C Labor Standards

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LABOR LAW: C. LABOR STANDARDS
Prof. Joselito Guianan Chan
LAST-MINUTE
NOTES ON THE 2012 BAR EXAMINATION IN LABOR LAW BASED ON THE
SUPREME COURT-PRESCRIBED SYLLABUS

C. LABOR STANDARDS

[These 8-part Notes discuss all topics/sub-topics in the Supreme Court-prescribed Syllabus for Labor Law]
==================================================================
TOPI CS UNDER THE SYLLABUS

C. LABOR STANDARDS

1. Hours of Work

a. Coverage/Exclusions
b. Normal Hours of Work
(a) Exceptions
(a) Health Personnel
c. Compressed Work Week
d. Work interruption due to brownouts
e. Meal Break
f. Idle time, waiting time, commuting time, travel time, whether part of hours of work or not
g. Overtime work
(a) Undertime not offset by overtime
(b) Waiver of overtime pay
h. Night Work
i. CBA provision vis--vis overtime work

2. Wages

a. No work no pay principle
b. Coverage/Exclusions
c. Facilities vs supplements
d. Wages vs. salaries
e. Wage distortion
f. CBA vis--vis Wage Orders CBA creditability
g. Non-diminution of benefits
h. Workers preference in case of bankruptcy
i. Labor Code provisions for wage protection
j. Allowable deductions without employees consent
k. Attorneys fees and union service fee in labor cases
l. Criteria/Factors for Wage Setting

3. Rest Day

a. Right to weekly rest day
b. Preference of the employee
c. When work on rest day authorized

4. Holidays

a. Right to holiday pay
(1) In case of absences
(2) In case of temporary cessation of work
(3) Of teachers, piece workers, seafarers, seasonal workers, etc.
b. Exclusions from coverage

5. Leaves

a. Service Incentive Leave Pay
(1) Right to service incentive leave
(2) Exclusions from coverage
(3) Commutable nature of benefit
b. Maternity Leave
(1) Coverage
(2) Conditions to entitlement
(3) Availment
c. Paternity Leave
(1) Coverage
ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.
www.chanroblesbar.com : www.chanroblesbar.com.ph
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(3) Availment
d. Parental Leave
(1) Coverage
(3) Availment
e. Leaves for victims of violence against women
(1) Coverage
(3) Availment

6. Service Charges

a. Coverage
b. Exclusion
c. Distribution
d. Integration

7. Thirteenth (13th) Month Pay and other bonuses

a. Coverage
b. Exclusion/Exemptions from coverage
c. Nature of 13th month pay
d. Commissions vis--vis 13th month pay
e. CBA vis--vis 13th month pay

8. Women Workers

a. Discrimination (Art. 135, LC)
b. Stipulation against marriage (Art. 136, LC)
c. Prohibited Acts (Art. 137, LC)
d. Classification of certain women workers (Art. 138, LC)
e. Anti-Sexual Harassment Act (RA 7877)

9. Minor Workers (RA 7678, RA 9231)

a. Regulation of working hours of a child
b. Employment of the child in public entertainment
c. Prohibition of employing minors in certain undertakings and in certain advertisements

10. Employment of Househelpers

a. Definition
b. Benefits accorded househelpers
c. Termination
d. Reliefs for unjust termination

11. Employment of Homeworkers

a. Definition
b. Rights and benefits accorded homeworkers
c. Conditions for deduction from homeworkers earnings

12. Apprentices and Learners

a. Distinctions between Learnership and Apprenticeship

13. Handicapped Workers (RA 7277)

a. Definition of handicapped workers
b. Rights of disabled workers
c. Prohibitions on discrimination against disabled persons
d. Incentives for employers
---------------------------------------------------------------------------------------------------------------------
==========================================
TOPIC UNDER THE SYLLABUS
C. LABOR STANDARDS
1. Hours of Work
a. Coverage/Exclusions
b. Normal Hours of Work
(a) Exceptions
(a) Health Personnel
c. Compressed Work Week
d. Work interruption due to brownouts
e. Meal Break
f. Idle time, waiting time, commuting time,
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travel time, whether part of hours of work or not
g. Overtime work
(a) Undertime not offset by overtime
(b) Waiver of overtime pay
h. Night Work
i. CBA provision vis--vis overtime work
==========================================
1.PROVISIONSOFTHELABORCODEONWORKINGCONDITIONS.
TheprovisionsonworkingconditionsintheLaborCodeareasfollows.
Article83 Normalhoursofwork;
Article84 Hoursworked;
Article85 Mealperiods;
Article86 Nightshiftdifferential;
Article87 Overtimework;
Article88 Undertimenotoffsetbyovertime;
Article89 Emergencyovertimework;
Article90 Computationofadditionalcompensation;
Article91 Righttoweeklyrestperiod;
Article92 Whenemployermayrequireworkonarestday;
Article93 Compensationforrestday,Sundayorholidaywork;
Article94 Righttoholidaypay;
Article95 Righttoserviceincentiveleave;and
Article96 Servicecharges.
2.COVERAGE.
Allemployeesinallestablishments,whether operatedforprofitornot,arecoveredbythelawonlabor
standards.
3.EXCLUSIONS.
Thefollowingareexcludedfromthecoverageofthelawonlaborstandards:
a. Governmentemployees;
b.Managerialemployees;
c.Otherofficersormembersofamanagerialstaff;
d.Domesticservantsandpersonsinthepersonalserviceofanother;
e.Workerspaidbyresults;
f.Nonagriculturalfieldpersonnel;and
g.Membersofthefamilyoftheemployer.
4.NORMALHOURSOFWORK.
Thetotalnumberofworkinghoursofaworkeroremployeeshallnotexceedeight(8)hoursdaily.Thiseight(8)
hourperiodiscalledthenormalhoursofwork.Anyworkinexcessofeight(8)hoursisconsideredovertimework.
4.1.EXCEPTIONS:
a.Reductionof8hourworkingdaybyemployer.
Theemployer,inthelawfulexerciseofitsprerogative,isnotprohibitedfromreducingtheeighthournormal
workingtimeperdayprovidedthatnocorrespondingreductionismadeontheemployeeswageorsalaryequivalentto
aneighthourworkday.Ininstanceswherethenumberofhoursrequiredbythenatureofworkislessthaneighthours,
suchnumberofhoursshouldberegardedastheemployeesfullworkingday.
b.Brokenhours.
Thenormaleight(8)workinghoursmandatedbylawdonotalwaysmeancontinuousanduninterruptedeight
(8)hoursofwork.Asmayberequiredbypeculiarcircumstancesofemployment,itmaymeanbrokenhoursofsay,four
hours in the morning and four hours in the evening or a variation thereof, provided the total of eight (8) hours is
accomplished within one work day as this term is understood in law [infra]. Hence, the 4hour work done in the
eveningasintheexampleabove,shouldnotbeconsideredovertimeworksincetheeighthourperiodhasnotyetbeen
exceeded.
c.Staggeredworkingtime.
Staggeredworkingtimeisavalidschemewhichmayberesortedtobyemployers.Asamatterofprecedence,
MemorandumCircularNo.81wasissuedbytheOfficeofthePresidentonDecember14,2004whichimplementedthe
StaggeredWorkingTimeintheExecutiveDepartmentinrelationtotheotherbranchesofgovernmentandtheprivate
sector in Metro Manila during the Christmas Season from December 15, 2004 to January 6, 2005. According to this
issuance,theStaggeredWorkingTimeismeanttoimprovethedeliveryofgoodsandservices.

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d.Workindifferentshifts.
Inestablishmentswhereworkisindifferentshifts,workdonebytheemployeebeyondhiseighthourshiftis
considered overtime work which should be compensated accordingly. For example, if there are three (3) eighthour
shiftsinaworkday,say,thefirstshiftisfrom6:00a.m.to2:00p.m.;secondshiftfrom2:00p.m.to10:00p.m.;andthe
thirdshiftfrom10:00p.m.to6:00a.m.ofthefollowingday,theemployeewhoseregulareighthourworkisinthefirst
shift (6:00 a.m. to 2:00 p.m.), once required to work in the second or third shift, should be given additional
compensationforsuchworkdonebeyondhisregularworkinghourswhichlegallyisconsideredovertimework.
e.Reductionofworkdaysonaccountoflosses.
Workdaysmaybereducedinsituationswherethereductioninthenumberofregularworkingdaysisresorted
tobytheemployertopreventseriouslossesduetocausesbeyondhiscontrol,suchaswhenthereisasubstantialslump
inthedemandforhisgoodsorservicesorwhenthereislackofrawmaterials.
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f.FlexibleworkscheduleunderR.A.No.8972.
UnderRepublic ActNo. 8972,otherwiseknownasTheSolo ParentsWelfareAct of2000,soloparents are
allowedtoworkonaflexibleschedule,thus:
Sec.6.FlexibleWorkSchedule.Theemployershallprovideforaflexibleworkingschedule
for solo parents: Provided, That the same shall not affect individual and company productivity:
Provided,further,Thatanyemployermayrequestexemptionfromtheaboverequirementsfromthe
DOLEoncertainmeritoriousgrounds.(Section6,RepublicActNo.8972).
Thephraseflexibleworkscheduleisdefinedinthesamelawastherightgrantedtoasoloparentemployee
tovaryhis/herarrivalanddeparturetimewithoutaffectingthecoreworkhoursasdefinedbytheemployer.
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g.Flexibleworkarrangementsduringeconomicdifficultiesandnationalemergencies.
DOLE Secretary Marianito D. Roque issued Department Advisory No. 2, Series of 2009, on January 29, 2009
enunciatingtheGuidelinesontheAdoptionofFlexibleWorkArrangements.
Thefollowingaretheflexibleworkarrangementswhichmaybeconsidered,amongothers:
1. CompressedWorkweekreferstoonewherethenormalworkweekisreducedtolessthansix(6)daysbut
thetotalnumber of workhours of48hoursper week shallremain. Thenormalworkday is increasedto
more than eight hours but not to exceed twelve hours, without corresponding overtime premium. The
conceptcanbeadjustedaccordinglydependingonthenormalworkweekofthecompanypursuanttothe
provisionsofDepartmentAdvisoryNo.02,Seriesof2004,datedDecember2,2004.
2. ReductionofWorkdaysreferstoonewherethenormalworkdaysperweekarereducedbutshouldnot
lastformorethansix(6)months.
3. RotationofWorkersreferstoonewheretheemployeesarerotatedoralternatelyprovidedworkwithin
theworkweek.
4. ForcedLeavereferstoonewheretheemployeesarerequirestogoonleaveforseveraldaysorweeks
utilizingtheirleavecredits,ifthereareany.
5. Brokentime schedule refers to one where the work schedule is not continuous but the workhours
withinthedayorweekremain.
6. Flexiholidaysschedulereferstoonewheretheemployeesagreetoavailoftheholidaysatsomeother
daysprovidedthereisnodiminutionofexistingbenefitsasaresultofsucharrangement.
Under these flexible work arrangements, the employers and the employees are encouraged to explore
alternativeschemesunderanyagreementandcompanypolicyorpracticeinordertocushionandmitigatetheeffectof
thelossofincomeoftheemployees.
h.Parttimework.
The rules implementing the different Wage Orders issued by the Regional Tripartite Wages and Productivity
Boards(RTWPBs)inthevariousregionsinthecountrycarryauniformprovisiontotheeffectthatwagesandallowances
ofparttimeworkersshallnotbelessthanthecompensabletimethattheyactuallyrenderedwork.Hence,inthecaseof
costoflivingallowance(COLA),iftheworkerrenderedworkforlessthantheprescribedeight(8)hours,sayforfour(4)
hoursonly,theemployermayvalidlymakeproportionatepaymentofCOLA,ifithasgrantedaproportionatepaymentin
theworkersbasicwage.Followingtheprincipleofnowork,nopay,noallowance,theworkersarenotentitledtosaid
benefitsforthefourhourperiodthattheydidnotrenderwork.Itisimportanttostress,however,thattheemployees
shouldhaveenteredintoanagreementwiththeemployerthattheywillbeemployedasparttimeworkers.
Inviewoftheforegoing,ontheissueofwhetherthecompanyshouldgivetheparttimeemployeesconcerned
onlyfiftypercent(50%)ofthewagesandotherbenefitsthattheemployermaypaytheworkerswhowillworkforfour
(4)hoursaday,6:00to10:00intheevening,itwasopinedintheAdvisoryOpiniononConditionsofEmploymentofPart
time Workers issued by the Bureau of Working Conditions of the Department of Labor and Employment, that
compensationinproportiontothetimetheyactuallyrenderedworkorequivalenttoonlyfour(4)hoursadaymustbe
given to parttime workers. This is, however, without prejudice to any individual or collective agreement or company
practiceorpolicythatprovideshigherbasisofcomputationofwages.
1
ExplanatoryBulletinontheEffect of Reductionof WorkdaysonWages/LivingAllowancesissuedbytheDOLEonJuly23, 1985.
2
SeeSection3[e] thereof
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4.2.HOURSOFWORKOFHOSPITALANDCLINICPERSONNEL.
a.Coverage.
The second paragraph of Article 83 of the Labor Code enunciates the rule on hours of work of hospital and
clinicpersonnel.ItsprovisionaswellasthecorrespondingprovisionsintheRulestoImplementtheLaborCode,applyto:
a.All hospitals and clinics, including those with a bed capacity of less than one hundred (100) which are
situatedincitiesormunicipalitieswithapopulationofone(1)millionormore;and
b.All hospitals and clinics with a bed capacity of at least one hundred (100), irrespective of the size of the
populationofthecityormunicipalitywheretheymaybesituated.
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b.Definitionofterms.
The terms hospital and clinic shall mean a place devoted primarily to the maintenance and operation of
facilitiesforthediagnosis,treatmentandcareofindividualssufferingfromillness,disease,injuryordeformity,orinneed
ofobstetricalorothermedicalandnursingcare.Eithertermshallalsobeconstruedasanyinstitution,building,orplace
wherethereareinstalledbedsorcribsorbassinetsfortwentyfour(24)houruseorlongerbypatientsinthetreatment
ofdiseases,injuries,deformitiesorabnormalphysicalandmentalstates,maternitycasesorsanitarialcareorinfirmaries,
nurseries, dispensaries and such other similar names by which they may be designated. (Section 2, Rule IA, Book III,
RulestoImplementtheLaborCode).
The term health personnel shall include resident physicians, nurses, nutritionists, dieticians, pharmacists,
social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other
hospitalorclinicpersonnel.
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c.Regularworkinghoursofhospitalorclinicpersonnel.
Theregularworkinghoursofhospitalandclinicpersonnelshallnotbemorethaneight(8)hoursinanyoneday
normorethanforty(40)hoursinanyoneweek.Adayshallmeanaworkdayoftwentyfour(24)consecutivehours
beginningatthesametimeeachcalendarday.Aweekshallmeantheworkweekof168consecutivehours,orseven
consecutive24hourworkdays,beginningatthesamehourandonthesamecalendardayeachcalendarweek.
5
d.Regularworkingdaysofhospitalorclinicpersonnel.
The regular working days of covered employees shall not be more than five (5) days in a workweek. The
workweekmaybeginatanyhourandonanyday,includingSaturdayorSunday,designatedbytheemployer.Employers
arenotprecludedfromchangingthetimeatwhichtheworkdayorworkweekbeginsprovidedthatthechangeisnot
intendedtoevadetherequirementsofRuleIAoftheRulestoImplementtheLaborCode.
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e.Overtimeworkofhospitalorclinicpersonnel.
Where the exigencies of the service so require as determined by the employee, any employee may be
scheduled to work for more than five (5) days or forty (40) hours a week provided that the employee is paid for the
overtime work an additional compensation equivalent to his regular wage plus at least thirty percent (30%) thereof,
subjecttotheprovisionsofBookIIIoftheLaborCodeonthepaymentofadditionalcompensationforworkperformed
onspecialandregularholidaysandonrestdays.
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f.Hoursworkedofhospitalorclinicpersonnel.
Indeterminingthecompensablehoursofworkofhospitalandclinicpersonnel,thepertinentprovisionsofRule
1ofBookIIIoftheRulestoImplementtheLaborCodeshallapply.
8

POLICYINSTRUCTIONSNO.54.
a.Workinghoursandcompensationofhospital/clinicpersonnel.
PolicyInstructionsNo.54[April12,1988]providesthatpersonnelinsubjecthospitalsandclinicsareentitledto
afullweeklywageforseven(7)daysiftheyhavecompletedthe40hour/5dayworkweekinanygivenworkweek.
b.PolicyInstructionsNo.54,declaredvoid.
The SupremeCourt,however,has voided Policy InstructionsNo.54 inthecaseof SanJuande DiosHospital
Employees Association v. NLRC, [G.R. No. 126383, November 28, 1997]. Consequently, the rule that hospital
employeeswhoworkedforonly40hours/5daysinanygivenworkweekshouldbecompensatedforfullweeklywagefor
seven(7)daysisnolongerapplicable.
TheSupremeCourtratiocinatedthattheSecretaryofLaborexceededhisauthoritybyincludingatwodaysoff
withpayincontraventionoftheclearmandateofthestatute.SuchacttheCourtshallnotcountenance.Administrative
interpretationofthelaw,wereiterate,isatbestmerelyadvisory,
andtheCourtwillnothesitatetostrikedownan
administrativeinterpretationthatdeviatesfromtheprovisionofthestatute.
3
Article83, LaborCode; Section1, RuleI-A, BookIII, RulestoImplement theLaborCode.
4
Article83, LaborCode; Section4, RuleI-A, BookIII, Ibid..
5
Section5, RuleI-A, BookIII, Ibid..
6
Section6, RuleI-A, BookIII thereof.
7
Article83, LaborCode; Section7, RuleI-A, BookIII, Ibid..
8
Section8, RuleI-A, BookIII, Ibid..
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5.COMPRESSEDWORKWEEK(CWW).
a.Compressedworkweekallowed.
Theemployermaycompresstheworkdaysfromsix(6)days(fromMondaytoSaturday)tofive(5)days(from
MondaytoFriday)undercertainconditionsimposedbytheDepartmentofLaborandEmployment.
In situations, for instance, where the employees workweek was fortyfive (45) hours consisting of eight (8)
hoursdailyfromMondaytoFridayandfive(5)hoursonSaturday,theemployermayproposetocompressorshorten
theworkweekfromMondaytoFridaywithworkfornine(9)hoursperdaywithoutovertimepayfortheexcessone(1)
hour. The Department of Labor and Employment (DOLE) normally does not interpose any objection to this kind of
schemeprovidedthefollowingconditionsaremet:
1. Theemployeesvoluntarilyagreetoworknine(9)hoursadayfromMondaytoFriday;
2. Thereshouldbenodiminutioninthetakehomepayandfringebenefitsoftheemployees;
3. The value of the benefits that will accrue to the employees under the proposed work schedule is more
than or, at least, commensurate with, or equal to, the onehour overtime pay that is due them during
weekdaysbasedontheemployeesquantification;
4. Theonehourovertimepayoftheemployeeswillbecomedueanddemandableifevertheyarepermitted
ormadetoworkonanySaturdayduringtheeffectivityofthenewworkingtimearrangement,sincethe
agreementbetweentheemployeesandmanagementisthattherewillbenoSaturdayworkinexchange
foralongerworkdayduringweekdays;
5. The work of the employees does not involve strenuous physical exertion and they are provided with
adequaterestperiodsorcoffeebreaksinthemorningandafternoon;and
6. Theeffectivityoftheproposedworkingtimearrangementshouldbeoftemporarydurationasdetermined
bytheSecretaryofLaborandEmployment.
PhilippineGraphicArts,Inc.v.NLRC,[G.R.No.L80737,September29,1988,166SCRA118].
TheHighCourtupheldthevalidityofthereductionofworkinghours,takingintoconsiderationthefollowing:
thearrangementwastemporary;itwasamorehumanesolutioninsteadoftheretrenchmentofpersonnel;therewere
notices and consultations with the workers and supervisors; a consensus was reached on how to deal with the
deterioratingeconomicconditions;anditwassufficientlyproventhatthecompanywassufferingfromlosses.
AlthoughthesaidExplanatoryBulletinofDirectorSanchezstandsmoreasasetofdirectoryguidelinesthana
bindingsetofimplementingrules,ithasonemainconsideration,consistentwiththerulinginPhilippineGraphicArts,in
determiningthevalidityofreductionofworkinghours,i.e.,thatthecompanywassufferingfromlosses.
LintonCommercialCo.,Inc.v.Hellera,[G.R.No.163147,October10,2007].
Indeclaringthecompressedworkweekarrangementinthiscaseasunjustifiedandillegalandinholdingthat
petitioners areguilty of illegalreductionof work hours,theSupreme Court found specious the petitioners attemptto
justifytheiractionbyallegingthatthecompanywassufferingfromfinancial lossesowingtotheAsiancurrencycrisis.
Petitionersclaimoffinanciallosseswasnotsupportedbyevidence.Acloseexaminationofpetitionersfinancialreports
for19971998showsthatwhilethecompanysufferedalossofP3,645,422.00in1997,itretainedaconsiderableamount
ofearningsandoperatingincome.Clearlythen,whileLintonsufferedfromlossesforthatyear,thereremainedenough
earningstosufficientlysustainitsoperations.Inbusiness,sustainedoperationsintheblackistheidealbutbeinginthe
red is a cruel reality. However, a year of financial losses would not warrant the immolation of the welfare of the
employees which in thiscasewasdonethrougha reducedworkweekthat resulted inanunsettlingdiminutionofthe
periodicpayforaprotractedperiod.Permittingreductionofworkandpayattheslightestindicationoflosseswouldbe
contrarytotheStatespolicytoaffordprotectiontolaborandprovidefullemployment.
b.DepartmentOrderNo.02,Seriesof2004.
DepartmentOrderNo.02,Seriesof2004,wasissuedbytheSecretaryofLaborandEmploymentonDecember
2, 2004 implementing compressed workweek schemes to guide employers and workers who may opt to adopt a
mutuallyacceptablecompressedworkweek(CWW)schemesuitabletotherequirementsoftheestablishment
As a matter of policy, and taking into account the emergence of new technology and the continuing
restructuring and modernization of the work process, the Department of Labor and Employment (DOLE) encourages
employersandworkerstoenterintovoluntaryagreementsadoptingCWWschemesbasedonthefollowingobjectives:
1. Topromotebusinesscompetitivenessandproductivity,improveefficiencybyloweroperatingcosts,and
reduceworkrelatedexpensesofemployees;
2. To give employers and workers flexibility in fixing hours of workcompatible with business requirements
andtheemployeesneedforabalancedworklife;and
3. Toensurethesafetyandhealthofemployeesattheworkplaceatalltimes.
A CWW scheme is an alternative arrangement whereby the normal workweek is reduced to less than six (6)
daysbutthetotalnumberofnormalworkhoursperweekshallremainatfortyeight(48)hours.Thenormalworkdayis
thus increased to more than eight (8) hours without corresponding overtime premium. This concept can be adjusted
accordinglyincaseswherethenormalworkweekofthefirmisfive(5)days.
Conditions.DOLEshallrecognizeCWWschemesadoptedinaccordancewiththefollowing:
1. The CWW scheme is undertaken as a result of an express and voluntary agreement of majority of the
covered employees or their duly authorized representatives. This agreement may be expressed through collective
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bargaining or other legitimate workplace mechanisms of participation such as labormanagement councils, employee
assembliesorreferenda.
2.Infirmsusingsubstances,chemicalsandprocessesoroperatingunderconditionswherethereareairborne
contaminants, human carcinogens or noise prolonged exposure to which may pose hazards to the employees health
andsafety,theremustbeacertificationfromanaccreditedhealthandsafetyorganizationorpractitionerorfromthe
firmssafetycommitteethatworkbeyondeight(8)hoursiswithinthresholdlimitsortolerablelevelsofexposure,asset
intheOSHS.
3.TheemployershallnotifytheDOLE,throughitsRegionalOfficehavingjurisdictionovertheworkplace,ofthe
adoptionoftheCWWscheme.ThenoticeshouldbemadeinDOLECWWReportForm.
Effects.ACWWschemewhichcomplieswiththeforegoingconditionsshallhavethefollowingeffects:
1. Unless there is a more favorable practice existing in the firm, work beyond eight (8) hours will not be
compensable by overtime premium provided the total number of hours worked per day shall not exceed twelve (12)
hours.Inanycase,anyworkperformedbeyondtwelve(12)hoursadayorfortyeight(48)hoursaweekshallbesubject
toovertimepremium.
2.ConsistentwithArticles85oftheLaborCode,employeesunderaCWWschemeareentitledtomealperiods
of not less than sixty (60) minutes. Nothing, however, shall impair the right of employees to rest days as well as to
holiday pay, rest day pays or leaves in accordance with law or applicable collective bargaining agreement (CBA) or
companypractice.
3. Adoption of the CWW scheme shall in no case result in diminution of existing benefits. Reversion to the
normaleighthourworkdayshallnotconstituteadiminutionofbenefits.Thereversionshallbeconsideredalegitimate
exerciseofmanagementprerogativeprovidedthattheemployershallgivetheemployeespriornoticeofsuchreversion
withinareasonableperiodoftime.
BisigManggagawasaTrycov.NLRC,[G.R.No.151309,October15,2008].
PrivaterespondentTrycoandthepetitionerssignedseparateMemorand[a]ofAgreement(MOA),providingfor
acompressedworkweekscheduletobeimplementedinthecompanyeffectiveMay20,1996.TheMOAwasentered
intopursuanttoDOLEDepartmentOrder(D.O.)No.21,Seriesof1990enunciatingtheGuidelinesontheImplementation
ofCompressedWorkweek.AsprovidedintheMOA,8:00a.m.to6:12p.m.,fromMondaytoFriday,shallbeconsidered
astheregularworkinghours,andnoovertimepayshallbedueandpayabletotheemployeeforworkrenderedduring
thosehours.TheMOAspecificallystatedthattheemployeewaivestherighttoclaimovertimepayforworkrendered
after5:00p.m.until6:12p.m.fromMondaytoFridayconsideringthatthecompressedworkweekscheduleisadoptedin
lieu of the regular workweek schedule which also consists of fortysix (46) hours. However, should an employee be
permittedorrequiredtoworkbeyond6:12p.m.,suchemployeeshallbeentitledtoovertimepay.Trycoinformedthe
BureauofWorkingConditions(BWC) oftheDepartmentofLaborandEmploymentoftheimplementationofthesaid
compressedworkweekinthecompany.
Inupholdingthevalidityofthecompressedworkweek,itwasnotedthatDepartmentOrderNo.21sanctions
the waiver of overtime pay in consideration of the benefits that the employees will derive from the adoption of a
compressedworkweekscheme,thus:
Thecompressedworkweekschemewasoriginallyconceivedforestablishmentswishingto
saveonenergycosts,promotegreaterworkefficiencyandlowertherateofemployeeabsenteeism,
among others. Workers favor the scheme considering that it would mean savings on the increasing
cost of transportation fares for at least one (1) day a week; savings on meal and snack expenses;
longer weekends, or an additional 52 offdays a year, that can be devoted to rest, leisure, family
responsibilities, studies and other personal matters, and that it will spare them for at least another
day in a week from certain inconveniences that are the normal incidents of employment, such as
commutingtoandfromtheworkplace,traveltimespent,exposuretodustandmotorvehiclefumes,
dressingupforwork,etc.Thus,underthisscheme,thegenerallyobservedworkweekofsix(6)daysis
shortened to five (5) days but prolonging the working hours from Monday to Friday without the
employer being obliged for pay overtime premium compensation for work performed in excess of
eight (8) hours on weekdays, in exchange for the benefits abovecited that will accrue to the
employees.
Moreover, the adoption of the compressed workweek scheme in the company will help temper any
inconveniencethatwillbecausedthepetitionersbytheirtransfertoafartherworkplace.
6.WORKINTERRUPTIONDUETOBROWNOUTS.
Thefollowingaretheeffectsofworkinterruptionduetobrownouts.
9
1. Brownouts of short duration but not exceeding twenty (20) minutes shall be treated as worked or
compensablehourswhetherusedproductivelybytheemployeesornot.
2. Brownoutsrunningformorethantwenty(20)minutesmaynotbetreatedashoursworkedprovidedany
ofthefollowingconditionsarepresent:
a.Theemployeescanleavetheirworkplaceorgoelsewherewhetherwithinorwithouttheworkpremises;
or
9
PolicyInstructionsNo. 36datedMay22, 1978wasissuedbytheUndersecretaryof LaborandEmployment toclarifytheeffectsof powerinterruptionsorbrown-outsonproductiveman-hours.

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b.Theemployeescanusethetimeeffectivelyfortheirowninterest.
3. Ineachcase,theemployermayextendtheworkinghoursofhisemployeesoutsidetheregularschedulesto
compensateforthelossofproductivemanhourswithoutbeingliableforovertimepay.
4. Industrialenterpriseswithoneortwoworkshiftsmayadoptanyoftheworkshiftsprescribedforenterprises
with three (3) workshifts to prevent serious loss or damage to materials, machineries or equipment that
mayresultincaseofpowerinterruptions.
10
5. Thedayswhenworkwasnotrequiredandnoworkcouldbedonebecauseofshutdownduetoelectrical
powerinterruptions,lackofrawmaterialsandrepairofmachines,arenotdeemedhoursworked.
11
7.MEALBREAKS(ARTICLE85,LABORCODE).
a.Generalruleonmealperiod.
Asageneralrule,everyemployerisrequiredtogivehisemployees,regardlessofsex,notlessthanone(1)hour
(or60minutes)timeoffforregularmeals.
12
Beingtimeoff,itisnotcompensablehoursworked.Inthiscase,theemployeeisfreetodoanythinghewants,
excepttowork.Ifheisrequired,however,toworkwhileeating,heshouldbecompensatedtherefor.
b.Shorteningofmealtimetonotlessthan20minutes,whencompensable.
In the following cases, a meal period of not less than twenty (20) minutes may be given by the employer
providedthatsuchshortermealperiodiscreditedascompensablehoursworkedoftheemployee:
a.Wheretheworkisnonmanualworkinnatureordoesnotinvolvestrenuousphysicalexertion;
b.Wheretheestablishmentregularlyoperatesfornotlessthansixteen(16)hoursaday;
c.Incasesofactualorimpendingemergenciesorwhenthereisurgentworktobeperformedonmachineries,
equipmentorinstallationstoavoidseriouslosswhichtheemployerwouldotherwisesuffer;and
d.Wheretheworkisnecessarytopreventseriouslossofperishablegoods.
13
c.Shorteningofmealtimetonotlessthan20minutes,whennotcompensable.
Thelawallowsasituationwheretheemployeesthemselvesrequestfortheshorteningofmealperiodtonot
less than twenty (20) minutes(say, thirty minutes, or from 12:00 to 12:30 p.m. instead of 12:00 to 1:00 p.m.) for the
purpose of allowing them to leave work earlier than the lapse of the eight (8) hours required by law (say, 4:30 p.m.
insteadof5:00p.m.).Thisshortenedperiod,however,shallnotbeconsideredcompensableworkingtimeprovidedthe
followingconditionsarecompliedwith:
a. The employees voluntarily agree in writing to a shortened meal period of thirty (30) minutes and are
willingtowaivetheovertimepayforsuchshortenedmealperiod;
b. Thereshouldbenodiminutioninthebenefitsoftheemployeeswhichtheyreceivepriortotheeffectivity
oftheshortenedmealperiod;
c. The work of the employees does not involve strenuous physical exertion and they are provided with
adequatecoffeebreaksinthemorningandafternoon;
d. Thevalueofthebenefitsderivedbytheemployeesfromtheproposedworkarrangementisequaltoor
commensuratewiththecompensationduethemfortheshortenedmealperiodaswellastheovertime
payfor30minutesasdeterminedbytheemployeesconcerned;
e. Theovertimepayoftheemployeeswillbecomedueanddemandableifevertheyarepermittedormade
toworkbeyond4:30p.m.;and
f. Theeffectivityoftheproposedworkingtimearrangementshallbeforatemporarydurationasdetermined
bytheSecretaryofLaborandEmployment.
14
d.Shorteningofmealtimetolessthan20minutes,effect.
Thelawdoesnotallowthatmealtimebeshortenedtolessthantwenty(20)minutes.Ifsoreduced,thesame
shall no longer be considered as meal time but merely as rest period or coffee break and, therefore, becomes
compensableworkingtime.
15
e.Changingfrom30minutepaidoncalllunchbreakto1hourmealtimewithoutpay,effect.
ThecaseofSimeDarbyPilipinas,Inc.v.NLRC,[G.R.No.119205,April15,1998,289SCRA86],isillustrativeof
this point. Prior to the present controversy, all company factory workers in Marikina including members of private
respondentunionworkedfrom7:45a.m.to3:45p.m.witha30minutepaidoncalllunchbreak.Petitioner,bywayof
a memorandum, changed the meal time schedule from 30 minutes to one (1) hour without pay. Since private
respondentfelt affected adversely by thechange inthe work schedule and discontinuance of the30minute paid on
call lunch break, it filed on behalf of its members a complaint with the Labor Arbiter for unfair labor practice,
discriminationandevasionofliability.Indeclaringthechangeintheworkscheduleasvalid,theSupremeCourtheld:
(The petitioner) rationalizes that while the old work schedule included a 30minute paid
lunch break, the employees could be called upon to do jobs during that period as they were on
call.Evenifdenominatedaslunchbreak,thisperiodcouldverywellbeconsideredasworkingtime
because the factory employees were required to work if necessary and were paid accordingly for
10
PolicyInstructionsNo. 36, May22, 1978.
11
Durabilt RecappingPlant Companyv. NLRC, G.R. No. L-76746, July27, 1987, 152SCRA328.
12
Article85, LaborCode; Section7, RuleI, BookIII, RulestoImplement theLaborCode.
13
Section7, RuleI, BookIII, Ibid..
14
Letter-OpiniondatedNov. 27, 1989of SecretaryFranklinDrilontoKodakPhilippines.
15
Last paragraph, Section7, RuleI, BookIII, RulestoImplement theLaborCode.
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working.Withthenewworkschedule,theemployeesarenowgivenaonehourlunchbreakwithout
anyinterruptionfromtheiremployer.Forafullonehourundisturbedlunchbreak,theemployeescan
freelyandeffectivelyusethishournotonlyforeatingbutalsofortheirrestandcomfortwhichare
conducive to more efficiency and better performance in their work. Since the employees are no
longer required to work during this onehour lunch break, there is no more need for them to be
compensated for this period.We agree with the Labor Arbiter that the new work schedule fully
complieswiththedailyworkperiodofeight(8)hourswithoutviolatingtheLaborCode.Besides,the
new schedule applies to all employees in the factory similarly situated whether they are union
membersornot.
f.Mealtimeinvolvingseveralshifts.
Inacompanywhereworkiscontinuousforseveralshifts,themealtimebreaksshouldbecountedasworking
time for purposes of overtime compensation. Consequently, the workers who are required to work in two (2) full
successiveshiftsshouldbepaidforsixteen(16)hoursandnotfourteen(14),thetwohoursforrestormealtimebreaks
beingincludedascompensableworkingtime.Theidletimethatanemployeemayspendforrestingwhereinhemay
leavetheworkareashouldnotbecountedasworkingtimeonlywhentheworkisnotcontinuous.
16
8.IDLETIME,WAITINGTIME,COMMUTINGTIME,TRAVELTIME,WHETHERPARTOFHOURSOFWORKORNOT.
(ARTICLE84,LABORCODE).
a.Compensablehoursworked.
Thefollowingshallbeconsideredascompensablehoursworked:
a. Alltimeduringwhichanemployeeisrequiredtobeondutyortobeattheemployerspremisesortobe
ataprescribedworkplace;and
b. Alltimeduringwhichanemployeeissufferedorpermittedtowork.
17
b.Someprinciplesindetermininghoursworked.
The following general principles shall govern in determining whether the time spent by an employee is
consideredhoursworked:
a. Allhoursarehoursworkedwhichtheemployeeisrequiredtogivetohisemployer,regardlessofwhether
ornotsuchhoursarespentinproductivelabororinvolvephysicalormentalexertion;
b. An employee need not leave the premises of the workplace in order that his rest period shall not be
counted,itbeingenoughthathestopsworking,mayrestcompletelyandmayleavehisworkplacetogo
elsewhere,whetherwithinoroutsidethepremisesofhisworkplace;
c. Iftheworkperformedwasnecessaryoritbenefitedtheemployerortheemployeecouldnotabandonhis
workattheendofhisnormalworkinghoursbecausehehadnoreplacement,alltimespentforsuchwork
shall be considered as hours worked if the work was with the knowledge of his employer or immediate
supervisor;
d. Thetimeduringwhichanemployeeisinactivebyreasonofinterruptionsinhisworkbeyondhiscontrol
shall be considered working time either if the imminence of the resumption of work requires the
employees presence at the place of work or if the interval is too brief to be utilized effectively and
gainfullyintheemployeesowninterest.(Section4,RuleI,BookIII,RulestoImplementtheLaborCode).
It bears emphasizing that the employer retains the management prerogative, whenever exigencies of the
servicesorequire,tochangetheworkinghoursofitsemployees.
18
Moreover, the ageold rule which governs the relationship between labor and capital or management and
employeeofafairdayswageforafairdayslabor,remainsthebasicfactorindeterminingtheemployeeswagesand
backwages.
19
8.1.IDLETIME.
Theidletimeduringwhichanotherwiseoffdutyemployeeremainsavailabletobecalledtoworkmayor
maynotbecompensable,dependinguponthesituation.Asageneralrule,theissueofcompensabilitydependson
whetherthetimeisspentprimarilyfortheemployersbenefitasopposedtotheemployees.Theanswerusually
turnsupontheextenttowhichemployeeisabletoanddoesusethetimeeffectivelyforpersonalpurposes.
An evaluation of all the relevant facts become necessary to determine compensability. The following,
amongothers,shouldbeconsidered:
a. Theemployerrequirestheemployeetoremainontheemployerspremises;
b. Theemployerrequirestheemployeetowaitathomeforcallsormessagesorconfinestheemployee
toahighlyrestrictedgeographicalarea;
c. Theemployeereceivesnumerousorfrequentworkassignmentsduringtheoncallperiod;
d. The employee must respond within a short timeframe under the circumstances (especially if the
employeemusttravelsomewheretodothework);
16
National Development Companyv. Court of Industrial Relations, G.R. No. L-15422, Nov. 30, 1962.
17
Article84, LaborCode; Section3, RuleI, BookIII, RulestoImplement theLaborCode; Radav. NLRC, G.R. No. 96078, Jan. 9, 1992, 205SCRA69.
18
UnionCarbideLaborUnionv. UnionCarbidePhilippines, Inc., 215SCRA554[1992].
19
Durabilt RecappingPlant Companyv. NLRC, G.R. No. L-76746, July27, 1987, 152SCRA328.
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e. Requirestheemployeetobeoncallfrequently,neverrelievestheemployeefromoncallstatus,does
notpermittheemployeetoexchangecallsorcallperiodswithanotherworker,ordoesnotallowthe
employeetoturndownatleastsomecalls;and
f. Thereisanagreementorunderstandingcoveringthearrangement.
Somecombinationoftheforegoingfactorsispresentwhenidleoncalltimeisfoundtobecompensable
work.
8.2.WAITINGTIME.
a.Whenwaitingtimeiscompensable.
Waitingtimespentbyanemployeeshallbeconsideredasworkingtimeifwaitingisanintegralpartofhiswork
ortheemployeeisrequiredorengagedbytheemployertowait.
20
InAricav.NLRC,[G.R.No.78210,February28,1989,170SCRA776],itwasruledthatthe30minuteassembly
time practiced by the employees of the company cannot be considered waiting time and should not, therefore, be
compensable.
Although it is clear that employers must compensate employees for time actually spent working,
questions arise as to whether the minimum wage and overtime provisions of the FLSA also apply to time spent
waitingtoperformproductivework.Undertheregulations,whetherwaitingtimeistimeworkeddependsonthe
particularcircumstances.
Time spent waiting for work is compensable if it is spent "primarily for the benefit of the employer and
[its] business." Conversely, if the time is spent primarily for the benefit of the employee, the time is not
compensable.Indeterminingwhetherwaitingtimeconstituteshoursworked,theamountofcontroltheemployer
has over the employee during the waiting time, and whether the employee can effectively use that time for his
ownpurposesismaterial.
b.OnDuty.
Waiting timewhile ondutyis included incompensable time, especially when it is unpredictable, or is of
suchshortdurationthattheemployeescannotusethetimeeffectivelyfortheirownpurposes.Inthoseinstances,
the employees are to be compensated whether their work is on or off the employer's premises, even if the
employees spend the time engaging in such amusements as playing cards, watching television or reading.
Examples in American jurisprudence where employees were found to be engaged in compensable waiting time
include:
Assembly lineworkers whoexperienced idle time of 45minutes or less due to delays in delivery and
mechanicalfailures;
Awellpumperwhoresidedontheemployer'spremisesandwhowasrequiredtobeondutyatleast
eighthoursperday,sevendaysperweektopumpwellsandrepairmachinerywhenneeded;
Restaurantemployeeswhowererequiredbytheiremployertoreporttoworkatacertaintimeeven
thoughtheycouldnotpunchinuntilenoughcustomerswerepresenttomakeworkavailable;
Truckwasherswhowereidlewhilewaitingforthearrivalofthenexttruck;
Truck drivers carrying the mail who had periodic layovers lasting two hours or less due to loading or
unloadingproblems;43
Oilwellcasingcrewswhohadtowaitforcasingsaftertheysetuptheirequipment;
Truckdriversandhelperswhowererequiredbytheiremployertowaitonpremisesforassignments;
and
Employeeswhoexperiencedoccasionalidletimecausedbymachinerybreakdowns.
c.OffDuty
Based on U.S. jurisprudence, periods during which an employee is completely relieved from duty and
which are long enough to enable him to use the time effectively for his own purposes are not hours worked.
Whethertimeoffworkistrulysufficienttoenableemployeestoeffectivelyusethetimefortheirownpurposesis
afactualissuedependentuponthecircumstances.
Circumstances considered by the courts include the duration of the time off and any other facts which
mayplacerestrictionsontheemployees.Examplesofcaseswherecourtshavefoundthatemployersarejustified
indenyingcompensationforidletimeinclude:
Atelephonedispatcherwhoonlyhadtoanswerasmallnumberoftelephonecallsfornonemergency
ambulance care each night and who was allowed to pursue her own personal, social and business
activitiesduringtheeveninghours;
Employeeswhowererequiredtoliveontheemployer'spremisesduringtheiroffshifthours,butwho
were free during their off duty time to sleep, eat, watch television, exercise, play ping pong or cards,
readandengageinotherpersonalamusements;and
Truck drivers responsible for picking up and delivering the mail who were free to attend to personal
mattersandoccupytheirtimeastheydesiredduringthewaitingtimebetweenscheduledruns.
20
Section5[a], RuleI, BookIII, Ibid..
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8.3.COMMUTINGTIMEANDTRAVELTIME.
The rules applicable to travel time in accordance with the Manual issued by the Department of Labor and
Employmentarediscussedbelow.
a.Travelfromhometowork.
An employee who travels from home before his regular workday and returns to his home at the end of the
workday is engaged in ordinary hometowork travel which is a normal incident of employment and, therefore, not
consideredashoursworked.Thisistruewhetherheworksatafixedlocationoratdifferentjobsites.
But while normal travel from home to work is not working time, if an employee receives an emergency call
outsideofhisregularworkinghoursandisrequiredtotraveltohisregularplaceofbusinessorsomeotherworksite,all
ofthetimespentinsuchtravelisconsideredworkingtime.
b.Travelthatisallinthedayswork.
Timespentbyanemployeeintravelaspartofhisprincipalactivity,suchastravelfromjobsitetojobsiteduring
theworkday,mustbecountedashoursworked.Whereanemployeeisrequiredtoreportatameetingplacetoreceive
instructionsortoperformotherworkthere,ortopickandtocarrytools,thetravelfromthedesignatedplace tothe
workplaceispartofthedaysworkandmustbecountedashoursworkedregardlessofcontract,customorpractice.If
anemployeenormallyfinisheshisworkonthepremisesat5:00p.m.andissenttoanotherjobwhichhefinishedat8:00
p.m.andisrequiredtoreturntohisemployerspremisesarrivingat9:00p.m.,allofthetimeisworkingtime.However,
iftheemployeegoeshomeinsteadofreturningtohisemployerspremises,thetravelafter8:00p.m.ishometowork
travelandisnothoursworked.
c.Travelawayfromhome.
Travelthatkeepstheemployeeawayfromhomeovernightistravelawayfromhome.Travelawayfromhome
isclearlyworkingtimewhenitcutsacrosstheemployeesworkday.Theemployeeissimplysubstitutingtravelforother
duties. The time is not only hours worked on regular working days during normal working hours but also during the
corresponding hours on nonworking days. Thus, if an employee regularly works from 9:00 a.m. to 5:00 p.m. from
MondaythroughFriday,thetraveltimeduringthesehoursisworkingtime.Regularmealperiodisnotcounted.Asan
enforcement policy, the Department of Labor and Employment does not consider as working time that time spent in
travelawayfromhomeoutsideofregularworkinghoursasapassengeronanairplane,train,boat,busorautomobile.
Any work which an employee is required to perform while travelling must be counted as hours worked. An
employeewhodrivesatruck,bus,automobile,boatorairplaneoranemployeewhoisrequiredtoridethereinasan
assistant or helper, is working while riding, except during bonafide meal periods or when he is permitted to sleep in
adequatefacilitiesfurnishedbytheemployer.
9.OVERTIMEWORK(ARTICLE87,LABORCODE).
a.Someprinciplesonovertimework.
1.Workrenderedafternormaleight(8)hoursofworkiscalledovertimework.
2. In computing overtime work, "regular wage" or "basic salary" means "cash" wage only without
deductionforfacilitiesprovidedbytheemployer.
3."Premium pay" means the additional compensation required by law for work performed within 8
hoursonnonworkingdays,suchasregularholidays,specialholidaysandrestdays.
4. "Overtime pay" means the additional compensation for work performed beyond 8 hours. Every
employeeentitledtopremiumpayisalsoentitledtothebenefitofovertimepay.
5.Illustrationsonhowovertimeiscomputed:
a. Forovertimeworkperformedonanordinaryday,theovertimepayisplus25%ofthe
basichourlyrate.
b.For overtimework performed on a rest day or on aspecial day, the overtime pay is
plus 30% of the basic hourly rate which includes 30% additional compensation as
providedinArticle93[a]oftheLaborCode.
c. Forovertimeworkperformedonarestdaywhichfallsonaspecialday,theovertime
payisplus30%ofthebasichourlyratewhichincludes50%additionalcompensationas
providedinArticle93[c]oftheLaborCode.
d. For overtime work performed on a regular holiday, the overtime pay is plus 30% of
the basic hourly rate which includes 100% additional compensation as provided in
Article94[b]oftheLaborCode.
e. For overtime work performed on a rest day which falls on a regular holiday, the
overtime pay is plus 30% of the basic hourly rate which includes 160% additional
compensation.
b.Distinctionbetweenpremiumpayandovertimepay.
Premiumpayreferstotheadditionalcompensationrequiredbylawforworkperformedwithineight(8)
hoursonnonworkingdays,suchasrestdaysandspecialdays.
21
21
No. III, DOLEHandbookonWorkersStatutoryMonetaryBenefits.
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Overtimepayreferstotheadditionalcompensationforworkperformedbeyondeight(8)hoursaday.
Everyemployeewhoisentitledtopremiumpayislikewiseentitledtothebenefitofovertimepay.
22
9.1.EMERGENCYOVERTIMEWORK(ARTICLE89,LABORCODE).

a.Generalrule.
Thegeneralruleremainsthatnoemployeemaybecompelledtorenderovertimeworkagainsthiswill

b.Exceptionswhenemployeemaybecompelledtorenderovertimework:
1. Whenthecountryisatwarorwhenanyothernationalorlocalemergencyhasbeendeclaredbythe
NationalAssemblyortheChiefExecutive;
2.Whenovertimeworkisnecessarytopreventlossoflifeorpropertyorincaseofimminentdangerto
public safety due to actual or impending emergency in the locality caused by serious accident, fire,
floods,typhoons,earthquake,epidemicorotherdisastersorcalamities;
3. Whenthereisurgentworktobeperformedonmachines,installationsorequipment,orinorderto
avoidseriouslossordamagetotheemployerorsomeothercausesofsimilarnature;
4. Whentheworkisnecessarytopreventlossordamagetoperishablegoods;
5. When the completion or continuation of work started before the 8th hour is necessary to prevent
seriousobstructionorprejudicetothebusinessoroperationsoftheemployer;and
6. When overtime work is necessary to avail of favorable weather or environmental conditions where
performanceorqualityofworkisdependentthereon.
c.Mayanemployeevalidlyrefusetorenderovertimeworkunderanyoftheaforesaidcircumstances?
Anemployeecannotvalidlyrefusetorenderovertimeworkifanyoftheaforementionedcircumstances
ispresent.Whenanemployeerefusestorenderemergencyovertimeworkunderanyoftheforegoingconditions,
hemaybedismissedonthegroundofinsubordinationorwillfuldisobedienceofthelawfulorderoftheemployer.
9.2.UNDERTIMENOTOFFSETBYOVERTIME(ARTICLE88,LABORCODE).
Thefollowingrulesshallapply:
1. Undertimeworkonanyparticulardayshallnotbeoffsetbyovertimeonanyotherday.
2. Permissiongiventotheemployeetogoonleaveonsomeotherdayoftheweekshallnotexemptthe
employerfrompayingtheadditionalcompensationrequiredbylawsuchasovertimepayornightshift
differentialpay.
9.3.WAIVEROFOVERTIMEPAY.
Therighttoclaimovertimepayisnotsubjecttoawaiver.Suchrightisgovernedbylawandnotmerelybythe
agreementoftheparties.
23
Whilerightsmaybewaived,thesamemustnotbecontrarytolaw,publicorder,publicpolicy,moralsorgood
customsorprejudicialtoathirdpersonwitharightrecognizedbylaw.
24
Butifthewaiverisdoneinexchangeforandinconsiderationofcertainvaluableprivileges,amongthemthatof
beinggiventipswhendoingovertimework,therebeingnoproofthatthevalueofsaidprivilegesdidnotcompensatefor
suchwork,suchwaivermaybeconsideredvalid.
25
10.NIGHTWORK(ARTICLE86,LABORCODE).
a.Nightshiftdifferential.
Nightshiftdifferentialisequivalentto10%ofemployee'sregularwageforeachhourofworkperformed
between10:00p.m.and6:00a.m.ofthefollowingday.
b.Nightshiftdifferentialandovertimepay,distinguished
Whentheworkofanemployeefallsatnighttime,thereceiptofovertimepayshallnotprecludetheright
to receive night differential pay. The reason is, the payment of the night differential pay is for the work done
during the night; while the payment of the overtime pay is for work in excess of the regular eight (8) working
hours.
c.ComputationofNightShiftDifferentialPay:
1.Wherenightshift(10p.m.to6a.m.)workisregularwork.
a. On an ordinary day: Plus 10% of the basic hourly rate or a total of 110% of the basic hourly
rate.
b.Onarestday,specialdayorregularholiday:Plus10%oftheregularhourlyrateonarestday,
specialdayorregularholidayoratotalof110%oftheregularhourlyrate.
2.Wherenightshift(10p.m.to6a.m.)workisovertimework.
a.Onanordinaryday:Plus10%oftheovertimehourlyrateonanordinarydayoratotalof110%
oftheovertimehourlyrateonanordinaryday.
22
No. IV, Ibid..
23
Mercaderv. ManilaPoloClub, G.R. No. L-8373, Sept. 28, 1956; Cruzv. YeeSing, G.R. No. L-12046, Oct. 1959; ManilaTerminal Co., Inc. v. CIR, G.R. No. L-9265, April 29, 1957, 48O. G. 7, p. 2725, 91Phil. 625.
24
Article6, Civil Code; PampangaSugarDevelopment Co., Inc. v. Court of Industrial Relations, G.R. No. L-39387, June29, 1982.
25
MeralcoWorkersUnionv. ManilaElectricCo., G.R. No. L-11876, May29, 1959.
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b. Onarestdayorspecialdayorregularholiday:Plus10%oftheovertimehourlyrateonarest
dayorspecialdayorregularholiday.
3. For overtime work in the night shift. Since overtime work is not usually eight (8) hours, the
compensationforovertimenightshiftworkisalsocomputedonthebasisofthehourlyrate.
a.Onanordinaryday.Plus10%of125%ofbasichourlyrateoratotalof110%of125%ofbasic
hourlyrate.
b.Onarestdayorspecialdayorregularholiday.Plus10%of130%ofregularhourlyrateonsaid
daysoratotalof110%of130%oftheapplicableregularhourlyrate.
11.CBAPROVISIONVISVISOVERTIMEWORK.
a.Validityofstipulatedovertimerates.
Generally, the premium pay for work performed on the employees rest days or on special days or regular
holidays is included as part of the regular rate of the employee in the computation of overtime pay for any overtime
work rendered on saiddays,especially if the employerpays only theminimum overtime ratesprescribedby law. The
employees and employer, however, may stipulate in their collective bargaining agreement (CBA) the payment of
overtimerateshigherthanthoseprovidedbylawandexcludethepremiumpaymentsinthecomputationofovertime
pay.Suchagreementmaybeconsideredvalidonlyifthestipulatedovertimepayrateswillyieldtotheemployeesnot
lessthantheminimumprescribedbylaw.
26
b.Builtinovertimepay.
Incasetheemploymentcontractstipulatesthatthecompensationincludesbuiltinovertimepayandthesame
is duly approved by the Director of the Bureau of Employment Services (now Bureau of Local Employment), the non
paymentbytheemployerofanyovertimepayforovertimeworkisjustifiedandvalid.
27
In PAL Employees Savings and Loan Association, Inc. [PESALA] v. NLRC, [G.R. No. 105963, August 22, 1996],
wheretheperiodofnormalworkinghoursperdaywasincreasedtotwelve(12)hours,itwasheldthattheemployer
remains liable for whatever deficiency in the amount for overtime work in excess of the first eight (8) hours, after
recomputationshowssuchdeficiency.
===============================================
C. LABOR STANDARDS
2. Wages
a. No work no pay principle
b. Coverage/Exclusions
c. Facilities vs supplements
d. Wages vs. salaries
e. Wage distortion
f. CBA vis--vis Wage Orders CBA creditability
g. Non-diminution of benefits
h. Workers preference in case of bankruptcy
i. Labor Code provisions for wage protection
j. Allowable deductions without employees consent
k. Attorneys fees and union service fee in labor cases
l. Criteria/Factors for Wage Setting
================================================
1.NOWORK,NOPAYPRINCIPLE.
a.Actualwork,thebasisofclaimforwages.
Itmustbeemphasizedthattheageoldrulegoverningtherelationbetweenlaborandcapital,ormanagement
andemployeeofnowork,nopayorfairdayswageforfairdayslaborremainstobeadheredinourjurisdictionas
thebasicfactorindeterminingthewagesofemployees.Iftheworkerdoesnotwork,heisgenerallynotentitledtoany
wageorpay.Theexceptioniswhenitwastheemployerwhoundulypreventedhimfromworkingdespitehisableness,
willingnessandreadinesstowork;orincaseswhereheisillegallylockedoutorillegallysuspendedorillegallydismissed,
orotherwiseillegallypreventedfromworking,inwhichevent,heshouldbeentitledtohiswage.
28
2.COVERAGE/EXCLUSIONS(ARTICLE97,LABORCODE).
a.Coverage.
The minimum wage rates prescribed by law shall be the basic cash wages without deduction therefrom of
whateverbenefits,supplementsorallowanceswhichtheemployeesenjoyfreeofchargeasidefromthebasicpay.
29
26
No. IV[D], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
27
EngineeringEquipment, Inc. v. Ministerof Labor, G.R. No. L-64967, Sept. 23, 1985
28
AklanElectricCooperativev. NLRC, G.R. No. 121439, Jan. 25, 2000; PhilippineAirlinesv. NLRC, G.R. No. 55159, June22, 1989; CaltexRefineryEmployeesAssociationv. Brillantes,G.R. No. 123782, Sept. 16, 1997, 279SCRA218; Durabilt RecappingPlant Companyv. NLRC, G.R.
No. L-76746, July27, 1987, 152SCRA328; SSSv. SSSSupervisorsUnion, G.R. No. L-31832, Oct. 23, 1982; J. P. HeilbronnCo. v. National LaborUnion, G.R. No. L-5121, Jan. 20, 1953.
29
Section1, RuleVII-A, BookIII, RulestoImplement theLaborCode, asamendedbyMemorandumCircularNo.3, Nov. 4, 1992.
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b.Exclusions.
Thetermbasicwagemeansalltheremunerationorearningspaidbyanemployertoaworkerforservices
rendered on normal working days and hours but does not include costofliving allowances, profitsharing payments,
premiumpayments,13thmonthpayorothermonetarybenefitswhicharenotconsideredaspartoforintegratedinto
theregularsalaryoftheworkersonthedatethislawbecameeffective.
30
Further,asheldinHondaPhils.,Inc.v.SamahanngMalayangManggagawasaHonda,[G.R.No.145561,June
15,2005,460SCRA187],thefollowingshouldbeexcludedfromthecomputationofbasicsalary,towit:paymentsfor
sick,vacationandmaternityleaves,nightdifferentials,regularholidaypayandpremiumsforworkdoneonrestdays
andspecialholidays.
31
3.FACILITIESVS.SUPPLEMENTS.
a.Facilities,defined.
The term facilities includes articles or services for the benefit of the employee or his family but does not
includetoolsofthetradeorarticlesorservicesprimarilyforthebenefitoftheemployerornecessarytotheconductof
the employers business.
32
They are items of expense necessary for the laborers and his familys existence and
subsistencewhichformpartofthewageandwhenfurnishedbytheemployer,aredeductibletherefrom,sinceifthey
arenotsofurnished,thelaborerwouldspendandpayforthemjustthesame.
33
b.Supplements,defined.
Thetermsupplementsmeansextraremunerationorspecialprivilegesorbenefitsgiventoorreceivedbythe
laborersoverandabovetheirordinaryearningsorwages.
34
c.Facilitiesandsupplements,distinguished.
The benefit or privilege given to the employee which constitutes an extra remuneration over and above his
basicorordinaryearningorwage,issupplement;andwhensaidbenefitorprivilegeispartofthelaborersbasicwage,it
isafacility.Asearlierpointedout,thecriterionisnotsomuchwiththekindofthebenefitoritem(food,lodging,bonus
orsickleave)givenbutitspurpose.Thus,freemealssuppliedbytheshipoperatortocrewmembers,outofnecessity,
cannotbeconsideredasfacilitiesbutsupplementswhichcouldnotbereducedhavingbeengivennotaspartofwages
butasanecessarymatterinthemaintenanceofthehealthandefficiencyofthecrewpersonnelduringthevoyage.
35
d.Someprinciplesonfacilitiesandsupplements.
1. Facilitiesaredeductiblebutnotsupplements.
36
2. Legal requirements must be complied with before deducting facilities from wages. The employer simply
cannotdeductthevaluefromtheemployeeswageswithoutsatisfyingthefollowing:
(a) proofthatsuchfacilitiesarecustomarilyfurnishedbythetrade;
(b) theprovisionofdeductiblefacilitiesisvoluntarilyacceptedinwritingbytheemployee;and
(c) thefacilitiesarechargedatfairandreasonablevalue.
37
3. Anemployermayprovidesubsidizedmealsandsnackstohisemployeesprovidedthatthesubsidyshallnot
be less than thirty percent (30%) of the fair and reasonable value of such facilities. In such a case, the
employermaydeductfromthewagesoftheemployeesnotmorethanseventypercent(70%)ofthevalue
of the meals and snacks enjoyed by the employees, provided that such deduction is with the written
authorizationoftheemployeesconcerned.
38
4. The free board and lodging petitioner SIP furnished its employees cannot operate as a setoff for the
underpaymentoftheirwages.
39
4.WAGESVS.SALARIES.
a.Wageandsalary,distinguished.
40
1. The term wage is used to characterize the compensation paid for manual skilled or unskilled labor.
Salary, on the other hand, is used to describe the compensation for higher or superior level of
employment.
2. Incasesofexecution,attachmentorgarnishmentofthecompensationofanemployeereceivedfromwork
issuedbythecourttosatisfyajudiciallydeterminedobligation,adistinctionshouldbemadewhethersuch
compensation is considered wage or salary. Under Article 1708 of the Civil Code, if considered a
wage, the employees compensation shall not be subject to execution or attachment or garnishment,
except for debts incurred for food, shelter, clothing and medical attendance. If deemed a salary, such
compensationisnotexemptfromexecutionorattachmentorgarnishment.Thus,thesalary,commission
andotherremunerationreceivedbyamanagerialemployee(asdistinguishedfromanordinaryworkeror
30
Item[n], Definitionof Terms, RulesImplementingRepublicAct No. 6727.
31
SeealsoSanMiguel CorporationCagayanCoca-ColaPlant v. Inciong, G.R. No. L-49774, Feb. 24, 1981, 103SCRA139.
32
33
StateMarineCooperationandRoyal Line, Inc. v. CebuSeamensAssociation, Inc., G.R. No. L-12444, Feb. 28, 1963; AtokBigWedgeMiningCo., Inc. v. AtokBigWedgeMutual Benefit Association, G.R. No. L-5276, March3, 1953, 97Phil. 294.
34
StatesMarineCooperationandRoyal Line, Inc. v. CebuSeamensAssociation, Inc., G.R. No. L-12444, Feb. 28, 1963, 7SCRA294; AtokBigWedgeMiningCo., Inc. v. AtokBigWedgeMutual Benefit Association, G.R. No. L-5276, March3, 1953, 97Phil. 294
35
StatesMarineCorporationandRoyal Line, Inc. v. CebuSeamensAssociation, Inc., infra; MayonHotel &Restaurant v. Adana, supra; Mabezav. NLRC, supra.
36
StatesMarineCorporationandRoyal Line, Inc. v. CebuSeamensAssociation, Inc., [G.R. No. L-12444, February28, 1963, 7SCRA294].
37
Mabezav. NLRC, [G.R. No. 118506, April 18, 1997, 271SCRA670].
38
39
S.I.P. FoodHousev. Batolina, [G.R. No. 192473, October11, 2010],
40
Thetermswage(etymologicallyfromtheMiddleEnglishwordwagen), salary(fromtheRomanwordsalandLatinwordsalarium) aresynonymousinmeaningandusage. Theyall refertothesamething, i.e., acompensationpaidonaccount of workorservicesrendered.
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laborer) cannot be considered wages. Salary is understood to relate to a position or office, or the
compensationgivenforofficialorotherservice;whilewageisthecompensationforlabor.
41
5.WAGEDISTORTION(ARTICLE124,LABORCODE).
a.Wagedistortion,asdefinedinthelawandimplementingrules.
As defined by law and implementing rules, wage distortion contemplates a situation where an increase in
prescribedwageratesresultsineitherofthefollowing:
1. Eliminationofthequantitativedifferencesintheratesofwagesorsalaries;or
2. Severe contraction of intentional quantitative differences in wage or salary rates between and among
employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage
structurebasedonthefollowingcriteria:
a.skills;
b.lengthofservice;or
c. otherlogicalbasesofdifferentiation.
42
Elaboratingonthisstatutorydefinition,theSupremeCourtruled:Wagedistortionpresupposesaclassification
ofpositionsandrankingofthesepositionsatvariouslevels.Onevisualizesahierarchyofpositionswithcorresponding
ranks basically in terms of wages and other emoluments. Where a significant change occurs at the lowest level of
positionsintermsofbasicwagewithoutacorrespondingchangeintheotherlevelinthehierarchyofpositions,negating
as a result thereof the distinction between one level of position from the next higher level, and resulting in a parity
between the lowest level and the next higher level or rank, between new entrants and old hires, there exists a wage
distortion. xxx. The concept of wage distortion assumes an existing grouping or classification of employees which
establishesdistinctionsamongsuchemployeesonsomerelevantorlegitimatebasis.Thisclassificationisreflectedina
differingwagerateforeachoftheexistingclassesofemployees.
43
b.Fourelementsofwagedistortion.
Thefour(4)elementsofwagedistortionareasfollows:
(1) Anexistinghierarchyofpositionswithcorrespondingsalaryrates;
(2) Asignificantchangeinthesalaryrateofalowerpayclasswithoutaconcomitantincreaseinthesalaryrate
ofahigherone;
(3) Theeliminationofthedistinctionbetweenthetwolevels;and
(4) Theexistenceofthedistortioninthesameregionofthecountry.
44
Normally,acompanyhasawagestructureormethodofdeterminingthewagesofitsemployees.Inaproblem
dealingwithwagedistortion,thebasicassumptionisthatthereexistsagroupingorclassificationofemployeesthat
establishesdistinctionsamongthemonsomerelevantorlegitimatebases.
45
Involved in the classification of employees are various factors such as the degrees of responsibility, the skills
andknowledgerequired,thecomplexityofthejob,orotherlogicalbasisofdifferentiation.Thedifferingwageratefor
eachoftheexistingclassesofemployeesreflectsthisclassification.
c.Formulaforresolvingwagedistortion.
InthecaseofMetropolitanBankandTrustCompanyEmployeesUnionALUTUCPv.NLRC,[G.R. No.102636,
September10,1993],theSupremeCourthasgivenitsimprimaturtothefollowingformulaforthecorrectionofwage
distortioninthepayscalestructures:

MinimumWage=%xPrescribedIncrease=DistortionAdjustment
ActualSalary

Theaboveformulawasheldtobejustandequitable.
d.Someprinciplesonwagedistortion.
1. Nowagedistortionincasewageincreasesweregrantedbyawageordertoemployeesinoneregionand
the same are not granted to their counterparts in other regions who are not covered by the same wage
order.
46
2. In correcting wage distortion, the law does not require that the difference which had previously existed
betweenandamongtheemployeesofdifferentclassesberestoredinexactlythesameamount.Whatis
requiredissubstantialdifferenceinsuchwagerates.
47

6.CBAVISVISWAGEORDERSCBACREDITABILITY(ARTICLE125,LABORCODE).
a.WageincreasesandbenefitsfromCBAdifferentfromthosegrantedbylaw.
WageincreasesandbenefitsderivedfromlawandwageorderandthosefromtheCBAorcompanypolicyor
practiceareseparateanddistinctfromeachother,unlessotherwiseprovidedbytheagreementitselforbylaw.
48
41
Gaav. CA, infra; SeealsoEquitableBankingCorp. v. Sadac, G.R. No. 164772, June8, 2006.
42
Article124, Labor Code; Item[p], Definitionof Terms, RulesImplementingRepublicAct No. 6727; Section4[m], RuleI, NWPCGuidelinesNo. 01, Seriesof 2007, June19, 2007[AmendedRulesof ProcedureonMinimumWageFixing; SeealsoSection1[l], RuleII, NCMBRevised
Procedural GuidelinesintheConduct of VoluntaryArbitrationProceedings[Oct. 15, 2004].
43
National Federationof Labor v. NLRC, G.R. No. 103586, July21, 1994, 234SCRA311; SeealsoMetropolitanBankandTrust CompanyEmployeesUnion-ALU-TUCPv. NLRC, [G.R. No. 102636, Sept. 10, 1993, 226SCRA268; Cardonav. NLRC, G.R. No. 89007, March11, 1991,
195SCRA92; AssociatedLaborUnions-TUCPv. NLRC, G.R. No. 109328, Aug. 16, 1994, 235SCRA395.
44
PrubankersAssociationv. Prudential BankandTrust Company, [G.R. No. 131247, January25, 1999, 302SCRA74].
45
National Federationof Laborv. NLRC, G.R. No. 103586, July21, 1994, 234SCRA311.
46
PrubankersAssociationv. Prudential BankandTrust Company, [supra].
47
National Federationof Laborv. NLRC, G.R. No. 103586, July21, 1994, 234SCRA311; MetroTransit Organization, Inc. v. NLRC, G.R. No. 116008, July11, 1995, 245SCRA767.
48
MeycauayanCollegesv. Drilon, G.R. No. 81144, May7, 1990; Universal CornProductsv. NLRC, 153SCRA191; CitibankPhilippinesEmployeesUnion-NATUv. Minister of Labor, 97SCRA52; Roche[Philippines], v. NLRC, G.R. No. 83335, Oct. 5, 1989; PhilippineApparel Workers
Unionv. NLRC, G.R. No. L-50320, July31, 1981, 106SCRA444.
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The CBAmandated wage increases are granted after serious bargaining negotiations between the employer
andthe employees throughtheirduly recognized orcertifiedbargaining agent. The legallymandated wage increases
andbenefitsareimposedbythegovernment,throughtheRegionalTripartiteWagesandProductivityBoards(RTWPBs)
withoutthebenefitofanybargainingnegotiationsalthoughpublichearingsareconductedpriortothepromulgationof
anywageordertheyissue.
Oncegranted,bothCBAmandatedandlegislatedwageincreasesandbenefitsshouldbefullycompliedwithby
theemployersunderpainofbeingpenalizedunderthelaw.
b.MaterialityoftheintentionofthepartiestotheCBA.
ACBA,justlikeanycontract,issubjecttointerpretationorconstructionifthereisambiguityinitsprovisionsor
stipulations.Ifnosuchambiguityexists,itsprovisionswhichmustbereadtogetherwithitsotherstipulationsandnotin
isolationfromoneanother,shouldbegiventheirliteralmeaning,followingthebasicrulesoflegalhermeneutics.
The purpose of applying the rules of legal hermeneutics is to ascertain the intention of the parties to the
agreement.Oncedetermined,suchintentionshouldbegivenfulleffectandforceasbetweenthem,itbeingunderstood
that such CBA is their law. The principle that the CBA is the law between the contracting parties stands strong and
true.
49
Hence,itiswellsettledthatifthepurposeofthepartiesinenteringintoastipulationonwageincreasesisto
grantthesameseparateanddistinctfromwhateverwageincreasesasmaybegrantedbylaworwageorder,thenthe
workersareentitled,nodoubt,toboththeCBAmandatedandlegallymandatedwageincreasesduringtheperiodwhen
bothincreasesareconcurrentlyeffective.Themanifestwillandintentofthepartiestotreatthelegislatedincreasesas
equivalentprotantotothosestipulatedintheirbargainingagreementmustberespectedandgiveneffect.
50
c.CreditabilityofCBAincreasestoWageOrderincreases.
Chargeability or creditability clause is a provision in the CBA or in the law or wage order allowing CBA
mandatedincreasestobechargedorcreditedascompliancewiththestatutorywageincreasesmandatedororderedby
laworwageorder.ThisisavalidprovisionintheCBAorinthelaworwageordermandatingwageincreases,provided
thatafterchargingorcreditingthereof,theamountofwagesoftheemployeesshallremainequivalenttooroverand
abovetheprevailingminimumwagesetbylaworwageorder.Wheretheincreasesarelessthantheapplicableamount
providedinthelaworwageorder,theemployerisrequiredtopaythedifference.
51

d.WageOrdersissuedbyRTWPBs.
Wage Orders issued by the various Regional Tripartite Wages and Productivity Boards (RTWPBs)
throughoutthePhilippinesusually,althoughnotineverycase,containaprovisiononchargeability.
Forinstance,inWageOrderNo.NCR15[effectiveJuly01,2010],thefollowingprovisiononcreditability
orchargeabilityisfoundinitsSection10,towit:
Section 10. CREDITABLE WAGE INCREASE. Any increase granted by an employer in an organized
establishment within three (3) months prior to the effectivity of this Order shall be credited as compliance with the
prescribed increase set forth herein, provided that an agreement to this effect has been forged between the parties or a
collective bargaining agreement provision allowing creditability exists. In the absence of such an agreement or provision
in the CBA, any increase granted by the employer shall not be credited as compliance with the wage increase prescribed
in this Order. In unorganized establishments, any increase granted by the employer within five (5) months prior to the
effectivity of this Order shall be credited as compliance therewith. In case the increases given are less than the
prescribed Minimum Wage, the employer shall pay the difference. Such increases shall not include anniversary
increases, merit wage increases and those resulting from the regularization or promotion of employees.
RuleIVoftheImplementingRulesofsaidWageOrderexpoundsthisfurtherinmoredetails,thus:
RULE IV
CREDITABLE INCREASE

Section 1. ORGANIZED ESTABLISHMENTS. Wage increases granted by an employer in an organized establishment
within three (3) months prior to the effectivity of the Order may be credited as compliance with the prescribed increase
set forth therein; Provided that an agreement to this effect has been forged between the parties or a provision in the
collective bargaining agreement allowing creditability exists. In the absence of such an agreement or provision in the
CBA, any increase granted by the employer shall not be credited as compliance with the increase prescribed in this
Order.

Section 2. UNORGANIZED ESTABLISHMENTS. In unorganized establishments, wage increases granted by the
employer within five (5) months prior to the effectivity of the Order may be credited as compliance.

Section 3. CREDITABLE INCREASES GIVEN IN THE FORM OF ALLOWANCES. Where the increase given by the
employer is in the form of allowances, the employer shall integrate the same into the basic wage of the workers to comply
with the P404.00 or P 367.00 per day minimum basic pay whichever is applicable, prescribed under the Order. However,
if the amount of the increase is greater than the increase granted under the Wage Order, the employer has the option to
integrate partially or in full the allowances earlier given. In the event of partial integration, any excess maybe retained as
allowances.

Section 4. CREDITABLE INCREASES GIVEN LESS THAN THE PRESCRIBED ADJUSTMENTS. In case the
increases given are less than the prescribed adjustments, the employer shall pay the difference. Such increases shall not
49
MarcopperMiningCorporationv. NLRC, G.R. No. 103525, March29, 1996; KimberlyClarkPhils. v. Lorredo, G.R. No. 103090, Sept. 21, 1993, 226SCRA639; PlasticTownCenter Corporationv. NLRC, G.R. No. 81176, April 19, 1989, 172SCRA580.
50
FilipinasGolf &CountryClub, Inc. v. NLRC, G.R. No. 62918, Aug. 23, 1989.
51
PhilippineTelegraphandTelephoneCorporationv. NLRC, G.R. No. 99858, June19, 1995, 245SCRA193; LibertyFlourMillsEmployeesv. LibertyFlourMills, Inc., G.R. Nos. 58768-70, Dec. 29, 1989, 180SCRA668.
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include anniversary increases, merit wage increases, and those resulting from the regularization or promotion of
employees.
e.Validityofchargeability/creditabilityclause.
ThevalidityofchargeabilityorcreditabilityclausehadlongbeenupheldbytheSupremeCourt.InearlierWage
Orderscontainingchargeabilityclauses, such asWageOrders Nos.5 [June 11,1984]and6 [October 26,1984], it was
ruled that such clause is grounded on public policy to encourage employers to grant wage and allowance increases
prescribedbythestatuteoradministrativeregulation.
52
Moreover, according to Filipinas Golf & Country Club, Inc. v. NLRC, [G.R. No. 61918, August 23, 1989, 176
SCRA 625], stipulations which subordinate contractual wage increases to those imposed or prescribed by law are not
contrarytolaw,customs,publicorderorpublicpolicy.
InPhilippineTelegraphandTelephoneCorporationv.NLRC,[G.R.No.99858,June1995],theCBAprovisions
in question reveal quite sufficiently the parties' intention to consider salary increases provided in the CBA to be
creditabletowageincreasesthatareormaybemandatedwithintheapplicableperiodbylaw.Inholdingthatthereis
nothingsinisterinthiskindofstipulation,theHighCourtcitedthesaidcaseofFilipinasGolfandCountryClub,Inc.,vs.
NLRC, where it was stated that such agreements merely create an equivalence between legal and contractual
imperatives, rendering both obligations susceptible of performance by compliance with either, subject only to the
conditionthatwheretheincreasesgivenundertheagreementfallshortinamountofthosefixedbylaw,thedifference
mustbemadeupbytheemployer.
f.LawispresumedpartoftheCBA.
Theprovisionsofexistinglawsformpartofavalidcontract.Thisisawellsettledrule.Thereisnoneedforthe
partiestomakeanyexpressreferencethereto.Thelawispresumedtobepartofthecontract.
53
g.ProhibitiononCBAstipulationsbelowminimumlegalstandards.
The parties to a CBA are not allowed to stipulate below the minimum standards provided under the law.
EnteringintoaCBAwhichcontainstermsandconditionsofemploymentbelowminimumstandardsestablishedbylaw
willnotconstituteabartotheconductofacertificationelectiondespitetheregistrationoftheCBAwiththeDepartment
ofLaborandEmployment.
Previously, entering into a CBA providing benefits below the minimum standards set by law is one of the
groundsforcancellationofunionregistrationunderArticle239[f]oftheLaborCode.Thisground,however,hasbeen
deletedbytheamendatoryprovisionofRepublicActNo.9481,whichtookeffectonJune14,2007.
7.NONDIMINUTIONOFBENEFITS(ARTICLE100,LABORCODE).
a.PrincipleunderArticle100.
Article 100 of the Labor Code ordains two (2) principles, namely, [1] the nonelimination and (2) the non
diminutionofthesupplementsorotherbenefitsofemployeesbeingenjoyedbythematthetimeofthepromulgation
of the Labor Code on May 1, 1974. Therefore, the reduction or diminution or withdrawal by employers of any such
benefits, supplements or payments as provided in existing laws, individual agreements or collective bargaining
agreementsbetweenworkersandemployersorvoluntaryemployerpracticeorpolicy,isnotallowed.
54
b.Thenoneliminationornondiminutionprincipleappliedeventobenefitsgrantedafterthe
promulgation/effectivityoftheLaborCode.
AlbeitArticle100isclearthatthetwinprinciplesofnoneliminationandnondiminutionofbenefitsapplyonly
tothebenefitsbeingenjoyedatthetimeofthepromulgationoftheLaborCode,theSupremeCourt,however,has
consistentlycitedArticle100asbeingapplicableeventobenefitsgrantedaftersaidpromulgation.Ithas,infact,been
treatedasthelegalanchorforthedeclarationoftheinvalidityofsomanyactsofemployersdeemedtohaveeliminated
ordiminishedthebenefitsofemployees.
c.Wheneliminationordiminutionofbenefitsconstitutesdemotion.
The illegal and unjustified elimination ordiminution of certain benefits may result in illegal demotion. Under
establishedjurisprudence,thereisdemotionwheretheactoftheemployerresultsintheloweringinpositionorrankor
reductioninsalaryoftheemployee.
55
Itinvolvesasituationwhereanemployeeisrelegatedtoasubordinateorlessimportantpositionconstitutinga
reductiontoalowergradeorrankwithacorrespondingdecreaseindutiesandresponsibilitiesandusuallyaccompanied
byadecreaseinsalary.
56
b.Wheneliminationordiminutionofbenefitsconstitutesconstructivedismissal.
Elimination or diminution of certain benefits may result in the constructive dismissal of an employee.
Constructive dismissal is an involuntary resignation resorted to when continued employment is rendered impossible,
unreasonableorunlikely;whenthereisademotioninrankand/oradiminutioninpay;orwhenacleardiscrimination,
insensibilityordisdainbyanemployerbecomesunbearabletotheemployeethatitcouldforecloseanychoicebyhim
excepttoforegohiscontinuedemployment.
57
52
ApexMiningCo., Inc. v. NLRC, G.R. No. 86200, Feb. 25, 1992, 206SCRA497.
53
LakasngManggagawangMakabayan[LMM] v. Abiera, G.R. No. L-29474, Dec. 19, 1970; LiberationSteamshipCo., Inc. v. CIR, G.R. No. L-25389,June27, 1968.
54
RepublicPlantersBank, nowknownasPNB-RepublicBank, v. NLRC, G.R. No. 117460, Jan. 6, 1997; DavaoFruitsCorporationv. AssociatedLaborUnion, G.R. No. 85073, Aug. 24, 1993, 225SCRA567
55
PhilippineWireless, Inc. [Pocketbell] v. NLRC, G.R. No. 112963, July20, 1999; Brillantesv. Guevarra, G.R. No. L-22586, Feb. 27, 1969, 27SCRA138; Fernandov. Sto. Tomas, G.R. No. 112309, July28, 1994, 234SCRA546.
56
Tiniov. CA, G.R. No. 171764, June8, 2007.
57
UnicornSafetyGlass, Inc. v. Basarte, G.R. No. 154689, Nov. 25, 2004; SeealsoUniwideSalesWarehouseClubv. NLRC, G.R. No. 154503, Feb. 29, 2008; ChiangKai ShekCollegev. Hon. CA, G.R. No. 152988, Aug. 24, 2004.
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8.WORKERSPREFERENCEINCASEOFBANKRUPTCY(ARTICLE110,LABORCODE).
a.RuleunderArticle110.
Article110,
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enunciatestheconceptofworkerpreferencetocovernotonlyunpaidwagesbutalsoother
monetaryclaimstowhichevenclaimsofthegovernmentmustbedeemedsubordinate.Thus,itisexplicitlyprovided
that(s)uchunpaidwagesandmonetaryclaimsshallbepaidinfullbeforeclaimsofthegovernmentandothercreditors
maybepaid.
Itsimplementingrule
59
states:
Section10.PaymentofWagesandOtherMonetaryClaimsinCaseofBankruptcy.Incase
ofbankruptcyorliquidationoftheemployersbusiness,theunpaidwagesandothermonetaryclaims
of the employees shall be given first preference and shall be paid in full before the claims of
governmentandothercreditorsmaybepaid.[Underliningsupplied]

Despitetheclearletterofthelawanditsimplementingrule,theSupremeCourtconsistentlyheldinaplethora
ofcasesthattherighttopreferencegiventoworkersunderArticle110cannotexistinanyeffectivewaypriortothe
timeofitspresentationindistributionproceedings.Inotherwords,thereshouldfirstbeadeclarationofbankruptcyor
judicialliquidation.
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Itisbeyonddisputethatemployeesindeedenjoyfirstpreferenceintheeventofbankruptcyorliquidationof
an employers business.
61
But Article 110 applies only in case of bankruptcy or judicial liquidation of the employer.
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Judicialproceedingsinremisrequiredforcreditorsclaimsagainstdebtorstobecomeoperative.
63
Inthisjurisdiction,bankruptcy,insolvencyandgeneraljudicialliquidationproceedingsprovidetheonlyproper
venuefortheenforcementofacreditor'spreferentialrightsuchasthatestablishedinArticle110oftheLaborCode,for
theseareinremproceedingsbindingagainstthewholeworldwhereallpersonshavinganyinterestintheassetsofthe
debtoraregiventheopportunitytoestablishtheirrespectivecredits.
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TocontendthatArticle110oftheLaborCodeisapplicablealsotoextrajudicialproceedingswouldbeputting
the worker in a better position than the State which could only assert its own prior preference in case of a judicial
proceeding.
65
b.Preferenceoftaxesandclaimsofgovernment.
By way of underscoring this point on preference of taxes, worth reiterating is the ruling in Commissioner of
InternalRevenuev.NLRC,[G.R.No.74965,November9,1994,238SCRA42],thatthereisnomeritinthecontention
that taxes areabsolutely preferredclaims only with respect to movable and immovableproperties on which they are
due.Theclaimofthegovernmentpredicatedonataxlienissuperiortotheclaimofaprivatelitigantpredicatedona
judgment.Thetaxlienattachesnotonlyfromtheserviceofthewarrantofdistraintofpersonalpropertybutfromthe
timethetaxbecamedueandpayable.
66
c.Preferenceofmortgagecredit.
AmortgagecreditisaspecialpreferredcreditunderArticle2241oftheCivilCodewhileworkerspreferenceis
anordinarypreferredcredit.
67
ThestatementinDevelopmentBankofthePhilippinesv.NLRC,[G.R.Nos.10026481,January29,1993,218
SCRA 183], that under the new Article 110 of the Labor Code, mortgage credits are subordinate to workers claim is
merelyanobiter.
68
Thus,itisgraveabuseofdiscretiononthepartoftheLaborArbiterinrulingthattheemployeesmayenforce
their firstpreferenceinthesatisfactionoftheirclaimsoverthoseofthemortgagorintheabsenceofadeclarationof
bankruptcy or judicial liquidation of the employer. There is nothing that prevents the employees from instituting
involuntaryinsolvencyoranyotherappropriateproceedingagainsttheiremployerwheretheirclaimscanbeasserted
withrespecttotheiremployersassets.
69
The2005caseofBarayogav.AssetPrivatizationTrust,[GRNo.160073,October24,2005],continuestoaffirm
the same principles enunciated in the cases mentioned earlier. In this case, Philippine National Bank (PNB) was a
mortgage creditor of Bicolandia Sugar Development Corp. (BISUDECO). The claim of PNB was later transferred to the
Asset Privatization Trust (APT) which was created to conserve, provisionally manage and dispose of nonperforming
assetsofthePhilippinegovernmentidentifiedforprivatizationordisposition.APTsubsequentlyacquiredownershipof
BISUDECOs assets following foreclosure proceedings. A complaint for underpayment of wages and other labor
standardsbenefitswasfiledbytheworkersofBISUDECO.APTlatersoldBISUDECOsassetstotheBicolAgroIndustrial
Cooperative(BAPCI).TheworkerssoughttoenforcetheirclaimagainstAPTandBAPCI.BoththeLaborArbiterandthe
NLRCruledinfavoroftheworkersfortheirunpaidbenefits.APT,havingbeenheldliabletherefor,raisedtheissueof
whether,asmortgageeoftheiremployersassets,itcanbeheldliablefortheworkersclaims.TheSupremeCourtruled
58
AsamendedbySection1of R.A. No. 6715[March21, 1989].
59
ParticularlySection10, RuleVIII, BookIII of theRulestoImplement theLaborCode, asamendedonMay24, 1989.
60
Someof thenotablecaseswherethispronouncement wasassertedareBolinao, Jr. v. Padolina, [G.R. No. 81415, June6, 1990, 186SCRA368]; DBPv. NLRC, [G.R. No. 86932, June27, 1990, 186SCRA841]; DBPv. Minister of Labor, [G. R. No. 75801, March20, 1991]; DBPv.
NLRC, [G.R. Nos. 100264-81, January29, 1993]; DBPv. NLRC, [G.R. No. 86227, January19, 1994, 229SCRA350]; Hauteav. NLRC, [G.R. No. 96149, February16, 1994]; DBPv. NLRC, [G.R. No. 106655, September1, 1994]; DBPv. NLRC, [G.R. No. 108031, March01, 1995] and
Barayogav. Asset PrivatizationTrust, [GRNo. 160073, October24, 2005].
61
TheManilaBankingCorporation, v. NLRC, G.R. No. 107487, Sept. 29, 1997, 279SCRA602.
62
Commissionerof Internal Revenuev. NLRC, G.R. No. 74965, Nov. 9, 1994, 238SCRA42; DBPv. Secretaryof Labor, G.R. No. 79351, Nov. 28, 1989.
63
DBPv. NLRC, G.R. No. 86227, Jan. 19, 1994, 229SCRA350.
64
DBPv. Secretaryof Labor, G.R. No. 79351, Nov. 28, 1989citingPhilippineSavingsBankv. Lantin, G.R. No. L-33929, Sept. 2, 1983, 124SCRA476; DBPv. Hon. LaborArbiterAriel C. SantosG.R. Nos. 78261-62, March8, 1989.
65
DBPv. NLRC, G.R. No. 108031, March1, 1995, 242SCRA59.
66
SeealsoRepublicv. Enriquez, G.R. No. L-78391, Oct. 21, 1988, 166SCRA608.
67
Hauteav. NLRC, G.R. No. 96149, Feb. 16, 1994, 230SCRA119; DBPv. NLRC, G.R. Nos. 82763-64, June27, 1990, 183SCRA328.
68
Hauteav. NLRC, G.R. No. 96149, Feb. 16, 1994, 230SCRA119.
69
DBPv. Secretaryof Labor, G.R. No. 79351, Nov. 28, 1989
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that the mortgageetransferee of its debtors assets does not automatically acquire the liabilities of the debtor
mortgagor,suchastheworkersclaimsforbenefits.Hence,APTasmortgageeofBISUDECO,cannotbeheldliableforthe
monetary claims of the latters workers. Citing DBP v. NLRC, [G.R. Nos. 8276364, March 19, 1990, 183 SCRA 328], it
further held that the workers preference of credit is not a lien that attaches to specific properties of their insolvent
employer. A mortgagees lien, on the other hand, creates a charge on the debtor companys particular property and,
hence,shouldprevailovertheworkerspreferenceofcredit.TheSupremeCourtreiteratedtherulethatthebenefitof
Article 110 cannot be invoked outside bankruptcy or judicial proceedings where the claims of all creditors may be
inventoriedanddetermined.
d.MeaningofwagesinArticle110.
The term wages under Article 110 of the Labor Code may be regarded as embracing within its scope,
severancepayorterminationorseparationpay.
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9.LABORCODEPROVISIONFORWAGEPROTECTION(ARTICLES112TO119,LABORCODE).
ThefollowingprovisionsoftheLaborCodearemeanttoprotectwage:
ART. 112. Non-interference in disposal of wages. - No employer shall limit or otherwise interfere with the
freedom of any employee to dispose of his wages. He shall not in any manner force, compel, or oblige his
employees to purchase merchandise, commodities or other property from any other person, or otherwise make
use of any store or services of such employer or any other person.

ART. 113. Wage deduction. - No employer, in his own behalf or in behalf of any person, shall make any
deduction from the wages of his employees, except:
(a) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense
the employer for the amount paid by him as premium on the insurance;
(b) For union dues, in cases where the right of the worker or his union to check-off has been recognized by the
employer or authorized in writing by the individual worker concerned; and
(c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and
Employment.

ART. 114. Deposits for loss or damage. - 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 when the employer is engaged in such trades, occupations 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. 115. Limitations. - No deduction from the deposits of an employee for the actual amount of the loss or
damage shall be made unless the employee has been heard thereon, and his responsibility has been clearly
shown.

ART. 116. Withholding of wages and kickbacks prohibited. - It shall be unlawful for any person, directly or
indirectly, to withhold any amount from the wages of a worker or induce him to give up any part of his wages by
force, stealth, intimidation, threat or by any other means whatsoever without the workers consent.

ART. 117. Deduction to ensure employment. - It shall be unlawful to make any deduction from the wages of any
employee for the benefit of the employer or his representative or intermediary as consideration of a promise of
employment or retention in employment.

ART. 118. Retaliatory measures. - It shall be unlawful for an employer to refuse to pay or reduce the wages and
benefits, discharge or in any manner discriminate against any employee who has filed any complaint or
instituted any proceeding under this Title or has testified or is about to testify in such proceedings.

ART. 119. False reporting. - It shall be unlawful for any person to make any statement, report, or record filed or
kept pursuant to the provisions of this Code knowing such statement, report or record to be false in any material
respect.
Alltheforegoingprovisionsareconsideredprohibitionsregardingwages.
10.ALLOWABLEDEDUCTIONSWITHOUTEMPLOYEESCONSENT(ARTICLE113,LABORCODE).
a.Generalrule.
Thegeneralruleisthatanemployer,byhimselforthroughhisrepresentative,isprohibitedfrommakingany
deductionsfromthewagesofhisemployees.Theemployerisnotallowedtomakeunnecessarydeductionswithoutthe
knowledgeorauthorizationoftheemployees.
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b.DeductionsallowedunderArticle113.
Article113allowsonlythree(3)kindsofdeductions,namely:
(a)Incaseswheretheworkerisinsuredwithhisconsentbytheemployer,andthedeductionisto
recompensetheemployerfortheamountpaidbyhimaspremiumontheinsurance;
(b) For union dues, in cases where the right of the worker or his union to checkoff has been
recognizedbytheemployerorauthorizedinwritingbytheindividualworkerconcerned;and
(c)IncaseswheretheemployerisauthorizedbylaworregulationsissuedbytheSecretaryofLabor
andEmployment.
70
Republicv. Peralta, G.R. No. 56568, May20, 1987, 150SCRA37, 51.
71
Galvadoresv. Trajano, G.R. No. L-70067, Sept. 15, 1986, 144SCRA138.
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c.DeductionsallowedunderotherprovisionsoftheLaborCodeandotherlaws.
Deductionsfromthewagesofemployeesmaybemadebytheemployerinanyofthefollowingcases:
1. DeductionsforlossordamageunderArticle114oftheLaborCode;
2. Deductions made for agency fee from nonunion members who accept the benefits under the CBA
negotiated by the recognized or certified bargaining union. This form of deduction does not require the
writtenauthorizationofthenonunionmemberconcerned;
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3. Unionservicefee;
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4. Whenthedeductionsarewiththewrittenauthorizationoftheemployeeforpaymenttoathirdpersonand
theemployeragreestodoso,providedthatthelatterdoesnotreceiveanypecuniarybenefit,directlyor
indirectly,fromthetransaction;
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5. Deductionsforvalueofmealandotherfacilities;
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6. DeductionsforpremiumsforSSS,PhilHealth,employeescompensationandPagIBIG;
7.WithholdingtaxmandatedundertheNationalInternalRevenueCode(NIRC);
8.Withholdingofwagesbecauseoftheemployeesdebttotheemployerwhichisalreadydue;
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.
9. Deductionsmadepursuanttoacourtjudgmentagainsttheworkerundercircumstanceswherethewages
maybethesubjectofattachmentorexecutionbutonlyfordebtsincurredforfood,clothing,shelterand
medicalattendance;
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10.Whendeductionsfromwagesareorderedbythecourt;
11.Salarydeductionsofamemberofalegallyestablishedcooperative.
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d.Someprinciplesondeductionsfromemployeessalaryorwage.
1. Debtduetotheemployermaybesetoffagainsttheemployeeswagesandbenefits.
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.
2. To validly setoff debt, the employees debt should arise from, or be connected with, the employment
relationship.Evidenceshouldbepresentedbytheemployertoprovethattheindebtednessaroseoutofor
wasincurredinconnectionwiththeiremploymentrelationship.Moreover,thesetoffshouldbeasserted
duringtheproceedingsbeforetheLaborArbiterandnotafterthecasehadbeenresolvedwithfinality.
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3. Deductionsduetotardinessorabsencesarevalid.
4. 13thmonthpayisconsideredpartofwageswithinthemeaningandcontemplationofArticle97[f]ofthe
LaborCode.Nodeduction,therefore,canbemadetherefromwithouttheknowledgeandconsentofthe
employeeconcerned.Thus,thedeductionofSSSloanandthevalueofshoesfromthe13thmonthpayof
theemployeeisnotallowed.
81
11.ATTORNEYSFEESANDUNIONSERVICEFEEINLABORCASES(ARTICLE111,LABORCODE).
I.ONATTORNEYSFEES.
aNonlawyersarenotentitledtoattorneysfees.
Albeitthelawallows,undercertaincircumstances,nonlawyerstoappearbeforetheLaborArbiter,National
LaborRelationsCommissionorotherlabortribunals,thisdoesnotmean,however,thattheyareentitledtoattorneys
fees. Their act of representing, appearing or defending a party litigant in a labor case does not, by itself, confer upon
themanylegalrighttoclaimforattorneysfees.Entitlementtoattorneysfeespresupposestheexistenceofattorney
clientrelationship.Thisrelationshipcannotexistunlesstheclientsrepresentativeisalawyer.
82

b.Attorneysfeescannotbesharedwithnonlawyers.
AsheldinthecaseofAmalgamatedLaborersAssociationv.CIR,[G.R.No.L23467,March27,1968,22SCRA
1266], it is an immoral act for a lawyer to enter into an agreement whereby the union president will share in his
attorneysfees.Canon34ofLegalEthicsproscribesandcondemnsthisarrangement.Itprovidesthatnodivisionoffees
forlegalservicesisproperexceptwithanotherlawyerbaseduponadivisionofserviceorresponsibility.Sincetheunion
presidentisnotthelawyerfortheworkers,hecannotbeallowedtoshareintheattorneysfees.
II.ONUNIONSERVICEFEES.
a.Entitlementtounionservicefees.
There are certain cases where it is not a lawyer who represents the interest of the employees. Labor
federationsandlocalunionsareallowedinourjurisdictiontoappearascounselsinlaborproceedings.Theirappearance
hasbeengivensanctionunderArticle222oftheLaborCodewhichallowsnonlawyerstorepresenttheirorganizationor
anymemberthereof.
83
Thebest illustrative caseon thispoint is Radio Communicationsof the Phils.,Inc. v.Secretary of Labor and
Employment,[G.R.No.77959,January9,1989,169SCRA38].Inthiscase,petitionercontinuouslywithheldpaymentof
theECOLAmandatedunderWageOrderNo.1.Forthisreason,theemployeeswereforcedtoavailoftheservicesof
72
Article248[e], LaborCode.
73
RadioCommunicationsof thePhils., Inc. v. Secretaryof LaborandEmployment, G.R. No. 77959, Jan. 9, 1989, 169SCRA38.
74
Section13, RuleVIII, BookIII, RulestoImplement theLaborCode.
75
Section7, RuleVI, BookIII, RulestoImplement theLaborCode.
76
Article1706, Civil Code
77
Article1708, Civil Code.
78
Article59, R.A. No. 6938.
79
Special Steel Products, Inc. v. Villareal, [G.R. No. 143304, July8, 2004].
80
Pondocv. NLRC, G.R. No. 116347, Oct. 03, 1996.
81
Agabonv. NLRC, [G.R. No. 158693, November 17, 2004].
82
FiveJ. Taxi, v. NLRC, G.R. No. 111474, Aug. 22, 1994, 235SCRA556; PhilippineAssociationof FreeLaborUnions[PAFLU] v. BinalbaganIsabelaSugarCo., G.R. No. L-23959, Nov. 29, 1971, 42SCRA302.
83
RCPI v. Secretaryof LaborandEmployment, infra.
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their union the United RCPI Communications Labor Association (URCPICLA) Federation of Unions of Rizal (FUR) in
ordertosecurethebenefit.URCPICLAFURlitigatedthecaseuptotheSupremeCourt.Inthemeantime,petitionerRCPI,
withouttheknowledgeandconsentofprivaterespondentURCPICLAFUR,enteredintoacompromiseagreementwith
Buklod ng Manggagawa sa RCPINFL (BMRCPINFL), the new bargaining agent of the RCPI employees. Petitioner then
implemented the terms of the compromise agreement without paying the 10% union service fee due private
respondentURCPICLAFUR.
Onthesoleissueofwhetherthepublicrespondentsactedwithgraveabuseofdiscretionamountingtolackof
jurisdiction in holding petitioner RCPI solely liable for "union service fee" to respondent URCPICLAFUR, the Supreme
Courtruledinthenegative.Theunionisentitledtounionservicefeesconsideringthatitwascategoricallyfoundbythe
LaborSecretarytohavebeenresponsibleforthesuccessfulprosecutionofthecasetoitsultimateconclusioninbehalfof
itsmembers,employeesofpetitioner.Theunionsrighttofeesforservicesrendered,orwhatittermedas"unionservice
fee,"is,therefore,indubitable.
In the 2009 case of Dealco Farms, Inc. v. NLRC, [G.R. No. 153192, January 30, 2009], the Supreme Court
affirmedtheunionservicefeesof10%ofthetotalmonetaryawardearliergrantedbytheLaborArbiterandtheNLRCas
itwasbasedonthefindingthatrespondentsweredismissedwithoutjustorauthorizedcause.
12.CRITERIA/FACTORSFORWAGESETTING(ARTICLE124,LABORCODE).
a.LatestNWPCGuidelinesNo.01,Seriesof2007.
NWPC Guidelines No. 01, Series of 2007 was issued by the NWPC on June 19, 2007, promulgating the
AmendedRulesofProcedureonMinimumWageFixinggoverningtheproceedingsintheCommissionandtheRTWPBs
inthefixingofminimumwageratesbyregion,provinceorindustry.
Byvirtueofthislatestissuance,thepreviousNWPCGuidelinesNo.00195andtheJune4,1990Rulesarenow
deemedrepealedpursuanttoSection1,RuleXIIthereofwhichdeclaresthat(a)llexistingrules,regulationsorordersor
anypartthereofinconsistentwiththisAmendedRulesarehereby,repealed,amendedormodifiedaccordingly.
b.Conductofwageandproductivitystudies.
The Board (RTWPB) shall, subject to the guidelines issued by the Commission (NWPC), conduct continuing
studiesofwagerates,productivityandotherconditionsintheregion,provincesorindustriestherein.TheBoardshall
investigate and study all pertinent facts, and based on standards and criteria (see below) shall determine whether a
wageordershouldbeissued.
84

c.Standards/Criteriaforminimumwagefixing.
TheminimumwageratestobeestablishedbytheBoardshallbeasnearlyadequateasiseconomicallyfeasible
tomaintaintheminimumstandardsoflivingnecessaryforthehealth,efficiencyandgeneralwellbeingoftheworkers
within the framework of national economic and social development goals. In the determination of regional minimum
wages,theBoardshall,amongotherrelevantfactors,considerthefollowing:
(a) Needsofworkersandtheirfamilies
1) Demandforlivingwages
2) Wageadjustmentvisvistheconsumerpriceindex
3) Costoflivingandchangestherein
4) Needsofworkersandtheirfamilies
5) Improvementsinstandardsofliving
(b) Capacitytopay
1) Fairreturnoncapitalinvestedandcapacitytopayofemployers
2) Productivity
(c) Comparablewagesandincomes
1) Prevailingwagelevels
(d) Requirementsofeconomicandsocialdevelopment
1) Needtoinduceindustriestoinvestinthecountryside
2) Effectsonemploymentgenerationandfamilyincome
3) Equitable distribution of income and wealth along the imperatives of economic and social
development.(Section2,RuleII,Ibid.).
=================================
C. LABOR STANDARDS
3. Rest Day
a. Right to weekly rest day
b. Preference of the employee
c. When work on rest day authorized
=================================
1.RIGHTTOWEEKLYRESTDAY(ARTICLE91,LABORCODE).
a.Coverage.
84
Section1, RuleII, NWPCGuidelinesNo. 01, Seriesof 2007, June19, 2007[AmendedRulesof ProcedureonMinimumWageFixing].
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The rule on weekly rest period is applicable to all employers, whether operating for profit or not, including
publicutilitiesoperatedbyprivatepersons.
85
b.Weeklyrestperiod.
Every employer is requiredto give his employees a restperiodofnot lessthantwentyfour (24)consecutive
hoursaftereverysix(6)consecutivenormalworkdays.
86
c.Scheduleofrestday.
Wheretheweeklyrestisgiventoallemployeessimultaneously,theemployershouldmakeknownsuchrest
period by means of a written notice posted conspicuously in the workplace at least one (1) week before it becomes
effective.
87
Wheretherestperiodisnotgrantedtoallemployeessimultaneouslyandcollectively,theemployershallmake
knowntotheemployeestheirrespectiveschedulesofweeklyrestdaythroughwrittennoticespostedconspicuouslyin
theworkplaceatleastone(1)weekbeforetheybecomeeffective.
88
2.PREFERENCEOFTHEEMPLOYEE(ARTICLE91,LABORCODE).
a.Employeespreferenceofrestdaybasedonreligiousgrounds.
ByexpressprovisionofArticle91oftheLaborCode,theexercisebytheemployerofsuchrightandprerogative
issubjecttothepreferenceinthechoicebytheemployeeofhisrestdaybasedonreligiousgrounds.Article91,infact,
makestheemployerdutyboundtorespectsuchpreferenceoftheemployeeifbasedonreligiousgrounds.
Theemployeeshouldmakeknownhispreferencetotheemployerinwritingatleastseven(7)daysbeforethe
desiredeffectivityoftheinitialrestdaysopreferred.
89
Where, however, the choice of the employees as to their rest day based on religious grounds will inevitably
result in serious prejudice or obstruction to the operations of the undertaking and the employer cannot normally be
expectedtoresorttootherremedialmeasures,theemployermaysoscheduletheweeklyrestdayoftheirchoiceforat
leasttwo(2)daysinamonth.
90
3.WHENWORKONRESTDAYAUTHORIZED(ARTICLE92,LABORCODE).
a.Generalrule.
No employee shall be required against his will to work on his scheduled rest day except under the
circumstancesprovidedunderArticle92oftheLaborCodewhereworkonsuchdaymaybecompelled.However,incase
workonrestdayisrequiredandnotoneofthesaidcircumstancesispresent,theemployeemayworkduringsuchrest
day but only on voluntary basis. And once an employee volunteers to work on his rest day, he should express such
willingnessanddesiretoworkinwriting.Accordingly,heshouldbepaidtheadditionalcompensationforworkingonhis
restdayunderthelaw.
91
b.Compulsoryworkonscheduledrestday.
An employer may require any of his employees to work on his scheduled rest day for the duration of the
followingemergencyandexceptionalconditions:
a.Incaseofactualorimpendingemergenciescausedbyseriousaccident,fire,flood,typhoon,earthquake,
epidemicorotherdisasterorcalamity,topreventlossoflifeandproperty,orincaseofforcemajeureor
imminentdangertopublicsafety;
b.Incaseofurgentworktobeperformedonmachineries,equipment,orinstallations,toavoidseriousloss
whichtheemployerwouldotherwisesuffer;
c. In the event of abnormal pressure of work due to special circumstances, where the employer cannot
ordinarilybeexpectedtoresorttoothermeasures;
d.Topreventseriouslossofperishablegoods;
e.Wherethenatureoftheworkissuchthattheemployeeshavetoworkcontinuouslyforseven(7)daysina
weekormore,asinthecaseofthecrewmembersofavesseltocompleteavoyageandinothersimilar
cases;and
f. Whentheworkisnecessarytoavailoffavorableweatherorenvironmentalconditionswhereperformance
orqualityofworkisdependentthereon.
92
=======================================
C. LABOR STANDARDS
4. Holidays
a. Right to holiday pay
(1) In case of absences
(2) In case of temporary cessation of work
(3) Of teachers, piece workers, seafarers,
85
Section1, RuleIII, BookIII, RulestoImplement theLaborCode.
86
Section3, RuleIII, BookIII, Ibid..
87
Section5[a], RuleIII, BookIII, Ibid..
88
Section5[b], RuleIII, BookIII, Ibid..
89
90
91
UnderSection6, RuleIII, BookIII of theRulestoImplement theLaborCode.
92
SeeSection6, RuleIII, BookIII, RulestoImplement theLaborCode.
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seasonal workers, etc.
b. Exclusions from coverage
=======================================
1.RIGHTTOHOLIDAYPAYINCASEOFABSENCES(ARTICLE94,LABORCODE).
a.Effectofabsencesonentitlementtoholidaypay.
1. Employeesonleaveofabsencewithpayentitledtoholidaypaywhentheyareonleaveofabsencewith
pay.
93
2. Employees on leave of absence without pay on the day immediately preceding the regular holiday
maynotbepaidtherequiredholidaypayifhehasnotworkedonsuchregularholiday.
94
3. Employees on leave while on SSS or employees compensation benefits Employers should grant the
same percentage of the holiday pay as the benefit granted by competent authority in the form of
employeescompensationorsocialsecuritypayment,whicheverishigher,ifheisnotreportingforwork
whileonsuchbenefits.
95
4. Whendayprecedingregularholidayisanonworkingdayorscheduledrestdayshouldnotbedeemed
tobeonleaveofabsenceonthatday,inwhichcase,heisentitledtotheregularholidaypayifheworked
onthedayimmediatelyprecedingthenonworkingdayorrestday.
96
2.RIGHTTOHOLIDAYPAYINCASEOFTEMPORARYCESSATIONOFWORK.
a.Temporaryorperiodicshutdownorcessationofworknotduetobusinessreverses.
Incasesoftemporaryorperiodicshutdownandtemporarycessationofworkofanestablishment,aswhena
yearlyinventoryorwhentherepairorcleaningofmachineriesandequipmentisundertaken,theregularholidaysfalling
within the period should be compensated in accordance with Rule IV [Holidays With Pay], Book III of the Rules to
ImplementtheLaborCode.
97

b.Temporarycessationofoperationduetobusinesslossesorreverses.
The regular holiday during the temporary cessation of operation of an enterprise due to business losses or
financialreversesasauthorizedbytheSecretaryofLaborandEmploymentmaynotbepaidbytheemployer.
98
3.RIGHTTOHOLIDAYPAYOFTEACHERS,PIECEWORKERS,SEAFARERS,SEASONALWORKERS,ETC.
ONRIGHTTOHOLIDAYPAYOFTEACHERS.
1. Private school teachers, in general. Private school teachers, including faculty members of colleges and
universities,maynotbepaidfortheregularholidaysduringsemestralvacations.Theyshall,however,be
paidfortheregularholidaysduringChristmasvacation.
99
2.Holidaypayofhourlypaidteachers. Aschoolisexemptedfrompayinghourlypaidfacultymembers
their pay for regular holidays,whether thesamebeduringtheregular semestersofthe schoolyearor
during semestral, Christmas, or HolyWeek vacations. However, it is liableto pay the faculty members
theirregularhourlyrateondaysdeclaredasspecialholidaysorif,forsomereason,classesarecalledoff
or shortened for the hours they are supposed to have taught, whether extensions of class days be
orderedornot;andincaseofextensions,saidfacultymembersshalllikewisebepaidtheirhourlyrates
shouldtheyteachduringsaidextensions,
100
ONRIGHTTOHOLIDAYPAYOFPIECEWORKERS.
a.Holidaypayofpieceworkersoremployeespaidbyresults.
Whereacoveredemployeeispaidbyresultsoroutputsuchaspaymentonpiecework,hisholidaypayshould
notbelessthanhisaveragedailyearningsforthelastseven(7)actualworkingdaysprecedingtheregularholiday.Inno
case,however,shouldtheholidaypaybelessthantheapplicablestatutoryminimumwagerate.
101
b.Workerspaidbyresultsclassifiedintosupervisedandunsupervised.
Theprincipaltesttodetermineentitlementtoholidaypayiswhethertheemployeestimeandperformanceof
theworkaresupervisedorunsupervisedbytheiremployer.Ifsupervised,theemployeeisentitledtoholidaypay.If
unsupervised,heisnot.
102
Thedistinctionsbetweensupervisedandunsupervisedworkerspaidbyresultsareasfollows:
(1) Thosewhosetimeandperformancearesupervisedbytheemployer.Here,thereisanelementofcontrol
andsupervisionoverthemannerastohowtheworkistobeperformed.Apiecerateworkerbelongsto
thiscategoryespeciallyifheperformshisworkinthecompanypremises;and
(2) Thosewhosetimeandperformanceareunsupervised.Here,theemployerscontrolisovertheresultof
thework.Workersonpakyaoandtakaybasisbelongtothisgroup.Bothclassesofworkersarepaidper
unitaccomplished.Pieceratepaymentisgenerallypracticedingarmentfactorieswhereworkisdonein
93
Section6[a], RuleIV, BookIII, RulestoImplement theLaborCode; No. II [E], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
94
Section6[a], RuleIV, BookIII, Ibid.;No. II [E], Ibid.
95
Section6[b], RuleIV, BookIII, Ibid.;No. II [E], Ibid..
96
Section6[c], RuleIV, BookIII, Ibid.; No. II [E], Ibid..
97
Section7[a], RuleIV, BookIII, Ibid.; No. II [F], Ibid..
98
Section7[b], RuleIV, BookIII, Ibid..
99
Section8[a], RuleIV, BookIII, Ibid.; No. II [G], Ibid..
100
JoseRizal Collegev. NLRC, [G.R. No. 65482, December 1, 1987].
101
Section8[b], RuleIV, BookIII, RulestoImplement theLaborCode; No. II [G], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
102
LaborCongressof thePhilippinesv. NLRC, [G.R. No. 123938, May21, 1998, 290SCRA509]; Tanv. Lagrama, [G.R. No. 151228, August 15, 2002].
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the company premises, while payment on pakyao and takay basis is commonly observed in the
agricultural industry, such as in sugar plantations where the work is performed in bulk or in volumes
difficulttoquantify.Petitionersbelongtothefirstcategory,i.e.,supervisedemployees.
103
ONRIGHTTOHOLIDAYPAYOFSEAFARERS.
Under the Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean
GoingVessels,itisprovidedthat(a)ny hours of work or duty including hours of watch keeping performedby the
seafarerondesignatedrestdaysandholidaysshallbepaidrestdayorholidaypay.
ONRIGHTTOHOLIDAYPAYOFSEASONALWORKERS.
Seasonal workers are entitled to holiday pay while working during the season. They may not be paid the
requiredregularholidaypayduringoffseasonwheretheyarenotatwork.
104
4.EXCLUSIONSFROMCOVERAGEOFHOLIDAYPAY.
a.Coverage;exceptions.
Generally, all employees are entitled to covered by Article 94 of the Labor Code, as amended, and its
implementingrules,except:
a.Thoseofthegovernmentandanyofthepoliticalsubdivisions,includinggovernmentownedandcontrolled
corporations;
b.Thoseofretailandserviceestablishmentsregularlyemployinglessthanten(10)workers;
c.Domestichelpers;
d.Personsinthepersonalserviceofanother;
e.ManagerialemployeesasdefinedinBookIIIoftheLaborCode;
f.Fieldpersonnelandotheremployeeswhosetimeandperformanceisunsupervisedbytheemployer;
g.Thosewhoareengagedontaskorcontractbasisorpurelycommissionbasis;
h. Those who are paid a fixed amount for performing work irrespective of the time consumed in the
performancethereof;
i.Otherofficersandmembersofthemanagerialstaff;
j. Membersofthefamilyoftheemployerwhoaredependentonhimforsupport.
105
===================================
C. LABOR STANDARDS
5. Leaves
a. Service Incentive Leave Pay
(1) Right to service incentive leave
(2) Exclusions from coverage
(3) Commutable nature of benefit
b. Maternity Leave
(1) Coverage
(3) Availment
c. Paternity Leave
(1) Coverage
(3) Availment
d. Parental Leave
(1) Coverage
(3) Availment
e. Leaves for victims of violence
against women
(1) Coverage
(3) Availment
===================================
1.SERVICEINCENTIVELEAVEPAY(ARTICLE95,LABORCODE).
a.Righttoserviceincentiveleave.
103
Lambov. NLRC, [G.R. No. 111042, October26, 1999, 317SCRA420].
104
Section8[c], RuleIV, BookIII, RulestoImplement theLaborCode; No. II [G], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
105
Article82, LaborCode; SeealsoSection1, RuleIV, BookIII, RulestoImplement theLaborCode; No. II [A], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
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Every covered employee who has rendered at least one (1) year of service is entitled to a yearly service
incentiveleaveoffive(5)dayswithpay.
106
Thetermatleastoneyearofserviceshouldmeanservicewithintwelve
(12) months, whether continuous or broken, reckoned from the date the employee started working, including
authorizedabsencesandpaidregularholidays,unlessthenumberofworkingdaysintheestablishmentasamatterof
practice or policy, or that provided in the employment contract, is less than twelve (12) months, in which case, said
periodshouldbeconsideredasone(1)yearforthepurposeofdeterminingentitlementtotheserviceincentiveleave
benefit.
107
b.Exclusionsfromcoverage.
Allemployeesarecoveredbytheruleonserviceincentiveleaveexcept:
a. Thoseofthegovernmentandanyofitspoliticalsubdivisions,includinggovernmentownedandcontrolled
corporations;
b. Domestichelpers;
c. Personsinthepersonalserviceofanother;
d. ManagerialemployeesasdefinedinBookIIIoftheLaborCode;
e. Fieldpersonnelandotheremployeeswhoseperformanceisunsupervisedbytheemployer;
f. Thosewhoareengagedontaskorcontractbasis,purelycommissionbasis,orthosewhoarepaidinafixed
amountforperformingworkirrespectiveofthetimeconsumedintheperformancethereof;
g. Thosewhoarealreadyenjoyingthebenefitprovidedinthelaw;
h. Thoseenjoyingvacationleavewithpayofatleastfive(5)days;
i. Thoseemployedinestablishmentsregularlyemployinglessthanten(10)employees;
j. Otherofficersandmembersofthemanagerialstaff;and
k. Membersofthefamilyoftheemployerwhoaredependentonhimforsupport.
108
c.Commutablenatureofbenefit.
Theserviceincentiveleaveiscommutabletoitsmoneyequivalentifnotusedorexhaustedattheendofthe
year.
109
Thephraseleavewithpaymeansthattheemployeeisentitledtohisfullcompensationduringhisleaveof
absencefromwork.
110
Incomputingtheserviceincentiveleavebenefit,thebasisisthesalaryrateatthedateofcommutation.The
availmentandcommutationoftheserviceincentiveleavebenefitmaybeonaproratabasis.
111
Illustration.
Toillustratethecomputationoftheserviceincentiveleave(SIL)cashcommutation,anemployeewhoishired
onJanuary1,2010andresignedonMarch1,2011,assuminghehasnotusedorcommutedanyofhisaccruedSIL,is
entitleduponhisresignationtothecommutationofhisaccruedSILasfollows:

SILearnedasofDecember31,2010 Five(5)days
ProportionateSILforJan.andFeb.
2011(2/12x5days) 0.833day
TotalaccruedSILasofMarch1,2011 5.833days
112

2.MATERNITYLEAVE.
(ARTICLE133,LABORCODE;SECTION14A,SOCIALSECURITYLAW[R.A.NO.8282).
a.Coverage.
Maternityleaveistheperiodoftimewhichmaybeavailedofbyawomanemployee,marriedorunmarried,
toundergoandrecuperatefromchildbirth,miscarriageorcompleteabortionduringwhichsheispermittedtoretainher
rightsandbenefitsflowingfromheremployment.
Section14A
113
oftheSocialSecurityLawnowprovidesasfollows:
Sec.14A.MaternityLeaveBenefit.Afemalememberwhohaspaidatleastthree(3)
monthly contributions in the twelvemonth period immediately preceding the semester of her
childbirthormiscarriageshallbepaidadailymaternitybenefitequivalenttoonehundredpercent
(100%) of her average daily salarycredit for sixty(60)days or seventyeight(78) days incase of
caesariandelivery,subjecttothefollowingconditions:
(a) That the employee shall have notified her employer of her pregnancy and the
probable date of her childbirth, which notice shall be transmitted to the SSS in
accordancewiththerulesandregulationsitmayprovide;
(b) The full payment shall be advanced by the employer within thirty (30) days from
thefilingofthematernityleaveapplication;
106
Article95[a], LaborCode; Section2, RuleV, BookIII, RulestoImplement theLaborCode.
107
Section3, RuleV, BookIII, RulestoImplement theLaborCode; No. VI [B], DOLEHandbookonWorkersStatutoryMonetaryBenefits; IntegratedContractorandPlumbingWorks, Inc. v. NLRC, G.R. No. 152427, August 9, 2005.
108
Article82, LaborCode; Section1, RuleV, BookIII, RulestoImplement theLaborCode; No. VI [A], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
109
Section5, RuleV, BookIII, Ibid.; No. VI [C], Ibid..
110
Escosurav. SanMiguel Brewery, Inc., G.R. No. L-16696; Jan. 31, 1962.
111
No. VI [C], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
112
SeeNo. VI [A], DOLEHandbookonWorkersStatutoryMonetaryBenefitsbasedontheopinionof DOLELegal Service.
113
AsamendedbyR.A. No. 7322aswell astheSocial SecurityAct of 1997[R.A. No. 8282].
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(c) Thatpaymentofdailymaternitybenefitsshallbeabartotherecoveryofsickness
benefitsprovidedbythisActforthesameperiodforwhichdailymaternitybenefits
havebeenreceived;
(d) Thatthematernitybenefitsprovidedunderthissectionshallbepaidonlyforthe
firstfour(4)deliveriesormiscarriages;
(e) That the SSS shall immediately reimburse the employer of one hundred percent
(100%) of the amount of maternity benefits advanced to the employee by the
employeruponreceiptofsatisfactoryproofofsuchpaymentandlegalitythereof;
and
(f) That if an employee member should give birth or suffer miscarriage without the
requiredcontributionshavingbeenremittedforherbyheremployertotheSSS,or
withoutthelatterhavingbeenpreviouslynotifiedbytheemployerofthetimeof
the pregnancy, the employer shall pay to the SSS damages equivalent to the
benefitswhichsaidemployeememberwouldotherwisehavebeenentitledto.
b.Conditionstoentitlement.
Thefollowingarethequalificationsforentitlementtomaternitybenefits:
1. Thefemalemembershouldbeemployedatthetimeofdelivery,miscarriageorabortion.
2.ShemusthavegiventherequirednotificationtotheSSSthruheremployer.
3. Her employer must have paid at least three (3) months of maternity contributions within the 12month
periodimmediatelybeforethesemesterofcontingency.
114
c.Availment.
1.Pregnantwomen,whethermarriedorunmarried,areentitledtomaternityleavebenefits.
Entitlement to maternity leave benefits is not dependent on the civil status of the pregnant woman. Every
pregnantwomanintheprivatesector,whethermarriedorunmarried,isentitledtothematernityleavebenefits.
115
2.Maternitybenefits,notpartof13thmonthpaycomputation.
Maternity benefits, like other benefits granted by the SSS, are granted to employees in lieu of wages and,
therefore,maynotbeincludedincomputingtheemployees13thmonthpayforthecalendaryear.
116
3.Voluntaryorselfemployedmembersnotentitledtomaternitybenefits.
Voluntary or selfemployed members are not entitled to maternity benefits because to be entitled thereto,
corresponding maternity contributions should be paid by employers. Voluntary or selfemployed members have no
employerssotheydonothavematernitycontributions.
4.Computationofmaternitybenefits.
Thematernitybenefitsshallbecomputedasfollows:
a. Exclude the semester of contingency (delivery, miscarriage or abortion). A semester refers to two
consecutivequartersendinginthequarterofcontingency.Aquarterreferstothree(3)consecutivemonths
endinginMarch,June,SeptemberorDecember.
b. Count twelve (12) months backwards starting from the month immediately before the semester of
contingency.
c. Identify the six (6) highest monthly salary credits within the 12month period. Monthly salary credit
meansthecompensationbaseforcontributionsandbenefitsrelatedtothetotalearningsforthemonth.
117
d.Addthesix(6)highestmonthlysalarycreditstogetthetotalmonthlysalarycredit.
e.Dividethetotalmonthlysalarycreditby180daystogettheaveragedailysalarycredit.Thisisequaltothe
dailymaternityallowance.
f. Multiplythedailymaternityallowancebysixty(60)days(or78days)togetthetotalmaternityallowance.
5.Entitlementtomaternitybenefitforeclosesentitlementtosicknessbenefit.
AfemalememberoftheSSSwhohasavailedofmaternitybenefitcannotclaimforsicknessbenefitforaperiod
ofsixty(60)days(or78days)withinwhichshewasalreadypaidthematernitybenefit.Asarule,nomembercanbe
entitledtotwo(2)benefitsforthesameperiod.
6.NotificationtoSSSincaseofpregnancy.
ItisarequirementtonotifytheSSS.Assoonasafemalememberbecomespregnant,shemustimmediately
informheremployerofsuchpregnancybyaccomplishingtheMaternityNotificationForm.Theemployermust,inturn,
notifytheSSSthruthesubmissionofsaidform.
7.Paymentofmaternitybenefit;howmade.
Thebenefitisadvancedbytheemployertothequalifiedemployeeinfullorintwo(2)equalinstallments.The
firstinstallmentwillbepaiduponreceiptofthematernityleaveapplication.Thesecondwillbepaidnotlaterthanthirty
(30) days after payment of the first installment. Upon receipt of satisfactory proof of such payment, the SSS will pay
backtheemployertheamountofmaternitybenefititlegallyadvancedtotheemployee.
114
No. XI, DOLEHandbookonWorkersStatutoryMonetaryBenefits.
115
116
117
Thetableof suchmonthlysalarycredit isomitted.

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3.PATERNITYLEAVE.
(R.A.NO.8187,THEPATERNITYLEAVEACTOF1996[JUNE11,1996].
a.Coverage.
Paternityleavecoversamarriedmaleemployeeallowinghimnottoreportforworkforseven(7)calendar
daysbutcontinuestoearnthecompensationtherefor,ontheconditionthathisspousehasdeliveredachildorsuffered
miscarriageforpurposesofenablinghimtoeffectivelylendsupporttohiswifeinherperiodofrecoveryand/orinthe
nursingofthenewlybornchild.
118
Deliveryincludeschildbirthoranymiscarriage.
119
Spousereferstothelawfulwife.Forthispurpose,lawfulwifereferstoawomanwhoislegallymarriedto
themaleemployeeconcerned.
120

Cohabitingreferstotheobligationofthehusbandandwifetolivetogether.
121
Everymarriedemployeeintheprivateandpublicsectorsisentitledtoapaternityleaveofseven(7)calendar
dayswithfullpayforthefirstfour(4)deliveriesofthelegitimatespousewithwhomheiscohabiting.Themaleemployee
applyingforpaternityleaveshouldnotifyhisemployerofthepregnancyofhislegitimatespouseandtheexpecteddate
ofsuchdelivery.
122
Paternityleavebenefitsaregrantedtothequalifiedemployeeafterthedeliverybyhiswife,withoutprejudice
to an employer allowing an employee to avail of the benefit before or during the delivery, provided that the total
number of days should not exceed seven (7) calendar days for each delivery. In the event that the paternity leave
benefitisnotavailedof,saidleaveshallnotbeconvertibletocash.
123
c.Availment.
Theemployeeisentitledtohisfullpay,consistingofbasicsalary,fortheseven(7)calendardaysduringwhich
heisallowednottoreportforworkprovidedthathispayshallnotbelessthanthemandatedminimumwage.
124
4.PARENTALLEAVE.
(R.A.NO.8972,THESOLOPARENTSWELFAREACTOF2000(NOVEMBER7,2000).
a.Coverage.
Parental leave is the leave benefits granted to a male or female solo parent to enable him/her to
performparentaldutiesandresponsibilitieswherephysicalpresenceisrequired.
The parental leave shall not be more than seven (7) working days every year to a solo parent who has
renderedserviceofatleastone(1)year,toenablehim/hertoperformparentaldutiesandresponsibilitieswherehis/her
physicalpresenceisrequired.Thesevendayparentalleaveshallbenoncumulative.
125
It bears noting that this leave privilege is an additional leave benefit which is separate and distinct from any
otherleavebenefitsprovidedunderexistinglawsoragreements.
126
Theterm"soloparent"referstoanyindividualwhofallsunderanyofthefollowingcategories:
(1) A woman who gives birth as a result of rape and other crimes against chastity even without a final
convictionoftheoffender:Provided,Thatthemotherkeepsandraisesthechild;
(2) Parentleftsolooralonewiththeresponsibilityofparenthoodduetodeathofspouse;
(3) Parent left solo or alone with the responsibility of parenthood while the spouse is detained or is
servingsentenceforacriminalconvictionforatleastone(1)year;
(4) Parent left solo or alone with the responsibility of parenthood due to physical and/or mental
incapacityofspouseascertifiedbyapublicmedicalpractitioner;
(5) Parent left solo or alone with the responsibility of parenthood due to legal separation or de facto
separation from spouse for at least one (1) year, as long as he/she is entrusted with the custody of
thechildren;
(6) Parent left solo or alone with the responsibility of parenthood due to declaration of nullity or
annulmentofmarriageasdecreedbyacourtorbyachurchaslongashe/sheisentrustedwiththe
custodyofthechildren;
(7) Parentleftsolooralonewiththeresponsibilityofparenthoodduetoabandonmentofspouseforat
leastone(1)year;
(8) Unmarriedmother/fatherwhohaspreferredtokeepandrearher/hischild/childreninsteadofhaving
otherscareforthemorgivethemuptoawelfareinstitution;
(9) Anyotherpersonwhosolelyprovidesparentalcareandsupporttoachildorchildren;
(10)Any family member who assumes the responsibility of head of family as a result of the death,
abandonment,disappearanceorprolongedabsenceoftheparentsorsoloparent.
118
Section3, R.A. No. 8187; Section1[a], RevisedImplementingRulesandRegulationsof R.A. No. 8187[March13, 1997].
119
Section2, Ibid.; Section1[c], Ibid..
120
Section1[d], Ibid..
121
Section1[e], Ibid..
122
Section2, R.A. No. 8187.
123
Sections5and8, RevisedImplementingRulesandRegulationsof R.A. No. 8187[March13, 1997].
124
Section6, RevisedImplementingRulesandRegulationsof R.A. No. 8187[March13, 1997].
125
Section18, ArticleV, ImplementingRulesof R.A. No. 8972.
126
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AchangeinthestatusorcircumstanceoftheparentclaimingbenefitsunderthisAct,suchthathe/sheis
nolongerleftalonewiththeresponsibilityofparenthood,shallterminatehis/hereligibilityforthesebenefits.
127
"Children"refertothoselivingwithanddependentuponthesoloparentforsupportwhoareunmarried,
unemployedandnotmorethaneighteen(18)yearsofage,orevenovereighteen(18)yearsbutareincapableof
selfsupportbecauseofmentaland/orphysicaldefect/disability.
128
"Parental responsibility" with respect to their minor children shall refer to the rights and duties of the
parentsasdefinedinArticle220ofExecutiveOrderNo.209,asamended,otherwiseknownasthe"FamilyCodeof
thePhilippines"andhereunderenumeratedasfollows:
(1) To keep them in their company, to support, educate and instruct them by right precept and good
exampleandtoprovidefortheirupbringinginkeepingwiththeirmeans;
(2) Togivethemloveandaffection,adviceandcounsel,companionshipandunderstanding;
(3) To provide them with moral and spiritual guidance, inculcate in them honesty, integrity, self
discipline,selfreliance,industryandthrift,stimulatetheirinterestincivicaffairs,andinspireinthem
compliancewiththedutiesofcitizenship;
(4) To furnish them with good and wholesome educational materials, supervise their activities,
recreation and association with others, protect them from bad company, and prevent them from
acquiringhabitsdetrimentaltotheirhealth,studiesandmorals;
(5) Torepresenttheminallmattersaffectingtheirinterest;
(6) Todemandfromthemrespectandobedience;
(7) ToImposedisciplineonthemasmayberequiredunderthecircumstances;and
(8) Toperformsuchotherdutiesasareimposedbylawanduponparentsandguardians.
129
Asoloparentshallbeentitledtoparentalleaveprovidedthat:
(a) He/Shehasrenderedatleastone(1)yearofservicewhethercontinuousorbrokenatthetimeofthe
affectivityoftheAct;
(b) He/Shehasnotifiedhis/heremployeroftheavailmentthereofwithinareasonabletimeperiod;and
(c) He/ShehaspresentedaSoloParentIdentificationCardtohis/heremployer.
130
c.Availment.
1. Nonconversion of parental leave. In the event that the parental leave is not availed of, said leave
shallnotbeconvertibletocashunlessspecificallyagreeduponpreviously.However,ifsaidleavewere
deniedanemployeeasaresultofnoncompliancewiththeprovisionsoftheseRulesbyanemployer,
theaforementionedleavemaybeusedabasisforthecomputationofdamages.
131
2. Crediting of existing leave. If there is an existing or similar benefit under a company policy, or a
collective bargaining agreement or collective negotiation agreement the same shall be credited as
such. If the same is greater than the seven (7) days provided for in the Act, the greater benefit shall
prevail. Emergency or contingency leave provided under a company policy or a collective bargaining
agreementshallnotbecreditedascompliancewiththeparentalleaveprovidedforundertheActand
theseRules.
132
3. Benefits.Anysoloparentwhoseincomeintheplaceofdomicilefallsbelowthepovertythresholdas
setbytheNationalEconomicandDevelopmentAuthority(NEDA)andsubjecttotheassessmentofthe
DSWD worker in the area shall be eligible for assistance: Provided, however, That any solo parent
whoseincomeisabovethepovertythresholdshallenjoythebenefitsmentionedinSections6,7and8
ofR.A.No.8972,towit:
Section 6. Flexible Work Schedule. The employer shall provide for a flexible working
schedule for solo parents: Provided, That the same shall not affect individual and company
productivity: Provided, further, That any employer may request exemption from the above
requirementsfromtheDOLEoncertainmeritoriousgrounds.
Section 7. Work Discrimination. No employer shall discriminate against any solo parent
employeewithrespecttotermsandconditionsofemploymentonaccountofhis/herstatus.
Section8.ParentalLeave.Inadditiontoleaveprivilegesunderexistinglaws,parentalleave
of not more than seven (7) working days every year shall be granted to any solo parent
employeewhohasrenderedserviceofatleastone(1)year.
4. OtherbenefitsundertheR.A.No.8972.Otherbenefitsconsistofthefollowing:
Section 9. Educational Benefits. The DECS, CHED and TESDA shall provide the following
benefitsandprivileges:
127
Section3[a], R.A. No. 8972; Section6[b], ArticleIII, ImplementingRulesof R.A. No. 8972.
128
Section3[b], R.A. No. 8972; Section6[e], ArticleIII, ImplementingRulesof R.A. No. 8972.
129
Section3[c], R.A. No. 8972; Section6[f], ArticleIII, ImplementingRulesof R.A. No. 8972.
130
Section19, Articlev, ImplementingRulesof R.A. No. 8972.
131
132
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(1) Scholarshipprogramsforqualifiedsoloparentsandtheirchildrenininstitutionsofbasic,
tertiaryandtechnical/skillseducation;and
(2) Nonformaleducationprogramsappropriateforsoloparentsandtheirchildren.
The DECS, CHED and TESDA shall promulgate rules and regulations for the proper
implementationofthisprogram.
Section10.HousingBenefits.Soloparentsshallbegivenallocationinhousingprojectsand
shallbeprovidedwithliberaltermsofpaymentonsaidgovernmentlowcosthousingprojects
in accordance with housing law provisions prioritizing applicants below the poverty line as
declaredbytheNEDA.
Section 11. Medical Assistance. The DOH shall develop a comprehensive health care
program for solo parents and theirchildren. The program shall be implemented by the DOH
through their retained hospitals and medical centers and the local government units (LGUs)
throughtheirprovincial/district/city/municipalhospitalsandruralhealthunits(RHUs).
5.LEAVESFORVICTIMSOFVIOLENCEAGAINSTWOMEN.
(R.A.NO.9262,ANTIVIOLENCEAGAINSTWOMENANDTHEIRCHILDRENACTOF2994[MARCH8,2004).
a.Coverage.
R.A.No.9262,grantstovictimsatotaloften(10)daysofpaidleaveofabsence,inadditiontootherpaid
leavesundertheLaborCodeandCivilServiceRulesandRegulations.Itisextendiblewhenthenecessityarisesas
specifiedintheprotectionorder.Thisisaffordedtothewomanemployeetoenablehertoattendtothemedical
andlegalconcernsrelativetosaidlaw.Thisleaveisnotconvertibletocash.
133
Anyemployerwhoshallprejudicetherightofthepersonunderthislawshallbepenalizedinaccordance
with the provisions of the Labor Code and Civil Service Rules and Regulations. Likewise, an employer who shall
prejudice any person for assisting a coemployee who is a victim under this Act shall likewise be liable for
discrimination.
134
b.Conditionsofentitlement.
At any timeduring the application of anyprotection order, investigation, prosecution and/or trial of the
criminalcase,avictimofViolenceAgainstWomenandtheirChildren(VAWC)whoisemployedshallbeentitledto
apaidleaveofuptoten(10)daysinadditiontootherpaidleavesundertheLaborCodeandCivilServiceRulesand
Regulationsandotherexistinglawsandcompanypolicies,extendiblewhenthenecessityarisesasspecifiedinthe
protection order. The Punong Barangay/kagawad or prosecutor or the Clerk of Court, as the case may be, shall
issueacertificationatnocosttothewomanthatsuchanactionispending,andthisisallthatisrequiredforthe
employertocomplywiththe10daypaidleave.
For government employees, in addition to the aforementioned certification, the employee concerned
must file an application for leave citing as basis R.A. 9262. The administrative enforcement of this leave
entitlement shall be considered within the jurisdiction of the Regional Director of the DOLE under Article 129 of
the Labor Code of the Philippines, as amended, for employees in the private sector, and the Civil Service
Commission,forgovernmentemployees.
135
c.Availment.
Theavailmentoftheten(10)dayleaveshallbeattheoptionofthewomanemployee,whichshallcover
the days thatshe has toattend to medical and legal concerns. Leavesnot availed ofare noncumulative andnot
convertibletocash.
The employer/agency head who denies the application for leave, and who shall prejudice the victim
survivor or any person for assisting a coemployee who is a victimsurvivor under the Act shall be held liable for
discrimination and violation of R.A. No. 9262. The provision of the Labor Code and the Civil Service Rules and
Regulationsshallgovernthepenaltytobeimposedonthesaidemployer/agencyhead.
136
6.SERVICECHARGES(ARTICLE96,LABORCODE).
a.Coverage.
1. Establishments covered. The rules on service charges apply only to establishments collecting service
charges, such as hotels, restaurants, lodging houses, night clubs, cocktail lounges, massage clinics, bars,
casinosandgamblinghouses,andsimilarenterprises,includingthoseentitiesoperatingprimarilyasprivate
subsidiariesofthegovernment.
137
2. Employees covered. The same rules on service charges apply to all employees of covered employers,
regardlessoftheirpositions,designationsoremploymentstatus,andirrespectiveofthemethodbywhich
theirwagesarepaid.exceptthosereceivingmorethanP2,000.00amonth.
138
133
134
Id.
135
Section42, ImplementingRules andRegulationsof R.A. No. 9262.
136
Id.
137
Article96, LaborCode; Section1, RuleVI [ServiceCharges], BookIII of theRulestoImplement theLaborCode.
138
Section2, RuleVI, BookIII, RulestoImplement theLaborCode.
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b.Exclusion.
Specifically excluded from coverage are employees who are receiving wages of more than P2,000.00 a
month.
139
However, it must be pointed out that the P2,000.00 ceiling is no longer realistic considering the applicable
minimumwagesprevailinginthecountry.Hence,itmustbedisregarded.Instead,therulenowisthatthe85%should
bedistributedtothecoveredemployeesexceptmanagerialemployees;whiletheremaining15%shouldberetainedby
management to answer for losses and breakages and for distribution to managerial employees, at the discretion of
managementinthelattercase.
140
c.Distribution.
1.Percentageofsharing.Allservicechargescollectedbycoveredemployersarerequiredtobedistributedat
thefollowingrates:
a.85%tobedistributedequallyamongthecoveredemployees;and
b.15%tomanagementtoanswerforlossesandbreakagesanddistributiontoemployeesreceivingmore
thanP2,000.00amonth,atthediscretionofthemanagement.
141
.
2.Frequencyofdistribution.Theshareoftheemployeesreferredtoaboveshouldbedistributedandpaidto
thethemnotlessoftenthanonceeverytwo(2)weeksortwiceamonthatintervalsnotexceedingsixteen
(16)days.
142
d.Integration.
In case the service charge is abolished, the share of covered employees should be considered integrated in
theirwages,inaccordancewithArticle96oftheLaborCode.Thebasisoftheamounttobeintegratedistheaverage
monthlyshareofeachemployeeforthepasttwelve(12)monthsimmediatelyprecedingtheabolitionorwithdrawalof
suchcharges.
143

e.Someprinciplesonservicecharges.
1. Tips and services chargesaretwodifferentthings. Tips aregivenbycustomers voluntarily to waiters and
otherpeoplewhoservethemoutofrecognitionofsatisfactoryorexcellentservice.Thereisnocompulsion
togivetipsunderthelaw.Thesamemaynotbesaidofservicechargeswhichareconsideredintegralpart
ofthecostofthefood,goodsorservicesorderedbythecustomers.Asageneralrule,tipsdonotformpart
of the service charges which should be distributed in accordance with the sharing ratio prescribed under
Article96oftheLaborCode.However,wherearestaurantorsimilarestablishmentdoesnotcollectservice
chargesbuthasapracticeorpolicyofmonitoringandpoolingtipsgivenvoluntarilybyitscustomerstoits
employees,thepooledtipsshouldbemonitored,accountedforanddistributedinthesamemannerasthe
servicecharges.
144
Hence,the85%:15%sharingratioshouldbeobserved.
2. Servicechargesarenotinthenatureofprofitshareand,therefore,cannotbedeductedfromwage.
145
7.THIRTEENTH(13
TH
)MONTHPAYANDOTHERBONUSES.
(P.D.NO.851[DECEMBER16,1975;MEMORANDUMORDERNO.28[AUGUST13,1986];REVISEDGUIDELINES
ONTHEIMPLEMENTATIONOFTHE13
TH
MONTHPAYLAW[NOVEMBER16,1987].
a.Coverage.
Allemployersarerequiredtopayalltheirrankandfileemployees,a13thmonthpaynotlaterthanDecember
24ofeveryyear.
b.Exclusions/Exemptionsfromcoverage.
ThefollowingemployersarenotcoveredbyP.D.No.851,asamended:
1. The government and any of its political subdivisions, including governmentowned and controlled
corporations,exceptthosecorporationsoperatingessentiallyasprivatesubsidiariesofthegovernment.
146
2. Employersalreadypayingtheiremployees13thmonthpayormoreinacalendaryearoritsequivalentat
thetimeoftheissuanceoftheRevisedGuidelines.
147
3. Employers of household helpers and persons in the personal service of another in relation to such
workers.
148
4. Employersofthosewhoarepaidonpurelycommission,boundary,ortaskbasis,andthosewhoarepaida
fixed amount for performing a specific work, irrespective of the time consumed in the performance
thereof, except where the workers are paid on piecerate basis, in which case, the employer shall be
coveredbytheRevisedGuidelinesinsofarassuchworkersareconcerned.Workerspaidonpieceratebasis
shallrefertothosewhoarepaidastandardamountforeverypieceorunitofworkproducedthatismore
orlessregularlyreplicatedwithoutregardtothetimespentinproducingthesame.
149
139
Id.
140
No. VII [A], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
141
Section3, RuleVI, BookIII, Ibid.; No. VII [A], Ibid..
142
Section4, RuleVI, BookIII, Ibid.; No. VII [B], Ibid..
143
Section5, RuleVI, BookIII, Ibid.; No. VII [B], Ibid..
144
No. VII [C], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
145
MayonHotel &Restaurant v. Adana, [G.R. No. 157634, May16, 2005].
146
No. 2[a], RevisedGuidelinesontheImplementationof the13th-MonthPayLaw, formerlySection3[b], RulesandRegulationsImplementingP.D. No. 851; Allianceof Government Workersv. Minister of LaborandEmployment, G.R. No. L-60403, Aug. 3, 1983.
147
Section2, P.D. No. 851; No. 2[b], RevisedGuidelinesontheImplementationof the13
th
-MonthPayLaw, formerlySection3[c], RulesandRegulationsImplementingP.D. No. 851.
148
No. 2[c], RevisedGuidelinesontheImplementationof the13
th
-MonthPayLaw, formerlySection3[d], RulesandRegulationsImplementingP.D. No. 851.
149
No. 2[d], Ibid., formerlySection3[e], RulesandRegulationsImplementingP.D. No. 851.
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c.Natureof13
th
monthpay.
13
th
monthpayisinthenatureofadditionalincomegrantedtoemployeeswhoarenotreceivingthesame.
150
P.D.No.851isundoubtedlyalaborstandardslawwhosepurposeistoincreasetherealwagesoftheworkers.
151
Itis
basedonwagebutnotpartofthewage.
152
The minimum 13thmonth pay required by law should not be less than onetwelfth (1/12) of the total basic
salaryearnedbyanemployeewithinacalendaryear.
153
d.Commissionsvisavis13
th
monthpay.
In order to be considered part of 13
th
month pay, the commission should be part of the basic salary of the
employee.
However, whether or not a commission forms part of the basic salary depends upon the circumstances or
conditionsforitspaymentwhichindubitablyarefactualinnaturefortheywillrequireareexaminationandcalibration
oftheevidenceonrecord.
154
Ifthecommissionpaidinadditiontothebasicsalaryisinthenatureofaproductivitybonusorprofitsharing
benefitwhichisdependentonandgenerallytiedtotheproductivityorcapacityforrevenueproductionofacompany,it
shouldnotbeconsideredaspartofbasicsalary.
155
Butifthecommissionpaidinadditiontothebasicsalaryhasacleardirectornecessaryrelationtotheamount
ofworkactuallydonebytheemployee,itshouldbeconsideredaspartofbasicsalary.
156
Iftheemployeeispaidoncommissionbasisonly,heisexcludedfromreceivingthe13thmonthpaybenefit.
157
e.CBAvisavis13
th
monthpay.
Forpurposesofcomputingthe13
th
monthpay,basicsalaryincludesallremunerationsorearningspaidby
theemployerforservicesrenderedbutdoesnotincludeallowancesandmonetarybenefitswhicharenotconsideredor
integratedaspartoftheregularorbasicsalary,suchasthecashequivalentofunusedvacationandsickleavecredits,
maternityleave,overtime,premium,nightdifferentialandholidaypay,premiumsforworkdoneonrestdaysandspecial
holidays and costofliving allowances. However, these salaryrelated benefits should be included as part of the basic
salaryinthecomputationofthe13thmonthpayifbyindividualorcollectivebargainingagreement,companypractice
orpolicy,thesamearetreatedaspartofthebasicsalaryoftheemployees.
158
e.Someprincipleson13
th
monthpay.
1. Basicsalaryorbasicwagecontemplatesworkwithinthenormaleight(8)workinghoursinaday.This
meansthatthebasicsalaryofanemployeeforpurposesofcomputingthe13thmonthpayshouldinclude
allremunerationsorearningspaidbytheemployerforservicesrenderedduringnormalworkinghours.
159
2. For purposes of computing the 13thmonth pay, basic salary should be interpreted to mean not the
amount actually received by an employee, but 1/12 of their standard monthly wage multiplied by their
lengthofservicewithinagivencalendaryear.
160
3. To be entitled to the 13thmonth pay benefit, it is imposed as a minimum service requirement that the
employeeshouldhaveworkedforatleastone(1)monthduringacalendaryear.
161
4. Onlyrankandfile employees, regardless oftheirdesignation or employmentstatus andirrespective of

themethodbywhichtheirwagesarepaid,areentitledtothe13thmonthpaybenefit.
162
5. Managerialemployees,notentitledto13
th
monthpay.
163
6. Extras,casualsandseasonalemployees,entitledto13thmonthpay.
164

==================================================
C. LABOR STANDARDS
8. Women Workers
a. Discrimination (Art. 135, LC)
b. Stipulation against marriage (Art. 136, LC)
c. Prohibited Acts (Art. 137, LC)
d. Classification of certain women workers (Art. 138, LC)
e. Anti-Sexual Harassment Act (RA 7877)
===================================================
1.DISCRIMINATION(ARTICLE135,LABORCODE).
a.Actsofdiscrimination.
Article 135 considers as unlawful the act of an employer to discriminate against any woman employee with
respecttotermsandconditionsofemploymentsolelyonaccountofhersex.
150
Agabonv. NLRC, [G.R. No. 158693, November 17, 2004].
151
Allianceof Government Workersv. Ministerof Labor, G.R. No. L-60403, Aug. 3, 1983; National Federationof SugarWorkersv. Ovejera, G.R. No. 59743, May31, 1982; MarcopperMiningCorporationv. Ople, G.R. No. 51254, June11, 1981, 105SCRA75.
152
Central AzucareradeTarlacv. Central AzucareradeTarlacLaborUnion-NLU, G.R. No. 188949, July26, 2010.
153
Section2[a], RulesandRegulationsImplementingP.D. No. 851.
154
Reyesv. NLRC, [G.R. No. 160233, August 8, 2007].
155
PhilippineDuplicators, Inc. v. NLRC, [G.R. No. 110068, February15, 1995]; Boie-TakedaChemicals, Inc. v. DelaSerna, [G.R. No. 92174] andPhilippineFuji XeroxCorporationv. Trajano, [G.R. No. 102552, March24, 1994].
156
Id.
157
Kingof KingsTransport, Inc. v. Mamac, [G.R. No. 166208, June29, 2007].
158
No. 4[a], RevisedGuidelinesontheImplementationof the13
th
-MonthPayLaw, formerlySection2[b] of theRulesandRegulationsImplementingP.D. No. 851; No. X[C], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
159
SeeNo. 1, DOLEExplanatoryBulletinontheInclusionof Teachers OverloadPayinthe13
th
-MonthPayDetermination[December 03, 1993].
160
HondaPhils., Inc. v. SamahanngMalayangManggagawasaHonda, [G.R. No. 145561, June15, 2005]; SanMiguel Corporation(CagayanCoca-ColaPlant) v. Inciong, [G.R. No. L-49774, February24, 1981, 103SCRA139].
161
No. 1, RevisedGuidelinesontheImplementationof the13th-MonthPayLaw; No. X[A], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
162
Ibid.; Section1, MemorandumOrderNo. 28.
163
Houseof SaraLeev. Rey, [G.R. No. 149013, August 31, 2006].
164
BWCOpiniondatedDec. 19, 1987, BagongPilipinoWorldsFashionWorkersUnion, WorldsFashion, Inc..
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Morespecifically,itenumeratesthefollowingactsofdiscrimination:
(a) Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe
benefits,toafemaleemployeeasagainstamaleemployee,forworkofequalvalue;and
(b) Favoring a male employee over a female employee with respect to promotion, training opportunities,
studyandscholarshipgrantssolelyonaccountoftheirsexes.
b.CriminalliabilityunderArticle135.
ThewillfulcommissionofanyofthespecificunlawfulactsdescribedinArticle135hasacriminalconsequence.
Consequently,theoffenderwillbepenalizedunderArticles288and289oftheLaborCode.
c.Moneyclaims,aseparateanddistinctaction.
The institution of any criminal action under Article 135 will not bar the aggrieved employee from filing an
entirely separate and distinct action for money claims, which may include claims for damages and other affirmative
reliefs.
c.Criminalactionmayproceedindependentlyfromthemoneyclaimscase.
The criminal and money claims actions authorized to be prosecuted under Article 135 shall proceed
independentlyofeachother.
165
2.STIPULATIONAGAINSTMARRIAGE(ARTICLE136,LABORCODE).
a.Invalidityofstipulationagainstmarriage.
Article 136 considers as an unlawful act of the employer to require as a condition for or continuation of
employmentthatawomanemployeeshallnotgetmarriedortostipulateexpresslyortacitlythatupongettingmarried,
awomanemployeeshallbedeemedresignedorseparated,
Itislikewiseanunlawfulactoftheemployer,toactuallydismiss,discharge,discriminateorotherwiseprejudice
awomanemployeemerelybyreasonofhermarriage.
166
b.Relevantjurisprudence.
Thefollowingcasesarerelevant:
1.Zialcitav.PhilippineAirlines,Inc.,[CaseNo.RO4339876,February20,1977].Inthiscasedecidedbythe
OfficeofthePresident,theprovisioninacontractbetweenanairlinecompanyandaflightattendantwhich
statesthatflightattendantapplicantsmustbesingleandthattheyshallbeautomaticallyseparatedfrom
employmentintheeventtheysubsequentlygetmarriedwasdeclaredasanullandvoidprovision;hence,
cannotbeenforcedforbeingcontrarytoArticle136oftheLaborCodeandtheprotectiontolaborclausein
theConstitution.
2. PhilippineTelegraphandTelephoneCompanyv.NLRC,[G.R.No.118978,May23,1997,272SCRA596,
605].Itwasdeclaredherethatthecompanypolicyofnotacceptingorconsideringasdisqualifiedfromwork
anywomanworkerwhocontractsmarriagerunsafoulofthetestof,andtherightagainst,discrimination
affordedallwomenworkersbyourlaborlawsandbynolessthantheConstitution.
167
3. Star Paper Corp. v. Simbol, Comia and Estrella, [G.R. No. 164774,April 12, 2006]. The following policies
were struck down as invalid for violating the standard of reasonableness which is being followed in our
jurisdiction,otherwisecalledtheReasonableBusinessNecessityRule:
1.Newapplicantswillnotbeallowedtobehiredifincasehe/shehas[a]relative,upto[the]
3
rd
degreeofrelationship,alreadyemployedbythecompany.
2.In case of two of our employees (both singles [sic], one male and another female)
developedafriendlyrelationshipduringthecourseoftheiremploymentandthendecidedto
getmarried,oneofthemshouldresigntopreservethepolicystatedabove.
4. Duncan Association of Detailman-PTGWO v. Glaxo Welcome Philippines, Inc., [G.R. No. 162994,
September 17, 2004]. In this case, the prohibition against marriage embodied in the following stipulation in
the employment contract was held as valid:
10.Youagreetodisclosetomanagementanyexistingorfuturerelationshipyoumayhave,
either by consanguinity or affinity with coemployees or employees of competing drug
companies.Shoulditposeapossibleconflictofinterestinmanagementdiscretion,youagree
toresignvoluntarilyfromtheCompanyasamatterofCompanypolicy.
The Supreme Court ruled that dismissal based on this stipulation in the employment contract is a valid
exercise of management prerogative. The prohibition against personal or marital relationships with
employees of competitor companies upon its employees was held reasonable under the circumstances
because relationships ofthatnaturemightcompromisethe interests ofthecompany. Inlaying downthe
assailed company policy, the employer only aims to protect its interests against the possibility that a
competitorcompanywillgainaccesstoitssecretsandprocedures.
165
Article135, LaborCode.
166
SeealsoSection13[e], RuleXII, BookIII, RulestoImplement theLaborCode; Gualbertov. MarinduqueMiningIndustrial Corporation, C.A.-G.R. No. 52753-R, June28, 1978.
167
SeealsoGualbertov. MarinduqueMining&Industrial Corporation, supra; Zialcita, v. PhilippineAirlines, supra; 45AAm. Jur. 2d, JobDiscrimination, Sec. 506, p. 486.
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3.PROHIBITEDACTS.(ARTICLE137,LABORCODE).
a.ProhibitedactsunderArticle137anditsimplementingrules.
ThecorrespondingprovisionsintheRulestoImplementtheLaborCodeprovideforabroaderenumerationof
prohibitedactsthanthosefoundinArticle137.Itisprovidedthereunderthatitshallbeunlawfulforanyemployer:
1.To discharge any woman employed by him for the purpose of preventing such woman from enjoying
maternityleave,facilitiesandotherbenefitsprovidedundertheLaborCode;
2. To discharge such woman on account of her pregnancy, or while on leave or in confinement due to her
pregnancy;
3.Todischargeorrefusetheadmissionofsuchwomanuponreturningtoherworkforfearthatshemayagain
bepregnant;
4. To discharge any woman or any other employee for having filed a complaint or having testified or being
abouttotestifyundertheLaborCode;or
5.Torequireasaconditionfororcontinuationofemploymentthatawomanemployeeshallnotgetmarried
ortostipulateexpresslyortacitlythatupongettingmarried,awomanemployeeshallbedeemedresigned
or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee
merelybyreasonofmarriage.
168
b.Denialofbenefitsordismissalofawomanemployeetodepriveherofbenefits.
Paragraph[a](1)ofArticle137speaksoftwoseparateprohibitedacts,namely:
1. To deny any woman employee the benefits provided in Chapter I (Employment of Women), Title III
(WorkingConditionsforSpecialGroupsofEmployees)ofBookIIIoftheLaborCode,namely:
a. FacilitiesforwomenunderArticle132;
b. MaternityleavebenefitsunderArticle133;and
c. FamilyplanningservicesandincentivesforfamilyplanningunderArticle134.
2. To discharge any woman employee for the purpose of preventing her from enjoying any of the benefits
providedundertheLaborCode.
169
UnderNo.1above,meredenialoftheaforedescribedbenefitswouldalreadyconstituteaviolationofArticle
137.
Under No. 2 above, it is requiredthat theremust not only be denialbut actual discharge or dismissal of the
woman employee meant to prevent her from enjoying any of the benefits under the Labor Code and not only of the
benefitsunderChapterI,TitleIIIofBookIIIoftheLaborCode.
c.Dischargingawomanduetopregnancy.
Paragraph [a] (2) and (3) of Article 137 contemplates the following prohibited acts in connection with the
pregnancyofawomanemployee:
1. Todischargeheronaccountofherpregnancy;or
2. Todischargeherwhilesheisonleaveduetoherpregnancy;or
3. Todischargeherwhilesheisinconfinementduetoherpregnancy;or
4. Todischargeheruponreturningtoherworkforfearthatshemayagainbepregnant;or
5. Torefuseheradmissionuponreturningtoherworkforfearthatshemayagainbepregnant.
170

DelMontePhilippines,Inc.v.Velasco,[G.R.No.153477,March6,2007].
The series of absences of the respondent due to pregnancy and its related ailments, such as urinary tract
infection, was found not to be a valid ground to dismiss her from employment. The Supreme Court agreed with the
CourtofAppealsinconcludingthatrespondentssicknesswaspregnancyrelatedand,therefore,thepetitionercannot
terminaterespondentsservicesbecauseindoingso,petitionerwill,ineffect,beviolatingtheLaborCodewhich,under
Article137 thereof,prohibitsanemployerto discharge anemployeeon account of thelatters pregnancy. The Court
wasconvincedthatthepetitionerterminatedtheservicesofrespondentonaccountofherpregnancywhichjustifiedher
absencesand,thus,committedaprohibitedactrenderingthedismissalillegal.
LakpueDrug,Inc.v.Belga,[G.R.No.166379,October20,2005].
Respondent was dismissed for allegedly deliberately concealing her pregnancy and for incurring absences
without official leave for 16 days at which time she delivered her baby. Petitioner argues that such nondisclosure is
tantamount to dishonesty. In finding the penalty of dismissal too harsh and illegal, the Supreme Court ruled that the
alleged misconduct of Belga barely falls within the situation contemplated by the law. Her absence for 16 days was
justifiedconsideringthatshehadjustdeliveredachild,whichcanhardlybeconsideredaforbiddenact,aderelictionof
duty;muchlessdoesitimplywrongfulintentonthepartofBelga.PetitionerharpsontheallegedconcealmentbyBelga
of her pregnancy.This argument, however, begs the question as to how one can conceal a fullterm pregnancy.The
Courtagreedwithrespondentspositionthatitcanhardlyescapenoticehowshegrowsbiggereachday.Whilethere
may be instances where the pregnancy may be inconspicuous, it has not been sufficiently proven by petitioner that
Belgascaseissuch.
168
Section13, RuleXII, BookIII thereof.
169
SeealsoSection13, RuleXII, BookIII, RulestoImplement theLaborCode.
170
SeealsoSection13, RuleXII, BookIII, RulestoImplement theLaborCode.
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d.Dischargingawomanemployeeforhavingfiledacaseorfortestifyingorbeingabouttotestifyinacase.
CitedasadditionalprohibitedactinSection13,RuleXII,BookIIIoftheRulestoImplementtheLaborCodeisthe
actofdischarginganywomanoranyotheremployeeforhavingfiledacomplaintorhavingtestifiedorbeingaboutto
testifyundertheLaborCode.
Of relevance to this prohibited act are the parallel provisions in Articles 118 and 248 [f] of the Labor Code.
Under Article 118, it is considered unlawful for an employer to discharge or in any manner discriminate against any
employeewhohasfiledanycomplaintorinstitutedanyproceedingunderTitleII(Wages)ofBookIIIorhastestifiedoris
about to testify in such proceedings. Under Article 248 [f], it is considered an unfair labor practice (ULP) to dismiss,
dischargeorotherwiseprejudiceordiscriminateagainstanemployeeforhavinggivenorbeingabouttogivetestimony
under the Labor Code. This is the only ULP act of the employer which need not be related to the exercise by the
employeeofhisrighttoselforganizationandcollectivebargaining.
171
e.PenaltyforcommissionoftheprohibitedactsunderArticle137.
Havingbeendeclaredunlawful,thecommissionofanyoftheprohibitedactsunderArticle137wouldsubject
theoffendertothepenaltiesprovidedunderArticle288oftheLaborCode.
4.CLASSIFICATIONOFCERTAINWOMANWORKERS(ARTICLE138,LABORCODE).
a.Womenworkinginnightclubsandsimilarestablishments.
Article138enunciatestheruleapplicabletowomenemployeeswhoworkregularlyduringnighttimeinplaces
of entertainment. The situation herein contemplated, because of its peculiar feature, constitutes an exception to the
prohibitionagainstnighttimeworkprescribedinArticle130,althoughthesamewasneverincludedintheenumeration
oftheexceptedinstancesunderArticle131.
b.Regularityofemployment.
Anywomanwhoispermittedorsufferedtowork,withorwithoutcompensation,inanynightclub,cocktail
lounge, massage clinic, bar or similar establishments may be considered an employee of such establishment for
purposesoflaborandsociallegislationifthefollowingrequisitesconcur:
1. Sheworksundertheeffectivecontrolorsupervisionoftheemployer;and
2. She has worked therein for a substantial period of time as determined by the Secretary of Labor and
Employment.
172
InaccordancewithArticle138,inrelationtoArticle280,oftheLaborCode,suchwomenworkinginnightclubs
and similar establishments are considered regular employees thereof considering that they are made to perform
activitiesthatareusuallynecessaryordesirableintheusualbusinessortradeoftheiremployer.
It bears noting that under Article 135 of the Labor Code, it is considered unlawful for any employer to
discriminateagainstanywomanemployeewithrespecttotermsandconditionsofemploymentsolelyonaccountofher
sex.
c.Hospitalitygirlsarenotregularemployees..
InanopinionoftheDepartmentofJusticedatedOctober27,1954,itwasopinedthathospitalitygirlsarenot
consideredemployeeswhenthenightcluboperatordoesnotcontrolnordirectthedetailsandmanneroftheirworkin
theentertainmentofnightclubpatronsand,havingnofixedhoursofwork,theymaycomeandgoastheyplease.
5.ANTISEXUALHARASSMENTACT(R.A.NO.7877,FEBRUARY14,1995).
a.Three(3)situationsonly.
R.A.No.7877declaressexualharassmentunlawfulonlyinthree(3)situations,namely:
(1)employment,
(2)education,or
(3)trainingenvironment.
Itmustbeunderscoredattheoutsetthatsexualharassmentisnotthesoledomainofwomenasmenmayalso
besubjectedtothesamedespicableact.Saidlawdoesnotlimitthevictimofsexualharassmenttowomen.

b.Specificactspenalized.
Thelawpunishessexualharassmentifthesameis:
1. workrelated;or
2. educationrelated;or
3. trainingrelated.
173

d.Personswhomaybeliableforsexualharassment.
Work, education or trainingrelated sexual harassment is committed by any employer, employee, manager,
supervisor, agent of the employer, teacher, instructor, professor, coach, trainor, or any other person who, having
authority, influence or moral ascendancy over another in a work or training or education environment, demands,
requests or otherwise requires any sexual favor from another, regardless of whether the demand, request or
requirementforsubmissionisacceptedbytheobjectofsaidact.
174
171
PhilcomEmployeesUnionv. PhilippineGlobal Communications, G.R. No. 144315, July17, 2006; SeealsoBisigManggagawasaTrycov. NLRC, G.R. No. 151309, Oct. 15, 2008.
172
Article138, LaborCode; Section4, RuleXII, BookIII, RulestoImplement theLaborCode.
173
174
Id..
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Further,anypersonwhodirectsorinducesanothertocommitanyactofsexualharassmentasdefinedinthe
law,orwhocooperatesinthecommissionthereofbyanotherwithoutwhichitwouldnothavebeencommitted,shall
alsobeheldliableunderthelaw.
175
e.Sexualharassmentinaworkrelatedoremploymentenvironment.
Inaworkrelatedoremploymentenvironment,sexualharassmentiscommittedwhen:
1. The sexual favor is made a condition in the hiring or in the employment, reemployment or continued
employment of said individual or in granting said individual favorable compensation, terms, conditions,
promotions, or privileges; or the refusal to grant the sexual favor results in limiting, segregating or
classifying the employee which in any way would discriminate, deprive or diminish employment
opportunitiesorotherwiseadverselyaffectsaidemployee;
2.Theaboveactswouldimpairtheemployeesrightsorprivilegesunderexistinglaborlaws;or
3.Theaboveactswouldresultinanintimidating,hostile,oroffensiveenvironmentfortheemployee.
176
Libresv.NLRC,[G.R.No.123737,May28,1999].
Theactofthemanagerintouchingafemalesubordinateshandandshoulder,caressinghernapeandtelling
other people that the subordinate was the one who hugged and kissed him or that she responded to his sexual
advances, was considered an act of sexual harassment for which he was penalized by the company with a 30day
suspensionwhosevaliditytheSupremeCourtaffirmed.
177
Domingov.Rayala,[G.R.No.155831,February18,2008].
ThisinvolvesasexualharassmentsuitfiledagainstRogelioI.Rayala,theformerChairmanoftheNationalLabor
Relations Commission (NLRC) by a subordinate, Ma. Lourdes T. Domingo, then Stenographic Reporter III. Rayala
contends that the acts ascribed to him do not constitute sexual harassment, because Domingo did not allege in her
complaint that there was a demand, request, or requirement of a sexual favor as a condition for her continued
employmentorforherpromotiontoahigherposition.IndisagreeingtothispostulationandinholdingRayalaliablefor
sexualharassment,theHighCourtruled:
xxx
Yet,evenifweweretotestRayalasactsstrictlybythestandardssetinSection3,RA7877,
he would stillbe administratively liable. It istrue thatthis provisioncalls for a demand, request or
requirementofasexualfavor.Butitisnotnecessarythatthedemand,requestorrequirementofa
sexualfavorbearticulatedinacategoricaloralorwrittenstatement.Itmaybediscerned,withequal
certitude, from the acts of the offender. Holding and squeezing Domingos shoulders, running his
fingers across her neck and tickling her ear, having inappropriate conversations with her, giving her
moneyallegedlyforschoolexpenseswithapromiseoffutureprivileges,andmakingstatementswith
unmistakablesexualovertonesalltheseactsofRayalaresoundwithdeafeningclaritytheunspoken
requestforasexualfavor.
Likewise, contrary to Rayalas claim, it is not essential that the demand, request or
requirement be made as a condition for continued employment or for promotion to a higher
position.Itisenoughthattherespondentsactsresultincreatinganintimidating,hostileoroffensive
environment for the employee. That the acts of Rayala generated an intimidating and hostile
environment for Domingo is clearly shown by the common factual finding of the Investigating
Committee,theOPandtheCAthatDomingoreportedthemattertoanofficemateand,afterthelast
incident,filedforaleaveofabsenceandrequestedtransfertoanotherunit.
f.Sexualharassmentinaneducationortrainingenvironment.
Inaneducationortrainingenvironment,sexualharassmentiscommitted:
1.againstonewhoisunderthecare,custodyorsupervisionoftheoffender;
2.againstonewhoseeducation,training,apprenticeshiportutorshipisentrustedtotheoffender;
3.whenthesexualfavorismadeaconditiontothegivingofapassinggrade,orthegrantingofhonorsand
scholarships,orthepaymentofastipend,allowanceorotherbenefits,privileges,orconsiderations;or
4.whenthesexualadvancesresultinanintimidating,hostileoroffensiveenvironmentforthestudent,trainee
orapprentice.
178
g.Dutyoftheemployerorheadofoffice.
It is the duty of the employer or the head of the workrelated, educational or training environment or
institution, to prevent or deter the commission of acts of sexual harassment and to provide the procedures for the
resolutionorprosecutionofactsofsexualharassment.
Towardsthisend,theemployerorheadofofficeisrequiredto:
1.promulgateappropriaterulesandregulationsinconsultationwithandjointlyapprovedbytheemployees
or students or trainees, through their duly designated representatives, prescribing the procedure for the
investigation of sexual harassment cases and the administrative sanctions therefor. The said rules and
175
Id..
176
Section3[a], RepublicAct No. 7877.
177
Villaramav. NLRCandGoldenDonuts, Inc., [G.R. No. 106341, September2, 1994].
178
Section3[b], Ibid..
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regulations issued shall include, among others, guidelines on proper decorum in the workplace and
educationalortraininginstitutions.
2. create a committee on decorum and investigation of cases on sexual harassment. The committee shall
conduct meetings, as the case may be, with officers and employees, teachers, instructors, professors,
coaches, trainors and students or trainees to increase understanding and prevent incidents of sexual
harassment.Itshallalsoconducttheinvestigationofallegedcasesconstitutingsexualharassment.
Inthecaseofworkrelatedenvironment,thecommitteeiscomposedofatleastone(1)representativeeach
from the management, the union, if any, the employees from the supervisory rank and from the rankandfile
employees.
Inthecaseofeducationalortraininginstitution,thecommitteeiscomposedofatleastone(1)representative
fromtheadministration,thetrainors,teachers,instructors,professors,orcoachesandstudentsortrainees,asthecase
maybe.
179
h.Someprinciplesonsexualharassment.
1. The employer or head of office or the educational or training institution are solidarily liable for damages
arising from the acts of sexual harassment committed in an employment, education or training
environment, if such employer or head of office or educational or training institution is informed of such
actsbytheoffendedpartyandnoimmediateactionistakenthereon.
180
2. The victim of sexual harassment is not precluded from instituting a separate and independent action for
damagesandotheraffirmativereliefs.
181
3. Anyactionarisingfromsexualharassmentprescribesinthree(3)years.
182
4. Any person who violates the provisions of R.A. No. 7877 shall, upon conviction, be penalized by
imprisonmentofnotlessthanone(1)monthnormorethansix(6)months,orafineofnotlessthanten
thousand pesos (P10,000.00) nor more than twenty thousand pesos (P20,000.00) or both such fine and
imprisonmentatthediscretionofthecourt.
183
Dr.RicoS.Jacutinv.PeopleofthePhilippines,[G.R.No.140604,March6,2002].
This case illustrates the proper penalty imposable on the violator. Here, the Supreme Court affirmed the
SandiganbayansdecisionfindingDr.RicoJacutinySalcedoguiltyofthecrimeofsexualharassmentdefined
and punished under R.A. No. 7877, particularly Sections 3 and 7 thereof, and penalizing him with
imprisonmentofsix(6)monthsandtopayafineofTwentyThousand(P20,000.00)Pesos,withsubsidiary
imprisonment in case of insolvency. Additionally, he was ordered to indemnify the offended party, Juliet
Yee, in the amount of P30,000.00 and P20,000.00 by way of moral damages and exemplary damages,
respectively.

6.MINORWORKERS(R.A.NO.7678,R.A.NO.9231).
a.Child,workingchild.meaning.
Forlegalpurposes,thetermchildreferstoanypersonlessthaneighteen(18)yearsofage.
Aworkingchildreferstoanychildengagedasfollows:
i.whenthechildisbeloweighteen(18)yearsofage,inworkoreconomicactivitythatisnotchildlabor;and
ii.whenthechildbelowfifteen(15)yearsofage:
(a) inworkwherehe/sheisdirectlyundertheresponsibilityofhis/herparentsorlegalguardianandwhere
onlymembersofthechildsfamilyareemployed;or
(b) inpublicentertainmentorinformationwhichreferstoartistic,literary,andculturalperformancesfor
television show, radio program, cinema or film, theater, commercial advertisement, public relations
activitiesorcampaigns,printmaterials,internet,andothermedia.
b.Regulationofworkinghoursofachild.
Thetermhoursofworkincludes(1)alltimeduringwhichachildisrequiredtobeataprescribedworkplace,
and (2) all time during which a child is suffered or permitted to work. Rest periods of short duration during working
hoursshallbecountedashoursworked.
184
The following hours of work shall be observed for any child allowed to work under R.A. No. 9231 and its
ImplementingRules:
(a) Forachildbelowfifteen(15)yearsofage,thehoursofworkshallnotbemorethantwenty(20)hoursper
week,providedthattheworkshallnotbemorethanfour(4)hoursatanygivenday;
(b) Forachildfifteen(15)yearsofagebutbeloweighteen(18),thehoursofworkshallnotbemorethaneight
(8)hoursaday,andinnocasebeyondforty(40)hoursaweek;and
(c) Nochildbelowfifteen(15)yearsofageshallbeallowedtoworkbetweeneight(8)oclockintheevening
and six (6) oclock in the morning of the following day and no child fifteen (15) years of age but below
eighteen(18)shallbeallowedtoworkbetweenten(10)oclockintheeveningandsix(6)oclockinthe
morningofthefollowingday.
185
179
Section4, Ibid..
180
Section5, Ibid..
181
Section6, Ibid..
182
Section7, Ibid..
183
Section7, Ibid..
184
Section3, Chapter1, Department OrderNo. 65-04.
185
Section15, Chapter5, Ibid.; Section12-A, R.A. No. 7610, asaddedbySection3, R.A. No. 9231.
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c.Employmentofthechildinpublicentertainment.
Sleeping time as well as travel time of a child engaged in public entertainment or information from his/her
residence to his/her workplace shall not be included as hours worked without prejudice to the application of existing
rulesonemployeescompensation.
186
d.Prohibitionofemployingminorsincertainundertakingsandincertainadvertisements
Nochildbeloweighteen(18)yearsofageisallowedtobeemployedasamodelinanyadvertisementdirectly
or indirectly promoting alcoholic beverages, intoxicating drinks, tobacco and its byproducts, gambling or any form of
violenceorpornography.
187
e.Prohibitionontheemploymentofchildrenbelow15yearsofage;exceptionsandconditions.
1. Generalrule.Thegeneralruleisthatnochildbelowfifteen(15)yearsofageshallbeemployed,permitted
orsufferedtoworkinanypublicorprivateestablishment.
188
2. Exceptions. The following shall be the only exceptions to the prohibition on the employment of a child
belowfifteen(15)yearofage:
(a) Whenthechildworksunderthesoleresponsibilityofhis/herparentsorguardian,providedthatonly
membersofthechildsfamilyareemployed.
(b) When the childs employment or participation in public entertainment or information is essential,
regardlessoftheextentofthechildsrole.
189
3. Conditionstotheprohibition.Suchemploymentshallbestrictlyunderthefollowingconditions:
i. ThetotalnumberofhoursworkedshallbeinaccordancewithSection15[HoursofWorkofaWorking
Child]oftheRules[infra];
ii.The employment does not endanger the childs life, safety, health and morals, nor impair the childs
normaldevelopment;
iii.Thechildisprovidedwithatleastthemandatoryelementaryorsecondaryeducation;and
iv.TheemployersecuresaworkpermitforthechildinaccordancewithSections8to12oftheRules.
190
Normal development ofthe child refers to thephysical, emotional, mental,and spiritual growth ofa child
within a safe and nurturing environment where he/she is given adequate nourishment, care and protection and the
opportunitytoperformtasksappropriateateachstageofdevelopment.
191

=================================
C. LABOR STANDARDS
10. Employment of Househelpers
a. Definition
b. Benefits accorded househelpers
c. Termination
d. Reliefs for unjust termination
=================================
1.EMPLOYMENTOFHOUSEHELPERS(ARTICLES141TO152,LABORCODE).
a.Definition.
Thetermhousehelperissynonymoustothetermdomesticservantandshallrefertoanyperson,whether
maleorfemale,whorendersservicesinandabouttheemployershomeandwhoseservicesareusuallynecessaryor
desirableforthemaintenanceandenjoymentthereof,andministersexclusivelytothepersonalcomfortandenjoyment
of the employers family.
192
It refers to any person who renders domestic or household services exclusively to a
householdemployer.Examplesaredrivers,babysitters,gardeners,cooks,nursemaidsoryaya,andthelike.
193
b.Benefitsaccordedhousehelpers.
Househelpersareentitledtothefollowingbenefits:
1. Minimumwage.TheminimumwageratesprescribedunderArticle143oftheLaborCodewhichrefersto
basiccashwagesmentionedinArticle144.Theseminimumwageratesareonamonthlybasis.[NOTE:
TheminimumwageratesprescribedbyRTWPBsdonotapplytohousehelpers].
2. Salaryrateincaseofassignmentincommercial,industrialoragriculturalestablishments.Househelpers
shouldnotbeassignedtoworkincommercial,industrialoragriculturalenterprises.However,ifsorequired
to work thereat, the wage or salary rate should not be lower than that provided for agricultural or non
agriculturalworkersasprescribedbylaworwageorder.
194
3. Lodging,foodandmedicalattendance.Suitableandsanitarylivingquarters(lodging)aswellasadequate
food and medical attendance, free of charge.
195
Article 1689 of the Civil Code enunciates the rule that
186
Id..
187
Section6, Chapter2, Department OrderNo. 65-04; Section14, ArticleVIII, R.A. No. 7610, asamendedbySection5, R.A. No. 9231.
188
Section4, Chapter2, Ibid..
189
190
Id..
191
192
Article141, LaborCode; Section1[b], RuleXIII, BookIII, RulestoImplement theLaborCode.
193
SSSCircular No. 21-VissuedbytheSSSAdministratoronSeptember1, 1993.
194
Article145, LaborCode; Section10, RuleXIII, BookIII, RulestoImplement theLaborCode.
195
Article148of theLaborCode.
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household service shall always be reasonably compensated. Any stipulation that household service is
without compensation shall be void. Lodging, food and medical attendance are not included in the term
basiccashwage.
196
4. Normalhoursofwork.Househelpersshallnotberequiredtoworkformorethanten(10)hoursaday.
197
5. Overtimepay.Ifthehousehelperconsentstorenderovertimework,heshouldbepaidovertimepay.In
thesamevein,ifthenatureofhisjobrequireshimtoworkovertime,hehastorenderovertimework.
6. Opportunity for elementary education. If the househelper is under the age of eighteen (18) years, the
employershouldgivehimorheranopportunityforatleastelementaryeducation.
198
Thecostofeducation
shallbepartofthehousehelperscompensation,unlessthereisastipulationtothecontrary.
199
7. Monthlyvacation.Thehousehelpershallbeallowedfour(4)daysvacationwithpayeachmonth.
200
8. Compulsory SSS coverage. It is mandated under the Labor Code

201
that in case the monthly wage of a
househelper is at least One thousand pesos (P1,000.00), such househelper shall be covered by the Social
SecuritySystem(SSS)andbeentitledtoallthebenefitsprovidedthereunder.
202
Compulsorycoverageofa
househelper shall take effect on the day of his/her employment in a household but not earlier than
September 1, 1993.
203
A covered househelper is entitled to the same benefits, loans and other privileges
that are made available to a regular covered employee under the Social Security (SS), PhilHealth and
EmployeesCompensation(EC)laws.
204
9. Retirementbenefits.Ahousehelpermayretireuponreachingtheageof60(optional)or65(compulsory)
underArticle287oftheLaborCode.
205
10.Funeralbenefit.AccordingtotheRulestoImplementtheLaborCode,incaseofdeathofahousehelper,the
employershallbearthefuneralexpensescommensuratetothestandardsoflifeofthedeceased.
206
c.Termination.
Thefollowingprinciplesapplytotheterminationofemploymentofahousehelper:
1. Theemploymentofhousehelpers,beingonafixedtermbasis,terminatesuponitsexpiration.Article142,
in describing the contract of domestic service, explicitly provides that (t)he original contract of domestic
serviceshallnotlastformorethantwo(2)yearsbutitmayberenewedforsuchperiodsasmaybeagreed
uponbytheparties.Theuseofthewordrenewalunderscorestooclearlythatthecontractofdomestic
servicehasanexpirationdatewhich,foritscontinuedeffectivity,needstoberenewedbytheemployer
andthehousehelper.
2. Thecontractofemploymentofhousehelpersisterminablebymerenotice,aclearindicationofthefixed
nature of its term. Article 150 simply requires that (i)f the duration of the household service is not
determinedeitherinstipulationorbythenatureoftheservice,theemployerorthehousehelpermaygive
noticetoputanendtotherelationshipfive(5)daysbeforetheintendedterminationoftheservice.
3. Househelpersenjoysecurityoftenureonlyduringtheeffectivityoftheirfixedtermemployment.Afterits
expiration,norighttosecurityoftenuremaybeinvokedbythem.Thus,itisprovidedinArticle149that(i)f
the period of household service is fixed, neither the employer nor the househelper may terminate the
contractbeforetheexpirationoftheterm,exceptforajustcause.
4. Dueprocessshouldbeobservedinterminatingtheemploymentofhousehelpers.ThefactthatArticle149
providesthat(i)ftheperiodofhouseholdserviceisfixed,neithertheemployernorthehousehelpermay
terminatethecontractbeforetheexpirationoftheterm,exceptforajustcause,isarecognitionthatdue
processhastobeobservedtodeterminewhetherjustcausereallyexiststojustifythedismissal.
207
5. Househelpers cannot acquire regularity of employment. They are not included in the concept of regular
employmentunderArticle280[RegularandCasualEmployment]oftheLaborCode.
d.Reliefsforunjusttermination.
Thefollowingprinciplesapplyinrelationtoreliefsavailabletohousehelpersincaseofunjusttermination
1. ThereliefstowhichanunjustlydismissedhousehelperisentitledareprovidedforinArticle149.Suchrelief
isinthenatureofanindemnity.Thus,ifthehousehelperisunjustlyterminated,heorsheshallbepaid
thecompensationalreadyearnedplusthatforfifteen(15)daysbywayofindemnity.
2. The reliefs for illegal dismissal under Article 280 of the Labor Code do not apply to unjust termination of
househelpers.Clearly,noreliefofreinstatementorseparationpayinlieuofreinstatementtowhichan
illegallydismissedregularemployeeisentitledisgrantedtoanillegallydismissedhousehelper.
196
Article144, LaborCode; Section8, RuleXIII, BookIII, RulestoImplement theLaborCode; SSSCircular No. 21-VissuedbytheSSSAdministratoronSeptember1, 1993.
197
Article1695of theCivil Code.
198
Article146of theLaborCode.
199
SeeSection11, RuleXIII, BookIII, RulestoImplement theLaborCode.
200
Article1695of theCivil Code.
201
Last paragraphof Article143of theLaborCode.
202
SeealsoSection5, RuleXIII, BookIII, RulestoImplement theLaborCode.
203
No. II [2], Ibid..
204
No. V, Ibid..
205
Househelperswereincludedinthecoverageof theRetirement PayLawbyvirtueof Department Order No. 20, issuedbySecretaryMa. NievesRoldanConfesor onMay31, 1994. OnOctober 24, 1996, SecretaryLeonardoA. QuisumbingissuedhisLabor AdvisoryontheRetirement
PayLawwheretheyhavebeenexpresslyandcategoricallyincludedwithinthecoverageof thislaw.
206
Section16, RuleXIII, BookIII thereof.
207
PhilemployServicesandResources, Inc. v. Rodriguez, [G.R. No. 152616, March31, 2006].

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================================
C. LABOR STANDARDS
11. Employment of Homeworkers
a. Definition
b. Rights and benefits accorded
homeworkers
c. Conditions for deduction from
homeworkers earnings
================================
Relevant Provisions: Articles 153 to 155, Labor Code; Department Order No. 5, [February 4, 1992] enunciating the
regulationsgoverningtheemploymentofhomeworkers.ThisDepartmentOrderisnowknownas
RuleXIV,BookIIIoftheRulestoImplementtheLaborCode.
1.DEFINITIONS.
a.Industrialhomeworker,defined.
Anindustrialhomeworkerisaworkerwhoisengagedinindustrialhomework.
208
b.Industrialhomework,defined.
Industrialhomeworkisasystemofproductionunderwhichworkforanemployerorcontractoriscarriedout
byahomeworkerathis/herhome.Materialsmayormaynotbefurnishedbytheemployerorcontractor.
Itdiffersfromregularfactoryproductionprincipallyinthat,itisadecentralizedformofproductionwherethere
isordinarilyverylittlesupervisionorregulationofmethodsofwork.
209
c.Home,defined.
Homemeansanynook,house,apartmentorotherpremisesusedregularly,inwholeorinpart,asadwelling
place,exceptthosesituatedwithinthepremisesorcompoundofanemployer,contractor/subcontractorandthework
performedthereinisundertheactiveorpersonalsupervisionbyorforthelatter.
210
d.Fieldpersonnel,defined.
A field personnel is a nonagricultural employee who regularly performs his duties away from the principal
placeofbusinessorbranchofficeoftheemployerandwhoseactualhoursofworkinthefieldcannotbedetermined
withreasonablecertainty.
211
e.Employer,defined.
Employer means any natural or artificial person who, for his own account or benefit, or on behalf of any
personresidingoutsidethePhilippines,directlyorindirectly,orthroughanyemployee,agent,contractor,subcontractor
oranyotherperson:
1. deliversorcausestobedeliveredanygoods,articlesormaterialstobeprocessedorfabricatedinorabouta
homeandthereaftertobereturnedortobedisposedofordistributedinaccordancewithhisdirection;or
2. sellsanygoods,articlesormaterialsforthepurposeofhavingsuchgoodsorarticlesprocessedinorabouta
homeandthenrepurchasesthemhimselforthroughanotheraftersuchprocessing.
f.Contractororsubcontractor,defined.
Contractororsubcontractormeansanypersonwho,fortheaccountorbenefitofanemployer,deliversor
causestobedeliveredtoahomeworker,goodsorarticlestobeprocessedinorabouthishomeandthereaftertobe
returned,disposedofordistributedinaccordancewiththedirectionoftheemployer.
212
g.Processing,defined.
Processing means manufacturing, fabricating, finishing, repairing,altering,packing,wrapping orhandling in
anywayconnectedwiththeproductionorpreparationofanarticleormaterial.
213
2.RIGHTSANDBENEFITSACCORDEDHOMEWORKERS.
a.Dutiesofemployer,contractororsubcontractor.
Wheneveranemployercontractswithanotherfortheperformanceoftheemployerswork,itshallbetheduty
of such employer to provide in such contract that the employees or homeworkers of the contractor and the latters
subcontractorshallbepaidinaccordancewiththeprovisionsofRuleXIVoftheRulestoImplementtheLaborCode.In
theeventthatsuchcontractororsubcontractorfailstopaythewagesorearningsofhisemployeesorhomeworkersas
specified in said Rules, such employer shall be jointly and severally liable with the contractor or subcontractor to the
workers of the latter, to the extent that such work is performed under such contract, in the same manner as if the
employees or homeworkers were directly engaged by the employer. The employer, contractor or subcontractor shall
208
Section2, Department OrderNo. 5[RuleXIV, BookIII, RulestoImplement theLaborCode].
209
Id..
210
Id..
211
Article82, LaborCode
212
213
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assistthehomeworkersinthemaintenanceofbasicsafeandhealthfulworkingconditionsatthehomeworkersplaceof
work.
214
b.Paymentforhomework.
Immediatelyuponreceiptofthefinishedgoodsorarticles,theemployerisrequiredtopaythehomeworkeror
the contractor or subcontractor, as the case may be, for the work performed less the corresponding homeworkers
shareofSSS,PhilHealthandECCpremiumcontributionswhichshouldberemittedbythecontractororsubcontractoror
employertotheSSSwiththeemployersshare.However,wherepaymentismadetoacontractororsubcontractor,the
homeworkershouldlikewisebepaidimmediatelyafterthegoodsorarticleshavebeencollectedfromtheworkers.
215
c.Prohibitionsoncertainkindsofhomework.
Nohomeworkshallbeperformedonthefollowing:
1.Explosives,fireworksandarticlesoflikecharacter;
2.Drugsandpoisons;and
3.otherarticles,theprocessingofwhichrequiresexposuretotoxicsubstances.
216
3.CONDITIONSFORDEDUCTIONFROMHOMEWORKERSEARNINGS.
a.Deductionsforlost,destroyed,soiledordamagedmaterials.
Noemployer,contractororsubcontractorshallmakeanydeductionfromthehomeworkersearningsforthe
value of materials which have been lost, destroyed, soiled or otherwise damaged unless the following conditions are
met:
a. Thehomeworkerconcernedisclearlyshowntoberesponsibleforthelossordamage;
b. Thehomeworkerisgivenreasonableopportunitytoshowcausewhydeductionshouldnotbemade;
c. Theamountofsuchdeductionisfairandreasonableandshallnotexceedtheactuallossordamage;and
d. Thedeductionismadeatsuchratethattheamountdeducteddoesnotexceedtwentypercent(20%)ofthe
homeworkersearningsinaweek.
217
==================================
C. LABOR STANDARDS
12. Apprentices and Learners
a. Distinctions between Learnership
and Apprenticeship
==================================
RelevantProvisions:1.ApprenticescoveredbyArticles57to72,LaborCode
2.LearnerscoveredbyArticles73to77,LaborCode
3.RepublicActNo.7796(TechnicalEducationandSkills
DevelopmentActof1994)anditsImplementingRulesand
Regulations
1.DISTINCTIONSBETWEENLEARNERSHIPANDAPPRENTICESHIP.
Thefollowingarethedistinctions:
1. Practicaltraining.Bothlearnershipandapprenticeshipinvolvepracticaltrainingonthejob.
2. Trainingagreement.Learnershipisgovernedbyalearnershipagreement;whileapprenticeshipisgoverned
byanapprenticeshipagreement.
2. Occupation. Learnership involves learnable occupations consisting of semiskilled and other industrial
occupations which are nonapprenticeable; while apprenticeship concerns apprenticeable occupations or
anytrade,formofemploymentoroccupationapprovedforapprenticeshipbytheDOLESecretary.
3. Theoreticalinstructions.Learnershipmayormaynotbesupplementedbyrelatedtheoreticalinstructions;
whileapprenticeshipshouldalwaysbesupplementedbyrelatedtheoreticalinstructions.
4. Ratio of theoretical instructions and onthejob training. For both learnership and apprenticeship, the
normalratioisonehundred(100)hoursoftheoreticalinstructionsforeverytwothousand(2,000)hoursof
practical or onthejob training. Theoretical instruction time for occupations requiring less than two
thousand(2,000)hoursforproficiencyshouldbecomputedonthebasisofsuchratio.
218
5. Competencybasedsystem.Unlikeinapprenticeship,itisrequired
219
inlearnershipthatitbeimplemented
basedontheTESDAapprovedcompetencybasedsystem.
220
6. Durationoftraining.Learnershipinvolvespracticaltrainingonthejobforaperiodnotexceedingthree(3)
months; while apprenticeship requires for proficiency, more than three (3) months but not over six (6)
months
221
ofpracticaltrainingonthejob.
7. Qualifications. The law does not expressly mention any qualifications for learners; while the following
qualificationsarerequiredtobemetbyapprenticesunderArticle59oftheLaborCode:
214
215
Section6, Ibid..
216
217
Section8, Ibid..
218
Section28, RuleVI, BookII, Ibid..
219
Underthe2004TESDARevisedGuidelinesintheImplementationof ApprenticeshipandLearnershipPrograms.
220
No. 1.2., TESDACircular No. 16, Seriesof 2004, datedAugust 12, 2004.
221
DOLECircular No. 2, Seriesof 2006, [AmendingCertainProvisionsof Department OrderNo. 68-04] issuedonAugust 11, 2006byformerDOLESecretary(nowAssociateJusticeof theSupremeCourt) ArturoD. Brion
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(a) Beatleastfourteen(14)yearsofage;
(b) Possessvocationalaptitudeandcapacityforappropriatetests;and
(c) Possesstheabilitytocomprehendandfolloworalandwritteninstructions.
8. Circumstances justifying hiring of trainees. Unlike in apprenticeship, in learnership, the law, Article 74 of
theLaborCode,expresslyprescribestheprerequisitesbeforelearnersmaybevalidlyemployed,towit:
a.Whennoexperiencedworkersareavailable;
b. Theemploymentoflearnersisnecessarytopreventcurtailmentofemploymentopportunities;and
c. Theemploymentdoesnotcreateunfaircompetitionintermsoflaborcostsorimpairorlowerworking
standards.
222
9. Limitationonthenumberoftrainees.Inlearnership,aparticipatingenterpriseisallowedtotakeinlearners
onlyuptoamaximumoftwentypercent(20%)ofitstotalregularworkforce.
223
Nosimilarcapisimposedin
thecaseofapprenticeship.
10. Option to employ. In learnership, the enterprise is obliged to hire the learner after the lapse of the
learnershipperiod;whileinapprenticeship,theenterpriseisgivenonlyanoptiontohiretheapprentice
asanemployee.
224
11 Wage rate. The wage rate of a learner or an apprentice is set at seventyfive percent (75%) of the
statutoryminimumwage.
225

====================================
C. LABOR STANDARDS
13. Handicapped Workers (RA 7277)
a. Definition of handicapped workers
b. Rights of disabled workers
c. Prohibitions on discrimination
against disabled persons
d. Incentives for employers
====================================
RelevantProvisions:HandicappedworkerscoveredbyArticles78to81,LaborCode
R.A.No.7277[March24,1992](MagnaCartaforDisabledPersons)[nowtobeknownas
MagnaCartaforPersonswithDisabilityperSection4ofR.A.No.9442(effectiveApril30,2007)],
1.DEFINITIONOFHANDICAPPEDWORKERS(UNDERR.A.NO.7277).
a.Importantclarificationofterms.
The term handicapped workers should no longer be used to describe persons with disability as this is no
longerlegallycorrect.Handicappedpersonsshouldnotbecalleddisabledpersonsbutpersonswithdisability.The
termdisabledpersonshasbeenchangedtopersonswithdisabilitynotonlyinthetitleofR.A.No.7277butinall
referencesinthesaidlawtodisabledpersonsbyvirtueofR.A.No.9442.
b.Definitionofimportantterms.
Thefollowingtermsarespecificallydefinedinthelaw:
1.PersonswithDisabilityarethosesufferingfromrestrictionordifferentabilities,asaresultofamental,
physicalorsensoryimpairment,toperformanactivityinthemannerorwithintherangeconsiderednormal
forahumanbeing.
2. Impairment refers to any loss, diminution or aberration of psychological, physiological, or anatomical
structureorfunction.
3. Disabilitymeans(1)aphysicalormentalimpairmentthatsubstantiallylimitsoneormorepsychological,
physiologicaloranatomicalfunctionsofanindividualoractivitiesofsuchindividual;(2)arecordofsuchan
impairment;or(3)beingregardedashavingsuchanimpairment.
4. Handicapreferstoadisadvantageforagivenindividual,resultingfromanimpairmentoradisabilitythat
limitsorpreventsthefunctionoractivitythatisconsiderednormalgiventheageandsexoftheindividual.
5. ReasonableAccommodationsinclude:(1)improvementofexistingfacilitiesusedbyemployeesinorder
to render these readily accessible to and usable by persons with disability; and (2) modification of work
schedules, reassignment to a vacant position, acquisition or modification of equipment or devices,
appropriateadjustmentsormodificationsofexaminations,trainingmaterialsorcompanypolicies,rulesand
regulations,theprovisionofauxiliaryaidsandservices,andothersimilaraccommodationsforpersonswith
disability.
6. Marginalized Disabled Persons or more appropriately, Marginalized Persons with Disability refer to
personswithdisabilitywholackaccesstorehabilitativeservicesandopportunitiestobeabletoparticipate
fullyinsocioeconomicactivitiesandwhohavenomeansoflivelihoodandwhoseincomesfallbelowthe
povertythreshold.
222
SeealsoSection2, RuleVII, BookII, RulestoImplement theLaborCode.
223
No. 3.7., Ibid..
224
SeeNo. 3.10of TESDACircular No. 16, Seriesof 2004andDOLECircularNo. 2, Seriesof 2006.
225
Section29, RuleVI, BookII, Ibid.; Section5, RepublicAct No. 6640; Section10, RulesImplementingRepublicAct No. 6640; Section10, RulesImplementingRepublicAct No. 6727; No. I [H], DOLEHandbookonWorkersStatutoryMonetaryBenefits; No. 3.8., TESDACircular No. 16,
Seriesof 2004, datedAugust 12, 2004[RevisedGuidelinesintheImplementationof ApprenticeshipandLearnershipPrograms].
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7. Qualified Individual with a Disability means an individual with a disability who, with or without
reasonable accommodations, can perform the essential functions of the employment position that such
individualholds ordesires.However,consideration shall be giventothe employers judgment as towhat
functionsofajobareessential,andifanemployerhaspreparedawrittendescriptionbeforeadvertisingor
interviewingapplicantsforthejob,thisdescriptionshallbeconsideredevidenceoftheessentialfunctions
ofthejob.
8. CoveredEntitymeansanemployer,employmentagency,labororganizationorjointlabormanagement
committee.
2.RIGHTSOFPERSONSWITHDISABILITY(DISABLEDWORKERS).
a.Equalopportunityforpersonswithdisability.
Underthelaw,
226
personswithdisabilityareentitledtoequalopportunityforemployment.Consequently,no
person with disability shall be denied access to opportunities for suitable employment. A qualified employee with
disability shall be subject to the same terms and conditions of employment and the same compensation, privileges,
benefits,fringebenefits,incentivesorallowancesasaqualifiedablebodiedperson.
Fivepercent(5%)ofallcasualemergencyandcontractualpositionsintheDepartmentsofSocialWelfareand
Development,Health,Educationandothergovernmentagencies,officesorcorporationsengagedinsocialdevelopment
shallbereservedforpersonswithdisability.
227
b.Shelteredemploymentforpersonswithdisability.
Sheltered Employment refers to the provision of productive work for persons with disability through
workshopsprovidingspecialfacilities,incomeproducingprojectsorhomeworkschemeswithaviewtogivingthemthe
opportunitytoearnalivingthusenablingthemtoacquireaworkingcapacityrequiredinopenindustry.
Ifsuitableemploymentforpersonswithdisabilitycannotbefoundthroughopenemployment,theStateshall
endeavor to provide it by means of sheltered employment. In the placement of persons with disability in sheltered
employment, it shall accord due regard to the individual qualities, vocational goals and inclinations to ensure a good
workingatmosphereandefficientproduction.
228
c.Vocationalrehabilitation.
Consistentwiththeprincipleofequalopportunityforworkerswithdisabilityandworkersingeneral,theState
shalltakeappropriatevocationalrehabilitationmeasuresthatshallservetodeveloptheskillsandpotentialsofpersons
with disability and enable them to compete favorably for available productive and remunerative employment
opportunitiesinthelabormarket.
TheStateshallalsotakemeasurestoensuretheprovisionofvocationalrehabilitationandlivelihoodservices
for persons with disability in the rural areas. In addition, it shall promote cooperation and coordination between the
government and nongovernmental organizations and other private entities engaged in vocational rehabilitation
activities.
The Department of Social Welfare and Development (DSWD) shall design and implement training programs
thatwillprovidepersonswithdisabilitywithvocationalskillstoenablethemtoengageinlivelihoodactivitiesorobtain
gainful employment. The Department of Labor and Employment (DOLE) shall likewise design and conduct training
programsgearedtowardsprovidingpersonswithdisabilitywithskillsforlivelihood.
229
d.Vocationalguidanceandcounselling.
TheDSWDshallimplementmeasuresprovidingandevaluatingvocationalguidanceandcounsellingtoenable
persons with disability to secure, retain and advance in employment. It shall ensure the availability and training of
counsellors and other suitably qualified staff responsible for the vocational guidance and counselling of persons with
disability.
230
e.Personswithdisabilityareeligibleforapprenticeshipandlearnership.
UnderR.A.No.7277,
231
itisprovidedthatsubjecttotheprovisionsoftheLaborCode,asamended,persons
withdisabilityshallbeeligibleasapprenticesorlearners;providedthattheirhandicapisnotasmuchastoeffectively
impede theperformanceofjoboperations intheparticular occupationfor whichthey are hired andprovided further
thatafterthelapseoftheperiodofapprenticeship,iffoundsatisfactoryinthejobperformance,theyshallbeeligiblefor
employment.
f.Wagerate.
Under Article 80 of the Labor Code, handicapped workers are entitled to not less than seventyfive percent
(75%)oftheapplicableadjustedminimumwage.
232
In view, however, of R.A. No. 7277,

233
the wage rate of persons with disability is 100% of the applicable
minimumwage.
226
UnderR.A. No. 7277, otherwiseknownastheMagnaCartaforDisabledPersons[nowknownasMagnaCartaforPersonswithDisability].
227
Section5, Chapter1, TitleII, RepublicAct No. 7277.
228
Section6, Chapter1, TitleII, Ibid..
229
230
231
Section7, ChapterI, TitleII thereof.
232
Article80[b], LaborCode; Section5, RepublicAct No. 6640; Section10, RulesImplementingRepublicAct No. 6640; Section10, RulesImplementingRepublicAct No. 6727; No. I [H], DOLEHandbookonWorkersStatutoryMonetaryBenefits.
233
Section5, Chapter1, TitleII of R.A. No. 7277.
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Wage orders issuedby theRegional TripartiteWages and ProductivityBoards(RTWPBs)normally reflectthis
principle.Tociteanexample,Section7ofWageOrderNo.NCR15[effectiveJuly01,2010]issuedbyRTWPBNational
CapitalRegionstates:
Allqualifiedhandicappedworkersshallreceivethefullamountoftheminimumwagerate
prescribed herein pursuant to Republic Act No. 7277, otherwise known as the Magna Carta for
DisabledPersons.
234
Moreover,incaseoflegallymandatedwageincreasesenunciatedinwageordersissuedbytheRTWPBs,the
employmentagreementswithpersonswithdisabilityaredeemedautomaticallymodifiedinsofarastheirwageclauses
areconcernedtoreflectthesaidincreases.
235
g.Wagerateasapprenticeorlearner.
Apersonwithdisabilityhiredasanapprenticeorlearnershallbepaidnotlessthanseventyfivepercent(75%)
oftheapplicableminimumwage.
Ifthepersonwithdisability,however,ishiredasalearnerandemployedinpieceorincentiveratejobsduring
thetrainingperiod,heshallbepaidonehundredpercent(100%)oftheapplicableminimumwage.
3.PROHIBITIONSONDISCRIMINATIONAGAINSTPERSONSWITHDISABILITY(DISABLEDPERSONS).
a.Discriminationonemploymentprohibited.
Noentity, whetherpublicorprivate, shalldiscriminate againstaqualifiedperson withdisabilityby reason of
disability in regard to job application procedures, the hiring, promotion, or discharge of employees, employee
compensation,jobtraining,andotherterms,conditionsandprivilegesofemployment.Thefollowingconstituteactsof
discrimination:
(a) Limiting,segregatingorclassifyingajobapplicantwithdisabilityinsuchamannerthatadverselyaffectshis
workopportunities;
(b) Using qualification standards, employment tests or other selection criteria that screen out or tend to
screenoutapersonwithdisabilityunlesssuchstandards,testsorotherselectioncriteriaareshowntobe
jobrelatedforthepositioninquestionandareconsistentwithbusinessnecessity;
(c) Utilizingstandards,criteria,ormethodsofadministrationthat:
(1) havetheeffectofdiscriminationonthebasisofdisability;or
(2) perpetuatethediscriminationofotherswhoaresubjecttocommonadministrativecontrol.
(d) Providinglesscompensation,suchassalary,wageorotherformsofremunerationandfringebenefits,toa
qualified employee with disability, by reason of his disability, than the amount to which a nondisabled
personperformingthesameworkisentitled;
(e) Favoring a nondisabled employee over a qualified employee with disability with respect to promotion,
trainingopportunities,studyandscholarshipgrants,solelyonaccountofthelattersdisability;
(f) Reassigningortransferringanemployeewithadisabilitytoajoborpositionhecannotperformbyreason
ofhisdisability;
(g) Dismissingorterminatingtheservicesofanemployeewithdisabilitybyreasonofhisdisabilityunlessthe
employercanprovethatheimpairsthesatisfactoryperformanceoftheworkinvolvedtotheprejudiceof
the business entity; provided, however, that the employer first sought to provide reasonable
accommodationsforpersonswithdisability;
(h) Failingtoselectoradministerinthemosteffectivemanneremploymenttestswhichaccuratelyreflectthe
skills, aptitude or other factor of the applicant or employee with disability that such tests purports to
measure,ratherthantheimpairedsensory,manualorspeakingskillsofsuchapplicantoremployee,ifany;
and
(i) Excludingpersonswithdisabilityfrommembershipinlaborunionsorsimilarorganizations.
236
4.INCENTIVESFOREMPLOYERS.
a.Incentivesforemployerswhoemploypersonswithdisability.
Toencouragetheactiveparticipationoftheprivatesectorinpromotingthewelfareofpersonswithdisability
andtoensuregainfulemploymentforqualifiedpersonswithdisability,adequateincentivesshallbeprovidedtoprivate
entitieswhichemploypersonswithdisability.
237
Private entities that employ persons with disability who meet the required skills or qualifications, either as a
regularemployee,apprenticeorlearner,shallbeentitledtoanadditionaldeductionfromtheirgrossincomeequivalent
to twentyfive percent (25%) of the total amount paid as salaries and wages to persons with disability; provided,
however,thatsuchentitiescouldpresentproofascertifiedbytheDepartmentofLaborandEmploymentthatpersons
with disability are under their employ and provided further that the employee with disability is accredited with the
DepartmentofLaborandEmploymentandtheDepartmentofHealthastohisdisability,skillsandqualifications.
238
Privateentitiesthatimproveormodifytheirphysicalfacilitiesinordertoprovidereasonableaccommodation
forpersonswithdisabilityshallalsobeentitledtoanadditionaldeductionfromtheirnettaxableincomeequivalentto
234
SeealsoSection8, RuleII, ImplementingRulesof WageOrderNo. NCR-14issuedonJune18, 2010.
235
Article124, Labor Codeas amendedby Section3, Republic Act No. 6727; Section10, Rules ImplementingRepublic Act No. 6727; Section5, Republic Act No. 6640; Section10, Rules ImplementingRepublic Act No. 6640[applyingby analogy similar provisions applicableto
apprenticeshipandlearnershipagreementsmentionedtherein].
236
Section32, ChapterI, TitleIII, Ibid..
237
Section8[a], Chapter1, TitleII, Ibid..
238
Section8[b], Chapter1, TitleII, Ibid.
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fiftypercent(50%)ofthedirectcostsoftheimprovementsormodifications.ThisSection,however,doesnotapplyto
improvementsormodificationsoffacilitiesrequiredunderBatasPambansaBilang344[February25,1983],entitledAn
ActtoEnhancetheMobilityofDisabledPersonsbyRequiringCertainBuildings,Institutions,Establishments,andPublic
UtilitiestoInstallFacilitiesandOtherDevices.
239

END OF DISCUSSION ON
TOPIC C. LABOR STANDARDS

oooooooooOoOooooooooo
239
Section8[c], Chapter1, TitleII, Ibid..

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4. Onlyrankandfile employees, regardless oftheirdesignation or employmentstatus andirrespective of

8. Compulsory SSS coverage. It is mandated under the Labor Code

In view, however, of R.A. No. 7277,

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