Professional Documents
Culture Documents
certain standards of terms & conditions of EENT or providing a legal framework w/in w/c these terms & conditions
& the EENT relationship may be negotiated, adjusted & administered.
1. Labor Standards sets out the minimum terms, conditions & benefits of EENT that EERS must provide or
comply w/ & to w/c EES are entitled as a matter of legal right.
- minimum requirements prescribed by existing laws, rules & regulations relating to wages, hours of work, cost-
of-living allowance and other monetary & welfare benefits, including occupational safety & health standards.
- Material or substance to be processed
2. Labor Relations defines the status, rights & duties and the institutional mechanisms, that govern the
individual & collective interactions of EERS, EES, or their representatives.
- Mechanism that processes the substance
o Labor physical toil although it does not necessarily exclude the application of skill (thus skilled &
unskilled labor)
o Skill the familiar knowledge of any art/science, united w/ readiness & dexterity in execution/performance
or in the application of the art/science to practical purposes.
o Work (broader than labor) covers all forms of physical/mental exertion, or both combined, for the
attainment of some obj other than recreation/amusement per se.
o Worker (broader than EE) may refer to self-employed people & those working in the service & under
the control of another, regardless of rank, title, or nature of work.
any member of the labor force whether employed/unemployed
o Employee a salaried person working for another who controls or supervises the means, manner or
method of doing the work.
Other Consti provisions that protect the Rs/promote the welfare of workers
R to form unions, associations or societies for purposes not contrary to law
R of self-org even for government EES.. No officer/Ee of the Civil Service shall be removed/suspended
for cause. Temporary EES of the government shall be given such protection as may be provided by law
Regular farmworkers shall have the R to own directly/collectively the lands they till. Landless farmworkers
may be resettled by the government in its own agricultural estates.
Continuing program of urban land reform & housing
Protection for working women taking into acct their maternal functions, etc
Labor sector is entitled to seats to party list
Goal: more equitable distribution of opportunities, income & wealth.
Agency to promote the viability & growth of cooperatives as instruments for social justice & economic
government
government shall increase the salary scales of the other officials & EES
Career civil service EES shall be entitled to separation pay & retirement benefits, OR may be considered
for reemployment in the govt
Consti prol-labor, but recognizes the indispensable role of the private sector, encourages private enterprise and
provides incentives to needed investments
The relations bet capital & labor are not merely contractual. They are so impressed w/ public interest that labor
contracts must yield to the common good. such contracts are subj. to the special laws on labor unions, collective
bargaining, strikes & lockouts, closed shop, wages, working conditions, hrs of labor & similar subjs. Art 1700
Neither capital nor labor shall act oppressively against the other, or impair the interest or convenience of the
public Art 1701.
3. RPC punishes the use of violence or threats by either EER or EE.
4. Special Laws (SSS law, GSIS law, Agrarian Reform law, the 13th-month pay law, the Magna Carta for Public
Health Workers)
Art 3. [Declaration of Basic Polici] The State shall afford protection to labor, promote full EENT, ensure
equal work opportunities regardless of sex, race or creed, and regulate the relations bet workers &
EERS. The State shall assure the rights of workers to self-org, collective bargaining, security of tenure,
and just & humane conditions of work.
Balanced Approach shared responsibility. Worker & EER sectors are interdependent.
Art4. [Construction in Favor of Labor] All doubts in the implementation & interpretation of the
provisions of this Code, including its IRRs, shall be resolved in favor of labor.
Interpretation & Construction policy is to extend the decrees applicability to a greater number of EES to enable
them to avail of the benefits under the law (Liberal approach is adopted)
Concern for the Lowly Worker SC reaffirms its concern for the lowly worker who, often at his EERs mercy, must
look up to the law for his protection.
(Reason: the EER stands on higher footing than the EE:
(1) There is greater supply than demand for labor;
(2) The need for EENT by labor comes from vital & even desperate necessity.)
Management Rights entitled to respect & enforcement in the interest of simple fair play.
1. R to manage, control, and use his property & conduct business in a manner satisfactory to himself (just
discrimination in the rate of wages paid to the skillful & to the unskillful, to the efficient & inefficient.)
2. R to prescribe rules (they become part of the contract of EENT)
3. R to select EES & to decide when to engage them, except as restricted by statute or valid contract, at a wage &
under conditions agreeable to them.
4. R to transfer & discharge EES in order to minimize expenses & to insure stability of the business & even to close
the business, provided it is done in good faith & due to causes beyond control.
Art 5. [Rules & Regulations] the DOLE & other govt agencies charged w/ the administration &
enforcement of this Code or any of its parts shall promulgate the necessary IRRs. Such RRs shall
become effective 15 days after announcement of their adoption in the newspapers of gen. circulation.
Art 6. [Applicability] All Rs & benefits granted to workers under this Code shall, except as may
otherwise be provided herein, apply alike to all workers, whether agricultural or non-agricultural.
- also applies to a govt corp incorporated under the Corporation Code.
- Test WON a government-owned/-controlled corporation is subj to CS Law is the manner of its creation.
Governmentt corps created by special charter are subj to its provisions, while those incorporated under the gen
Corp Law are not w/in the coverage of the CS law.
PNOC-EDC incorporation under the Corp Law subj to LC
NHA incorp under Act 1459, the former corp law LC
Govt agencies Ees covered by CS Law
Art 8: [Transfer of Lands to Tenant-workers] tenant-farmers on private agri lands primarily devoted
to rice & corn under a sys of share crop or lease tenancy whether classified as landed estate or not
shall be deemed owner of apportion constituting a family-size farm of 5 hectares if not irrigated & 3
hectares if irrigated..
In all cases, the landowners may retain an area of not more than 7 hectares if such landowner is
cultivating such area or will now cultivate it.
Art 9. [Determination of Land Value] For the purpose of determining the cost of the land to be
transferred to the tentant-farmer, the value of the land shall be equivalent to 2 & times the average
harvest of 3 normal crop yrs immediately preceding the promulgation of PD 27 (OCT 21, 1972).
The total cost of the land, including interest at the rate of 6% per annum, shall be pd by the tenant in
15 yrs of 15 equal annual amortizations.
In case of default, the amortizations due shall be pd by the farmers cooperative in w/c the defaulting
tenant-farmer is a member, w/ the coop having a right of recourse against him.
The govt shall guarantee such amortizations w/ shares of stock in govt-owned & -controlled corps.
Art 10. [Conditions of Ownership] No title to the land acquired by the tenant-farmer under PD 27 shall
be actually issued to him unless & until he has become a full-fledged member of a duly recognized
farmers coop.
Title to the land acquired pursuant to PD 27 or the Land Reform Program of the Govt shall not be
transferable except by hereditary succession or to the Govt in accdance w/ the provisions of PD 27,
the Code of Agrarian Reforms & other existing laws & regulations.
Art 11. [Implementing Agency] The Dept of Agrarian Reform shall promulgate the necessary rules &
regulations to implement the provisions of this Chapter.
*Land for the landless battle cry dramatizing the increasingly urgent demand of the dispossessed for a plot of
earth as their place under the sun.
*CARP Law signed by Cory, declaring full land ownership in favor of the beneficiaries of the PD 27.
Share tenancy abolished, put the agricultural leasehold sys in its stead, geared towards eventual ownership of
land by its tillers
Constitution - State shall undertake an Agrarian Reform Program, and encourage & undertake the just distribution
of all agri lands, subj to such priorities & reasonable retention limits as the Congress may prescribe,
Compensation scheme: Sec 18 of CARP: Title to all expropriated properties shall be transferred to the State only
upon full payment of compensation of their respective owners.
Retention Limits provided for by RA 6657 : as otherwise provided.. no person may own/retain
directly/indirectly, any public/private agri land, the size of w/c shall vary accdg to factors governing a viable
family-sized farm, such as commodity produced, terrain, infrastructure, & soil fertility as determined by the
Presidential Agrarian Reform Council (PARC).
3 hectares may be awarded to each child of the landowner, subj to the ff qualifications:
(1.) he is at least 15 y/o, and
(2) he is actually tilling the land or directly managing the farm; Provided, that landowners whose lands have been
covered b PD 27 shall be allowed to keep the area originally retained by them thereunder;
Provided further, that original homestead grantees or direct compulsory heirs who still own the org homestead at
the time of the approval of this Act shall retain the same areas as long as they continue to cultivate said
homestead.
3. Livestock, poultry & Swine raising lands: Sec 2 of RA 6657 w/c includes private agri lands devoted to
commercial livestock, poultry & swine raising in the definition of commercial farms is invalid. They are covered
by the agrarian reform program of the State.
- The demand for those who live by wages necessarily increases w/ the increase of the revenue & stock of
every country and cannot increase w/o it. The increase of revenue & stock is the increase of national wealth.
An Exploited Class J. Reynato Puno
- Overseas workers constitute an exploited class. Their unfortunate circumstance makes them easy prey to
avaricious EERs. They will work under subhuman conditions & accept salaries below the minimum.
Aim: A more equitable distribution & ownership of land, w/ due regard to the rights of landowners to just
compensation & to the ecological needs of the nation
Basis: the R of farmers & regular farm workers, who are landless, to own directly or collectively the lands they till
or, in the case of other farm workers, to receive a share of the fruits thereof
The State:
- shall respect the R of small landowners & shall provide incentives for voluntary land-sharing
- shall recognize the R of farmers, farm workers & landowners, as well as cooperatives & other independent
farmers org, to participate in the planning, org, & managementt of the program & shall provide support to
agriculture though tech & research & financial, production, marketing & other support services
- may resettle landless farmers & farm workers in its own agricultural estates
- shall encourage the formation & maintenance of economic-sized family farms to be constituted by individual
beneficiaries & small landowners
- shall protect the Rs of subsistence fishermen to the preferential use of communal marine & fishing resources
both inland & offshore
- shall provide support to such fishermen thru appropriate tech & research, adequate financial, production &
marketing assistance
- shall protect offshore fishing grounds of subsistence fishermen against foreign intrusion. Fisherman shall receive
a just share from their labor in the utilization of marine & fishing resources
- owners of agricultural land have the obligation to cultivate directly or thru labor admin the lands they own &
thereby make the land productive.
- Shall provide incentives to landowners to invest the proceeds of the agrarian reform program to promote
industrialization, EENT & privatization of pub sector enterprises
- May lease undeveloped lands of pub domain to qualified entities for the devopmentt of capital-intensive farms,
traditional & pioneering crops esp those for export (subj. to Rs of beneficiaries)
Definitions
1. Agrarian Reform the redistribution of lands, regardless of crops/fruits produced, to farmers & regular farm
workers who are landless, irrespective of tenurial arrangemt, to include the totality of factors & support services
designed to lift the economic status of the beneficiaries and all other arrangements alternative to the physical
redistribution of lands (production or profit-sharing, labor admin, distribution of shares of stock)
2. Agriculture, Agricultural Enterprise or Agricultural Activity the cultivation of the soil, planting of crops,
growing of fruit trees, incl. the harvesting of such farm products, & other farm activities
3. Agricultural land land devoted to agricultural activity, and NOT classified as mineral, forest, residential,
commercial or industrial land
4. Agrarian Dispute any controversy relating to tenurial arrangements, whether leasehold, tenancy, stewardship
or otherwise, over lands devoted to agriculture
- including disputes concerning farm workers associations, or representation of persons in negotiating, fixing,
maintaining, changing or seeking to arrange terms of conditions of such tenurial arrangements
- including controversy relating to compensation of lands acquired under this Act & other terms & conditions of
transfer of ownership from landowners to farm workers, tenants & other agrarian reform beneficiaries
5. Idle / Abandoned Land any agricultural land not cultivated, tilled or developed to produce any crop nor
devoted to any specific economic purpose continuously for a period of 3 years immediately prior to the receipt of
notice of acquisition by the government
- but does NOT include land that has become permanently or regularly devoted to non-agricultural purposes
- does NOT include land w/c has become unproductive by reason of force majeure or F event
6. Farmer a natural person whose primary livelihood is cultivation of land or the production of agricultural crops
either by himself, or primarily w/ the assistance
of his immediate farm household, whether the land is owned by him, or by another person under a leasehold or
tenancy agreement
7. Farmworker a natural person who renders service for value as an EE or laborer in an agricultural enterprise or
farm
8. Regular Farmworker a natural person who is employed on a permanent basis by an agricultural enterprise or
farm
9. Season Farmworker a natural person who is employed on a recurrent, periodic or intermittent basis by an
agricultural enterprise or farm
h. Cooperatives orgs composed primarily of small agriculture producers, farmers, farmworkers or other agrarian
reform beneficiaries who voluntarily organize themselves for the purpose of pooling land, human, technological,
financial or other economic resources & operated on the principle of one member, one vote. (a juridical person
may be a member of a coop, w/ the same Rs & duties as a natural person.
Scope: all public & private agricultural lands, incl. other lands of the pub domain suitable for agriculture
1. All alienable & disposable lands of the pub domain devoted to or suitable for agriculture
2. All lands of the pub domain in excess to the specific limits as determined by Congress
3. All other lands owned by the Govt devoted to or suitable for agriculture
4. All private lands devoted to or suitable for agriculture regardless of the agri products raised/can be raised
thereon
Presidental Agrarian Reform Council (PARC) shall provide the implementing rules
- upon recommendation by the Provincial Agrarian Reform coordinating Committee, may declare certain
provinces/regions as priority land reform areas
Multinational Corps all lands of the pub domain leased, held, or possessed by multi corps or associations, and
other lands owned by the govt, or govt-owned/-controlled corps, assocs, institutions or entities, devoted to
existing & operational agribusiness or agro-industrial enterprises, operated by multi corporations shall be
programmed for acquisition & distribution immediately upon effectivity
Ancestral Lands shall include, but not limited to, lands in the actual, continuous & open possession & occupation
of the community and its members, provided that the Torrens System shall be respected
- shall be protected to ensure their economic, social & cultural well-being
- in the autonomous regions, the respective legislature may enact their own laws on ancestral domain subj to the
provisions of the Consti, this Act and other national laws.
*Provided: children of landowners who are qualified shall be given preference in the distribution of the land of
their parents
*Provided further: actual tenant-tillers in the landholding shall not be ejected/removed therefrom. \
Transferability of Acquired lands by beneficiaries may not be sold, transferred or conveyed except thru
hereditary succession, or to the govt, or to the LBP, or to other qualified beneficiaries for 10 yrs
*Provided, that the children/spouse of the transferor shall have a Right to repurchase the land from the govt/LBP
w/in 2 yrs
Standing crops at the time of acquisition shall be retained by the landowner, Dar shall give a reasonable time to
harvest the same
Corporate Farms
- in case land cannot be divided directly, shall be owned collectively by the worker-beneficiaries who shall form a
workers cooperative or assoc w/c will deal w/ the corp
- individual members of the coop shall be provided w/ home lots or small farm lots for their family use taken from
the land owned by the coop
RA 9700 Act Strengthening the CARP, extending the acquisition & distribution of all agricultural lands, instituting
necessary reforms, amending for the purpose certain provisions of RA 6657
- State shall protect Filipino enterprises against unfair foreign competition & trade practices
- State recognizes that there is not enough agricultural land to be divided & distributed to each farmer & regular
farmworker so that each one can own his economic-size family farm.
- Answer: simultaneous industrialization aimed at developing a self-reliant & independent national economy
effectively controlled by Filipinos
- State may, in the interest of national welfare or defense, establish & operate vital industries
- Implementation of the prog shall be community-based
- State shall recognize & enforce the Rs of rural women to own & control land
- State shall provide incentives to landowners to invest the proceeds of the agrarian reform prog to promote
industrialization, EENT & privatization of the pub sector enterprises
Added Definition
1. Rural women women who are engaged directly/indirectly in farming and/or fishing as their source of
livelihood, whether paid or unpaid, regular or seasonal, or in food preparation, managing the household, caring for
the children, & other similar activities
2. Landless beneficiary one who owns less than 3 hectares of agri land
Landicho v Sia
Facts:
3 parcels of land were originally owned by the Aragons, tenanted by the late Arcadio Landicho from 1949 until his
death in 1972, afterwhich, his tenancy rights were succeded by his son, petitioner Francisco Landicho (the other
petitioners were Buenaventura (Franciscos son), and Federico (Franciscos brother), helped him cultivate the land
in 1976, Francisco voluntarily surrendered his tenancy Rs over the land to the Aragons through a notarized
kasulatan for a consideration of P1,000, but petitioners continued cultivating the land until 1987 when
Francisco executed another notarized kasulatan thru w/c he surrendered his tenancy rights for a consideration
of P3,000.
On the same day as the execution of the 1987 kasulatan, the lands were sold by the Aragons for P50,000 to
respondent Felix Sia, who in turn converted the same to a residential subd w/o a DAR clearance and ejected the
petitioners therefrom.
Peitioners filed a protest before the DAR alleging that they are the tenants of the lands and claimed that they are
entitled to a disturbance compensation. They alleged that they were fooled into signing over their tenancy rights
thru the machinations of the Aragons.
The respondents in their answer, denied such allegation and added that the petitioners are barred by estoppel,
laches and prescription
Held: A tenant is defined as a person who, himself and w/ the aid available from w/in his immediate farm
household, cultivates the land belonging to, or possessed by another, w/ the latters consent for purposes of
production, sharing the produce w/ the landholder under the share tenancy system, or paying to the landholder a
price certain or ascertainable in produce or in money or both, under the leasehold tenancy system
For a tenancy relationship to exist, all of the ff essential requisites must be present:
1) the parties are the landowner & the tenant
2) the subj matter is agricultural land
3) there is consent bet the parties
4) the purpose is agricultural production
5) there is personal cultivation by the tenant
6) there is sharing of the harvests bet the parties
Under the definition, only Francisco possesses the requisites of a tenant. Petitioners Federico and Buenaventura
are not tenants because consent (#3) by the landowners is lacking. They are merely farm helpers of Francisco as
part of his immediate farm household. There was also no evidence to show that they gave a share of their harvest
to the Aragons (#6).
Issue 2: WON the respondents took advantage of Franciscos old age & illiteracy and employed fraudulent
schemes in order to deceive him into signing the Kasulatans
Held: As the legal tenant of the lands, Francisco had voluntarily surrendered his tenancy rights when he knowingly
& freely executed the 1987 Kasulatan. There was no showing of foul play, because the Kasulatan was in Filipino, a
language spoken & understood by Francisco and was couched in plain and clear terms. Such kasulatan was also
duly notarized and are considered as public documents executed w/ all the legal formalities which afford it the
legal presumption of regularity and legality abent full, clear and convincing evidence to the contrary.
Final ruling: Petitioners have no cause of action and the same has prescribed.
Held: No.
Constructive dismissal quitting because continued EENT is rendered impossible, unreasonable or unlikely, as an
offer involving a demotion in rank & a dimunition in pay. May also mean an act of clear discrimination, insensibility
or disdain by an EER may become so unbearable on the part of the EE so as to foreclose any choice on his part
except to resign
Petitioner claims he was discriminated against as new hires were given higher salaries than he was receiving.
Discrimination failure to treat all persons equally when no reasonable distinction can be found bet those favored
& those not favored. It must be clearly established that (1) there is no reasonable distinction for classification that
can be obtained bet persons belonging to the same class, and (2) persons belonging to the same class have not
been treated alike
Petitioner failed to established that he possessed the same skills, competencies & expertise as those newly hired
to eliminate the possibility of substantial distinction that may warrant unequal treatment bet them.
Petitioner contends that in cases of constructive dismissal, the burden of proof rests on the EER to show that the
EE was dismissed on a valid & just cause. But this legal principle presupposes that there is indeed an involuntary
separation from EENT & the facts attendant to such forced separation was clearly established, w/c the petitioner
failed to do. It was him who availed of the voluntary retirement program. And absent the showing of duress, the
presumption is that it was done by him voluntarily.
While the state promotes the utmost protection of labor against capital, it does not mean that the working class is
upheld in all labor dispute. The law also recognizes the rights of management.
PRE-EMPLOYMENT
Art 12. It is the policy of the State:
1. to promote and maintain a state of full employment through improved manpower training,
allocation and utilization;
2. to protect every citizen desiring to work locally/overseas by securing for him the best possible
terms and condition of employment;
3. to facilitate a free choice of available employment by persons seeking work in conformity with the
national interest;
4. to facilitate & regulate the movement of workers in conformity w/ the national interest;
5. to regulate the employment of aliens, including the establishment of a registration and/or work
permit system;
6. to strengthen the network of public employment offices and rationalize the participation of the
private sector in the recruitment and placement of workers, locally and overseas, to serve national
development objectives;
7. to insure careful selection of Filipino workers for overseas employment in order to protect the good
name of the PH abroad.
The DOLE
- by Administrative Code of 1987 (EO 292)
- the primary policy-making, programming, coordinating and administrative entity of the Executive branch of the
govt in the field of labor and employment
Bureau of Local Employment (BLE) assigned the effective allocation of manpower resources in local
Ph Overseas Employment Administration (POEA) for overseas employment
The decisions of the regional offices of the BES if so authorized by the Sec of DOLE shall be appealable to the
NLRC upon the same grounds provided in Art 233 hereof.
The decisions of the NLRC shall be final & unappealable.
Minister of Labor has the power to impose & collect fees, based on rates recommended by the BES. Such fees
shall be deposited in the National Treasury as a special acct of the General Fund, for the promotion of the
objectives of the BES, subj to the provisions of Sec 40 of PD 1177.
PD 850 replaced BES w/ BLE, and created POEA
AO 186 made licensing of local recruitment agencies and the issuance of work permits to non-resident aliens
and EENT registration certificates to resident aliens a function of the regional offices of DOLE
RA 8795 required the establishment of a Public Employment Service Office (PESO) in capital towns, cities and
other strategic areas
PESO - serves as EENT service & information center
- Regularly obtains lists of job vacancies from EERS, publicizes them, invites and evaluates applicants, and refers
them for probable hiring
- Provides training and educational guidance and EENT counseling services
- Also renders special services to the public such as holding of job fairs, livelihood and self-employment bazaars
- Special credit assistance for placed overseas workers
- Special program for EENT of students (SPES) during summer or semestral breaks
- Work appreciation seminars & conferences and
- Hiring of workers in infrastructure projects (WHIP)
Ra 6885 created WHIP, a program w/c requires the DPWH and private contractors to hire 30% of skilled and
50% unskilled labor requirements from the area where the project is being undertaken
2 Classifications
1. Land-based contract workers other than a seaman including workers ingaged in offshore activities whose
occupation requires that majority of his working/gainful hrs are spent on land
2. Sea-based those employed in a vessel engaged in maritime navigation
Regulatory Functions
1. Regulate private sector participation in the recruitment & overseas placement of workers through its licensing
and registration system;
2. Formulate & implement, in coordination w/ appropriate entities concerned, when necessary, a system for
promoting and monitoring the overseas EEnt of Filipino workers taking into consideration their welfare and the
domestic manpower requirements;
3. Inform migrant workers not only of their rights as workers but also of their rights as human beings;
4. Instruct and guide the workers how to assert their rights and provide the available mechanism to redress
violation of their rights;
5. In the recruitment & placement of workers to service the requirements for trained and competent Filipino
workers of foreign govts and their instrumentalities, and such other employers as public interest may require,
deploy only to countries:
a. Where the PH has concluded bilateral labor agreements or arrangements;
b. Observing and/or complying w/ the international laws and standards of migrant workers;
c. Guaranteeing to protect the rights of Filipino migrant workers.
Adjudicatory Functions
1. Administrative cases involving violations of licensing rules & regulations and registration of recruitment and
EEnt agencies/entities; and
2. Disciplinary action cases and other special cases w/c are administrative in character, involving employers,
principals, contracting partners and Filipino migrant workers.
Jurisdiction of POEA
1. all cases w/c are administrative in character, involving or arising out of violations of rules & regulations relating
to licensing & registration of recruitment and employment agencies/entities; and
2. disciplinary action cases and other special cases w/c are administrative in character, involving EERS, principals,
contracting partners and Filipino migrant workers
3. NO jurisdiction to enforce foreign judgment (must be brought before the regular courts). POEA is an
administrative (not a court), exercising adjudicatory or quasi-judicial functions
4. NO jurisdiction over torts
COMPROMISE AGREEMENT
-consistent w/ the policy encouraging amicable settlement of labor disputes Sec 10 of RA 8042 allows resolution
by compromise of cases filed w/ the NLRC
- any compromise agreement on money claims inclusive of damages shall be paid w/in 4 months from the
approval of the settlement
Penalties for Non-compliance of the mandatory period for resolution of cases
1. The salary of such official who fails to render his decision/resolution w/in the prescribed pd shall be, or caused
to be, withheld until such official complies therewith;
2. Suspension for not more than 90 days; or
3. Dismissal w/ disqualification to hold any appointive public office for 5 yrs
Agencies Given the Duty to promote the welfare & rights of migrant workers:
1. DFA
2. DOLE
3. POEA
4. OWWA Overseas Workers Welfare Administration provides social & welfare services including insurance
coverage, legal assistance, placement assistance and remittance services to Filipino overseas workers. Under
RA8042, it shall provide the Filipino migrant worker & his faily assistance in the enforcement of contractual obligs
by agencies, entities and/or their principals;
5. RPM - Re-Placement and Monitoring Center develops livelihood programs for the returning workers to
reintegrate the returning migrant workers to the Ph society;
6. NLRC tasked w/ the settlement/adjudication of labor disputes
Art 18: BAN ON DIRECT HIRING
GR: Direct hiring of Filipino workers for overseas EENT is not allowed
Exceptions:
1. Members of Diplomatic corps;
2. International organizations;
3. Other employers as may be allowed by DOLE; and
4. Name hires individual workers who are able to secure contracts for overseas EENT on their own
efforts and representations w/o assistance/participation of any agency. Their hiring nonetheless,
shall pass through the POEA for processing purposes
Disqualified from Recruitment & Placement of Workers for Overseas EEnt whether for profit or not
1. Travel agencies & sales agencies of airline companies;
2. Officers/members of the board of any corp or members in a partnership engaged in the business of a travel
agency;
3. Corps & partnerships, when any of its officers, members of the board or partners, is also an officer, member of
the board or partner of a corp or partnership engaged in the business of a travel agency (interlocking officers)
4. Persons, partnerships or corps which have derogatory records, such as but not limited to:
a. Those certified to have derogatory record/info by the NBI or by the Anti-illegal Recruitment Branch of the
POEA;
b. Those against whom probable cause or prima facie finding of guilt for illegal recruitment or other related cases
exists;
c. Those convicted of cases and/or crimes involving moral turpitude;
d. Those agencies whose licenses have been previously cancelled or revoked by POEA for violation of RA 8042, PD
442 as amended and their IRR as well as the Labor Codes IRR
e. Officials/EES of the DOLE or other govt agencies directly involved in overseas EENT program and their relatives
w/in the 4th degree of consanguinity or affinity; and
f. Those whos License have been previously cancelled o revoked
* Change of ownership of single proprietorship licensed to engage in overseas EENT shall cause the automatic
revocation of the license.
Note: POEA has the power to enforce liability under cash & surety bonds.
Art 32: FEES TO BE PAID BY WORKERS
The applicant can be charged w/ fees only after he has obtained EENT or has actually commenced
EENT
Fees paid shall always be covered w/ the appropriate receipt clearly showing the amount paid.
Jurisdiction
The DOLE Sec and the POEA Admin have concurrent jurisdiction to suspend or cancel a license
Liability of Recruitment Agency
Solidarily liable w/ the foreign principal for unpaid salaries of a worker it recruited. Before recruiting, the agency is
required to submit a doc containing its power to sue and be sued jointly and solidarily w/ the principal or foreign-
based employer for any of the violations of the recruitment agreement, and the contracts of employment
Note: The recruitment agency may still be sued even if agency agreement bet recruitment agency & principal is
already severed if no notice of the termination was given to the EE
Contract by Principal
Even if it was the principal of the manning agency who entered into contract w/ the EE, the manning agent in the
PH is jointly & solidarily liable w/ the principal
Illegal Recruitment any act of (CETCHUP) canvassing, enlisting, transporting, contracting, utilizing, or procuring
workers and includes (CRAP) contract services, referrals, or advertising, promising for employment abroad,
whether for profit or not, when undertaken by a non-licensee or non-holder of authority; Provided that any such
non-licensee or non-holder of authority who in any manner, offers or promises for a fee employment abroad to 2
or more persons shall be deemed so engaged. Also includes the act of reprocessing workers through a job order
that pertains to nonexistent work, work different from the actual overseas work, or work w/ a different EER
whether registered or not w/ the POEA
It shall likewise include the commission of the ff prohibited acts whether committed by a non-licensee or non-
holder of authority or a licensee or a holder of authority:
1. Those prohibited practices under Art 34;
2. Failure to actually deploy w/o valid reason as determined by DOLE;
3. Failure to reimburse expenses incurred by the worker in connection w/ his documentation & processing for
purposes of deployment, in cases where the deployment does not actually take place w/o the workers fault; and
4. Recruitment & placement activities of agents or representatives appointed by a licensee, whose appointments
were not previously authorized by the POEA shall likewise constitute illegal recruitment.
Consequences of Conviction
1. Automatic revocation of license/authority;
2. Forfeiture of the cash & surety bonds;
3. Conviction for the crime of estafa, if found guilty thereof
Absence of receipts evidencing payment, not fatal to prosecutions case for illegal recruitment as long as the
witnesses can positively show through their respective testimonies that the accused is the one involved in
prohibited recruitment
Liability of Local EEnt agency solidarily liable w/ the foreigh principal for unpaid salaries of a worker recruited.
Before recruiting, the agency is required to submit a doc containing its power to sue and be sued jointly and
solidarily w/ the principal or foreign-based EER for any of the violations of the recruitment agreement and the
contracts of EEnt
Liability of Company Engaged in Illegal Recruitment may be held as principal, together his EER, if it is shown
that he actively & consciously participated in illegal recruitment
Issuance of search warrant/warrant of arrest
Art 38 is unconstitutional inasmuch as it gives the Sec of Labor the power to issue search or arrest warrants
The exception is in cases of deportation whom the President or the Commissioner of Immigration may order
arrested, following a final order of deportation
Note: the Sec of Labor may order closure of illegal recruitment establishments because it is only administrative &
regulatory in nature
Alien Employment Permit (AEP) required for entry into the country for employment purposes and is issued
after determination of the non-availability of a person in the pH who is competent, able and willing at the time of
application to perform the services for w/c the alien is desired
All foreign nationals who intend to engage in gainful EENT in the PH shall apply for AEP
Note: AEP should be secured regardless of the source of compensation and duration of the EENT, whether the
EENT is part-time or temp
Note: Understudy Training Program is no longer a requirement in the issuance of AEP and the EEr has now the
option to implement transfer of technology
Note: Violations of the abovementioned acts will subj the alien to the punishment in Art 289 & 290 and to
deportation after service of sentence
Middle-level Manpower
1. Those who have acquired practical skills & knowledge through formal or non-formal education & training
equivalent to at least a secondary education but preferably a post-secondary education w/ a corresponding
degree/diploma; or
2. Skilled workers who have become highly competent in their trade or craft as attested by industry.
Art 57 STATEMENT OF OBJECTIVES FOR THE TRAINING & EENT OF SPECIAL WORKERS
1. To help meet the demand of the economy for trained manpower;
2. To establish a national apprenticeship program; and
3. To establish apprenticeship standards for the protection of apprentices.
Note: Total physical fitness is not required of the apprentice-applicant unless it is essential to the expeditious and
effective learning of the occupation. Only physical defects w/c constitute real impediments to effective perf as
determined by the plant apprenticeship committee may dispqualify an applicant
Art 60: EMPLOYMENT OF APPRENTICES
Qualifications to be met by EER:
1. Only EERS in highly technical industries may employ apprentices; and
2. Only in apprenticeable occupations as determined by the TESDA.
Note: at the termination of the apprenticeship, the EER is not required to continue the EENT
There is no valid apprenticeship if:
1. The agreement submitted to the TESDA was made long after the workers started undergoing apprenticeship;
2. The work performed by the apprenticeship was different from those allegedly approved by TESDA;
3. The workers undergoing apprenticeship are already skilled workers;
4. The workers were required to continue undergoing apprenticeship beyond 6mos.
Working Hrs shall not exceed the max number of hrs prescribed by law, if any, for a worker of his age and sex.
Time spent in compulsorily theoretical instruction shall be considered hrs of work. An apprentice not otherwise
barred by law from working 8hrs may be requisted by his EER to work overtime and paid accordingly.
FACTS:
Petitioner Antonio Serrano was hired by respondents Gallant Maritime Services, Inc. and Marlow Navigation Co.,
Inc., under a POEA-approved contract of employment for 12 months, as Chief Officer, with the basic monthly
salary of US$1,400, plus $700/month overtime pay, and 7 days paid vacation leave per month.
On the date of his departure, Serrano was constrained to accept a downgraded employment contract upon the
assurance and representation of respondents that he would be Chief Officer by the end of April 1998.
Respondents did not deliver on their promise to make Serrano Chief Officer.
Hence, Serrano refused to stay on as second Officer and was repatriated to the Philippines, serving only two
months and 7 days, leaving an unexpired portion of nine months and twenty-three days.
Upon complaint filed by Serrano before the Labor Arbiter (LA), the dismissal was declared illegal.
On appeal, the NLRC modified the LA decision based on the provision of RA 8042. Serrano filed a Motion for Partial
Reconsideration, but this time he questioned the constitutionality of the last clause in the 5th paragraph of Section
10 of RA 8042.
ISSUES:
1. Whether or not the subject clause violates Section 10, Article III of the Constitution on non-impairment of
contracts;
2. Whether or not the subject clause violate Section 1, Article III of the Constitution, and Section 18, Article II and
Section 3, Article XIII on labor as a protected sector.
HELD:
On the first issue.
The answer is in the negative. Petitioners claim that the subject clause unduly interferes with the stipulations in
his contract on the term of his employment and the fixed salary package he will receive is not tenable.
The subject clause may not be declared unconstitutional on the ground that it impinges on the impairment clause,
for the law was enacted in the exercise of the police power of the State to regulate a business, profession or
calling, particularly the recruitment and deployment of OFWs, with the noble end in view of ensuring respect for
the dignity and well-being of OFWs wherever they may be employed.
On the second issue.
The answer is in the affirmative.
To Filipino workers, the rights guaranteed under the foregoing constitutional provisions translate to economic
security and parity.
Upon cursory reading, the subject clause appears facially neutral, for it applies to all OFWs. However, a closer
examination reveals that the subject clause has a discriminatory intent against, and an invidious impact on, OFWs
at two levels:
First, OFWs with employment contracts of less than one year vis--vis OFWs with employment contracts of one
year or more;
Second, among OFWs with employment contracts of more than one year; and
Third, OFWs vis--vis local workers with fixed-period employment;
The subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage.
Thus, the subject clause in the 5th paragraph of Section 10 of R.A. No. 8042 is violative of the right of petitioner
and other OFWs to equal protection.
The subject clause or for three months for every year of the unexpired term, whichever is less in the 5th
paragraph of Section 10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL.
FACTS:
Sometime in the months of January to February, 1996, representing to have the capacity, authority or license to
contract, enlist and deploy or transport workers for overseas employment, did then and there, willfully, unlawfully
and criminally recruit, contract and promise to deploy, for a fee the herein complainants, namely, Imelda D.
Bamba, Geraldine M. Lagman and Alma E. Singh, for work or employment in Los Angeles, California, U.S.A. in
Nursing Home and Care Center.
Prosecution presented three witnesses, namely Imelda Bamba, Geraldine Lagman and Alma Singh.
According to Bamba, she met the appellant on a bus. She was on her way to SM North Edsa where she was a
company nurse. Appellant introduced himself as a recruiter of workers for employment abroad. Appellant told her
he could help her get employed as nurse. Appellant gave his pager number and instructed her to contact him is
shes interested. Sometime in January 1996, appellant fetched her at her office, went to her house and gave him
the necessary documents and handed to appellant the amount of US$300.00 and the latter showed her a
photocopy of her supposed US visa. However, the appellant did not issue a receipt for the said money. Thereafter,
appellant told her to resign from her work because she was booked with Northwest Airlines and to leave for USA
on Feb, 1996. On the scheduled departure, appellant failed to show up. Instead, called and informed her that he
failed to give the passport and US visa because she had to go to province because his wife died. Trying to contact
him to the supposed residence and hotel where he temporarily resided, but to no avail.
Winess Lagman testified that she is a registered nurse. In January 1996, she went to SM North Edsa to visit her
cousin Bamba. At that time Bamba informed her that she was going to meet to appellant. Bamba invited Lagman
to go with her. The appellant convinced them of his ability to send them abroad. On their next meeting, Lagman
handed to the latter the necessary documents and an amount of US$300.00 and 2 bottles of black label without
any receipt issued by the appellant. Four days after their meeting, a telephone company called her because her
number was appearing in appellants cell phone documents. The caller is trying to locate him as he was a swindler.
She became suspicious and told Bamba about the matter. One week before her scheduled flight, appellant told her
he could not meet them because his mother passed away.
Lastly, Alma Singh, who is also a registered nurse, declared that she first met the appellant at SM North Edsa
when Imelda Bamba introduced the latter to her. Appellant told her that he is an undercover agent of FBI and he
could fix her US visa. On their next meeting, she gave all the pertinent documents. Thereafter, she gave P10,000
to the appellant covering half price of her plane ticket. They paged the appellant through his beeper to set up
another appointment but the appellant avoided them as he had many things to do.
The accused Jamilosa testified on direct examination that he never told Bamba that he could get her a job in USA,
the truth being that she wanted to leave SM as company nurse because she was having a problem thereat. Bamba
called him several times, seeking advices from him. He started courting Bamba and went out dating until latter
became his girlfriend. He met Lagman and Singh thru Bamba. As complainants seeking advice on how to apply for
jobs abroad, lest he be charged as a recruiter, he made Bamba, Lagman and Singh sign separate certifications, all
to effect that he never recruited them and no money was involved. Bamba filed an illegal recruitment case against
him because they quarreled and separated.
RTC rendered judgment finding accused guilty beyond reasonable doubt of illegal recruitment in large scale.
HELD: Recruitment and placement" refers to any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring, or procuring workers, and includes referrals, contract services, promising or advertising for employment,
locally or abroad, whether for profit or not. Provided, That any person or entity which, in any manner, offers or
promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement.
Illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or
procuring workers and includes referring, contract services, promising or advertising for employment abroad,
whether for profit or not, when undertaken by a non-licensee or non-holder of authority. Provided, That any such
non-licensee or non-holder who, in any manner, offers or promises for a fee employment abroad to two or more
persons shall be deemed so engaged.
To prove illegal recruitment in large scale, the prosecution is burdened to prove three (3) essential elements,
to wit:
(1) the person charged undertook a recruitment activity under Article 13(b) or any prohibited practice under
Article 34 of the Labor Code;
(2) accused did not have the license or the authority to lawfully engage in the recruitment and placement of
workers; and
(3) accused committed the same against three or more persons individually or as a group. As gleaned from the
collective testimonies of the complaining witnesses which the trial court and the appellate court found to be
credible and deserving of full probative weight, the prosecution mustered the requisite quantum of evidence to
prove the guilt of accused beyond reasonable doubt for the crime charged. Indeed, the findings of the trial court,
affirmed on appeal by the CA, are conclusive on this Court absent evidence that the tribunals ignored,
misunderstood, or misapplied substantial fact or other circumstance.
The failure of the prosecution to adduce in evidence any receipt or document signed by appellant where he
acknowledged to have received money and liquor does not free him from criminal liability. Even in the absence of
money or other valuables given as consideration for the "services" of appellant, the latter is considered as being
engaged in recruitment activities. It can be gleaned from the language of Article 13(b) of the Labor Code that the
act of recruitment may be for profit or not. It is sufficient that the accused promises or offers for a fee
employment to warrant conviction for illegal recruit
CONDITIONS OF EMPLOYMENT
WORKING CONDITIONS & REST PERIODS
a. ALL employees in all establishments & undertakings whether for profit or not
b. Such standards apply only if there exists EER-EE relationship
EXCEPTIONS on Conditions of EEnt
i. Government employees EES of govt agencies & govt corps
ii. Managerial employees those whose primary duty consists of the mgt of the establishment in
w/c they are employed or of a dept/subd thereof, and to other officers/members of the managerial staff
- under the direct supervision of the EER, and assist in the planning, organizing, staffing, directing
controlling, communicating and in making decisions in attaining the companys set goals & objectives:
a. Includes supervisiors (only as regards Art 82) likewise responsible for the effective &
efficient operation of their respective depts
iii. Field personnel non-agricultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours of work in the field
cannot be determined w/ reasonable certainty
c. those whose performance of their job/service is not supervised by the ER or his rep, the workplace being away
from the principal office and whose hours & days of work cannot be determined w reasonable certainty; hence
they are paid specific amount for rendering specific service or performing specific work.
a. drivers that are required to be at specific places at specific times are not field personnel
b. in case of fishermen although performing non-agri work away from the office, the fact that they have
no choice but to remain on board the vessel, they are still under constant supervision by the ER thru the vessels
patron/master
c. Employers family members who are dependent on him for support
d. Domestic helpers
house personnel hired by a ranking company official, a foreigner, but paid for by the company
itself, to maintain a staff house provided for the official - regular EE
Persons in the personal service of another
Workers paid by result per piece/per task
- laborer/EE w/ no fixed salary, wag, or renumeration but receiving a compensation from his ER an uncertain &
variable amount depending upon the work done or the result of said work (piece work), irrespective of the time
employed
EER-EE Relationship is not dependent upon the agreement of the parties. The characterization by law prevails
over that in the contract. the existence of an EER-EE relshp is not a matter of stipulation but a question of law
depends on the facts of each case
Core/Non-core Jobs
EER-EE relationship may cover core/non-core activities of the EERs business.
The kind of work is not the definitive test of whether the worker is an EE or not.
Employer any person, natural or juridical, domestic or foreign, who carries on in the PH any trade, business,
industry, undertaking or activity of any kind and uses the services of another person who is under his order as
regards employment
Employee any person who performs services for an EER in w/c either or both mental & physical efforts are used
and who receives compensation for such services, where there is an EER-EE relationship
Right of Control Test where the person for whim the services are performed reserves a right to control not
only the end to be achieved but also the means to be sued in reaching such end.
Plus: the courts added the existing economic conditions prevailing bet the parties (like payrolls) in determining the
existence of EER-EE Relship.
Independent contractors can employ others to work & accomplish contemplated result w/o consent of
contractee, while EE cannot substitute another in his place w/o consent of his EER.
The Economic Dependence Test observes the need to consider the existing conditions bet the parties
Standard of economic dependence whether the worker is dependent on the alleged employer for his continued
employment in that line of business
Evidence of employment
id card
vouchers of salaries
sss registration
memorandum
* Unions and unregistered associations can be EERs of the persons who work for them
An employer is free to regulate, according to his own discretion & judgment, all aspects of EENT, including hiring,
work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed,
supervision of workers, working regulations, transfer of EES, work supervision, lay-off of workers and discipline,
dismissal and recall of workers.
Employers have the right to exercise management prerogatives to strengthen his business
competitiveness unlawful/ unjust/unfair; so long as they are exercised in GF for the advancement of his interest
and not for the purpose of defeating/circumventing the Rights of the EES
a. May devise & implement new salary scales applicable only to future EES. (salary distortion)
Purpose of 8-hr Labor law not only to safeguard the health & welfare of the laborer/EE, but in a way to minimize
unemployment by forcing ERs, in cases where more than 8-hr operation is necessary, to utilize different shifts to
laborers/EEs working only for 8 hrs each
Part-time Work not prohibited. (What the law regulates is work exceeding 8hrs)
GR: Wage & benefits of a part-timer are in proportion to the number of hrs worked.
Work hrs of Health Personnel
Health personnel shall include, but not limited to, resident physicians, nurses, nutritionists, dieticians,
pharmacists, social workers, lab technicians, paramedics, psychologists, midwives, attendants, and all other
hospital & clinic personnel like medical secretaries
Resident physicians customary practice to work for 24 hrs a day violates the limitations in Art 83. when they
are under training program/agreement bet the residents and the hospital accredited by the govt
Hospital EEs are entitled to a full weekly salary w/ apid 2 days off if they have completed the 40hr/5day
workweek (7days pay for 5 days work)
Health personnel in Govt service covered by RA 7305
12-hr Workshift with Overtime - through a contract freely entered into, workshift may exceed 8hrs w/
corresponding overtime pay.
Rest periods of short duration during work hours shall be counted as hours worked
Pre/Postliminary Activities
Preliminary (before work) and postliminary (after actual work) activities are deemed performed during
working hrs, where such activities are controlled/required by the ER and are pursued necessarily & primarily for
the ERs benefit
Waiting Time
whether waiting time constitutes working time depends on the circumstances on each particular case
controlling factor is WON time spent in idleness is so spent predominantly for the ERs benefit or for the EEs
1. Engaged to Wait waiting time spent by EE shall be considered as working time if waiting is considered an
integral part of his work or if the EE is required/engaged by an ER to wait
2. Waiting to Engage idle time is not work time
depends upon the express/implied agreement of the parties, or in absence of an agreement, upon the nature of
the service and its relation to the working time.
On Call
Although EE can rest completely and may not be actually at work, if they are required to be in their place of work
before/after the regular working hrs and w/in the call of their ERs, the time they stay in the place of work sould
not be discounted from their working hrs
EE cannot use the time effectively for his own purposes is working while on call.
Note on call: EE is not required to remain on the ERs premises but is merely required to leave work at his home
or w/ company officials where he may be reached
Public health workers On call status refers to a condition when public health workers are called upon to
respond to urgent or immediate need for health/medical assistance or relief work during emergencies such that
he/she cannot devote the time for his/her own use.
Travel Time time spent walking, riding, or traveling to/from place of work
a. Travel from home to work not worktime when EE receives an emergency call outside his regular
working hrs and is required to travel to his regular place of business or some other worksite working time
b. Travel that is all in a days work time spent by an EE in travel as part of his principal activity hrs worked
c. Travel away from home travel that keeps an EE away from home overnight worktime when it cuts
across the EEs workday
Grievance Meeting time spent in adjusting grievance bet ER & Ee during the time the EEs are required by the ER
to be on the premises -hrs worked
if a bona fide union is involved depends on the CBA or the custom practice under the CBA
If less than 20 minutes it becomes only a rest period and is thus considered work time
Note: Meal periods during overtime work is not given to workers performing OT bcoz OT is usually for a short
period
Requisites
1. EEs voluntarily agree in writing and waive their OT pay;
2. No diminution in the salary and other fringe benefits of the EEs already existing;
3. Work is not physically strenuous and they are provided w/ adequate coffee breaks in the morning & afternoon;
4. Value of benefits is equal to the compensation due them;
5. OT pay will become due and demandable if they are permitted/made to work beyond 4:30 pm; and
6. The arrangement is of temporary duration.
Note: The 8-hr work period does not include the meal break. EEs may leave the company premises as long as
they return to their posts on time.
PALEA v PAL (1976) PALEA & PAL Supervisors Assoc (PALSA), commenced an action v PAL in the CIR praying
that the latter be ordered to revise the method of computing the basic daily & hourly rates of its monthly-salaried
EEs and necessarily to pay them their accrued salary differentials
PALs Formula:
monthly salary x 12/365 days in a yr = Basic daily rate
basic daily rate/8 Basic hourly rate
Proposed Formula:
Monthly salary x 12/actual working days = BDR
BDR/8 = BHR
Paid Unworked days of a monthly-paid EE
- ER may stipulate that EEs monthly salary constitutes payment for all the days of the month incl rest days &
holidays if when converted into its daily equivalent would still meet minimum wage legal
a. Broken Hrs of Work the minimum normal working hrs need not be continuous to constitute as the legal
working day of 8 hrs as long as the 8 hrs is w/in a work day
b. Work in Different Shifts in a Work day work in excess of 8hrs w/in a work day is considered as OT regardless
of whether this is performed in a work shift other than at w/c the EE regularly works
EEs shift is 10pm-6am. He is asked to take a shift of another EE who is absent from 2pm-10pm (his regular work
day would be from 10pm-10pm) the 2nd shift is considered OT because it is still w/in his work day
GR: An express instruction from the ER to the EE to render OT work is not required for the EE to be entitled to OT
pay. It is sufficient that the EE is permitted or suffered to work. Neither is an express approval by a supervisor
needed.
On rest days & holidays, written authority after office hrs is required for the EE to be entitled to compensation
A verbal instruction to render OT work prevails over a memorandum prohibiting such work.
OT claim is not justified for days where no work was required and no work could be done (i.e. brownout, machine
repair, lack of rawmats)
OT Work of Seamen whether or not the sailors are entitled to OT pay is not whether they were on board and
cannot leave ship beyond the regular 8 working hrs a day, but whether they actually rendered service in excess of
8 hrs
OT work must be proven by factual & legal basis
Action to Recover Compensation
- estoppel & laches cannot be invoked against EEs bcoz that would be contrary to the spirit of the 8-hr Labor Law,
under w/c the laborers cannot waive their R to extra compensation
- OT pay in arrears retroacts to the date when services were actually rendered
GR: Waiver or quitclaim not a waiver of OT pay. Any stipulation in the contract that the laborer shall work
beyond the regular 8 hrs w/o addtl compensation for the extra hrs is contrary to law and null and void
Waiver of OT Pay
GR: OT pay cannot be waived expressly or impliedly. Any contrary stipulation is null and void.
Exceptions
1. When the waiver is made in consideration of benefits & privileges w/c may be more than what will accrue to
them in OT pay; and
2. Compressed workweek (CWW) the number of work days is reduced but the number of work hrs in a day is
increased to more than 8, but no OT pay may be claimed.
* EE may validly waive the R to OT under a CWW program, provided he did so voluntarily, w/ full understanding of
what he was doing and in consideration for the quit claim is credible & reasonable.
Note: EEs promoted from rank-and-file to supervisory lose their OT pay and other benefits under Art 82-96
Illustrations of OT Computations
1. Regular Workdays
Rest day & special holiday wage rate (150%) + 30% thereof
Rest day & legal holiday wage rate (260%) + 30% thereof
6. Double holiday
EE will receive 200% of his regular daily wage when both regular holidays fall on the same day and he does not
work (Law provides that he shall get his regular daily wage of each regular holiday)
100% of Araw ng Kagitingan, 100% Good Friday. If he works on that day, he gets 400%
OT pay integrated in Basic Salary (composite/package pay/all-inclusive salary) not illegal nor unusual for
executives or managers But for non-managerial EEs, there must be:
1. A clear written agreement
2. Agreed legal wage rate and OT pay computed separately are equal or higher than the separate amounts legally
due
1. Reduction of workdays where normal workdays per week are reduced but should not last for more than 6
months
2. Rotation of workers where the EEs are rotated/alternately provided work w/in the workweek
3. Forced leave EEs are required to go on leave for several days or weeks, utilizing their leave credits if there
are any
4. Broken-time schedule the work schedule is not continuous but the number of hrs w/in the day or week is not
reduced
5. Flexi-holiday schedule Ees agree to avail themselves of the holidays at some other days, provided that there
is no diminution of existing benefits as a result of such arrangement
Exceptions
1. In cases of urgent work to be performed on the machinery, equipment or installation;
2. To prevent loss or damage to perishable goods;
3. In case of actual/impending emergencies caused by force majeure to prevent loss of life and property, or
imminent danger to public safety;
4. Where the nature of work requires continuous operations and the stoppage of work may result in irreparable
injury/loss to the ER;
5. In the event of abnormal pressure of work due to special circumstances, where the ER cannot ordinarily be
expected to resort to other measures; and
6. Under the circumstances analogous to the foregoing as determined by the Sec of Labor.
Note: The failure to work during an EEs rest day does not justify disciplinary sanction of outright dismissal, more
so when justifiable grounds exist for the said failure.
Note: When an EE volunteers to work on his rest day under other circumstances, he may be allowed to do so,
provided he expresses such desire in writing and he is paid the addtl compensation for working on his rest day
2. For declared SPECIAL DAYS such as Special Non-Working Day, Special Public Holiday, Special National Holiday
and nationwide special days
a. If unworked no pay, unless there is a favorable company policy, practice or CBA granting payment of
wages on special days even if unworked
b. If worked
i. 1st 8hrs plus 30% of the daily rate of 100%
ii. excess of 8hrs plus 30% of hourly rate on said day
B. Special (Non-working)Days
1. Black Saturday
2. Ninoy Aquino Day
3. All Saints Day
4. Nov 2
5. Dec 24
6. Last Day of the Year
D. Local Holiday
Note: In addition to the Exceptions in Art 82, Holiday pay is n/a to EEs of retail and service establishments
regularly employing 10 workers or less
Rule on Compensability compensable whether worked or unworked subj to certain conditions.
Legal holiday falling on a Sunday does not create an addtl oblig for the ER to pay extra, aside from the usual
holiday pay to its montly paid EEs
Holiday pay of Monthly paid EEs
GR: for the company w/ a 6-day working schedule, the divisor 314 already means that the legal holidays are
included in the monthly pay of the EE. The divisor is arrived at by subtracting all Sundays from the total number
of calendar days in a yr
GR: for a company w/ a 5-day working schedule, the divisor 261 means that the holiday pay is already included in
the montly salary of the EE
Double Holiday Pay (Araw ng Kagitingan & Good Friday on the same day)
1. 200% of the basic wage
a. entitled even if said holiday is unworked
b. to give EE only 100% would reduce the number of holidays under the law
2. 400% if he worked on 2 regular holidays falling on the same day
3. 520% if he worked on 2 regular holidays falling on the same day and at the same time falling on a scheduled
rest day
* EEs engaged on task/contract basis or paid purely commission basis are not automatically exempted from the
SEL unless they fall under the classification of field personnel.
Conversion to Monetary Equivalent
SIL is COMMUTABLE or convertible to cash if not used or exhausted at the end of the yr
Basis of conversion: the salary rate at the date of commutation
ALSO Entitled to SIL
1. EE illegally dismissed
2. Part-time workers
3. Piece-rate workers:
a. Working inside the premises of ER & thus are under direct supervision of the ER entitled
b. Working outside the premises of the ER whose hours of work cannot be ascertained w/ reasonable certainty and
thus are not under the direct supervision of the ER not entitled
EEs w/ salaries above Min Wage: the difference bet the min wage and the actual salary received by the EEs
cannot be deemed as their 13th month pay and SIL pay
GR: Benefits are non-cumulative and non-commutative; must be enjoyed by the EE w/in 1yr otherwise forfeited
when the labor law contract or the established practice of the ER provides otherwise
SIL VL/SL
Mandatory Art 95 Voluntary grant (ERs
policy or CBA)
Intended to alleviate the Intended to afford a
economic condition of laborer a chance to get
the workers for it acts a much needed rest to
as replacement for replenish his energy and
regular income that renew his efficiency
would not be earned
during such instance
Cannot be waived Must be demanded in its
opportune time; silence
is waiver
Commutable Not commutable
Distribution distributed to paid EEs at least once every 2 weeks or 2x a month at interval of at least 16 days
Rule in case of abolition
- in case the service charge is abolished, the share of the covered EEs shall be considered integrated in their
wages
- the basis of the amount to be integrated shall be the average share of each EE for the past 12 months
immediately preceding the abolition
Pooled Tips
- where an establishment does not collect service charges but has a practice/policy of pooling tips given
voluntarily by its customers, the pooled tips should be monitored, accounted for and distributed in the same
manner as the service charges
Title 2 WAGES
Ch 1
Art 97. Definitions
Person an individual, partnership, assoc, corp, business trust, legal rep, or any organized group of persons
Employer any person acting directly/indirectly in the interest of an ER in relation to an EE & shall include the
Govt & all its branches, subd, & instrumentalities, all govt-owned/-controlled corps & institutions, as well as non-
profit private institutions/orgs.
Employee - any indiv employed by an ER
Agriculture includes farming in all its branches, and among other things, includes the cultivation & tillage of soil,
dairying, the production, cultivation, growing & harvesting of any agricultural & horticultural commodities, the
raising of livestock or poultry, and any practices performed by a famer on a farm as an incident to or in
conjunction with such farming operations, but does not include the manufacturing or processing of sugar,
coconuts, abaca, tobacco, pineapples or other farm products.
Employ includes to suffer or permit to work
Wage paid to any EE; shall mean the renumeration or earnings, however designated, capable of being
expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other
method of calculating the same, w/c is payable by and ER to an EE under a written/unwritten contract of ENT for
work done or to be done, or for services rendered and includes the fair and reasonable value, as determined by
the Sec of Labor, of board, lodging, or other facilities customarily furnished by the ER ro the EE.
Includes commissions the recompense compensation/reward of an agent, salesman, executor, trustee, receiver,
factor, broker or bailee, when the same is calculated as a percentage on the amt of his transactions or on the
profit of the principal
Sonco v NLRC:
Zuelig was made to pay the terminated EE (due to retrenchment), separation pay based not only on the basic
salary, but also on the commissions, transpo & emergency living allowances.
Even if commissions were in the form of incentives or encouragement, still these commissions are direct
renumerations for services rendered w/c contributed to the increase of income of the ER. The nature of work of a
salesman & the reason for such type of renumeration for services rendered demonstrate that commissions are
part of their wage or salary. (Some salesmen do not receive any basic salary but depend on commissions &
allowances or commissions alone, although an EE-ER relationship exists).
Includes facilities or commodities fair & reasonable value of board, lodging, or other facilities customarily
furnished by the ER to the EE.
An ER may provide, for instance, food & housing to his EEs but he may deduct their values from the EES wages to
be determined by the Sec of Labor.
Snacks
70% - deducted from wages (must be authorized in writing)
30% - subsidized by the ER
Lodging facility the cost of operation & maintenance, including adequate depreciation plus amt of capital
invested by the ER, provided that if the total is more than the fair rental value ( or the fair price of the
commodities or facilities offered for sale)
Fair rental value -shall be the reasonable cost of the operation & maintenance.
Rate of depreciation & depreciated amt those arrived at under good accounting practices
Good accounting practices shall NOT include accounting practices w/c have been rejected by the BIR for IT
purposes
Depreciation shall include obsolescence
In order that the cost of facilities furnished by the ER may be charged against an EE, his acceptance of such
facilities must be voluntary
Excludes allowances Fair & reasonable value shall NOT include any profit to the ER or to any person affiliated
w/ the ER
WAGES SALARY
Compensation for manual labor, Denotes a higher degree of ENT, or a superior
skilled/unskilled, paid at stated times, grade of services, and implies a position or
and measured by the day, week, office
month, or season
Indicates considerable pay for a lower Suggestive of a larger and more permanent or
and less responsible character of ENT fixed compensation for more important service
Has a less extensive meaning than Compensation of clerks, officers of pub corps,
salary; being ordinarily restricted to and pub offices
sums paid as hire or reward to
domestic or menial servants and to
sums paid to artisans, mechanics,
laborers, and other EEs of like class
In many situations, however, and as the SC states, they are in essence synonymous
FACILITIES SUPPLEMENTS
Include articles or services for the benefit of
the EE or his family but shall NOT include
tools of the trade or articles or service
primarily for the benefit of the ER or
necessary to the conduct of the
ERs business
Wage-deductible Not wage-deductible
Benefit/privilege part of the laborers basic Benefit/privilege given to the EE w/c
wages, constitutes an extra renumeration above &
over his basic or ordinary earning or wage
The distinction bet a facility & a supplement is in the purpose, (not the kind) of the item.
State Marine Corp & Royal Line, Inc. v Cebu Seamens Assoc, inc:
The vessel crew were provided w/ free meals by the ship owners (petitioner), not part of their wages but as a
necessary matter in the maintenance of the health & efficiency of the crew during the voyage. They should not be
deducted from their wages. The deductions should be returned to them.
Mabeza v NLRC:
The ER failed to meet any of the requirements. More significantly, the food & lodging or the electricity & water
consumed by the EE were not facilities, but supplements. Hotel workers are required to work different shifts and
are expected to be available at various odd hours, their ready availability is a necessary matter in the operations
of respondents hotel.
Gratuity - Given freely or w/o recompense; a gift; something voluntarily given in return for a favor or services; a
bounty; a tip.
- gratuity pay is not intended to pay a worker for actual services rendered. It is a money benefit given to the
workers whose purpose is to reward EEs who have rendered satisfactory & efficient service to the company.
- Not mandatory & not part of labor standard law
A fair days wage for fair days labor. if there is no work performed by the EE, there can be no wage or
pay unless the laborer was able, willing and ready to work but was prevented by the mgt or was illegally locked
out, suspended or dismissed.
Equal pay for equal work. EEs working in the PH, if they are performing similar functions & responsibilities
under similar working conditions, should be paid under the principle of equal pay for equal work.
SC: If an ER accords EEs the same position & rank, the presumption is that these EEs perform equal work. There
is no showing that foreign-hires perform 25% more efficiently or effectively than the local-hires. Both groups have
similar functions & responsibilities w/c they perform under similar working conditions. The dislocation factor
and limited tenure cannot serve as valid bases for the distinction in salary rates, and are adequately
compensated by certain benefits accorded them w/c are not enjoyed by local-hires (housing, transpo, shipping,
taxes, home leave allowance).
Agricultural Activities
Preparation of the soil, planting of ramie stalks and transporting them to the stripping sheds, stripping the
fibers w/ the use of decorticating machines run by electricity, drying the wet fibers, passing them through the
brusher to cleanse them of impurities and baling the fiers for the market
Planting & harvesting sugar cane & other chores incidental to ordinary farming operations
Tillage of the soil, raising of crops including discovery of plant pests and their eradication by means of
insecticides
Fishpond business
farmhands employed to cultivate the vegetable garden of a non-agricultural corp are not agricultural workers
Art 99. The minimum wage rates for agricultural and non-agricultural EEs and workers in each and
every region of the country shall be those prescribed by the Regional Tripartite Wages and
Productivity Boards
Statutory Minimum Wage the lowest wage rate fixed by law that an ER can pay his workers. Compensation
w/c is less than such minimum rate is considered an underpayment that violates the law.
- determined for each region by the regional wage boards
- provided w/ margin to take care of contingencies, such as increase of prices of commodities and increase in
wants and to provide means for a desirable improvement in EEs mode of living (A persons needs increase as his
means increase.)
Effects:
1. benefits all wage earners by setting a floor below w/c their pay cannot fall
2. raises the standard of competition among ERs, since it would protect the fair-minded ER from the competition
of the ER who pays his workers a wage below subsistence;
3. is a prereq to the adoption of the SSS, w/c requires contributions from EEs themselves
Food/Meal Allowance
Samahang Manggagawa sa Top Form v NLRC: Granted that the ER had granted an across-the-board wage
increase pursuant to RA 6727, that single instance may not be considered an established company practice.
Negotiated benefits benefits initiated through negotiation bet ER & EEs, such as CBAs, are not w/in the
prohibition of Art 100 because, as products of bilateral contract, they can only be eliminated or diminished
bilaterally. What the law forbids is elimination/modification done unilaterally by the ER.
Wage Order Compliance the giving of across-the-board salary increases so as to rectify a salary distortion
caused by compliance w/ a wage order cannot be said to have ripened into a company practice.
Pag-asa Steel Works v CA: To ripen into a company practice that is demandable as a matter of right, the giving of
the increase should not only be by reason of a strict legal (as Wage Order) or contractual oblig (CBA), but by
reason of an act of liberality on the part of the ER.
SC: This reclassification is in essence a promotion w/c is one of the jurisprudentially recognized exclusive
prerogatives of mgt, provided in is done in GF. Union failed to prove BF on the part of the ER.
Promotion the advancement from one position to another with an increase in duties & responsibilities as
authorized by law and usually accompanied by an increase in salary
Bonus an amount granted & paid to an EE for his industry & loyalty w/c contributed to the success of the ERs
business and made possible the realization of profits. It is an act of generosity.
- it is not a demandable and enforceable obligation. BUT! It is so when it is made a part of the wage/salary. In
such a case, the latter would be a fixed amount and the former would be a contingent one dependent upon the
realization of profit
American Wire & Cable Daily Rated EEs Union v AWC Co Inc & the CA:
For a bonus to be enforceable, it must have been promised by the ER and expressly agreed by the parties, or it
must have had a fixed amt and had been a long and regular practice on the part of the ER.
Marcos v NLRC:
if one enters into a contract of ENT under an agreement that he shall be paid a certain salary by the week or some
other stated period and, in addition, a bonus, in case he serves for a specified length of time, there is no reason
for refusing to enforce the promise to pay the bonus, if the EE has served during the stipulated time, on the
ground that it was a promise of mere gratuity.
No Profit, No Bonus
Productivity Incentives - bonus that comes from productivity gain, or improved output without increasing input
- RA 6971: EEs share is in the nature of salary bonus proportionate to increases in current productivity over the
average for the preceding 3 consecutive years
- Not gratuitous; it is a benefit claimable only on the basis of predefined output level
- Contingent/conditional; if they are not given because the preconditions are absent, Art 100 is not violated
except perhaps if there is contractual commitment to the contrary.
its Equivalent shall include Xmas bonus, mid-year bonus, profit-sharing payments and other cash bonuses
amounting to not less than 1/12 of the basic salary. When an ER pays less than 1/12 of the EEs basic salary, the
ER shall pay the difference.
Framanlis Farms Inc. v Minister of Labor: Such benefits in the form of food or free electricity are not the proper
substitute for the 13thMP required by law. Neither may year-end rewards for loyalty & service be considered in
lieu of 13thMP
If the bonus was included in or considered as the equivalent of the 13thMP, there would be no need for a specific
provision of such bonus in the CBA. But if the CBA did provide for a bonus in graduated amts depending on the
length of service, for example, the intention is clear that the bonus provided in the CBA was meant to be in
addition to the legal requirement of 13thMP.
Fringe benefits all allowances & monetary benefits w/c are not considered/integrated as part of the basic
salary
The items excluded by the decree may be included through established practice or agreement binding on the ER
Q: Are commissions included in the computation?
A: It depends.
1. If the commissions may properly be considered part of the basic salary, they should be included in computing
the 13THMP
Sales commissions are intimately related or directly proportional to the extent or energy of an EEs endeavors;
paid upon the specific results achieved by a salesman-EE; it is a percentage of the sales closed by a salesman &
operates as an integral part of such salesmans basic pay.
2. If they are NOT integral part of the basic salary, then they should be excluded.
Boie-Takeda Case:
the commissions paid to med reps were excluded from the term basic salary because these were paid to them
as productivity bonuses. They are generally tied to the productivity or capacity for revenue production of a
corp; such bonuses closely resemble profit-sharing payments and have no clear direct or necessary relation to the
amt of work actually done by each indiv EE.
The commissions paid by Boie to its med reps could not have been sales commissions. Med reps are not
salesmen; they do not affect any sale of any article at all. They are EEs engaged in the promotion of
pharmaceutical products or med devices manufactured by their ER. They promote such products by visiting
identified physicians & inform such physicians orally/w/ the aid of brochures, of the existence & chem composition
of the pharma product. The addts payments given to them were not in fact commissions but rather in the nature
of profit-sharing bonuses.
Guaranteed wage/commission EEs whose income is guaranteed by way of wages and/or commissions are
entitled to a 13thMP based on their earnings that include commissions.
Proportionate 13thMP
- an EE who has resigned or was dismissed at any time before the time for payment of the 13thMP is entitled to
this monetary benefit in proportion to the length of time he worked during the year. unless otherwise stipulated in
the CBA
Distressed Employer exempted from paying 13thMP upon prior authorization from the Sec of DOLE
Difference of opinion in the computation of 13thMP is a nonstrikeable issue. a strike held on this ground is illegal.
Govt Employees not covered by 13thMP
Seafarers not covered by 13thMP; because they are contractual, not regular EEs. Their ENT is governed by
their Contract of Enlistment w/c was approved by the POEA. It does not provide for 13thMP.
Pakyaw Piece-rate
More aptly used when the job/work to Common where the output may
be performed is in bulk/volumes w/c easily be counted or
are difficult to quantify
*Payment by result is not determinative of EE-ER Relationship. It is merely a method of compensation and does
not define the essence of the relation.
B. As to Rate of Payment
1. Those who are paid piece rates w/c are prescribed in Piece Rate Orders issued by DOLE
2. Those who are paid output rates w/c are prescribed by the ER and are not yet approved by the DOLE.
a.) If the resulting amt is than the statutory min daily rate in rel to the # of hrs worked, the
worker will rcv such amt.
b.) BUT, if the amt is less than the applicable legal rate, it is possible that the rates per pc are not
in accordance w/ the standards. In that case, the ER is required by law to pay the difference.
Entitlement of Piece-Rate Workers to NSD and SIL
a. Unsupervised no OT/SIL
b. Supervised entitled to OT/SIL
- The yearly commutation/cash conversion of the SIL should be based on their average daily earnings earned
during the yr by the actual number of working days or the statutory min rate, whichever is higher.
GR: the amt earned during the year may exclude COLA, OT pay, and premium pay, holiday pay, NSD and
company fringe benefits
there is agreement to the contrary
Entitlement to 13thMP
GR: PD 851 exempts from payment of 13thMP ERs of those who are paid a fixed amt for performing specific work,
irrespective of time consumed in the perf thereof,
except where the workers are paid on piece-work basis (those who are paid a standard amt for every pc/unit of
work produced that is more/less regularly replicated, w/o regard to the time spent in producing the same) in w/c
case the ER shall grant the 13thMP to such EEs.
The piece-rate worker should have rendered at least 1 month work/service during the calendar yr.
Ch 3 PAYMENT OF WAGES
Exception:
1. In case of force majeure or other circs beyond the ERs control, payment must be made immediately after such
occurrence has ceased.
2. If engaged to perform a task w/c cannot be completed in 2 weeks and in the absence of CBA or arbitration
award:
a. Payment shall be made at intervals not exceeding 16 days, in proportion to the amt of work completed;
b. That final settlement is made upon completion of work.
Exception:
1. When payment cannot be effected at or near the place of work by reason of deterioration of peace & order
conditions, or by reason of actual or impending emergencies caused by fire, flood or other calamity rendering
payment thereat impossible;
2. When the ER provides for free transportation to the EEs back and forth; and
3. Under any other analogous circs.
Prohibition: No ER shall pay his EEs in a bar, night or day club, drinking establishment, massage clinic, dance
hall or other similar places or in places where games are played w/ stakes of money or thins representing money
except in the case of persons employed in such places.
Procedure
1) Claimants shall execute an affidavit attesting their relshp to the deceased and the fact that they are his heirs,
to the exclusion of all others (Affidavit of Next of Kin);
2) In case of a minor heir, affidavit shall be executed on his behalf by his natural guardian or next of kin;
3) Affidavit shall be presented to the ER who shall make paymt through the Sec of Labor or his rep;
4) The rep shall act as referee in dividing the amt paid among the heirs; and
5) Payment of wages under this Art shall absolve the ER of any further liability w/ respect to the amt paid.
BUT ER-EE Relationship will exist bet the Principal & the Workers where the contracting arrangement is not
legitimate, as in labor-only contracting
2. Labor-only Contracting an arrangement where the sub/contractor merely recruits, supplies or places
workers to perform a job, work or service for a principal, and ANY of the ff ELEMENTS is present:
a. Lack of substantial capital/investment AND performance of activities directly related to the principals
business (confirming element); or
b. The contractor does not exercise the right of control over the performance of the contractual EE
(confirming element);
c. The arrangement is merely to recruit, supply or place workers to perform a job, work, or service for a
principal (Essential Element)
LOC = Essential Element + either or both confirming element/s
Labor-only contracting is wrong & prohibited because it is an attempt to evade the obligation of an EEr:
a) To respect EEs R to unionize;
b) Right to ENT standards;
c) Right to security of tenure
Substantial capital capital stocks and subscribed capitalization in the case of corps, tools, equipment,
implements, machineries and work premises, actually & directly used by the sub/contractor in the performance or
completion of the job, work or service contracted out.
- the law does not require both substantial capital and investment in the form of tools, equipment, machineries,
etc.
Right to control refers to the right reserved to the person for whom the service of the contractual workers are
performed, to determine not only the end to be achieved, but also the manner & means to be used in reaching
that end
Insular life v NLRC: exclusive servicing esp springing from a regulation issued by the Insurance Commission,
and not from an intention by the alleged ER, does not necessarily mean being under the control or ENT of the
entity being served. The relationship may still be classified as independent contractorship because the element of
control is absent.
- EEs may resign from their jobs to become contractors to their former ER, but the latter should cease controlling
the means & method of doing the work allegedly contracted, otherwise, the result is LOC.
Note: The principal shall be SOLIDARILY liable w/ the contractor in the event of any violation of any provision of
the LC, including failure to pay wages. This will not prevent the principal from claiming reimbursement from the
contractor.
Note: The principal shall be deemed the ER of the contractual EE in any of the ff cases as declared by competent
authority:
1. Labor-only contracting; and
2. Contracting arrangement falling w/in the prohibitions
Art 107. INDIRECT ER any person, partnership, association or corporation w/c not being n ER, contracts w/ an
independent contractor for the perf of any work, task, job or project
A manpower company may be a LOC in one case but an independent contractor in another.
The existence of ER-EE Relationship is a precondition to entitlement to labor standards & labor relations Rs. Extent
of Principals Liability in Legitimate Contracting - solidarily liable in the event of any violation of any provisions of
the LC
1. For wages and money claims if the sub/contractor fails to pay the wages of his EEs in accordance w/ the
LC, the ER shall be jointly & severally (solidarily) liable w/ his contractor to such EEs to the extent of work
performed under the contract, in the same manner & extent that he is liable to EEs directly employed by him.
He cannot escape this liability even if he has paid the workers wage rate in accordance w/ the contract w/ the
contractor. The EEs are not privy to the contract. Also, the labor standard legislations are considered written in
every contract. Similarly, legislated wage increases are deemed amendments to the contract.
Thus, ERs cannot hide behind their contracts in order to evade their or their contractors liability for
noncompliance w/ the statutory min wage, w/o prejudice to his R to recover whatever amount he paid from the
contractor.
2.
a) Reimbursement the joint & several liability of the contractor & the principal under Arts 106, 107 & 109 of
the LC is mandated to assure compliance of the provisions including the statutory min wage. The contractor is
made liable by virtue of his status as the direct ER; and the principal is made the indirect ER of the contractors
EEs for purposes of paying the EEs their wages should the contractor fail to do so.
- Where no ER-EE Relationship exists bet the parties, as to reimbursement bet the principal & the contractor, the
RTC has jurisdiction
b) Payment before Reimbursement but one may seek reimbursement only AFTER it has paid the EEs.
c) For Other Violations qualified or limited liability; if the liability is for failure to pay the min wage, or the SIL,
or other benefits derived from or provided for by law, the principal is equally liable w/ the contractor as if the
principal were the direct ER.
BUT, if the liability is invested w/ punitive character, such as an award for backwages & separation pay because of
an illegal dismissal of the contractors EE, the liability should be solely that of the contractor in absence of
proof that the principal conspired w/ the contractor in the commission of the illegal dismissal.
The sub/contractor shall inform the contractual EE of the foregoing terms & conditions on or before the 1st day of
his ENT.
Security of Tenure:
a. in cases of termination of ENT prior to the expiration of the contract bet the principal & the sub/contractor, the
R of the contractual EE to separation pay or other related benefits shall be governed by applicable laws &
jurisprudence on termination of ENT.
b. Where the termination results from expiration of contract bet the principal & the contractor, or from completion
of the phase of the job for w/c the EE is engaged-not entitled to separation pay.
however, this shall be w/o prejudice to completion bonuses or other emoluments, included retirement pay as may
be provided by law/contract bet the principal & the contractor.
Requirements:
1. Submission of annual reports
a. Sworn undertaiking that the sss, Home Devt Mutual Fund, PhilHealth, EEs Compensation Commission
(ECC), and BIR remittances
Effect of Nonregistration:
GR: The absence of registration gives rise to the presumption that the contractor is engaged in LOC,
But, if the contractor directly supervises the workers & imposes disciplinary action, he qualifies as a legit
contractor despite nonregistration w/ DOLE.
Art. 110. WORKER PREFERENCE IN CASE OF BANKRUPTCY
- Workers shall enjoy first preference as regards their unpaid wages & other monetary claims, any provision of
law to the contrary notwithstanding.
- Unpaid wages earned by EEs before the declaration of bankruptcy or judicial liquidation of the ERs business shall
be given first preference & shall be paid in full before other creditors may establish any claim to share in the
assets of the employer.
- Not only unpaid wages, but also other monetary claims to w/c even claims of the govt must be deemed
subordinate.
Conditions:
1. Formal declaration of insolvency or bankruptcy;
2. General judicial liquidation proceedings of the ERs business; and
3. Filing of claims by workers.
Basis:
1. The time spent & the extent of services rendered or required;
2. The novelty & difficulty of the questions involved;
3. The importance of the subject matter;
4. The skill demanded;
5. The probability of losing other ENT as a result of acceptance of the proferred IBP chapter to w/c the lawyer
belongs;
6. The amt involved in the controversy and the benefits resulting to the client from the services;
7. The contingency of certainty of compensation;
8. The character of ENT, whether occasional or established; and
9. The professional standing of the lawyer.
GR: Although the law allows non-lawyers to appear before the NLRC or any Labor Arbiter, this does not mean that
they are entitled to attys fees. Entitlement to attys fees presupposes the existence of ER-EE Relshp, and this
cannot exist unless the clients rep is a lawyer.
Union Service Fee non-lawyers may represent their org or members. The said labor federations & local unions
have a valid claim to attys fees.
PAO lawyers are disqualified from being awarded attys fees