zapato is still not exercising control over the shoe shine boys. For control to exist, Zapato must have the power or right to control the employee not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished.The Central Bank ordered the liquidation of the Millionaires Bank. Under a plan approved by the Central Bank, the liquidator turned over the Millionaires Banks assets and liabilities to a group of investors who immediately organized the Reliable Banking Corp. The new bank hired new employees and retained only 50 of the employees of the defunct bank. The labor union protested the failure of the new bank management to retain all employees and charged it with violating an existing collective bargaining agreement with the previous management.Is the new management compelled to retain all the employees in its employ? Discuss.SA:The new management may not be compelled to retain all the employees of the defunct bank in its employ, but it should at least give preference to these employees in the filling up of vacancies in the new Banking Corporation. The Supreme Court in MDII Supervisors and Confidential Employees Association vs. Presidential Assistant on Legal Affairs, G.R. Np. L-45421, September 9, 1977 ruled that while there is no law requiring the purchaser of the assets of a corporation to absorb the employees of such corporation, for reasons of public and social justice, the purchaser may be directed to give preference to the qualified separated employees of said corporation in the filling up of vacancies in the purchasers new set up.AA:The new management may be compelled to retain all the employees in its employ. It may be noted that what were turned over to the group of investors who organized the Reliable Banking Corp were not only the assets but also the liabilities of the defunct Millionaires Bank. Given said fact, it could be considered that part of the liabilities turned over to the new banking corporation could be the obligation to continue, this time in its employ, the old employees of the defunct bank.AAA:The new management may not be compelled to retain all the employees of Millionaires Bank. When the assets and liabilities of Millionaires Bank were turned over to a group of investors who organized the Reliable Banking Corp., a new corporation came into being. The new corporation does not have any employer-employee relationship with the employees of Millionaires Bank which was liquidated. The new corporation can be compelled to continue as its employees the employees of Millionaires Bank only if the liquidation of the Millionaires Bank and the organization of the new corporation was done in bad faith for the purpose of easing out the employees of Millionaires Bank. This is not the case here. Thus, there is no legal obligation on the part of the new corporation to accept as its employees all the employees of the Millionaires Bank.TOPIC: MANAGERIAL/SUPERVISORY/RANK-AND-FILE EMPLOYEESThe Labor Code treats differently in various aspects the employment of (i) managerial employees, (ii) supervisory employees, and (iii) rank-and-file employees. State the basic distinguishing features of each type of employment.BOOK IIIBOOK VRIGHT TO SELF-ORGANIZATION

MANAGERIAL EMPLOYEESOne whose primary duty consists of the management of the establishment in which he is employed or of a department or subdivision thereof, and to other officers or members of the managerial staff.One who is vested with powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees.A managerial employee cannot exercise the right to self-organization (Art. 245).

SUPERVISORY EMPLOYEESSupervisors and Rank-and-File employees can be considered as members of the managerial staff, and therefore a managerial employee, if:a.) their primary duty consists of work directly related to management policies;b.) they customarily and regularly exercise discretion and independent judgment in the performance of their functions;c.) regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of the establishment in which they are employed or a subdivision thereof; andd.) do not devote more than 20% of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described above (Art. 82; Sec. 2c, Rule I, Book III, Implementing Rules).One who, in the interest of the employer, effectively recommends such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment.A supervisory employee may form, assist, or join a labor organization of their own and not together with the rank-and-file employees (R.A. No. 6715).

RANK-AND-FILE EMPLOYEESAll others not falling within any of the above definitions.All others not falling within any of the above definitions (Art. 212m).A rank-and-file employee can exercise the right to self-organization (Art. 243).

The Job Valuation Contribution Statements of the union members of NBSR Supervisory Union show that these supervisory employees were under the direct supervision of their respective department superintendents and that, generally, they assisted the latter in planning, organizing, staffing, directing, controlling, communicating and in making decisions in attaining the companys set goals and objectives. These supervisory employees were likewise responsible for the effective and efficient operation of their respective departments. Should the supervisory employees, as defined in Article 212(m) of the Labor Code, be considered as members of the managerial staff under Article 82 and hence, are not entitled to overtime, rest day and holiday pay? (case cited in Azucena, 2007).YES. From the foregoing, it is apparent that the members of the union discharge duties and responsibilities which qualify them as members of the managerial staff, as defined in Section 2, Rule I, Book III of Implementing Rules of the Labor Code, viz: (1) their primary duty consists of the performance of work directly related to management policies; (2) they customarily and regularly exercises discretion and independent judgment; (3) they regularly and directly assists in the management of the establishment; (4) they execute, under general supervision, work along specialized or technical lines requiring special training, experience, or knowledge; (5) they execute, under general supervision, special assignments and tasks; and (6) they do not devote more than 20% of their time to work other than those described above. Therefore, they are exempt from the coverage of Article 82 (National Sugar Refineries Corp. v. NLRC, G.R. No. 101761, March 24, 1993).TOPIC: HOLIDAYS AND SERVICE INCENTIVE LEAVESThis year, National Heroes Day (August 25) falls on a Sunday. Sunday is the rest day of Bonifacio whose daily rate is P500.If Bonifacio is required by his employer to work on that day for eight (8) hours, how much should he be paid for his work? Explain.For working on his scheduled rest day, according to Art. 93(a), Bonifacio should be paid P500 (his daily rate) plus P150 (30% of his daily rate) = P650. This amount P650 should be multiplied by 2 = P1,300, this is the amount that Bonifacio as employee working on his scheduled rest day which is also a regular holiday should receive. Art. 94(c) of the Labor Code provides that an employee shall be paid a compensation equivalent to twice his regular rate for working on any regular holiday. The regular rate of Bonifacio on May 1,2002 with an additional thirty percent because the day is also his scheduled rest day.Formula:To get rest day pay

STEP 1: Get hourly wage rateDaily Basic WageSpecial Holiday Wage Rate

Number of Hours Worked

Thus:P500130%=P81.25

8 Hours

STEP 2: Compute wage between 8:00pm to 5:00pm using rest day wage rate

Number of Hours WorkedSpecial Holiday Wage Rate

Thus:8 HoursP81.25=P650

To get regular holiday pay

Rest Day Wage RateRegular Holiday

Thus:P650200%=P1,300

All the 30 employees of the Aliw Trading, Inc. are monthly salaried, had been such since 1974, when the Labor Code took effect, whenever they would work overtime, the accounting department would compute the daily equivalent of the employees monthly salary by using 301 days as divisor, however, for deductions due to absences not otherwise covered by the 15-day vacation leave policy of the company, the divisor used is 313 days, the workweek is Monday-Saturday.In 1985, the employees filed as complaint for non-payment of holiday pay and service incentive leave after years of unsuccessfully trying to convince Aliw management to grant holiday pay and five-day service incentive leave pay. In the past whenever a demand for payment of holiday pay was presented by the employees, management would invariably deny liability on the other hand would give a nominal salary adjustment.If you were counsel for Aliw, what defenses would you raise?If you were the Labor Arbiter hearing the case, how would you resolve the issues?SA:As counsel for Aliw, I will contend: as regard holiday pay, when the company uses 313 as the divisor in computing the daily equivalent of employees monthly salary, the company thereby considers that only 52 weekly rest days are the only days not considered as paid and that the regular holidays are therefore considered as paid even if they are unworked days. So, there is no need to gain pay holiday pay.As to the five-day SIL, I will contend that the Labor Code provides that the provision on SIL shall not apply to those already enjoying the benefit, namely those enjoying vacation leaves with pay at least five days.The Company here has a fifteen-day vacation policy and should therefore, be already deemed as giving five-day SIL.As the Labor Arbiter, I will rule that the Company is liable to pay holiday pay. We will base this ruling on the ground that the Company uses 301 as divisor in computing the daily equivalent of an employees monthly salary. Thus, the company considers both 52 weekly rest days and 11 holidays as unpaid days. Thus, the Company should pay holiday pay.As for the SIL, I will rule that with its fifteen-day vacation leave policy, Aliw, pursuant to the Labor Code is already giving the five-day SIL to its employees.A case against an employer company was filed charging it with having violated the prohibition against offsetting undertime for overtime work on another day. The complainants were able to show that, pursuant to the CBA, employees of the union had been required to work overtime on Saturday but were paid only at regular rates of pay on the thesis that they were not required to complete, and they did not in fact complete, the eight-hour work period daily from Monday through Friday. Given the circumstances, the employer contended that the employees were not entitled to overtime compensation, i.e., with premium rates of pay. Decide the controversy.SA:The employer is correct. While Art. 88 of the Labor Code clearly provides that undertime work on any other particular day shall not be offset by overtime work on any other day, this rule is inapplicable in this case pertaining to Saturday work which in reality does not constitute overtime work as Saturday is still a working day under the law and there is no CBA stipulation against it.AA:Art. 88 of the Labor Code provides that undertime work on any particular day shall not be offset by overtime work on any other day. The CBA being the law between the parties and the Union having shown that the employees rendered overtime work on Saturday, the contention of the employer is not tenable. The employer cannot use the undertime of Monday through Friday to offset the overtime on Saturday. Hence, the employees are entitled to overtime compensation, i.e., premium rates of pay on Saturday.TOPIC: WAGESIn accordance with the provisions of the CBA, RLU submitted to Zenith, a union board resolution authorizing the deduction from the wage of the unions 2000 members a special assessment in the sum of 20php to help pay the expenses of the RLU president during his observation tour of New Zealand.When the company honored the authorization and implemented the deductions, more than a thousand of the employees complained and sought your assistance. What legal action would you take and what legal advice would you give?BOA:

I will advise the employees to file a complaint against the company for making illegal deductions of P20 from their wages. Article 113 of the Labor Code strictly prohibits an employer from making any deduction from the wages of his employees. The only exceptions are (1.) when the deduction is made with the employees consent in writing as regards SSS payments, PHILHEALTH payments, contributions to PAG-IBIG Fund, value of meals and other facilities, payments to third persons, and deduction of absences; (2.) when the deduction is made even without the employees consent when it is with regard to workers insurance acquired by the employer (3.) for union dues where the right to check-off has been recognized by the employer (4.) in those cases where the employer is authorized by law or regulations issued by the Secretary of Labor, and (5.) debts of the employee to the employer that have become due and demandable. The deduction made in the case at bar does not fall under any of the exceptions. It was not made for union dues, and the union members were not shown to have individually authorized the deductions in writing.Revise answer TOPIC: THIRTEENTH MONTH PAY

TRX, a local shipping firm, maintains a fleet of motorized boats plying the island barangays of AP, a coastal town. At days end, the boat operators/crew members turn over to the boat owner their cash collections from cargo fees and passenger fares, less the expenses for diesel fuel, food, landing fees and spare parts.

Fifty percent (50%) of the monthly income or earnings derived from the operations of the boats are given to the boatmen by way of compensation. Deducted from the individual shares of the boatmen are their cash advance and peso value of their absences, if any.

Are these boatmen entitled to overtime pay, holiday pay, and 13th month pay?

SA:If the boatmen are considered employees, like jeepney drivers paid on a boundary system, the boatmen are not entitled to overtime pay and holiday pay because they are workers who are paid by results. Said workers, under the Labor Code are not entitled, among others, to overtime pay and holiday pay.

In accordance with the Rules and Regulations implementing the 13th month pay law, however, the boatmen are entitled to the 13th month pay. Workers who are paid by the results are to be paid their 13th month pay.AA:NO. The arrangement between the boat owner and the boat operators/crew members partook of the nature of a joint venture. The boatmen did not receive fixed compensations as they shared only in the cash collections from cargo fees and passenger fares, less expenses for fuel, food, landing fees and spare parts. It appears that there was neither right of control nor actual exercise of such right on the part of the boat owner over the boatmen. It is clear that there was no employer-employee relationship between the boat owner and the boatmen. As such, these boatmen are not entitled to overtime pay, holiday pay and 13th month pay.TOPIC: JOB CONTRACTING AND LABOR-ONLY CONTRACTINGWhat are the distinctions between labor-only contracting and job contracting?

SA:There is job contracting when the following elements are present:1. The contractor or subcontractor carries on a distinct and independent business and undertakes to perform the job on his own account and under his own responsibility, according to its own manner and method and free from the control and direction of the principal in all matters connected with the performance of the work except as to the results thereof;

2. The contractor or subcontractor has substantial capital or investment in tools, equipment and machineries, work premises and other materials necessary in the conduct of his business; and

3. The agreement between the principal and contractor or subcontractor assures the contractual employees entitlement to all labor and occupational safety and health standards, free exercise of the right to self-organization, security of tenure and social and welfare benefits (D.O. No. 10 of 1997; Baguio v. NLRC, G.R. Nos. 79004-08, Oct. 4, 1991).

On the other hand, there is labor-only contracting when the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal, and any of the following elements is present:

1. The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed, and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal; or2. The contractor does not exercise the right to control over the performance of the work of the contractual employee. (D.O. 18-02, Series of 2002)Distinguish the liabilities of an employer who engages the services of a bona fide independent contractor from one who engages a labor-only contractor?BOA:

An employer who engages the services of a bona fide independent contractor is merely an indirect employer, by operation of law, of his contractors employees (PCI Automation Center, Inc. v. NLRC, G.R. No. 115920, January 29, 1996). He becomes solidarily liable with the contractor only in the event the latter fails to pay the employees wages and for violation of labor standard laws. The liability, however, does not extend to the payment of back-wages or separation pay of employees who are illegally dismissed (Rosewood Processing v. NLRC, G.R. No. 116476-84, May 21, 1998).On the other hand, an employer who engages a labor-only contractor is treated as direct employer of his contractors employees in all instances, and the contractor is deemed only as an agent of the employer (Manila Water Company v. Pea, G.R. No. 158255, July 8, 2004). The principal becomes solidarily liable with the contractor not only for unpaid wages but also for all the rightful claims of the employees under the Labor Code and ancillary laws (SMC v. MAERC Integrated Services, Inc., G.R. No. 144672, July 10, 2003).TOPIC: WORKER PREFERENCE IN CASE OF BANKRUPTCYPremiere Bank, a banking corporation, being the creditor-mortgagee of X Co., a garment firm, foreclosed the hypothecated assets of the latter. Despite the foreclosure, X Co. continued its business operations. A year later, the bank took possession of the foreclosed property. The garment firms business operations ceased without a declaration of bankruptcy. Jose, an employee of X Co. was dismissed from employment due to the cessation of business of the firm. He filed a complaint against X Co. and the bank. The Labor Arbiter, after hearing, so found the company liable, as claimed by Jose, for separation pay. Premiere Bank was additionally found subsidiarily liable upon the thesis that the satisfaction of labor benefits due to the employee is superior to the right of a mortgagee of property. Was the Labor Arbiter correct?SA:NO. The preference of credits established in Art. 110 of the Labor Code cannot be invoked in the absence of any insolvency proceedings, declaration of bankruptcy, or judicial liquidation (DBP vs. Santos, G.R. No. 79351, November 28, 1989).AA:NO. What Art. 110 of the Labor Code establishes is not a lien but a preference of credit in favor of employees. Unlike a lien, a preference of credit does not create a charge upon any particular property of the debtor (ibid).AAA:The decision of the Labor Arbiter holding Premiere Bank subsidiarily liable for a money obligation of X Co. to Jose, its employee, has no legal basis for the following reasons:There is no privity of relationship between the Bank and Jose. The relationship, upon which the obligation to pay a sum of money is based, is between X (the mortgagor) and Jose as its employee arising from the Labor Code provision requiring an employer to pay separation pay.

At both timesLabor Arbiter decision to pay separation pay and foreclosureX Co. was an existing business entity and neither bankrupt or in liquidation, although its business operations after the foreclosure ceased.

The decision of the Labor Arbiter for X Co. to pay a sum of money to Jose was based on an action in personam not in rem, enforceable against any party (Sundowner Corporation vs. Drilon, G.R. No. 82341, December 6, 1989)The reference in the decision to labor benefits due to an employee is superior to the right of a mortgagee of property is misplaced. The preferential claim rule has no basis and runs contrary to law and jurisprudence.TOPIC: WORKING CONDITIONS FOR SPECIAL GROUPS OF EMPLOYEESMrs. Josie Juan is the confidential secretary of the Chairman of the Board of the bank. She is presently on maternity leave. In an arrangement where the Chairman of the Board can still have access to her services, the bank allows her to work in her residence during her leave. For this purpose, the bank installed a fax machine in her residence and gave her a cellphone and a beeper. Is Mrs. Juan a homeworker under the law? Explain.SA:NO, she is actually an office worker. She is not an industrial homeworker who accepts work to be fabricated or processed at home for a contractor, which work, when finished, will be returned to or repurchased by said contractor (Art. 155, Labor Code).Ngipin Toothpaste Co., Inc. manufactured and sold toothpaste in the market. It considered labor contracting as a cost reduction move. The plan was for the company to continue manufacturing the toothpaste in its facilities up to the stage where it was already packed in labeled plastic tubes and capped. These would then be taken to the homes of women in a militant squatter area near the plant. The women would be given the filled tubes and flat, die-cut cardboard pieces with indented folds printed with the label. These flats cost P0.30 per piece. The women would form the boxes, apply paste to one side so it would hold together as a box, and then put the filled tubes onto it. Management though it was a good idea as it would give employment and help bring the women into the money economy. The job was not hard to learn. The women would do all the work at home in their free time.The companys personnel staff took up the concept with the leader of the squatter womens group who agreed it was a good idea. They showed her how the job was to be done. She learned the work immediately. She said that women would be willing to accept the home work, but they would insist on being paid in accordance with the law. She also told the companys representatives that help reduce theirs headaches in the operation, she was willing to be their main contractor and she would sub-contract the work to her neighbors. She also said that she wants that the housewives whom she engages be allowed to use the labor of the children in their homes to increase the number of the boxes that they assemble and the tubes that they can box.Management asks for your advice on the following matters:1. Would the women who are engaged to form the boxes and pack toothpaste tubes into them be considered employees of the company? Explain.2. Can the women workers use their children, regardless of age, to help them perform their task? Reasons.3. May the company deduct spoilage costs of P0.30 per every dirty box and the value of tubes lost or not accounted for it is provided for when in the contract for piece work?BOA:

1. NO. The company does not have control over them. The control test, which is the most important test our courts apply in distinguishing an employee from an independent contractor, is not satisfied. In this case, the women do the work at home in their free time. These women can be specifically classified as industrial homeworkers. The Labor Code provides that their employment shall be regulated through regulations issued by the Secretary of Labor and Employment to ensure their general welfare and protection (Article 153). This rule shall apply to any homeworker who performs, in or about his home, any processing of goods or materials, in whole or in part, which have been furnished, directly or indirectly, by an employer and thereafter to be returned to the latter.

2. YES. If their children would work directly under their sole responsibility and are provided with primary and/or secondary education, and the employment would not endanger their childrens life, safety, health and morals, nor impair their normal development, then they could use their children, regardless of age, to help them (Sec. 12, R.A. No. 9231).3. NO. The Labor Code provides that no employer shall require his worker to make deposits from which deductions shall be made for the reimbursement of loss of or damage to tools, materials or equipment supplied by the employer, except where the employer is engaged in such trades, occupation or business where the practice of making deductions or requiring deposits is a recognized one, or is necessary or desirable as determined by the Secretary of Labor and Employment in appropriate rules and regulations (Art.114).SA:These women cannot be considered as independent job contractors because they do not have substantial capital. They are employees paid on piece-rate basis (Makati Haberdashery vs. NLRC, G.R. Nos. 83380-81, November 15, 1989; Labor Congress of the Philippines vs. NLRC, G.R. No. ).Rosa Cartagena, a 14-year old orphan, was hired as a domestic helper by Elvira Pacheco, a friend of Rosas aunt, who could no longer support her. The aunt and Elvira agreed that Rosa would serve the Pachecos for 3 years, with clear understanding that the Pachecos would see her through high school.The Pachecos never sent Rosa to high school. After 2 years of unfulfilled promises of her education, Rosa went back to her aunt, who confronted Elvira about her breach of their agreement. The aunt demanded that Rosa be paid the cash equivalent of the 3 years high school education that Rosa was denied. Elvira contended that Rosa quit before the end of the fixed employment period and therefore, is not entitled to anything. The aunt filed a complaint against the Pachecos.Decide.BOA:

Rosas quitting is justifiable, and the Pachecos should pay the cash equivalent of at least 2 years high school education.

The Labor Code provides that the original contract of domestic service shall not last for more than 2 years but it may be renewed for such periods as may be agreed by the parties (Art. 142). In this case, the contract is fixed for 3 years. Hence, in conformity with the law, it should be considered as fixed for only 2 years. Since Rosa quit after 2 years, then such action is justifiable.The Labor Code also provides that if the househelper is under the age of 18 years, the employer shall give him or her an opportunity for at least elementary education. The cost of education shall be part of the househelpers compensation, unless there is stipulation to the contrary (Art. 146). Since Rosa is only 14 years old when she was hired, and the law does not prohibit the employer from obligating himself to give more than just elementary education, then the Pachecos should comply with what they agreed to do under the contract they entered into.Lydia Cancio was on her sixth and last month as a probationary employee of the Banco Seguridad when she was confirmed to be pregnant. Being unmarried and wanting to become a regular employee, she initially kept her pregnancy a secret from her employer. She was subsequently appointed a regular employee on the first month of her pregnancy.Because of morning sickness, however, Lydia frequently absented herself from work. After 2 months, the personnel manager told her that her habitual absences had become so intolerable that she would have to go. Replying that her absences were caused by her pregnancy, Lydia asked for a leave of absence, which was denied. She nevertheless went on leave and was dismissed for going on leave without prior permission.Lydia filed a complaint for illegal dismissal, praying that she be reinstated. The bank contested that the complaint on the ground that she was not dismissed because of her pregnancy but because of her absence without leave.Decide.SA:The dismissal is illegal. The Labor Code very clearly provides that: It shall be unlawful for any employer to discharge a woman on account of her pregnancy or while on leave or in confinement due to her pregnancy (Art. 137).The employer should have granted her request for leave of absence, the request being made because of her pregnancy.Dismissal after she went on leave without prior permission is too harsh punishment for the pregnant woman.Filipinas Airlines advertised for stewardess. Among the requirements were that an applicant must be single and not more than 25 years of age. Luzviminda, who happens to be the most attractive, intelligent, and capable among the applicants, was rejected because she was 26 years old and married. She files a complaint against the airlines pre-employment requirements as being contrary to law and public policy. What are the arguments for and against the above requirements? As Labor Arbiter, how would you decide the case.BOA:

In favor of the requirements: Except as limited by special laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring (San Miguel Brewery Sales v. Ople, G.R. No. L-53515, February 8, 1989).Against the requirements: The Labor Code provides that it shall be unlawful for an employer to require as a condition of employment that a woman employee shall not get married (Art. 136). The Code also prohibits an employer from discriminating against any person in respect to terms and conditions of employment on account of his age (Art. 140).

As the labor arbiter, I would rule that the requirements are contrary to law and public policy. Although management has prerogatives, they are still subject to limitations provided by (1) law, (2) contract or collective bargaining agreements and (3) general principles of fair play and justice. (Mendoza v. Rural Bank of Lucban, G.R. No. 155421, July 7, 2004) The Labor Code itself expressly makes the given requirements illegal.A spinster school teacher took pity on one of her pupils, a robust and precocious 12-year old boy whose poor family could barely afford the cost of his schooling. She lives alone at her house near the school after her housemaid left. In the afternoon, she lets the boy do various chores as cleaning, fetching water and all kinds of errands after school hours. She gives him rice and P30 before the boy goes home at 7:00 every night. The school principal learned about it and charged her with violating the law which prohibits the employment of children below 15 years of age. In her defense, the teacher stated that the work performed by her pupil is not hazardous, and she invoked the exception provided in the Department Order of DOLE for the engagement of persons in domestic and household service.Is her defense tenable? Reason.SA:NO. Her defense is not tenable. Under Art. 19 of the Labor Code on minimum employable age, no child below 15 years of age shall be employed except when he works directly under the sole responsibility of his parents or guardian, the provisions of the alleged Department Order of DOLE to the contrary notwithstanding. A mere Department Order cannot prevail over the express prohibitory provisions of the Labor Code.NOTE: Sec. 3, RA 9231, approved on July 28, 2003, allows a child below 15 years of age to work for not more than 20 hours a week; provided that the work shall not be more than 4 hours at any given day; provided further, that he does not work between 8PM and 6AM of the following day; and provided, finally, that the work is not hazardous or deleterious to his health or morals.Labor RelationsBook Five: Labor RelationsTOPIC: JURISDICTIONSome disgruntled members of Bantay Labor Union filed with the Regional Office of the DOLE a written complaint against their union officers for mismanagement of union funds. The Regional Director did not rule in the complainants favor. Not satisfied, the complainants elevated the Regional Directors decision to the NLRC. The union officers moved to dismiss on the ground of lack of jurisdiction. Are the union officers correct? Why?BOA:YES, the union officers are correct in claiming that the NLRC has no jurisdiction over the appealed ruling of the Regional Director. Sec. 16 of D.O. No. 40-03 provides that the decision of the med-arbiter and Regional Director may be appealed to the BUREAU OF LABOR RELATIONS by any of the parties within 10 days from receipt thereof. Hence, it is the BLR that has jurisdiction and not the NLRC.A was dismissed from the service by his employer for theft of goods owned by the company. He was also prosecuted for theft before the Regional Trial Court of Pasay City. Meanwhile, A filed a complaint for illegal dismissal against the employer before the Labor Arbiter. The trial court subsequently acquitted A and ordered his reinstatement with backwages from the time of his separation to the date of his actual reinstatement.1. Is the decision of the court correct? State your reason.2. Even with such acquittal, may the labor arbiter still proceed to resolve the complaint for illegal dismissal filed by A? State your reason.SA:1. The decision of the court is not entirely correct. It is within the jurisdiction of the Regional Trial Court to acquit A. As a regular court, The RTC has jurisdiction over criminal cases. But it is outside of the jurisdiction of the RTC to order the reinstatement of A with backwages. A termination dispute, which could give rise to a decision for the reinstatement of an illegal dismissed employee and the payment of his backwages is outside the jurisdiction of the RTC. It is within the original and exclusive jurisdiction of labor arbiters.2. Even with As acquittal, the labor arbiter should still proceed to resolve the complaint for illegal dismissal filed by A. An action for illegal dismissal is entirely separate and distinct from a criminal action.Jun de Gracia a 2nd year law student and personnel assistant in the Peoples Bank and Trust Co., never like his superior, the personnel manager, who was always putting him down. When his patience ran out, he walked up to his boss during office hours and slugged him to unconsciousness. He was dismissed. The personnel manager filed a complaint for damages against de Gracia with the RTC. In retaliation, de Gracia filed a complaint for illegal dismissal with the DOLE.The counsel of de Gracia then filed a motion to dismiss the damage suit, alleging that LA before whom illegal dismissal case is pending has exclusive jurisdiction over the case for damages.Decide.SA:The motion to dismiss should not be granted. The fact that there is a complaint for illegal dismissal with a Labor Arbiter filed by de Gracia is not a ground for dismissal of a damage suit filed with the RTC.The 2 cases can be considered distinct from each other.The case before the RTC is based on the slugging by de Gracia of his superior, the personnel manager who filed the damage suit. This, therefore is a case based on the Civil Code, not on the Labor Code, and is thus, within the jurisdiction of the regular courts.On the other hand, the complaint for illegal dismissal is within the jurisdiction of the Labor Arbiter. The Labor Arbiter could have included in the exercise of his jurisdiction also the damages arising from the manner in which the employer dismissed an employee. But it may be noted: the damage suit here arises from what an employee did to the personnel manager, not what the employer did to an employee. This is an added reason why the damage suit filed by the personnel manager against de Gracia is properly within the RTCs jurisdiction.TOPIC: APPEALThe affected members of the rank-and-file elevated a labor arbiters decision to the NLRC via a petition for review filed after the lapse of the 10-day reglementary period for perfecting an appeal. Should the NLRC dismiss the petition outright or may the NLRC take cognizance thereof?BOA:The NLRC should dismiss the appeal outright because the same was filed beyond the reglementary period of appeal as provided in Art. 223 of the Labor Code. The court ruled that perfection of an appeal within the statutory or reglementary period is not only mandatory but also jurisdictional and failure to do so renders the questioned decision final and executory (Asuncion vs. NLRC, G.R. No.109311, June 17, 1997).Company A, within the reglementary period, appealed the decision of the Labor Arbiter directing the reinstatement of an employee and awarding backwages. However, As cash bond was filed beyond the ten-day period. Should the NLRC entertain the appeal? Why?SA:NO, the NLRC should not entertain the appeal, as the same was not perfected for failure to file a bond. Art. 223 of the Labor Code reads:

In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of cash or surety bond in the amount equivalent to the monetary award in the judgment appealed from.In Catubay et al vs. NLRC, GR No. 119289, April 12, 2000, the SC ruled that the bond is sine qua non to the perfection of an appeal from the labor arbiters monetary award.TOPIC: COMPROMISE AGREEMENTSThe Labor Arbiter ordered the reinstatement of 40 workers and the payment of backwages on a finding that their termination was illegal. The decision became final and executory. The union to which the workers belonged filed a motion for execution which was opposed by the company. During the pendency of the motion, the union and the company entered into a compromise agreement stipulating that for the sum of P80,000.00 , the union and its principals waived their claims or causes of action and forever released the company from further liability or responsibility over the matter. Ten of the dismissed employees objected to the compromise agreement, alleging it was entered into without their consent. The union lawyer admitted having failed to get their consent because they could not be contacted at their respective addresses. But the lawyer alleged that the 30 other dismissed workers agreed and signed the waiver and quitclaim.Are the 10 employees whose consent was not secured bound by the compromise agreement? Decide.SA: BOA answer jag and haggarNO. The backwages which were to be paid to the workers who were illegally dismissed belong to each of the illegally dismissed workers. It is beyond the power of their union to waive the right of each of the workers to these backwages. Thus, the compromise agreement which waived the right to backwages could not apply to the workers who did not give their consent to such waiver.TOPIC: LABOR ORGANIZATIONDo workers have a right not to join a labor organization?SA:YES, workers decide whether they will or will not become members of a labor organization. That is why a unions constitution and by-laws need the members adoption and ratification. Moreover, if they are members of a religious group whose doctrine forbids union membership, their right not to be compelled to become union members has been upheld. However, if the worker is not a religious objector and there is a union security clause, he may be required to join the union if he belongs to the bargaining unit (Kaisahan ng mga Manggagawa sa La Campana vs. Sarmineto, G.R. No. L-47853, November 16, 1984).Do the following workers have the right to self-organization? Reasons.1. Employees of non-stock, non-profit organizations2. Alien employeeBOA:1. Employees of non-stock, non-profit organizations have the right to self-organization. This is explicitly provided for in Art. 243 of the Labor Code. A possible exception, however, are employee-members of non-stock, non-profit cooperatives.2. Alien employees with valid work permits in the Philippines may exercise the right to self-organization on the basis of parity or reciprocity, that is, if Filipino workers in the aliens country are given the same right (Art. 269, Labor Code).Mang Bally, owner of a shoe repair shop with only nine (9) workers in his establishment, received proposals for collective bargaining from the Bally Shoe Union. Mang Bally refused to bargain with the workers for several reasons. First, his shoe business is just a service establishment. Second, his workers are paid on a piecework basis (i.e. per shoe repaired) and not on a time basis. Third, he has less than 10 employees in the establishment. Which reason or reasons is/are tenable?SA:NONE. First, Mang Ballys shoe business is a commercial enterprise, albeit a service establishment. Second, the mere fact that the workers are paid on a piece-rate basis does not negate their status as regular employees. Payment by piece is just a method of compensation and does not define the essence of the relation. Third, the employees right to self-organization is not delimited by their number.The right to self-organization covers all persons employed in commercial, industrial and agricultural enterprises and in religious, charitable, medical or educational institutions whether operating for profit or not.TOPIC: COVERAGE AND EMPLOYEES RIGHT TO SELF-ORGANIZATIONMalou is the Executive Secretary of the Senior Vice-President of a bank while Ana is the Legal secretary of the banks lawyer. They and other executive secretaries would like to join the union of rank and file employees of the bank. Are they eligible to join the union? Explain.BOA:YES. As a general rule, Executive Secretaries are considered CONFIDENTIAL EMPLOYEES. Confidential employees -employees who act in a confidential capacity to persons who formulate, determine, and effectuate management policies IN THE FIELD OF LABOR-MANAGEMENT RELATIONS, have no right to self-organization. The two criteria are cumulative and must be met (San Miguel Corporation vs. Laguesma, G.R. No. 110399, August 15, 1997). Since there is no showing that they have access to confidential labor relations information, there is no legal prohibition against said confidential employees from forming, assisting, or joining labor a labor organization (Sugbuanon Rural Bank, Inc. vs. Laguesma, G.R. No. 11694, February 2, 2000).TOPIC: UNFAIR LABOR PRACTICESArticle 248(d) of the Labor Code states that it shall be unlawful for an employer to initiate, dominate, assist in or otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other support to it or to its organizers or officers.X Company, Inc. has been regularly contributing money to the recreation fund of the labor union representing its employees. This fund, including the financial assistance given by the employer, is used for refreshment and other expenses of the labor union whenever the employees go on a picnic, on an excursion, or hold a Christmas party. Is the employer liable for unfair labor practice under Article 248(d) of the Labor Code? Explain your answer.BOA:If Art. 248(d) is strictly applied, the giving of money by the employer to the recreation fund of the labor union is an unfair labor practice because said Article considers as an unfair labor practice the giving of financial or other support to it (meaning a union) or to its organizers or officers.

The Bisig Ng Mga Manggagawa (BMM) and the Visayan Oil Mfg, Co are parties to a CBA, containing a union security provision, which stipulates that all employees within the bargaining unit shall join the union within thirty (30) days from the signing of the agreement. On the date the agreement was signed, and in fact even before signing, the minority group of employees in the bargaining unit were members of the Kapisanan ng mga Unionista (KMU).When the KMU members failed to join the BMM within the stipulated period, BMM demanded the termination of their employment. The company acceded to the demand and dismissed the KMU members. KMU filed ULP case alleging that the dismissals and the application of the union security clause is illegal.Decide.SA:The dismissal is ULP. A union security clause, such as the provision in question is allowed under the Labor Code. Such clause cannot be applied to those employees who are already members of another union at the time of the signing of the CBA. Therefore, such cannot be applied to KMU members who were members of KMU on the date of CBA was signed and in fact, even before signing. The union clause has no retroactive effect. It binds only new hires.TOPIC: COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENTA collective bargaining agreement was signed between Ang Sarap Kainan Company and the Ang Sarap Kainan Workers Union. Should the CBA be registered with the BLR?SA:YES. So that the contract-bar rule may apply, the CBA should be registered, assuming it has been validly ratified and contains the mandatory provisions (Art. 232, Labor Code).Company A and Union B had a 3-year CBA that expired on June 12, 1990. Negotiations proved futile so the unresolved issues were referred to an Arbiter who rendered a decision on March 15, 1992 retroactive to December 14, 1990. Is the Arbiters decision providing for retroactivity tenable or not?BOA:Since the unresolved issues in the collective bargaining negotiations were properly referred to the Arbiter pursuant to Art. 262 of the Labor Code, which states that a Voluntary Arbitrator may hear and decide any labor dispute, including bargaining deadlocks, the Arbiters decision providing for retroactivity is tenable. Exercising his compulsory arbitration power, the Arbiter could decide the issue of retroactivity in any way which is not contrary to law, morals, good customs, public order or public policy.What, if any, is the maximum term of a collective bargaining agreement under RA 6715?SA:According to RA 6715, the maximum term of a collective bargaining agreement is five (5) years, but except as to the representation aspect, all other provisions, especially the economic provisions of the agreement shall be renegotiated not later than three (3) years after its execution.Company America and the union entered into five (5) year collective bargaining agreement (CBA). Three (3) years thereafter, the Company received a demand letter from the union for renegotiations of the terms and conditions of the CBA on the ground that the cost of living and prices of the essential commodities have gone up by 30% since the CBA was concluded.1. Was the five year term of the CBA legal?2. Is the Company obligated to renegotiate the CBA as demanded by the Union? If your reply is in the affirmative state the extent of the companys obligation.3. What are the remedies available to the Union in the event the Company refuses to renegotiate the CBA? Does it include the right to strike?SA:1. The five year term of CBA is legal. This is provided for in RA 6715.2. The company is obligated to renegotiate the CBA as demanded by the Union. RA 6715 provides that the economic provisions of a CBA shall be renegotiated not later than three (3) years after its execution except the representation aspect of CBA. All other provisions cannot be altered or terminated before the expiration of the CBA, not even during the freedom period (Contract Bar Rule).3. The refusal of the company to renegotiate not later than three (3) years after the execution of the CBA is a refusal to bargain collectively and is, therefore, an unfair labor practice. Thus, a case of unfair labor practice may be filed against the employer with a Labor Arbiter. Moreover, the Union may go on an unfair labor practice strike.

TOPIC: CERTIFICATION ELECTIONDistinguish between Certification Election, Consent Election, Direct Certification, Run-off Election and Re-run ElectionPURPOSEPARTICIPATION OF MED-ARBITER

CERTIFICATION ELECTIONPurpose is to determine the sole and exclusive bargaining agent of all the employees in an appropriate bargaining unit for the purpose of collective bargaining.Requires a petition for certification election filed by a union or employer. A med-arbiter grants the petition and an election officer is designated by the regional director to supervise the election.

CONSENT ELECTIONPurpose is to determine the issue of majority representation of all the workers in the appropriate collective bargaining unit mainly for the purpose of determining the administrator of the CBA when the contracting union suffered massive disaffiliation and NOT for the purpose of determining the bargaining agent for purposes of collective bargaining.Held by agreement of the unions with or without the participation of the med-arbiter.

DIRECT CERTIFICATIONA labor organization is directly certified as an appropriate bargaining unit of a company upon showing that petition is supported by at least a majority of the employees in the bargaining unit. Direct certification is no longer allowed.Med-arbiter directly certifies that a labor union is the exclusive collective bargaining representative of the employees of an appropriate bargaining unit without holding a certification election, but merely on the basis of evidence in support of the Unions claim that it is the choice of the majority of the employees.

RUN-OFF ELECTIONTakes place between the unions who received the two highest number of votes in a certification election with three (3) or more choices, where not one of the unions obtained the majority of the valid votes cast, provided that the total union votes is at least 50% of the votes cast.

RE-RUN ELECTIONTakes place in two instances: if one choice receives a plurality of vote and the remaining choices results in a tie; or if all choices received the same number of votes. In both instances, the NO UNION is also a choice.

UNIDAD, a labor organization claiming to represent the majority of the rank-and-file workers of BAGSAK Toyo Manufacturing Corp. (BMTC), filed a petition for certification election during the freedom period obtaining in said corporation. Despite the opposition thereto by SIGAW Federation on the ground that UNIDAD was not possessed with all the attributes of a duly registered union, the Med-Arbiter issued an order calling for a certification election on July 25, 2001.This order was promulgated and served on the parties on July 12, 2001. On July 14, 2001, UNIDAD submitted and served the required documents for its registration as an independent union, which documents were approved by the DOLE on July 15, 2001.During the elections, UNIDAD won over SIGAW. SIGAW questioned UNIDADs victory on the ground that UNIDAD was not a duly registered union when it filed the petition for a certification election. Shall SIGAWs case prosper or not? Why?BOA:NO. SIGAWs contention will not prosper. Under the Implementing Rules as amended by D.O. no. 40-03, mere opposition to the legitimacy of the union shall not dismiss the Petition for Certification Election. It is a statutory policy that no obstacles should be placed on the holding of a certification election (Association of Labor Union vs. NLRC, 305 SCRA 762, 1999).The Construction and Development Corporation has a total of one thousand and one hundred (1,100) employees. In a certification election ordered by the Bureau of Labor Relations to elect the bargaining representative of the employees, it was determined that only one thousand (1,000) employees are eligible voters. In the election, nine hundred (900) ballots were cast. There were fifteen (15) spoiled ballots and five (5) blank ballots. Four hundred (400) votes were cast for ABC Labor Union, two hundred forty (240) votes were cast in favor of JVP Labor Union, and two hundred and forty (240) votes were cast in favor of RLG Labor Organization.1. Is there a valid certification election? Why?2. You are called upon to decide the case. Which labor union will you certify as the collective bargaining representative of the employees of the company? Why?SA:1. There is a valid certification election. In the facts of the case in a question, there is no bar to the holding of the certification election. The Labor Code provides (Art. 256) that to have a valid certification election; at least majority of all eligible voters in bargaining unit must have cast their votes in the election. In the question, 1000 employees are eligible voters. 900 votes were cast. This means that more than the majority (501) of the eligible voters cast their votes.2. As med-arbiter called upon to decide the case, I will not certify any labor union as the collective bargaining representative of the company, because none of the Labor unions who participated in the certification election garnered a majority of the valid votes cast. According to the Labor Code (Art. 256), the labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agency of all the workers in the unit. The valid votes cast in the certification election are 880 votes (900 votes cast minus 20 invalid votes 15 of which were spoiled ballots and 5 blank ballots). No labor union garnered at least 441 votes which is the majority of 880 votes.The PMG Stevedoring Company is relatively a new firm engaged in the stevedoring business in the port of Cebu City. The company has 278 regular and permanent employees, engaged in the loading and unloading of foreign and domestic vessels docking at the said port. The company also employs 55 supervisory personnel.The AH Labor Organization filed a verified petition with the company stating, inter alia, that it is a legitimate labor organization representing majority of the employees, and that there is no bargaining agent in the unit. The union asked for recognition as the bargaining agent of all the employed of the company. The company replied that while it is not anti-union, it cannot under the circumstances, accede to the union demand on the ground that the petition is not supported by the written consent of at least twenty-five percent (25%) of all the employees and also because the company wide unit sought to be represented by the union is not an appropriate collective bargaining unit.After hearing, the Med-arbiter ordered a certification election. The company elevated the order to the Secretary of Labor.If you were the Secretary of the Labor, how will you decide this case? Give your reasons.SA:As Secretary of Labor, I will affirm the order for a certification election made by the Med-arbiter but I will amend the order. Instead of a certification election in a company-wide unit, I will order a certification election only for a bargaining unit composed of rank-and-file employees, or only for a bargaining unit composed of supervisory employees, in whichever bargaining unit is found the members of the petitioning labor organization.The order for a certification election is proper even if the petition for certification filed by AH Labor Organization is not supported by at least 25% of the employees of the appropriate collective bargaining unit. The petition for certification election is filed in an unorganized establishment there being, as yet, no bargaining agent in PMG Stevedoring Company. A petition for certification election in an unorganized establishment does not require the consent of at least 25% of all the employees in the bargaining unit (Art. 257, Labor Code).But the bargaining unit cannot be company-wide. RA 6715 in reaffirming the right of supervisory employees to form a union provides that they can only be members of unions whose members are all supervisory employees. This restriction means that unlike the situation before RA 6715, supervisory employees and rank-and-file employees could no longer belong to one union. Thus, as a result, a bargaining unit could no longer be composed of rank-and-file employees and supervisory employees.As Human Resources Department Manager of EZ Components, an unorganized manufacturer of electric components for household appliances, you are suddenly confronted with demands for recognition and collective bargaining negotiations from two competing labor unions. They both claim to represent all the rank-and-file employees. Union A is led by moderate faction, while Union B is affiliated with a militant federation identified with leftist ideology.

Which of the following courses of action should you take to best protect the interests of your company and employees?A. Recognize Union A as the rightful bargaining representative because it will be more reasonable to deal with;B. Recognize Union B because you do not want to antagonize its leftist connections;C. Ignore the demands of either union since you cannot be compelled legally to deal with them at this stage; orD. Petition the Bureau of Labor Relations to conduct a certification election to determine which union really represents the majority of the employees in the bargaining unit.

BOA:D. Petition the Bureau of Labor Relations to conduct a certification election to determine which union really represents the majority of the employees in the bargaining unit.

Article 258 of the Labor Code provides that when requested to bargain collectively, an employer may petition the Bureau for an election.Yellow Bus Company has an existing collective bargaining agreement (CBA) with Union X. During the 60-day freedom period, Union A filed a petition for the certification election claiming a majority of the rank-and-file employees of the company had joined it. Pending the hearing of the petition, the company and the Union X renegotiated and signed a new CBA, which is admittedly better than the previous one.In view of this supervening event, the Med-arbiter dismissed the petition of Union A for being moot and academic. Is the dismissal of the petition correct? Can the company and the Union X claim the benefit of the contract bar rule?BOA:The dismissal of the petition is not correct. The company and Union X cannot claim the benefit of the contract bar rule. The rules implementing the Labor Code provide (Book V, Rule V, Sec. 4) that the representation case shall not xxx be adversely affected by a collective agreement submitted before or during the last 60 days of a subsisting agreement or during the pendency of a representation case.

Assuming that the petition of Union A was supported by at least 25% of the employees in the bargaining unit, the Med-Arbiter should have automatically ordered a certification election since the petition was duly filed during the freedom period.TOPIC: STRIKES AND LOCKOUTSThe workers engaged in picketing activity in the course of a strike.1. Will picketing be legal if non-employees of the strike-bound employer participate in the activity?2. Can picketing activity be curtailed when illegal acts are committed by the picketing workers in the course of the activity?SA:1. YES, the picketing is legal even though non-employees join it. Picketing is a form of exercise of freedom of speech. Picketing, provided it is held peacefully, is a constitutional right. The disputants in a legal dispute need not be employer-employee of each other (De Leon vs. National Labor Union, 100 Phil. 789, [1957]).2. NO, the picketing activity itself cannot be curtailed. What can be curtailed are the illegal acts being done in the course of the picket. However, if what is involved is a national interest case under Art. 263(g), the strike or work stoppage may be stopped by the power of assumption of jurisdiction by the Secretary of Labor or certification of the case to the NLRC (Nagkakaisang Manggagawa sa Cuison Hotel vs. Libron, G.R. No. L-64336, August 31, 1983).Because of alleged unfair labor practices by the management of GFI system, a government-owned and controlled financial corporation, its employees walked out from their jobs and refused to return to work until the management would grant their union official recognition and start negotiations with them.The leaders of the walk-out were dismissed, and the other participants were suspended for 60 days. In arguing their case before the Civil Service Commission, they cited the principle of social justice of workers and the right to self-organization and collective action, including the right to strike. They claimed that the Constitution shielded them from any penalty because their walk-out was a concerted action pursuant to their rights guaranteed by basic law.Is the position taken by the walk-out leaders and participants legally correct? Reason briefly.SA:NO. Assuming that what we have is an originally chartered GOCC, they cannot, under EO 180 and related jurisprudence, stage such walk-out which is basically a case of strike. (insert citation fr azucena)Even if GFI was organized under the Corporation Code, still no such walk-out is allowed without complying with the requirements of a valid strike, among which is that said strike should be validly grounded on a (a) deadlock in collective bargaining, or (b) ULP.Delete On May 24, 1989, the UKM urged its member-unions to join a Welga ng Bayan to pressure Congress to increase the daily minimum wage. Union X staged a strike and put up a picket the following day. As a result, the company officials and supervisory employees were allowed ingress and egress to and from the company premises. The picket was likewise peaceful. On May 28, 1989, the UKM leadership announced the end of the Welga ng Bayan. Union X immediately lifted its picket and its member went back to work. The company sought your legal advice on the legality of the strike and the liability, if any, of the union officers and the participating members. What is your opinion? Explain.SA:The strike was illegal. For a strike to be legal, it should either be an economic strike, i.e., caused by a bargaining deadlock or an unfair labor practice strike, i.e., caused by the commission of an unfair labor practice by an employer.The strike of Union X was neither an economic strike nor an unfair labor strike. Thus, it was an illegal strike.Because it was an illegal strike, any union officer who knowingly participated in it may be declared to have lost his employment status, meaning such union officer could be legally terminated.

As for the union members who participated in the strike, the facts show that no illegal acts were committed. They allowed ingress and egress to and from the company premises. The picket was peaceful. The mere participation of the union members, without their committing illegal acts, does not constitute sufficient ground for the termination of their employment. They shall be reinstated without backwages.Hercules Drug Company operates a chain of drug stores around the country. In addition to several hundreds of clerical and other rank-and-file employees, the company also employs 200 salesmen who decided to form their own exclusive union. Meanwhile, the sales manager of the company has scheduled the transfer of several salesmen from Manila to Cebu City as part of the rotation system. The transfer was supposed to be made on November 2, 1988. On October 10, 1988, the sales manager learned of the formation of the union. He thereafter ordered the immediate transfer of 20 salesmen to Cebu City. Among those ordered transferred were the union president and union treasurer. Both refused to be transferred and as a result thereof, the company dismissed them for gross insubordination. The union held strike the following day. Was the dismissal of these union officers legal? How about the strike?SA:NO. The dismissal of the union officers was illegal. It is true that the sales manager of the Company had scheduled the transfer of several salesmen from Manila to Cebu City as part of the rotation system of the company. But it should be noted: The Sales Manager ordered the immediate transfer of 20 salesmen when he learned of the formation of the union. He no longer waited for the November 2, 1988 date he had earlier scheduled for the transfer. It is noted that among those ordered transferred were the Union President and the Union Treasurer, key officials of the Union. The immediate transfer constitutes an unfair labor practice. It was an act of discrimination directed against union officials; an act of union busting since the union has just been formed.YES. The strike was a legal strike because it was caused by an unfair labor practice of an employer. In fact, what the employer did could be considered as union busting, the existence of the union being threatened. In which case, the Labor Code provides (Art. 263) that the 15-day cooling off period shall not apply and the union may take action immediately.In any case, the union must take the necessary strike vote and submit the strike vote results to the Department of Labor and Employment in accordance with the law.TOPIC: ASSUMPTION OF JURISDICTIONIn a labor dispute, the Secretary of Labor issued an Assumption Order. Give the legal implications of such an order.SA:Under Art. 263(g) of the Labor Code, such assumption order shall:

have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption order. If one had already taken place at the time of assumption, all striking or lockout employees shall immediately resume operations and re-admit all workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. The mere issuance of an assumption order by the Secretary of Labor automatically carries with it a return-to-work order, even if the directive to return to work is not expressly stated in the assumption order. Those who violate the foregoing shall be subject to disciplinary action or even criminal prosecution. Under Art. 264 of the Labor Code, no strike or lockout shall be declared after the assumption of jurisdiction by the Secretary.What are the issues covered by the Secretary of Labors jurisdiction in assumption cases?BOA:

The court holds in International Pharmaceutical vs. Secretary of Labor, G.R. Nos. 92981-83, January 9, 1992, that the Secretarys jurisdiction over national interest labor disputes extends to all questions and controversies arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction. However, the court excepted from this ruling the situation where in their CBA the parties categorically agreed that disputes between them shall be referred to the grievance machinery which ends in voluntary arbitration (University of San Agustin Employess Union vs. Court of Appeals, G.R. No. 169632, March 28, 2006).Employees of ABC declared a strike after filing a Notice of Strike with the DOLE. They barricaded company gates and damaged vehicles entering company premises. On the second day after the strike, ABC filed a petition with the DOLE Secretary to intervene through the issuance of an assumption of jurisdiction order that the Secretary may issue when a strike or lockout will adversely affect national interest. ABC furnished the Secretary with evidence to show that company vehicles had been damaged; that electric power had been cut off; and equipment and materials were damaged because electric power was not immediately restored. ABC forecast that the countrys supply of chlorine for water treatment (which the company produces) would be affected adversely if ABCs operations were closed down by the strikers.Could the DOLE Secretary intervene, assume jurisdiction and issue a TRO? Briefly justify your answer.SA:YES, the Secretary can assume jurisdiction over the dispute because ABC could be considered as an industry indispensable to the national interest since it produces the countrys supply of chlorine for water treatment.The assumption of jurisdiction by the Secretary has the effect of ending the strike. The strikers will be subject to Return-to-Work Order by the Secretary upon his assumption of jurisdiction.Book Six: Post-EmploymentDesign Consultants, Inc. was engaged by the PNCC to supervise the construction of the South Expressway Extension. Design Consultants hired Omar as a driver for 2 years. After his two-year contract expired, he was extended another contract for 9 months. These contracts were entered into during the various stages and before the completion of the extension project. Omar claims that because of these repeated contracts, he is now a regular employee of Design Consultants. Is he correct?BOA:Although the work to be performed is only for a specific project or seasonal, where a person thus engaged has been performing the job for at least one year, even if the performance is not continuous or is merely intermittent, the law deems the repeated and continuing need for its performance as being sufficient to indicate the necessity or desirability of that activity to the business or trade of the employer. The employment of such person is also then deemed to be regular with respect to such activity and while such activity exists (Magsalin, et. al. vs. National Organization of Working Men, et. al., 403 SCRA 199, [2003]).

TOPIC: JUST CAUSES OF TERMINATIONWhat are the requisites for willful disobedience to be a valid ground for termination?SA:Willful disobedience or insubordination envisages the concurrence of at least two requisites:

1. the employees assailed conduct must have been willful or intentional, the willfulness being characterized by a wrongful and perverse attitude; and

2. the order violated must have been reasonable, or lawful, made known to the employee and must pertain to the duties which he had been engaged to discharge.Mr. Armand Reyes, married, 55, was the Manila manager of the International Milk Company, a multinational corporation with main office in San Francisco, California, U.S.A., and branches all over the world. Reyes has served the company in various capacities here and abroad for 16 years. The main office advised him of his transfer to the San Francisco main office and of his promotion as director of international marketing. He refused the promotion and transfer for personal and family reasons. After Reyes had remained adamant in staying in Manila, the company dismissed him on the ground of insubordination.Was his dismissal valid and legal? Discuss.SA:NO. If the transfer of Reyes from Manila to San