ust labor law 2013

8/17/2019 UST Labor Law 2013

1/214

FUNDAMENTAL PRINCIPLES AND POLICIES

1U N I V E R S I T Y O F S A N T O T O M A S

F A C U L T Y O F C I V I L L A W

LEGEND

BFOQ

BLR

CB

CBA

CE

DOLE

Ee

Er

LA

LC

LLO

LOA

NCMB

NLRC

NSD

OFW

OTPCE

POEA

RAB

RD

RH

RTWPB

RW

RWD

SIL

SLE

ULP

UT

VA

VR

WD

WRD

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

--

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Bona Fide Occupational Qualification

Bureau of Labor Relations

Collective Bargaining

Collective Bargaining Agreement

Certification Election

Department of Labor and

Employment

Employee

Employer

Labor Arbiter

Labor Code

Legitimate Labor Organization

Leave of Absence

National Conciliation and Mediation

Board

National Labor Relations Commission

Night Shift Differential

Overseas Filipino Worker

OvertimePetition for Certification Election

Philippine Overseas Employment

Administration

Regional Arbitration Branch

Regional Director

Regular Holiday

Regional Tripartite Wages and

Productivity Boards Regular Wage

Regular Working Days

Service Incentive Leave

Secretary of Labor and Employment

Unfair Labor Practice

Undertime

Voluntary Arbitrator

Voluntary Recognition

Wage Distortion

Weekly Rest Day

LABOR LAW

Q: What is labor?

A: It is the exertion by human beings of physical ormental efforts, or both, towards the production of

goods and services.

Q: What is labor Law?

A: The law that defines State policies on labor andemployment and governs the rights and duties of the

employer (Er) and employees (Ee) with respect to:

1. The terms and conditions of employment, and

2. Labor disputes arising from collective bargaining

or other concerted activity respecting such terms

and conditions.

Q: What matters may properly fall under the term“labor law”?

A: The term “labor law” covers the following:

1. Statutes passed by the State to promote thewelfare of the workers and Ees and regulate their

relations with their Ers.

2. Judicial decisions applying and interpreting the

aforesaid statutes.

3. Rules and regulations issued by administrative

agencies, within their legal competence, to

implement labor statutes.

Q: What is the purpose of labor legislation? (2006Bar Question)

A: The purpose of labor legislation is to affordprotection to labor, promote full employment, ensureequal work opportunities regardless of sex, race or

creed and regulate the relations between workers

and Ers. The State shall assure the rights of workers

to self-organization, collective bargaining (CB),

security of tenure and just and humane conditions of

work.

Q: What are the classifications of labor laws?

A:1. Labor Standards – That which sets out the

minimum terms, conditions and benefits ofemployment that Ers must provide or comply

with and to which Ees are entitled as a matter of

legal right.

e.g. 13th

month pay

2. Labor Relations – Defines and regulates thestatus, rights and duties, and the institutional

mechanisms, that govern the individual and

collective interactions of Ers, Ees or their

representatives. It is concerned with the

stabilization of relations of Ers and Ees and seeks

to forestall and adjust the differences between

them by the encouragement of CB and the

settlement of labor disputes through conciliation,

mediation and arbitration.

e.g. Collective Bargaining Negotiations

3. Social Legislation – All laws passed by the Stateto promote public welfare. It includes statutes

8/17/2019 UST Labor Law 2013

2/214

Labor Law and Social Legislation

2U N I V E R S I T Y O F S A N T O T O M A S2 0 1 3 G O L D E N N O T E S

intended to enhance the welfare of the people

even where there is no Er-Ee relationship.

e.g. GSIS Law, SSS Law, Philhealth benefits,

Agrarian Laws

Q: How do the provisions of the law on laborrelations interrelate, if at all, with the provisions

pertaining to labor standards? (2003 Bar Question)

A: The law on Labor Relations provides for rights andprocedures by which workers may obtain from their

Er benefits which are over and above the minimum

terms and conditions of employment set by labor

standards law. Labor Standards law alone does not

guarantee lasting industrial peace. It is assured

through Labor Relations law which enables workers

to obtain better benefits guaranteed by labor

standards laws and by providing for a mechanism to

settle disputes between the Er and his Ees.

Q: Is there any distinction between Labor Legislationand Social Legislation? Explain.

A: Labor Legislation is sometimes distinguished fromsocial legislation by the former referring to labor

statutes, like Labor Relations Law and Labor

Standards, and the latter to Social Security Laws.

Labor legislation focuses on the rights of the worker

in the workplace.

Social Legislation are those laws that provide

particular kinds of protection or benefits to society or

segments thereof in furtherance of social justice.

Note: All Labor laws are social legislations, but not all sociallegislations are labor laws.

Q: What are the sources of labor laws?

A:1. Labor Code (LC) and other related special

legislation [including their respective

Implementing Rules and Regulations (IRR)] 2. Contracts 3. Collective Bargaining Agreement (CBA)

4. Company practice

5. Company policies

Q: How does the CBA operate as a source of law?

A: The CBA is the norm of conduct between Er andEes and compliance therewith is mandated by the

express policy of the law [DOLE Philippines, Inc.,

vs. Pawis ng Makabayang Obrero (PAMAO-NFL), G.R.

No. 146650, (2003) in citing E. Razon, Inc. vs.

Secretary of Labor and Employment, G.R. No. 85867,

(1993)].

Q: What are the requisites before past practiceswould be considered as a source of labor law?

A: There must be:1. Voluntarily institution by Er without any legal

compulsion2.

A passage of time- should have been done over a

long period of time, and must be shown to have

been consistent and deliberate [American Wire

and Cable Daily Rated Employees Union vs.

American Wire and Cable Co., Inc., G.R. No.

155059, (2005)].

Note: No passage of time is required for a company policyto become a source of labor law.

Q: What is a contract of labor?

A: It is a consensual, nominate, principal, andcommutative contract whereby one person, called

the Er, compensates another, called the laborer,

worker or Ee, for the latter’s service. It is relationship

impressed with public interest in keeping with our

constitutional policy of social justice.

Q: What are the essential characteristics of acontract of labor?

A:1. Er freely enters into a contract with the Ee;

2. Er can select who his Ee will be;3. Er can dismiss the Ee; the Ee in turn can quit his

job;

4. Er must give remuneration; and

5. Er can control and supervise the conduct of the

Ee.

8/17/2019 UST Labor Law 2013

3/214





CONSTITUTIONAL PROVISIONS

Q: What are the constitutional mandates on LaborLaw?

A:

1. Sec. 3, Art. XIII – The State shall afford fullprotection to labor, local and overseas, organized

and unorganized, and promote full employment

and equality of employment opportunities for all.

It shall guarantee the rights of all workers to self-

organization, collective bargaining and

negotiations, and peaceful concerted activities,

including the right to strike in accordance with

law. They shall be entitled to security of tenure,

humane conditions of work, and a living wage.

They shall also participate in policy and decision-

making processes affecting their rights andbenefits as may be provided by law.

The State shall promote the principle of shared

responsibility between workers and employers

and the preferential use of voluntary modes in

settling disputes, including conciliation, and shall

enforce their mutual compliance therewith to

foster industrial peace.

The State shall regulate the relations between

workers and employers, recognizing the right of

labor to its just share in the fruits of production

and the right of enterprises to reasonable returnsto investments, and to expansion and growth.

2. Sec. 9, Art. II – The State shall promote a just and

dynamic social order that will ensure the

prosperity and independence of the nation and

free the people from poverty through policies

that provide adequate social services, promote

full employment, a rising standard of living, and

an improved quality of life for all.

3. Sec. 10, Art II - The State shall promote social

justice in all phases of national development.

4. Sec. 11, Art II - The State values the dignity of

every human person and guarantees full respect

for human rights.

5. Sec. 13, Art. II - The State recognizes the vital role

of the youth in nation-building and shall promote

and protect their physical, moral, spiritual,

intellectual, and social well-being. It shall

inculcate in the youth patriotism and

nationalism, and encourage their involvement in

public and civic affairs.

6. Sec. 14, Art. II - The State recognizes the role of

women in nation-building, and shall ensure the

fundamental equality before the law of women

and men.

7. Sec. 18, Art. II – The State affirms labor as aprimary social economic force. It shall protect the

rights of workers and promote their welfare.

8. Sec. 20, Art. II – The State recognizes the

indispensable role of the private sector,

encourages private enterprise and provide

incentives to needed investments.

9. Sec. 1, Art. III - No person shall be deprived of

life, liberty, or property without due process of

law, nor shall any person be denied the equal

protection of the laws.

10. Sec. 4, Art. III - No law shall be passed abridging

the freedom of speech, of expression, or of the

press, or the right of the people peaceably to

assemble and petition the government for

redress of grievances.

11. Sec. 8, Art. III – The right of the people, includingthose employed in the public and private sectors,

to form unions, associations, or societies for

purposes not contrary to law shall not be

abridged.

12. Sec. 10, Art. III – No law impairing the obligation

of contracts shall be passed.

13. Sec. 16, Art. III – All persons shall have the right

to a speedy disposition of their cases before all

judicial, quasi-judicial or administrative bodies.

14. Sec. 18 (2), Art. III – No involuntary servitude in

any form shall exist except as a punishment for a

crime whereof the party shall have been duly

convicted.

15. Sec. 1, Art. XIII - The Congress shall give highest

priority to the enactment of measures that

protect and enhance the right of all the people to

human dignity, reduce social, economic, and

political inequalities, and remove cultural

inequities by equitably diffusing wealth and

political power for the common good.

8/17/2019 UST Labor Law 2013

4/214



To this end, the State shall regulate the

acquisition, ownership, use, and disposition of

property and its increments.

16. Sec. 2, Art. XIII - The promotion of social justice

shall include the commitment to create

economic opportunities based on freedom of

initiative and self-reliance.

17. Sec. 13, Art. XIII – The State shall establish a

special agency for disabled persons for their

rehabilitation, self-development and self-reliance

and their integration into the mainstream of

society.

18. Sec. 14, Art. XIII – The State shall protect working

women by providing safe and healthful working

conditions, taking into account their maternal

functions, and such facilities and opportunities

that will enhance their welfare and enable them

to realize their full potential in the service of thenation.

Q: What is the State policy on labor as found in theConstitution (Sec. 3, Art. XIII)?

A:1. Afford full protection to labor

2. Promote full employment

3. Ensure equal work opportunities regardless of

sex, race, or creed 4. Assure the rights of workers to self-organization,

security of tenure, just and humane conditions of

work, participate in policy and decision-makingprocesses affecting their right and benefits

5. Regulate the relations between Ers and workers

Q: What are the basic rights of workers guaranteedby the Constitution (Sec. 3, Art. XIII)?

A: The Right to: 1. Security of tenure

2. Living wage

3. Humane working conditions

4. Share in the fruits of production

5. Self-organization

6. Collective bargaining and negotiation

7. Engage in peaceful concerted activities, including

the right to strike

8. Participate in policy and decision making

processes

Q: What is the principle of non-oppression?

A: The principle mandates capital and labor not to actoppressively against each other or impair the interest

and convenience of the public. The protection to

labor clause in the Constitution is not designed to

oppress or destroy capital [Capili vs. NLRC, G.R. No.

117378, (1997)].

The law in protecting the rights of the Ees authorizes

neither oppression nor self-destruction of the Er

[Pacific Mills Inc. vs. Alonzo, G.R. No. 78090, (1991)].

It should be made clear that when the law tilts thescale of justice in favor of labor, it is but a recognition

of the inherent economic inequality between labor

and management. The intent is to balance the scale

of justice; to put the two parties on relatively equal

positions. There may be cases where the

circumstances warrant favoring labor over the

interests of management but never should the scale

be so tilted if the result is an injustice to the

employer. Justitia nemini neganda est (Justice is to be

denied to none ) [Philippine Geothermal, Inc. vs. NLRC

and Edilberto M. Alvarez, G.R. No. 106370, (1994)].

NEW CIVIL CODE AND OTHER LAWS

Q: What are other related laws to labor?

A:1. New Civil Code (NCC)

a. Art. 19 – Every person must, in the exercise

of his rights and in the performance of his

duties, act with justice, give everyone his

due, and observe honesty and good faith.

b. Art. 1700 - The relations between capital

and labor are not merely contractual. They

are so impressed with public interest thatlabor contracts must yield to the common

good. Therefore, such contracts are subject

to the special laws on labor unions,

collective bargaining, strikes and lockouts,

closed shop, wages, working conditions,

hours of labor and similar subjects.

c. Art. 1701 - Neither capital nor labor shall

act oppressively against the other, or

impair the interest or convenience of the

public.

d. Art. 1702 - In case of doubt, all labor

legislation and all labor contracts shall be

construed in favor of the safety and decent

living for the laborer.

e. Art. 1703 - No contract which practically

amounts to involuntary servitude, under

any guise whatsoever, shall be valid.

f. Art. 1704 - In collective bargaining, the

labor union or members of the board or

committee signing the contract shall be

liable for non-fulfillment thereof.

8/17/2019 UST Labor Law 2013

5/214




g. Art. 1705 - The laborer's wages shall be

paid in legal currency.

h. Art. 1706 - Withholding of the wages,

except for a debt due, shall not be made by

the employer.

i. Art. 1707 - The laborer's wages shall be a

lien on the goods manufactured or the

work done.

j. Art. 1708 - The laborer's wages shall not besubject to execution or attachment, except

for debts incurred for food, shelter,

clothing and medical attendance.

k. Art. 1709 - The employer shall neither seize

nor retain any tool or other articles

belonging to the laborer.

l. Art. 1710 - Dismissal of laborers shall be

subject to the supervision of the

Government, under special laws.

2. Revised Penal Code (RPC)

Art. 289 – Formation, maintenance and prohibition of combination of capital or labor

through violence or threats. – Any person

who, for the purpose of organizing,

maintaining or preventing coalitions or

capital or labor, strike of laborers or lock-out

of employees, shall employ violence or

threats in such a degree as to compel or

force the laborers or employers in the free

and legal exercise of their industry or work,

if the act shall not constitute a more serious

offense in accordance with the provisions of

the RPC.

3. Special Laws

a. E.O. 180 - Providing guidelines for the

exercise of the Right to Organize of

Government Employees, creating a Public

Sector Labor-Management Council, and for

other purposes

b. R.A. 8291 - Government Service Insurance

Act of 1997

c. 13th

Month Pay Law

d. Retirement Pay Law

e. SSS Law

f. Paternity Leave Actg. Anti – Child Labor Act

h. Anti – Sexual Harassment Act

i. Magna Carta for Public Health Workers

j. Solo Parents Welfare Act of 2000

k. National Health Insurance Act as amended

by R.A. 9241

l. Migrant Workers and Overseas Filipinos Act

of 1995 as amended by RA 10022

m. PERA Act of 2008

n. Home Development Mutual Fund Law of

2009

o. The Magna Carta of Women

p. Comprehensive Agrarian Reform Law as

amended by R.A. 9700

LABOR CODE

Q: What is the aim of labor law?

A: The aim of labor law is social justice.

Q: What is social justice?

A: Social Justice is “neither communism, nordespotism, nor atomism, nor anarchy,” but the

humanization of laws and the equalization of social

and economic force by the State so that justice in its

rational and objectively secular conception may at

least be approximated. Social Justice means the

promotion of the welfare of all the people, theadoption by the government of measures calculated

to insure economic stability of all the competent

elements of society, through the maintenance of a

proper economic and social equilibrium in the

interrelations of the members of the community,

constitutionally, through the adoption of measures

legally justifiable, or extra-constitutionally, through

the exercise of powers underlying the existence of all

governments on the time-honored principle of salus

populi est suprema lex [Calalang vs. Williams, G.R.

No. 47800, (1940)].

Q: What are the limitations in invoking the principleof social justice?

A:1. Not to undermine property rights resulting in

confiscation [Guido vs.Rural Progress Adm, L-

2089, (1949)]

2. May only protect the laborers who come to court

with clean hands [Phil.Long Distance Telephone

Co. vs. NLRC, G.R. 80609, (1988)]

3. Never result to an injustice or oppression of the

Er [Phil.Geothermal Inc. vs. NLRC, G.R. No.

106370, (1994)]

Q: May social justice as a guiding principle in laborlaw be so used by the courts in sympathy with theworking man if it collides with the Equal protectionclause of the Constitution? (2003 Bar Question)

A: Yes. The State is bound under the Constitution toafford full protection to Labor and when conflicting

interests collide and they are to be weighed on the

scales of social justice, the law should accord more

8/17/2019 UST Labor Law 2013

6/214



sympathy and compassion to the less privileged

workingman [Fuentes v. NLRC, 266 SCRA 24, (1997)].

However it should be borne in mind that social justice

ceases to be an effective instrument for the

“equalization of the social and economic forces” by

the State when it is used to shield wrongdoing

[Corazon Jamer v. NLRC, 278 SCRA 632 (1997)].

Q: What agency exercises the “rule-making power”granted in the Labor Code?

A: The Department of Labor and Employment (DOLE)thru the Secretary of Labor and Employment (SLE)

and other Government agencies charged with the

administration and enforcement of the LC or any of

its parts shall promulgate the necessary IRRs.

Note: Such rules and regulations shall become effective 15days after announcement of their adoption in newspapers

of general circulation.

Q: What are the limitations to the “rule-makingpower” given to the Secretary of Labor and

Employment and other Government agencies?

A: It must: 1. Be issued under the authority of law

2. Not be contrary to law and the Constitution

Q: To whom shall all rights and benefits under theLabor Code apply?

A: GR: All rights and benefits granted to workersunder the LC shall apply alike to all workers,

whether agricultural or non-agricultural.

XPNs:1. Government Ees 2. Ees of government corporations created by

special or original charter 3. Foreign governments 4. International agencies 5. Corporate officers/ intra-corporate disputes

which fall under P.D. 902-A and now fall under

the jurisdiction of the regular courts pursuant

to the Securities Regulation Code. 6. Local water district except where NLRC’s

jurisdiction is invoked. 7. As may otherwise be provided by the LC.

Q: What is the test in determining whether a GOCCis subject to the provisions of the LC?

A: It is determined by the manner of their creation.Government corporations incorporated under the

Corporation Code are covered by the LC while those

created by special (original) charter from Congress

are subject to Civil Service rules.

Art. 3, Declaration of Basic Policy

Q: What is the policy of the State on labor as foundin the LC?

A: It is the policy of the State to: 1. Afford full protection to labor

2. Promote full employment

3. Ensure equal work opportunities regardless of sex,

race, or creed

4. Assure the rights of workers to self organization,

security of tenure, just and humane conditions of

work, participate in policy and decision-making

processes affecting their right and benefits

5. Regulate the relations between Ers and workers.

Art. 4, Construction in favor of Labor

Q: What is “Compassionate Justice”?

The social justice policy mandates a compassionate

attitude toward the working class in its relation to

management. In calling for protection to labor, the

Constitution does not condone wrong doing by the

Ee. However, it urges a moderation of the sanctions

that maybe applied to him in the light of the many

disadvantages that weigh heavily on him like an

albatross on his neck.

It is disregarding rigid rules and giving due weight to

all equities of the case [Gandara Mill Supply andMilagros Sy vs. NLRC and Silvestre Germano, G.R.

126703, (1998)].

e.g. An Ee who was validly dismissed may still begiven severance pay.

Q: What is the concept of liberal approach ininterpreting the Labor Code and its IRR?

A: The LC and its IRR, being remedial in charactermust be accorded the broadest scope and most

beneficial interpretation. It is only in this way that

their purpose, which is to remedy evils ofexploitation, manipulation and oppression, may be

achieved. Strict adherence to the letter of labor law is

not allowed; the spirit thereof prevails and must be

given effect. Under Art. 4 of the LC, all doubts in the

implementation and interpretation of the provisions

thereof, including its IRR, are to be resolved in favor

of labor.

Q: Are all labor disputes resolved in favor of labor?

8/17/2019 UST Labor Law 2013

7/214




A: No. The law also recognizes that management hasrights which are also entitled to respect and

enforcement in the interest of fair play [St. Luke’s

Medical Center Ees Ass’n vs. NLRC, G.R. No. 162053,

(2007)].

Art. 166, Policy

Q: What is the policy of the State in relation toEmployees’ Compensation and State Insurance

Fund?

A: The State shall promote and develop a tax-exemptEes’ compensation program whereby Ees and their

dependents, in the event of work-connected

disability or death, may promptly secure adequate

income benefits and medical related benefits. [Art.

166, LC]

Q: What is the purpose of a Workmen’s

Compensation Act?

A: The primary purpose of a Workmen’sCompensation Act is to provide compensation for

disability or death resulting from occupational

injuries or diseases, or accidental injury to, or death

of Ees.

Art. 211, Declaration of Policy

Q: What are the policy objectives of our LaborRelations law?

A: The state aims to promote:1. Free CB and negotiations, including voluntary

arbitration, mediation and conciliation as modes

of settling labor or industrial disputes;

2. Free trade unionism;

3. Free and voluntary organization of a strong and

united labor movement;

4. Enlightenment of workers concerning their rights

and obligations as union members and as Ees;

5. Adequate administrative machinery for the

expeditious settlement of labor or industrial

disputes;

6. Stable but dynamic and just industrial peace;

7. Participation of workers in the decision-making

processes affecting their rights, duties and

welfare;

8. Truly democratic method of regulating the

relations between the Ers and Ees by means of

agreements freely entered into through CB, no

court or administrative agency or official shall

have the power to set or fix wages, rates of pay,

hours of work or other terms and conditions of

employment, except as otherwise provided

under the LC.

Art. 212, Definitions

Q: Who is an employer?

A: Any person acting in the interest of an Er, directlyor indirectly. The term does not include a labor

organization or any of its officers and agents, except

when acting as an Er. (Art. 212[e], LC)

An Er is defined as any person or entity that employs

the services of others; one for whom work is done

and who pays their wages of salaries; any person

acting in the interest of an Er; refers to the enterprise

where the labor organization operates or seeks to

operate. (Sec.1[s], Rule I, Book V, IRR)

Note: The term “employer” is not restricted to businessowners alone because it includes any person as long as he

acts in the interest of the Er.

Q: When is a labor organization deemed an

employer?

A: When it is acting as such in relation to personsrendering services under hire, particularly in

connection with its activities for profit or gain.

Note: The mere fact that respondent is a labor union doesnot mean that it cannot be considered an Er for persons

who work for it. Much less should it be exempted from

labor laws [Bautista vs. Inciong, G.R. No. L-52824, (1988)].

Q: Who is an employee?

A: The term “employee” covers: 1. Any person in the employ of the Er

2. Any individual whose work has ceased as a result

of or in connection with any current labor

dispute or because of any unfair labor practice if

he has not obtained any other substantially

equivalent and regular employment

3. One who has been dismissed from work but the

legality of dismissal is being contested in a forum

of appropriate jurisdiction. (D.O. No. 40-03)

Note: The term shall not be limited to the Ees of a

particular Er unless the LC explicitly states.

Any Ee, whether employed for a definite period or not,

shall, beginning on the first day of service, be considered an

Ee for purposes of membership in any labor union. (Art.

277[c], LC)

Q: What is a labor dispute?

A: A labor dispute includes any controversy or matterconcerning:

1. Terms and conditions of employment, or

8/17/2019 UST Labor Law 2013

8/214



2. The association or representation of persons in

negotiating, fixing, maintaining, changing or

arranging the terms and conditions of

employment

3. Regardless of whether the disputants stand in

the proximate relation of Er and Ee. (Art. 212[l],

LC)

Q: What are the tests on whether a controversy is alabor dispute?

A: 1. As to nature – It depends on whether the dispute

arises from Er-Ee relationship, although

disputants need not be proximately Er or Ee of

another.

2. As to subject matter – The test depends on

whether it concerns terms or conditions of

employment or association or representation of

persons in negotiating, fixing, maintaining or

changing terms or conditions of employment.

Q: What are the kinds of labor disputes?

A: 1. Labor standard disputes

a. Compensation – E.g. Underpayment of

minimum wage; stringent output quota; illegal

pay deductions

b. Benefits – E.g. Non-payment of holiday pay, OT

pay or other benefits

c. Working Conditions – E.g. Unrectified work

hazards

2. Labor relations disputes

a. Organizational right disputes/ Unfair Labor

Practice (ULP) – E.g. Coercion, restraint or

interference in unionization efforts; reprisal or

discrimination due to union activities;

company unionism; ULP, strike or lockout;

union members’ complaint against union

officers

b. Representation disputes – E.g. Uncertainty as

to which is the majority union; determination

of appropriate CB unit; contests for recognition

by different sets of officers in the same union

c. Bargaining disputes – E.g. Refusal to bargain;

bargaining in bad faith; bargaining deadlock;

economic strike or lockout

d. Contract administration or personnel policy

disputes – E.g. Non-compliance with CBA

provision (ULP if gross non-compliance with

economic provisions); disregard of grievance

machinery; non observance of unwarranted

use of union security clause; illegal or

unreasonable personnel management policies;

violation of no-strike/no-lockout agreement

e. Employment tenure disputes – E.g. Non-

regularization of Ees; non-absorption of labor-

only contracting staff; illegal termination; non-

issuance of employment contract

Q: Who are the parties to a labor dispute?

A: 1. Primary parties are the Er, Ees and the union.

2. Secondary parties are the voluntary arbitrator,

agencies of DOLE, NLRC, SLE and the Office of the

President.

Q: What is an inter-union dispute?

A: Any conflict between and among legitimate laborunions involving representation questions for thepurposes of CB or to any other conflict or dispute

between legitimate labor unions.

Q: What is an intra-union dispute?

A: Any conflict between and among union members,grievances arising from any violation of the rights and

conditions of membership, violation of or

disagreement over any provision of the union’s

constitution and by-laws, or disputes from chartering

or affiliation of union.

Q: What are rights disputes?

A: They are claims for violations of a specific rightarising from a contract, i.e. CBA or company policies.

Q: What are interest disputes?

A: They involve questions on “what should beincluded in the CBA.” Strictly speaking, the parties

may choose a voluntary arbitrator to decide on the

terms and conditions of employment, but this is

impracticable because it will be a value judgment of

the arbitrators and not of the parties.

Q: What are “contract–negotiation disputes”?

A: These are disputes as to the terms of the CBA.

Q: What are “contract–interpretation disputes”?

A: These are disputes arising under an existing CBA,involving such matters as the interpretation and

8/17/2019 UST Labor Law 2013

9/214




application of the contract, or alleged violation of its

provisions.

Art. 255, Exclusive Bargaining Representation andWorker’s Participation in Policy and Decision-

Making

Q: Who shall be the bargaining representative of

the employees for purposes of collective bargaining?

A: The labor organization designated or selected bythe majority of the Ees in an appropriate collective

bargaining unit shall be the exclusive representative

of the Ees in such unit for the purpose of CB.

However, an individual Ee or group of Ees shall have

the right at any time to present grievances to their Er.

(Art. 255, LC, as amended by Sec. 22 of R.A. No. 6715,

1989)

Q: What is the extent of the worker’s right to

participate in policy and decision-making processesin a company?

A: Such right refers not only to formulation ofcorporate programs and policies but also to

participation in grievance procedures and voluntary

modes of settling disputes.

Q: Explain the extent of the workers’ right to

participate in policy and decision-making process asprovided under Art. XIII, Sec. 13 of the 1987Constitution. Does it include membership in theBoard of Directors of a corporation? (2008 Bar

Question)

A: No. The Supreme Court recognized the right of theunion to participate in policy formulation and

decision-making process on matters affecting the

union members’ rights, duties and welfare. However,

such participation of the union in committees of the

Er is not in the nature of a co-management control of

the business. Impliedly, therefore, workers’

participatory right in policy and decision-making

processes does not include the right to put a union

member in a corporation’s Board of Directors.

[Manila Electric Company vs. Quisumbing, G.R. No.

127598, (1999)].

Q: May the management be compelled to share withthe union or its employees its prerogative offormulating a Code of Discipline?

A: Yes. The Code of Discipline involves security oftenure and loss of employment — a property right. It

is time that management realizes that to attain

effectiveness in its conduct rules, there should be

candidness and openness by Management and

participation by the union, representing its members.

In fact, our Constitution has recognized the principle

of shared responsibility between Ers and workers and

has likewise recognized the right of workers to

participate in policy and decision-making process

affecting their rights [PAL vs. NLRC, G.R. No. 85985,

(1993)].

Q: What is the principle of codetermination? (2007Bar Question)

A: It refers to the right of workers to participate inpolicy and decision-making process affecting their

rights and benefits [PAL vs. NLRC, G.R. No. 85985

(1993); Art. XIII, Sec. 3, 1987 Constitution].

Q: May an employer solicit questions, suggestionsand complaints from employees who arerepresented by a union?

A: No, unless:1. The CB representative executes an agreement

waiving the right to be present on any occasion

when Ee grievances are being adjusted by the Er;

and

2. Er acts strictly within the terms of his waiver

agreement.

Q: The hotel union filed a Notice of Strike with theNational Conciliation and Mediation Board (NCMB)due to an unfair labor practice against the DiamondHotel who refused to bargain with it. The hotel

advised the union that since it was not certified bythe DOLE as the exclusive bargaining agent, it couldnot be recognized as such. The union sought tobargain for members only. May the Union bargaincollectively?

A: No. Art. 255 of the LC declares that only the labororganization designated or selected by the majority

of the Ees in an appropriate CB unit is the exclusive

representative of the Ees in such unit for the purpose

of CB. The union is admittedly not the exclusive

representative of the majority of the Ees of the hotel,

hence, it could not demand from the hotel the right

to bargain collectively in their behalf [Manila

Diamond Hotel vs. Manila Diamond Hotel Ees Union,

G.R. No. 158075, (2006)].

Q: Who is a managerial employee?

A: The person who is vested with the powers orprerogatives to lay down and execute management

policies and/or to hire, transfer, suspend, lay-off,

recall, discharge, assign or discipline Ees.

8/17/2019 UST Labor Law 2013

10/214



Q: Who is a supervisory employee?

A: The person who effectively recommends suchmanagerial actions if the exercise of such authority is

not merely routinary or clerical in nature but requires

the use of independent judgement.

Q: Who are rank-and-file employees?

A: Those persons who are neither Managerial norSupervisory Ees are considered rank-and file.

Art. 277, Miscellaneous Provisions

Q: What is the right to security of tenure?

A: The right to security of tenure connotes that no

worker shall be dismissed upon employment without

cause and without due process.

Q: What is the worker’s right to notice and hearingprior to dismissal?

A: Art. 277 (b) of the LC provides that:1. The Er shall furnish the Ee whose employment is

sought to be terminated a written notice containing a statement of the causes for

termination; and

2. Afford the Ee ample opportunity to be heard and

to defend himself

Note: In connection with dismissals for authorized causes,the Er must serve a written notice upon the worker and the

DOLE at least 1 month before the intended date oftermination. (Art. 283, LC)

Q: Why is notice and hearing necessary in cases ofemployee dismissal?

A: The twin requirement of notice and hearingconstitutes essential elements of due process in cases

of Ee dismissal. The requirement of notice is intended

to inform the Ee concerned of the Er’s intent to

dismiss and the reason for the proposed dismissal,

upon the other hand, the requirement of hearing

affords the Ee opportunity to answer his Er’s charges

against him and accordingly to defend himself

therefrom before dismissal is effected. Neither of

these two requirements can be dispensed with

without running afoul of the due process

requirement of the 1987 Constitution [Century Textile

Mills, Inc., et al. v. NLRC, et al. G.R. No. 77859, May

25, 1988].

Q: May the employer be allowed to dismiss anemployee and let him explain later? Why?

A: No. While the procedure laid down by the law forthe dismissal of an Ee need not be observed to the

letter of the law, at least it must be done in the

natural sequence of notice, hearing and judgment.

Dismissing the Ee and let him explain later is not in

accord with the requirement of due process[Batangas Laguna Tayabas Bus Co. v. NLRC, et al. G.R.

No. 94429, May 29, 1992].

Q: Under what circumstances may the terminationof employees be suspended by the SLE?

A: The SLE may suspend the effects of thetermination in the event of a prima facie finding bythe appropriate official of the DOLE before whom

such dispute is pending that the termination may

cause a serious labor dispute or is in implementation

of a mass lay-off. (Art. 277(b), as amended by Sec. 33,R.A 6715)

Q: Who has the burden of proving the existence of avalid or authorized cause of termination?

A: The Er has the burden of proof in proving that thetermination was for a valid or authorized cause. The

existence of a just or authorized cause for dismissal

cannot be presumed. A contrary rule would

contravene the constitutional policy of affording

protection to the worker. (Art. 277, LC)

Q: Is a labor organization responsible for thepreservation of industrial peace?

A: Yes. The Ministry shall help promote and graduallydevelop, with the agreement of labor organizations

and Ers, labor-management cooperation programs at

appropriate levels of the enterprise based on the

shared responsibility and mutual respect in order to

ensure industrial peace and improvement in

productivity, working conditions and the quality of

working life. [Art. 277(g), LC, incorporated by B.P Blg.

130]

Q: How about in establishments where no legitimatelabor organization exists?

A: Labor management committees may be formedvoluntarily by workers and Ers for the purpose of

promoting industrial peace. [Art. 277(h), LC, as

amended by Sec. 33, R.A. 6715]

8/17/2019 UST Labor Law 2013

11/214

RECRUITMENT AND PLACEMENT




RECRUITMENT OF LOCAL AND MIGRANT WORKERS

Q: Who is a worker?

A: Any member of the labor force, whether employedor unemployed. (Art. 13 [a], LC)

Q: What is recruitment and placement?

A: 1. Any act of canvassing, enlisting, contracting,

transporting, utilizing, hiring or procuring

workers; and

2. Includes referrals, contact services, promising or

advertising for employment, locally or abroad,

whether for profit or not. (Art. 13 [b] ,LC)

Q: What are the essential elements in determining

whether one is engaged in recruitment andplacement?

A: It must be shown that:1. The accused gave the complainant the distinct

impression that she had the power or ability to

send the complainant for work, 2. Such that the latter was convinced to part with

his money in order to be so employed [People vs.

Goce, G.R. No. 113161, (1995)].

Q: Who is deemed engaged in recruitment andplacement?

A: Any person or entity which, in any manner, offersor promises for a fee employment to 2 or more

persons. (Art. 13[b], LC)

Q: Who may engage in recruitment and placement?

A: GR: No person or entity other than the publicemployment offices, shall engage in the

Recruitment and Placement of workers.

XPNs:1. Construction contractors if authorized by the

DOLE and Construction Industry Authority

2. Other persons or entities as may be

authorized by the SLE

3. Members of the diplomatic corps (but hiring

must go through POEA)

4. Public employment offices

5. Private recruitment offices

6. Private employment agencies

7. POEA

8. Shipping or manning agents or

representatives

9. Name hires (Sec. 1(i) of Rule II, Omnibus Rulesand Regulations implementing the Migrant

Workers and Overseas Filipinos Act of 1995 as

amended by R.A. 10022)

Q: Who are name hires?

A: They are individual workers who are able to securecontracts for overseas employment opportunities

with Ers without the assistance or participation of any

agency. [Rule II, Omnibus Rules and Regulations

implementing the Migrant Workers and Overseas

Filipinos Act of 1995 as amended by R.A. 10022]

Q: Is recruitment and placement constituted even ifemployment is offered only to one person?

A: Yes, the number of persons dealt with is not an

essential ingredient of the act of recruitment andplacement of workers. The proviso merely lays down

a rule of evidence that where a fee is collected in

consideration of a promise or offer of employment to

2 or more prospective workers, the individual or

entity dealing with them shall be deemed to be

engaged in the act of recruitment and placement. The

words "shall be deemed" create that presumption

[People vs. Panis, G.R. L-58674-77, (1986)].

Q: What is a private employment agency?

A: Any person or entity engaged in the recruitment

and placement of workers for a fee which is charged ,directly or indirectly, from the workers or Ers or both.

(Art. 13, LC)

Q: What is a private recruitment agency?

A: It is any person or association engaged in therecruitment and placement of workers without

charging any fee, directly or indirectly, from the

workers or Ers.

Q: Who is a seafarer?

A: It refers to any person who is employed orengaged in overseas employment in any capacity on

board a ship other than a government ship used for

military or non-commercial purposes. The definition

shall include fishermen, cruise ship personnel and

those serving on mobile offshore and drilling units in

the high seas. [Sec. 1(ss), Rule II, Omnibus Rules and

Regulations Implementing Migrant Workers Act as

amended by R.A. 10022 (2010)]

8/17/2019 UST Labor Law 2013

12/214



Q: What is overseas employment?

A: It is the employment of a worker outside thePhilippines.

Q: Who is an Overseas Filipino Worker (OFW)?

A: A person who is to be engaged, is engaged or has

been engaged in a remunerated activity in a State ofwhich he or she is not a citizen or on board a vessel

navigating the foreign seas other than a government

ship used for military or non-commercial purposes or

on an installation located offshore or on the high

seas. [Sec.(jj), Rule II, Omnibus Rules and Regulations

Implementing Migrant Workers Act as amended by

R.A. 10022 (2010)]

Note: The term “OFW” is to be used interchangeably with“migrant worker” as provided in R.A. 10022.

Q: Who is an Emigrant?

A: Any person, worker or otherwise, who emigratesto a foreign country by virtue of an immigrant visa or

resident permit or its equivalent in the country of

destination. (Art. 13, LC)

EMPLOYMENT OF NON-RESIDENT ALIENS

Q: What are the requirements in employment ofnon-resident aliens?

A: Any alien seeking admission to the Philippines for

employment purposes and any domestic or foreign Erwho desires to engage an alien for employment in the

Philippines: 1. Shall obtain an employment permit from the

DOLE

2. The permit may be issued to a non-resident alien

or to the applicant Er after a determination of

the non-availability of a person in the Philippines

who is competent, able and willing at the time of

application to perform the services for which the

alien is desired

3. For an enterprise registered in preferred areas of

investments, said permit may be issued upon

recommendation of the Government agency

charged with the supervision of said registered

enterprise

Q: The DOLE issued an alien employment permit forEarl Cone, a U.S. citizen, as sports consultant andassistant coach for GMC. Later, the Board of SpecialInquiry of the Commission on Immigration andDeportation approved Cone’s application for a

change of admission status from temporary visitorto pre-arranged employee. A month later, GMC

requested that it be allowed to employ Cone as full-fledged coach. The DOLE Regional Director grantedthe request. The Basketball Association of the Phils.appealed the issuance of said permit to theSecretary of Labor who cancelled Cone’semployment permit because GMC failed to showthat there is no person in the Philippines who iscompetent and willing to do the services nor that

the hiring of Cone would redound to the nationalinterest. Is the act of the Secretary of Labor valid?

A: Yes. GMC’s claim that hiring of a foreign coach isan Er’s prerogative has no legal basis. Under Art. 40

of the LC, an Er seeking employment of an alien must

first obtain an employment permit from the DOLE.

GMC’s right to choose who to employ is limited by

the statutory requirement of an employment permit.

[GMC vs. Torres, G.R. No. 9366, (1991)]

PROHIBITION AGAINST TRANSFER OF EMPLOYMENT

Q: Who are required to obtain employment permit?

A: GR: Only non-resident aliens;

XPNs:1. Diplomatic services and foreign government

officials;

2. Officers and staff of international

organizations and their legitimate spouses;

3. Members of governing board who has voting

rights only;

4. Those exempted by special laws;

5. Owners and representatives of foreignprincipals who interview Filipino applicants

for employment abroad;

6. Aliens whose purpose is to teach, present

and/or conduct research studies;

7. Resident aliens. (D.O. 75-06)

Q: May the non-resident alien transfer employmentafter issuance of the employment permit?

A: After the issuance of an employment permit, thealien shall not transfer to another job or change his Er

without prior approval of the SLE.

Q: What is required for immigrants and residentaliens?

A: An Alien Employment Registration Certificate.

Q: What is the duration of the employment permit?

A: GR: Minimum of 1 year

8/17/2019 UST Labor Law 2013

13/214




XPN: Unless the employment contract,consultancy services, or other modes of

engagement provides otherwise, which in no

case shall exceed 5 years. [DOLE Department

Order 97-09, Revised Rules for the Issuance of

Employment Permits to Foreign Nationals

(2009)]

Q: May aliens be employed in entities engaged innationalized activities?

A: GR: No.

XPNs: 1. Secretary of Justice specifically authorizes the

employment of technical personnel;

2. Aliens are elected members of the board of

directors or governing body of corporations or

associations engaging in partially nationalized

activities shall be allowed in proportion to their

allowable participation or share in the capitalof such entities [Section 2-A of Anti-Dummy

Law, as amended by P.D. 715]; or

3. Enterprises registered under the Omnibus

Investment Code in case of technical,

supervisory or advisory positions, but for a

limited period.

PRIVATE SECTOR PARTICIPATION IN THERECRUITMENT AND PLACEMENT OF WORKERS

Q: What are the entities in the private sectors thatcan participate in recruitment and placement of

workers?

A:1. Shipping or manning agents or representatives

2. Private recruitment offices

3. Public employment offices

4. Construction contractors if authorized by the

DOLE and Construction Industry Authority.

5. Persons that may be authorized by the SLE

6. Private employment agencies. (Sec. 1, Rule VII,

Book I, IRR of the LC)

Q: What are the qualifications for participation inrecruitment and placement of workers?

A:1. Filipino citizens, or partnerships or corporations

with at least 75% of the authorized capital stock

is owned and controlled by Filipino citizens; (Art.

27, LC)

2. Capitalization

a. Single proprietorship or partnership

-A minimum capitalization of P2 million

b. Corporation

-A minimum paid-up capital of P2 million

Provided, that those with existing licenses shall,within 4 yrs. from the affectivity hereof, increase

their capitalization or paid up capital, as the case

may be, to P2 million at the rate of Php

250,000.00 every year. (Art. 28, LC)

3. Not otherwise disqualified by law or other

government regulations to engage in therecruitment and placement of workers for

overseas employment. (Rule I, Part II, POEA

Rules) 4. Payment of registration fees

5. Posting of surety/cash bonds

Q: How will POEA regulate private sectorparticipation in the recruitment and overseasplacement of workers?

A: By setting up a licensing and registration system.

(Sec. 14, R.A. 10022)

Q: Is a corporation, 70% of the authorized andvoting capital of which is owned and controlled byFilipino citizens, allowed to engage in therecruitment and placement of workers, locally oroverseas? Explain briefly. (2002 Bar Question)

A: No. It is because Art. 27 of the LC requires at least75%.

Q: Who are disqualified to engage in the business ofrecruitment and placement of workers?

A:1. Travel agencies and sales agencies of airline

companies; (Art. 26, LC)

2. Officers or members of the board of any

corporation or members in a partnership

engaged in the business of a travel agency;

3. Corporations and partnerships, when any of its

officers, members of the board or partners, is

also an officer, member of the board or partner

of a corporation or partnership engaged in the

business of a travel agency;

4. Persons, partnerships or corporations which have

derogatory records, such as but not limited to

those:

a. Certified to have derogatory record or

information by the NBI or by the Anti-Illegal

Recruitment Branch of the POEA;

b. Against whom probable cause or prima facie

finding of guilt for illegal recruitment or

other related cases exists;

8/17/2019 UST Labor Law 2013

14/214



c. Convicted for illegal recruitment or other

related cases and/or crimes involving

moral turpitude; and

d. Agencies whose licenses have been

previously revoked or cancelled by the

POEA for violation of R.A. 8042, P.D. 442

as amended and their IRRs as well as these

rules and regulations.

5. Any official or Ee of the DOLE, POEA, OWWA,DFA and other government agencies directly

involved in the implementation of R.A. 8042

and/or any of his/her relatives within the 4th

civil

degree of consanguinity or affinity; and

6. Persons or partners, officers and directors of

corporations whose licenses have been

previously cancelled or revoked for violation of

recruitment laws. (Sec. 2, Rule I, 2002 Rules and

Regulations on the Recruitment and Employment

of Land-Based Workers)

TRAVEL AGENCIES PROHIBITED FROMRECRUITMENT AND PLACEMENT

Q: What is the rule on recruitment of travel agenciesand sales agencies of airline companies?

A: They are prohibited from engaging in the businessof recruitment and placement of workers for

overseas employment whether for profit or not.

Q: WTTA is a well-known travel agency and anauthorized sales agent of the PAL. Since majority ofits passengers are overseas workers, WTTA applied

for a license for recruitment and placementactivities. It stated in its application that its purposeis not for profit but to help Filipinos findemployment abroad. Should the application beapproved? (2006 Bar Question)

A: The application should be disapproved, as it isprohibited by Art. 26 of the LC, to wit: "Art. 26. Travel

agencies and sales agencies of airline companies are

prohibited from engaging in the business of

recruitment and placement of workers for overseas

employment whether for profit or not." Rule I, Part II

POEA Rules and Regulations Governing the

Recruitment and Employment of Land-Based Workers

(2002) disqualifies any entity having common director

or owner of travel agencies and sales agencies of

airlines, including any business entity from the

recruitment and placement of Filipino workers

overseas, whether they derive profit or not.

FEES TO BE PAID BY WORKERS

Q: When may a worker be charged any fee?

A: Only when:1. He has obtained work through recruiter’s efforts,

and

2. The worker has actually commenced working

Note: A land-based agency may charge and collect from itshired workers a placement fee in an amount equivalent to 1

month salary, exclusive of documentation costs. (Sec. 3,

Rule V, POEA Rules and Regulations)

Q: What are the only authorized payments that maybe collected from a hired worker?

A:1. Placement fee in an amount equivalent to one

month’s salary of the worker, and

2. Documentation costs (Sec. 3, Rule V, POEA Rules

and Regulations)

ILLEGAL RECRUITMENT, ART. 38 (LOCAL), SEC. 6,MIGRANT WORKERS ACT, R.A. 8042

Q: What are prohibited practices in recruitment orplacement?

A:1. Furnishing or publishing any falsie

notice/information/document related to

recruitment/employment

2. Failure to file reports required by SLE

3. Inducing or attempting to induce a worker

already employed to quit his employment in

order to offer him another unless the transfer is

designed to liberate a worker from oppressiveterms and conditions

4. Recruitment/placement of workers in jobs

harmful to public health or morality or to the

dignity of the country

5. Engaging directly or indirectly in the

management of a travel agency

6. Substituting or altering employment contracts

without approval of DOLE

7. Charging or accepting any amount greater than

that specified b DOLE or make a worker pay any

amount greater than actually received by him

8. Committing any act of misrepresentation to

secure a license or authority9. Influencing or attempting to influence a

person/entity not to employ any woker who has

not applied employment through his agency

10. Obstructing or attempting to obstruct

inspection by SLE or by his representatives

11. Withholding or denying travel documents from

applicant workers before departure for

monetary considerations other than authorized

by law

8/17/2019 UST Labor Law 2013

15/214




12. Granting a loan to an overseas Filipino worker

with interest exceeding eight percent (8%) per

annum, which will be used for payment of legal

and allowable placement fees and make the

migrant worker issue, either personally or

through a guarantor or accommodation party,

postdated checks in relation to the said loan

13. Refusing to condone or renegotiate a loan

incurred by an OFW after his employmentcontract has been prematurely terminated

through no fault of his or her own

14. For a suspended recruitment/manning agency

to engage in any kind of recruitment activity

including the processing of pending worker’s

applications; and

15. For recruitment/manning agency or a foreign

principal/Er to pass on the OFW or deduct from

his or her salary the payment of the cause of

fees, premium or other insurance related

charges, as provided under the compulsory

worker’s insurance coverage 16. Imposing a compulsory and exclusive

arrangement whereby an OFW is required to:

a. Avail a loan only from specifically designated

institutions, or entities or persons

b. To undergo health examinations only from

specifically designated medical, entities or

persons, except seafarers whose medical

examination cost is shouldered by the ship

owne

c. To undergo training of any kind only from

designated institutions, entities or persons,

except for recommendatory trainings

mandated by principals/shipowners (Sec. 6,R.A. 8042, Migrant Workers and Overseas

Filipino Act, as amended by R.A. 10022)

Q: What are the differences between the prohibitedacts under the Labor Code and R.A. 8042 or theOverseas Filipinos and Overseas Migrant WorkersAct, as amended by R.A. 10022?

A:

Labor Code(Art. 38)

R.A. 8042, as amended by RA10022

Local recruitment Applies to recruitment foroverseas employment

Illegal recruitment

under Art. 38

means any

recruitment

activity including

prohibited acts

under Art. 34

committed by non-

licensees or non-

Illegal recruitment under Sec.

6 means any recruitment

activity committed by non-

licensees/ non-holders of

authority or prohibited acts

(same as Art. 34, LC)

Added to the following in the

list of prohibited acts:

holders of

authority.

1. Failure to actually deploy

without valid reason;

2. Failure to reimburse

expenses incurred by the

worker in connection

with his/her

documentation and

processing for purposes

of deployment;3. To allow a non-Filipino

citizen to head or

manage a licensed

recruitment/ manning

agency.

Q: Who are the persons prohibited from engagingthe business of recruiting migrant workers?

A:1. Unlawful for any official or Ee of the:

a.

DOLEb. POEA

c. Overseas Workers Welfare Administration

(OWWA)

d. DFA

e. Other Government agencies involved in the

implementation of this Act

2. Their relatives within the 4th

civil degree of

consanguinity or affinity, to engage, directly or

indirectly in the business of recruiting migrant

workers. (Sec. 8, R.A. 8042)

LICENSE vs. AUTHORITY

Q: How does the law regulate the business orrecruitment and replacement?

A: By requiring license and authority.

Q: What is a license?

A: It is issued by DOLE authorizing a person or entityto operate a private employment agency.

Q: What is an authority?

A: It is a document issued by the DOLE authorizing aperson or association to engage in recruitment and

placement activities as a private recruitment entity.

Q: Who may be issued license and authority?

A: 1. Natural persons – Filipino (citizenship requirement)

8/17/2019 UST Labor Law 2013

16/214



2. Artificial persons – question of owners of capital

and voting stock (75% Filipino).

Q: Who is a non-licensee / non-holder of authority?

A: Any person, corporation or entity:1. Which has not been issued a valid license or

authority to engage in recruitment and

placement by the SLE, or2. Whose license or authority has been suspended,

revoked or cancelled by the POEA or the SLE

Q: Is the license or authority transferable?

A: No, they are non-transferable (Art. 29, LC). Licenseor authority is granted on the basis of personal

qualifications of the grantee. Thus, it is beyond the

commerce of man. The law prohibits alienation of

license or authority.

Q: A recruitment and placement agency declaredvoluntary bankruptcy. Among its assets is its licenseto engage in business. Is the license of the bankruptagency an asset which can be sold in public auctionby the liquidator? (1998 Bar Question)

A: No, because of the non-transferability of thelicense to engage in recruitment and placement. The

LC ( Art. 29) provides that no license to engage in

recruitment and placement shall be used directly or

indirectly by any person other than the one in whose

favor it was issued nor may such license be

transferred, conveyed or assigned to any other

person or entity. It may be noted that the grant of alicense is a governmental act by the DOLE based on

personal qualifications, and citizenship and

capitalization requirements. (Arts.27-28, LC).

Note: Change of ownership or relationship of a singleproprietorship licensed to engage in overseas employment

shall cause the automatic revocation of the license.

ESSENTIAL ELEMENTS OF ILLEGAL RECRUITMENT

Q: What are the elements of illegal recruitment?

A: 1. Offender is a non-licensee or non-holder of

authority to lawfully engage in the

recruitment/placement of workers.

2. Offender undertakes:

a. Any act of canvassing, enlisting, contracting,

transporting, utilizing, hiring, or procuring

workers and includes referring, contract

services, promising or advertising for

employment abroad, whether for profit or

not, when undertaken by non-licensee or

non-holder of authority [Art. 13(f), as

amended by R.A. 10022] ; or

b. Any of prohibited practices under Art. 34 of

the LC.

3. For complex illegal recruitment, an additional

element is the offender commits the act against

three or more persons, individually, or as a group[People vs. Baytic, (2003)] or there are three or

more offenders.

Q: Larry Domingo was accused of the crime of illegalrecruitment. He argued that he issued no receipt ordocument in which he acknowledged as havingreceived any money for the promised jobs. Hence,he should be free him from liability. Was Larryengaged in recruitment activities?

A: Yes. Even if at the time Larry was promising

employment no cash was given to him, he is stillconsidered as having been engaged in recruitment

activities, since Art. 13(b) of the LC states that the act

of recruitment may be for profit or not. It suffices

that Larry promised or offered employment for a fee

to the complaining witnesses to warrant his

conviction for illegal recruitment [People vs.

Domingo, G.R. No. 181475, (2009)].

Q: How does one prove illegal recruitment? `

A: It must be shown that the accused gave thedistinct impression that he had the power or ability to

send complainants abroad for work such that thelatter were convinced to part with their money in

order to be deployed [People vs. Fortuna, 395 SCRA

353 (2003)].

Q: May a licensee or holder of authority be heldliable for illegal recruitment?

A: Yes, any person (whether non-licensee, non-holderof authority, licensee or holder of authority) who

commits any of the prohibited acts, shall be liable for

Illegal recruitment. (R.A. 8042, as amended by R.A.

10022)

Q: What are the kinds of illegal recruitment?

A: 1. Simple Illegal Recruitment2. Complex Illegal Recruitment

SIMPLE ILLEGAL RECRUITMENT

Q: What is simple illegal recruitment?

8/17/2019 UST Labor Law 2013

17/214




A: It is the violation of Arts. 13(b) and 34 of the LCinvolving less than three recruiters or victims.

Q: What is complex illegal recruitment?

A: It is the violation of Arts. 13(b) and 34 of the LCinvolving at least three recruiters or victims. It may

either be:

1. committed by a syndicate;2. in large Scale

ILLEGAL RECRUITMENT IN LARGE SCALE (SEC. 6, R.A.10022)

Q: When is illegal recruitment committed in largescale?

A: When it is committed against three or morepersons individually or as a group.

Q: When is illegal recruitment considered to becommitted by a syndicate?

A: It is committed by a syndicate if Illegal Recruitmentwas carried out by a group of three or more persons

conspiring or confederating with one another.

Note: Illegal Recruitment in Large Scale pertains to thenumber of victims while Syndicated Illegal Recruitment

pertains to the number of recruiters.

Q: While her application for renewal of her licenseto recruit workers for overseas employment was

still pending Maryrose Ganda recruited Alma andher 3 sisters, Ana, Joan, and Mavic, for employmentas housemates in Saudi Arabia. Maryroserepresented to the sisters that she had a license torecruit workers for overseas employment anddemanded and received P30,000.00 from each ofthem for her services. However, her application forthe renewal of her license was denied, andconsequently failed to employ the four sisters inSaudi Arabia. The sisters charged Maryrose withlarge scale illegal recruitment. Testifying in herdefense, she declared that she acted in good faithbecause she believed that her application for the

renewal of her license would be approved. Sheadduced in evidence the Affidavits of Desistancewhich the four private complainants had executedafter the prosecution rested its case. In the saidaffidavits, they acknowledge receipt of the refundby Maryrose of the total amount of Php 120,000.00and indicated that they were no longer interested topursue the case against her. Resolve the case withreasons. (2005 Bar Question)

A: Illegal recruitment is defined by law as anyrecruitment activities undertaken by non-licenses or

non-holders of authority [People vs. Senoron, G.R. No.

119160, (1997)]. It is large scale illegal recruitment

when the offense is committed against 3 or more

persons, individually or as a group (Art. 38[b], LC). In

view of the above, Maryrose is guilty of large scale

illegal recruitment. Her defense of good faith and the

Affidavit of Desistance as well as the refund given willnot save her because R.A. 8042 is a special law, and

illegal recruitment is malum prohibitum [People vs.

Saulo, G.R. No. 125903, (2000)].

ILLEGAL RECRUITMENT AS ECONOMIC SABOTAGE

Q: When is illegal recruitment considered aseconomic sabotage?

A: When complex illegal recruitment is committed,such that it is syndicated or done in a large scale.

ILLEGAL RECRUITMENT vs. ESTAFA

ILLEGAL RECRUITMENT ESTAFA

Malum prohibitum, thus:

1. Criminal intent is NOT

necessary

2. it is a crime which involves

moral turpitude

Malum in se,

thus:

1. criminal intent is

necessary

2. Same

It is not required that it be

shown that the recruiter

wrongfully represented

himself as a licensedrecruiter

Note: It is enough that thevictims were deceived as they

relied on the misrepresentation

and scheme that caused them

to entrust their money in

exchange of what they later

discovered was a vain hope of

obtaining employment abroad

Accused defrauded

another by abuse of

confidence, or by

means of deceit

Note: It is essential thatthe false statement or

fraudulent

representation

constitutes the very

cause or the only motive

which induces the

complainant to part

with the thing of value.

Illegal recruitment and estafa cases may be filed

simultaneously or separately. The filing of charges forillegal recruitment does not bar the filing of estafa,

and vice versa.

Double jeopardy will not set

Q: Bugo, by means of false pretenses and fraudulentrepresentation, convinced Dado to give the amountof Php 120,000.00 for processing the latter’s papersso that he can be deployed to Japan. Dado later onfound out that Bugo had misappropriated,misapplied and converted the money to her own

8/17/2019 UST Labor Law 2013

18/214



personal use and benefit. Can Dado file the cases ofillegal recruitment and estafa simultaneously?

A: Yes, illegal recruitment and estafa cases may befiled simultaneously or separately. The filing of

charges for illegal recruitment does not bar the filing

of estafa, and vice versa. Bugo’s acquittal in the illegal

recruitment case does not prove that she is not guilty

of estafa. Illegal recruitment and estafa are entirelydifferent offenses and neither one necessarily

includes or is necessarily included in the other. A

person who is convicted of illegal recruitment may, in

addition, be convicted of estafa under Art. 315, par.

2(a) of the RPC. In the same manner, a person

acquitted of illegal recruitment may be held liable for

estafa. Double jeopardy will not set in because illegal

recruitment is malum prohibitum, in which there is no

necessity to prove criminal intent, whereas estafa is

malum in se, in the prosecution of which, proof of

criminal intent is necessary [Sy vs. People, G.R. No.

183879, (2010)].

LIABILITIES

LOCAL RECRUITMENT AGENCY

Q. What is the liability of the Local RecruitmentAgency?

A. A Local Recruitment Angency shall be jointly andsolidarily liable with its principal or foreign-based Er

for any violation of the recruitment agreement and

violation of contracts of employment. [Sec. 10(a)(2)

Rule V, Book I, IRR]

Q. What is the liability of corporate officers,directors or partners if the recruitment/ placementagency is a juridical being?

A. If the recruitment/placement agency is a juridicalbeing, the corporate officers, directors or partners as

the case may be, shall themselves be jointly and

solidarily liable with the corporation or partnership

for the claims and damages [Becmen Service Exporter

and Promotion vs. Cuaresma, G.R. Nos. 182978-79,

(2009)].

Q: What are the remedies under the MigrantWorkers Act and how may they be enforced?

A:

CRIMINAL ACTIONS

RTC

Province or city:

1. Where the offense was committed or

2. Where the offended party actually resides at the

same time of the commission of the offense

MONEY CLAIMS

NLRC

Original and exclusive jurisdiction to hear and decide

claims arising out of an Er-Ee relationship or by virtue

of any law or contract involving Filipino workers for

overseas deployment including claims for actual,

moral, exemplary and other forms of damages.

The liability of the principal/ Er and the

recruitment/ placement agency for any and all

claims shall be joint and several.

The performance bond to be filed by therecruitment/ placement agency shall be answerable

for all money claims or damages that may be

awarded to the workers.

If the recruitment/placement agency is a juridical

being, the corporate officers and directors and

partners as the case may be, shall themselves be

jointly and solidarily liable with the corporation or

partnership for the claims and damages.

ADMINISTRATIVE ACTIONS

POEA

Original and exclusive jurisdiction to hear and decide:

1. All cases which are administrative in character,

involving or arising out of violations of rules and

regulations relating to licensing and registration of

recruitment and employment agencies or entities

and

2. Disciplinary action cases and other special cases

which are administrative in character, involving Ers,

principals, contracting partners and Filipino migrant

workers.

a. It may be filed with the POEA Adjudication

Office or the DOLE/POEA regional office of the

place where the complaint applied or was

recruited at the option of the complainant. Theoffice with which the complaint was first filed

shall take cognizance of the case.

b. DA cases and other special cases, as mentioned

in the preceding Section, shall be filed with

POEA Adjudication Office.

Q: Is compromise agreement on money claimsallowed?

8/17/2019 UST Labor Law 2013

19/214




A: Yes. Consistent with the policy encouragingamicable settlement of labor disputes, Sec. 10 of R.A.

8042 allows resolution by compromise of cases filed

with the NLRC.

Q: When shall compromise agreements on moneyclaims be paid?

A: Any compromise/amicable settlement or voluntaryagreement on money claims inclusive of damages

shall be paid within four months from the approval of

the settlement by the appropriate authority.

Q: Are overtime and leave pay included in the termswhich is the basis in the computation of themonetary award?

A: No. The word “salaries” in Sec. 10(5) of the LC doesnot include OT and leave pay. For seafarers, DO No.

33, series of 1996, provides a Standard Employment

Contract of Seafarers, in which salary is understoodas the basic wage, exclusive of OT, leave pay and

other bonuses; whereas OT pay is compensation for

all work “performed” in excess of the regular 8 hours,

and holiday pay is compensation for any work

“performed” on designated rest days and holidays

[Serrano vs. Gallant Maritime Services & Marlow

Navigation Co., Inc., G.R. No. 167614, (2009)].

FOREIGN EMPLOYER

THEORY OF IMPUTED KNOWLEDGE

Q: What is the theory of imputed knowledge?

A: A rule in insurance law that any informationmaterial to the transaction, either possessed by the

agent at the time of the transaction or acquired by

him before its completion, is deemed to be the

knowledge of the principal, at least so far as the

transaction is concerned, even though in fact the

knowledge is not communicated to the principal at all

[Leonor vs. Filipinas Compania, 48 OG 243].

Q: Sunace International Management Services(Sunace), deployed to Taiwan Montehermozo as adomestic helper under a 12-month contracteffective Feb. 1, 1997. The deployment was with theassistance of a Taiwanese broker, Edmund Wang,President of Jet Crown International Co., Ltd. Afterher 12-month contract expired on Feb. 1, 1998,Montehermozo continued working for herTaiwanese employer for two more years, afterwhich she returned to the Philippines on Feb. 4,2000. Shortly after her return she file before theNLRC against Sunace, one Perez, the Taiwanese

broker, and the employer-foreign principal allegingthat she was jailed for three months and that shewas underpaid. Should Sunace be held liable for theunderpayment for the additional two years that sheworked for her Taiwanese employer under thetheory of imputed knowledge?

A: No, the theory of imputed knowledge ascribes the

knowledge of the agent, Sunace, to the principalTaiwanese Er, not the other way around. The

knowledge of the principal-foreign Er cannot,

therefore, be imputed to its agent Sunace.

There being no substantial proof that Sunace knew of

and consented to be bound under the 2-year

employment contract extension, it cannot be said to

be privy thereto. As such, it and its owner cannot be

held solidarily liable for and of Montehermozo’s

claims arising from the 2-year employment extension

[Sunace vs. NLRC, G.R. No. 161757, (2006)].

SOLIDARY LIABILITY

Q: What is the liability of the private employmentagency and the principal or foreign-based employer?

A: They are jointly and solidarily liable for anyviolation of the recruitment agreement and the

contracts of employment.

Note: This joint and solidary liability imposed by law againstrecruitment agencies and foreign Ers is meant to assure the

aggrieved worker of immediate and sufficient payment of

what is due him [Becmen Service Exporter and Promotionvs. Cuaresma, G.R. Nos. 182978-79, (2009)].

Q. May the absence of employment contract, specialpower of attorney and affidavit of responsibility, asrequired by the POEA Rules and Regulations,absolve the private employment agency and theprincipal from liability?

A. No. Non-compliance with POEA Rules andRegulations cannot be utilized to relieve the agency

and its principal from liabitliy. In fact, such non-

compliance is a ground for the cancellation or

suspension of their license [Hornales vs. NLRC, et al.,G.R. No. 118934 (2001)].

PRETERMINATION OF CONTRACT OF MIGRANTWORKER

Q: Serrano, a seafarer, was hired by GallantMaritime and Marlow Navigation Co. for 12 monthsas Chief Officer. On the date of his departure, hewas constrained to accept a downgradedemployment contract for the position of Second

8/17/2019 UST Labor Law 2013

20/214



Officer, upon the assurance that he would be madeChief Officer after a month. It was not done; hence,he refused to stay on as Second Officer and wasrepatriated to the Phils. He had served only 2months & 7 days of his contract, leaving anunexpired portion of 9 months & 23 days.

Serrano filed with the LA a Complaint against

Gallant Maritime and Marlow for constructivedismissal and for payment of his money claims. TheLA rendered a favorable decision to Serranoawarding him $8,770.00, representing his salary for3 months of the unexpired portion of his contract ofemployment applying R.A. 8042, Sec 10, par. 5:

Money Claims. - In case of termination of

overseas employment without just, valid

or authorized cause as defined by law or

contract, the workers shall be entitled to

the full reimbursement of his placement

fee with interest of 12% per annum, plushis salaries for the unexpired portion of

his employment contract or for 3 months

for every year of the unexpired term,

whichever is less.

Is the subject clause constitutional?

A: No. The subject clause contains a suspectclassification in that, in the computation of the

monetary benefits of fixed-term Ees who are illegally

discharged, it imposes a 3-month cap on the claim of

OFWs with an unexpired portion of one year or more

in their contracts, but none on the claims of otherOFWs or local workers with fixed-term employment.

The subject clause singles out one classification of

OFWs and burdens it with a peculiar disadvantage.

The clause is a violation of the right of Serrano and

other OFWs to equal protection and right to

substantive due process, for it deprives him of

property, consisting of monetary benefits, without

any existing valid governmental purpose.

Furthermore, prior to R.A. 8042, all OFWs, regardless

of contract periods or the unexpired portions thereof,

were treated alike in terms of the computation of

their monetary benefits in case of illegal dismissal.

Their claims were subjected to a uniform rule of

computation: their basic salaries multiplied by the

entire unexpired portion of their employment

contracts. The same applies local workers with fixed-

term employment.

Thus, Serrano is entitled to his salaries for the entire

unexpired period of nine months and 23 days of his

employment contract, pursuant to law and

jurisprudence prior to the enactment of RA 8042

[Serrano vs. Gallant Maritime Services & Marlow

Navigation Co., Inc., G.R. No. 167614, (2009)].

Q: What is the basis in computing an employee’s

compensation in case of premature termination ofcontract?

A: A worker dismissed from overseas employmentwithout just, valid or authorized cause as defined by

law or contract is entitled to full reimbursement of

his placement fee with interest at 12% per annum,

plus his salary for the unexpired portion of his

employment contract or for three months for every

year of the unexpired term, whichever is less. (Sec. 7,

R.A. 10020, 2010)

Q: What is the basis in computing an employee’s

compensation in case of premature termination of

contract?

A: The Migrant Workers Act provides that salaries for

the unexpired portion of the employent contract or

three months for every year of the unexpired term,

whichever is less, shall be awarded to the overseas

Filipino worker, in cases of illegal dismissal. However

in Serrano v. Gallant Maritime Services (G.R. No.

167614, 2009), the clause “or for three months for

every year of the unexpired term, whichever is less”

is declared unconstitutional and awarded the entire

unexpired portion of the employment contract to theoverseas Filipino worker.

Nonetheless, Sec. 7 of R.A. 10022 amended Sec. 10 of

the Migrant Workers Act, and once again reiterated

ust labor law 2013

Documents